Alan, I would hope that we borrow because we can produce 1.x dollars of wealth for every dollar we borrow above interest costs, and because we also have something much better to do with the money than the people who are lending it to us, hence we have opportunity to generate excess returns from the borrowed money.
I find it hard to see how we are going to add much to the value chain with our cost of labour as high as it is, hence that is why we sell raw materials to China for a huge profit, let them produce the goods we want to our order for a very small profit above the base cost of the raw material we sold them.
The technology of resource discovery and exploitation and the process control required for world class operation is high quite value, the technology of converting that material to a sheet of metal is not so high value and much of what goes on in China quite easy to reproduce if we wished to import masses of slave labour. (Of course depending on the product)
Although this is a simplictic view of the world, it does serve to reframe the discussion slightly.
