In a global environment, innovations don't remain behind borders for very long. Artificially propping up wages or subsidizing certain industries are not long-term solutions to continuing growth and productivity.
When we import cheap labor, we are artificially lowering wages.
But I agree, we are not on the path to continued growth and productivity.
I predict that future innovations will come from China as they strive to maintain their growth. They may be an old culture, but young enough in the global market to realize that growth comes from change and development.