It is more profitable for the individual entrepreneur to seek advantage from imbalances in the economy than from genuine improvements in quality or efficiency of production. Ultimately, if these imbalances are to be corrected without lowering our standard of living, we must focus on innovation.
For instance, textile manufacturing has almost entirely moved overseas to cheaper labor markets because it is more profitable to take advantage of the low cost of labor than to improve the manufacturing process. The lower cost of textiles is not due to a genuine improvement in manufacturing, it is directly a result of imbalances in the labor market and will disappear when these imbalances disappear; we will have cheap textiles only as long as the imbalances in the labor markets exist. If the labor market balances out, not only would the cost of production rise to what it would cost us to make the products here, but also provide the laborers in other countries consumer power allowing them to afford these products as well. This increase in demand would not be offset by the increase in production since the improved wages would not necessarily equate to increased production. The disturbing reality is that it is in our best interest to 'preserve' and even 'perpetuate' the imbalances in the labor market because, unless we offset the correction of the imbalances with genuine improvements in production, our standard of living will decline as those in other countries rise. Even if we do improve our manufacturing that gain can, if we 'preserve' the labor imbalances, be used to improve our standard of living further, rather than being used to offset the labor correction. I am not saying this to suggest that we should 'preserve' or 'perpetuate' the labor imbalances, but to point out the very real conflict of interest that exists within our system. We must understand, as a people, that our standard of living cannot be justly sustained without innovation. We must choose either to live comfortably off the backs of others, decline for the sake of others, or work hard towards, and invest in, genuine improvements in production that are significant enough to bring labor markets into balance while improving our own standard of living.