Absolutely…i live in Massachusetts-we have a city called Worcester-formerly a big manufacturing town. Worcester had factories making everything from screws, bolts, machine tools, hand tools, locks, machinery, knives, etc. all gone-it is now a wasteland of closed factories, many facing demolition. Just yesterday, i bought a box of screws-made by Parker Mfg. (in Worcester)…now made in China. At least half were defective-malformed heads, crooked threads-absolute junk. So not only does the Worcester factory worked out of a job, I get to buy inferior products at a dirt cheap price-how does the USA benefit from this? WE get unemployment, stagnant wages, and China gets to ship us garbage products.
Why did people stop buying the ‘screws, bolts, machine tools, hand tools, locks, machinery, knives, etc.’ made in that and other US manufacturing towns? Why do they buy the defective products brought here from China and other such countries? How would forcing US companies to come back to, say, Worcester make a difference? If we forced the companies that used to be there back, do you expect they would make ‘screws, bolts, machine tools, hand tools, locks, machinery, knives, etc.’ they way they did when those companies left, using all the labor they used when they left, and that the workers in those plants would make the wages and benefits they made when those companies left?
And even China has been losing manufacturing jobs to countries with cheaper labour. Err, I mean countries with more rational labour pricing.
Of course they are valid statistics but when you are comparing economies over time, you have to compare apples to apples.
What makes you think that the U6 tells us something that u3 does not?
You see how the U3 and U6 move proportionally to each other. The U6 does not have a significantly different looking curve than the U3. People frequently use the U6 when they want to make the unemployment rate seem higher than it is. The U3 is about 5% right now and the U6 is on the high side of normal for that U3 but its not out of whack.
WTF are you talking about? Do you know what comparative advantage means?
The classic example of comparative advantage is the lawyer who types 300 words a minute who hires a secretary who types 150 words a minute but knows nothing about law.
Typing and legal work are both types of labor. As is factory labor.
Well those screws now cost you $0.99 instead of $1.09. So enjoy your $0.10 and YOU’RE WELCOME.
ETA, perhaps a more effective comparison would be to compare U6 over time and rather than sate the U3 number and then say “BUT the U6 number is so much higher” the U6 number has ALWAYS been higher, it always will be. But that’s not what I see on TV, I see the U6 being used to make people think that the government is trying to hide something from us. Hide the fact that the economy is a lot weaker than the U3 number indicates when in fact the U6 number is pretty consistent with what the U6 number has been in other economic recoveries.
I agree, that’s why I said we should compare like to like. I just thought you were being more dismissive of those stats all together. Never mind! 
They buy the Chinese made junk because there are NO MORE American factories making these things. The Federal Stea and Local governments piled taxes upon taxes on these firms…so they just closed up and bought junk for resale.
So, your theory is that it was state and federal taxes that pushed these companies out of business? Let’s say that’s true. What’s changed? Have the state and federal taxes on local businesses changed? Do you expect that Trump et al would be able to change that to attract those companies back in? If they did, do you expect that this would mean all those former jobs would come back? Companies coming back to the US would just make all those screw and such the old fashioned and labor intensive ways they used to, or as China does?
As they should. What’s rational about having a wage price floor when the consequences are a strategic competitor is enriched, national production is less than optimal, need for welfare is increased, and structural (yet unreported) unemployment is higher? Other than receiving some votes.
Well, I’ll stick with my irrational preference for countries that have voting.
Voting leads to marvels of productivity like Detroit. I can’t blame you.
Main thing isn’t the voting it’s the voters. It’s the incentives to enact sensible economic legislation or regulation are quite often different from the incentives to enact stupid legislation that appeals to the ignorant.
That isn’t what “comparative advantage” is.
There is, in the sense of comparative advantage, no such thing as a universal “labor” input. It depends entirely on what you are selling. The United States self-evidently has enormous comparative advantage in the production of commercial aircraft, which it produces and exports in truly staggering amounts - US aircraft exports are by themselves larger than the entire GDP of most countries - and does not have a comparative advantage in clothing, which it imports more than it exports. But both are, presumably, produced by US labor. Apparently Chinese labor doesn’t give them much of an advantage in making big commercial airplanes, unless they have a huge aircraft industry I missed.
Having cheap labor is not “comparative advantage.” It may confer a COMPETITIVE advantage, if the cheapness of the labor isn’t offset by other areas of disadvantage, but that’s not the same thing. Comparative advantage more or less by definition is Chinese laborers competing against other Chinese laborers.
I don’t see the necessity of limiting the comparison intranationally. But I’m inspired to do some reading.
People are generally not driven out of business by taxes. Income taxes are only applied to profits. no profits, no taxes. Property taxes are usually keyed to real property values and there is plenty of cheap real property in this country, with plenty of labor willing to move to middle America for a job.
Tax competition between countries is a race to the bottom. Tax competition between states is cannibalism. The main driver for the shift of jobs to China is the price of labor. Its just cheaper there. We are undermining the great American consumer class. Once the driver of economic growth around the world, we no longer have the capacity (or income) to keep driving that economic machine. Others have started to pick up the slack but the Europeans are far more frugal than Americans and the Asian middle class is not large or robust enough.
But you don’t think that they can be better at factory labor than anything else? They are better at factory labor than they are at raising beef or running call centers or waging war. They are better at factory labor than they are at many many things (comparative advantage). They are also better at it than virtually any other country on the planet (absolute advantage). Do you understand what comparative advantage is now? I can try a different example if you still think I don’t understand what comparative advantage is.
EVERYONE has a comparative advantage (something they do better than anything else that they can do). Having a comparative advantage is the only requirement to benefit from trade. However, that benefit is an aggregate benefit and is not shared proportionally by everyone. I this country the benefits of free trade are overwhelmingly enjoyed by the owners of capital while the burdens of free trade are borne overwhelmingly by the owners of labor.
Oh, lookee here:
So, apparently, the US Congress and the President agree with me that there’s slave labor going on in SE Asia in the fishing industry. Fucking clowns in this thread. Next person who tries to dishonestly argue and tries to make up crap up about my position is going to get pitted.
And that’ll get you a warning. Please don’t refer to other posters as such. If you absolutely feel you must then do so in the Pit.
I don’t know how many factories you’ve been in, but the term “factory labor” is meaningless in the context of this discussion. There is no such thing as a universal skill of “factory labor.” The type of labor involved in sewing T-shirts is nothing at all like the labor involved in welding and fitting structural steel, which is nothing at all like running an injection molding machine, which is nothing at all like producing nylon fibers, which is nothing at all like assembling centrifugal pumps.