Now that the financial sector is near full capitulation, with numerous bailouts in record time, I think the future of American R&D will be joining it in oblivion.

I think it’s safe to say that much of science and engineering will be done in east Asia for much of the next century.

The USA will be looking more like a downtrodden post-Empire Britain but w/o a financial sector to buffer the losses since capital won’t be flowing here just to prop up some socialized banking sector and coddle the stock of a Google or Apple.

The Boston area, like many other high cost regions, will have a softer, white collar rust belt hue in the years ahead. Realize, after the 90s, even Credit Suisse dropped the name, *First Boston*, since it didn’t have any real brand name value in the long haul.

If you want to rebut these sites, you need to counter the arguments they are actually making. And you need to provide evidence and not rely on anecdotes.

We also seem to use similar vocabulary in describing phenomena. The one thing that I’d never really considered was actually being a tech employer vs employee/subcontractor in town.

The companies that I’d work with appear to want to leave Mass. There isn’t this “oh, there’s lot of talent here, let’s stay in Boston” mentality like ten years ago. It’s more the getting out of Taxachusetts and seeking, at most, a sales/post-sales consulting liaison in town because for some reason, international clients tend to feel comfortable working with a Boston-based enterprise. I guess Yankee ingenuity still exists in myths and collective memories. The concern I have is how long can that fantasy continue?

Well, my observation of this is that even during the 70s and 80s, the student group was always split between the premed, pre-MBA, prelaw (IP/patent) crowd and those who went into technology as a career. Today, anyone with the proper grades is preMed, prelaw, pre-Google [ yeah, I know ridiculous ], or financial engineering (quant -> trading desk). Anything else isn’t really viable, as a blue chip type of career, and that’s pretty much the rule of the game. So whereas in the past, getting a starting offer from DEC would be great demarcation point for one’s career, today, an offer from a Silicon Graphics would be a *dead end* time waster until one attends law school, at a Columbia or Georgetown, for that IP legal job at Hale & Dorr with some so-called *tech background*.

I entirely agree with your projection. The trade deficit that brings about the transformation that you are predicting is yet another sympatom of the government intervention in the market place in favor of the financial industry. As government taxes all companies but only bails out the financial companies (while bankrupting others in the process as resources has to come from other participants in the economy to do the bailing), regular manufacturing companies simply can not compete against financial companies for land, buiding, managerial talant or even workers. I’m speaking as the owner of a firm that has lost very talented workers to financial companies in the last couple years simply because my firm could not afford to pay someone fresh out of college $40/hr . . . nobody can, except the mortgage fraudsters originating those worthless mortgage papers for reselling, and calling that profit making! Now the companies folded, but mangers kept millions of dollars of bonuses, for essentially disrupting the economy and misallocating resources.

For the very same reason, the most brilliant minds among the youths in America have not been going into science and engineering over the past decade . . . because the government has tilted the playing field in favor of ponzi scams. Any wonder why manufacturing and engineering are going overseas? Like you said, I too wouldn’t be surprised at all when MIT have labs abroad . . . or for that matter being surpassed by insitutions like IIT (India) altogether, just like MIT surpassed Cambridge (England) at the beginning of 20th century.

You see, capital eventually goes where the hi-end work is and/or the executive decisions about that work. There won’t be these behemoths on the Kendall-128-495 axis with a support staff in east Asia. Instead, it’ll be the opposite because the wealth simply won’t be here anymore. The east Asians will invest locally, MIT professors will comb the globe for funding, and my scenario could easily play out. At some point, even MIT may have labs abroad co-chaired by someone in Cambridge.

I’m glad you’d brought up this point. The fact that housing in a once, highly productive region of the country, turned into a *frontier town’s* casino is the crux of the matter.

You see, Massachusetts since the rise of DEC (Ken Olsen era), was the technology center of the nation (along with S.V. and a one or two other sections). The vast wealth in the region was generated through value added export industries (plus adjuncts), which included all types of careers from floor cleaner all the way to technician, R&D designer, and financial operations. Now, that was the basis of the late 80s run up in real estate. Clearly, Mass was the place to buy, back then, and the rationalization was economic fundamentals. Here’s a short list of some of those blue chip companies: DEC, Data General, Gillette, Teradyne, Wang, Prime, John Hancock, First Boston, Stone & Webster, Raytheon, Polaroid, MITRE, AT&T, Biogen, Fidelity, Putnam, Arthur D. Little, and so on. This was literally 100s of thousands of jobs and was the reason why the region had added a million plus residents from ‘65 to the 90s.

The past several years, however, was a dearth of job creation and no matter what, Fidelity and Gillette won’t be moving 4-6K middle to upper middle income jobs back into the state. Likewise, when State St finally acknowledges its MBS losses during the decade, there’s a good chance that it too will be moving out to Raleigh NC / Dallas TX to skeleton-ize its operations. All and all, the fundamentals point to a long term bear market for real estate in the state. In addition, the real estate geared towards the old money, academically-tied, landed wealthy have already been procured in Beacon Hill and the Holden Green/Brattle regions around Harvard. These regions are insensitive to the actual working populace of the area. What happened, since the Nasdaq 5K crashed, was a credit fueled asset bubble in RE and now, since a lot of people don’t understand how the situation manifested to begin with, will be calling *bottoms*, every time a property sells within a standard deviation from its asking price. The problem, however, is that the underlying value of the property isn’t worth it when if a person decides to take a 10-15% paycut, for an equivalent job in Austin, can buy that same exact piece of property for half the cost. And nowadays, mobility is the key to keeping oneself employable.