As Japan lost its position to China, and Malaysia, Cambodia and Vietnam will to India, eventually.
We don't want to race to the bottom for labor-intensive jobs, because that's a race we can't win. We just need the government off our backs, and we'll compete with the rest of the world, just fine.
As England lost to the mills in Massachusetts as the Mass mills lost the Carolina’s
Government regulation and government collusion with market manipulators are both contributing factors.
“...When the recent trade deal with Peru was signed, that country’s president told the U.S. Chamber of Commerce, “Come and open your factories in my country so we can sell your own products back to the U.S.” This is not what Adam Smith, David Ricardo, and the classical advocates of free trade had in mind.
We are no longer just talking about simple trade among economies defined by national frontiers. Today’s globalization represents the creation of a world market without the enforceable rules that make markets work for everyone’s benefit. Led by multinational corporate interests, American policy makers pushed American workers into a brutally competitive market that resembles not so much the future, but the past: the 19th century dog-eat-dog robber baron era...”
http://www.epi.org/publication/trade_policy_and_the_american_worker/