Yep, I've been singing this tune for years. Our economy is being driven by retail, I don’t know how its holding together, but the stores are full and the factories are few and far apart.To be serious for a moment. Somebody with more economics background may be able to correct me, but to be able to buy things don't you need to provide goods and services to get the wealth to actually buy it? We still lead the world in services, like software, banking etc... which provide us with a good enough economy *for now*. But all of those areas have low barriers of entry to an educated population. Other than protectionism what's to stop India from providing say, the next big operating system and eating our lunch?
What stopped India from inventing the airplane? The submarine? The air conditioner? The transistor? I don't know. What prevents GM from being Toyota? I don't know. There are a lot of moving parts involved. And a secret sauce that's not easily definable. I wouldn't be too sure that India (or China) can just step into our shoes. Note that Vinod Khosla helped co-found Sun. Why couldn't he have done that in India? Indra Nooyi is Pepsi's CEO. Why isn't she the founder of globe-spanning soft drink company in India? Again - it's not as simple as it sounds.
Nothing, as a matter of fact American businesses are showing them exactly how to do it. American engineers are wearing a hole in the carpet between the U.S. and Asia.