Democrat congress = protectionist economic policies?

Great Debates
81

Look, it’s actually pretty simple. The economy is getting more global. This gives capitalists a huge advantage of workers, because money travels a lot faster and much more cheaply than workers do. (This I got from Thomas Friedman.) And while some jobs are not easily outsourced, others are VERY easily outsourced. The money will go to whoever in the world can do the world most cheaply, as American IT workers have discovered to their woe.

What Sam and other free market advocates say is that this is absolutely not a problem in the long term because over time, there’s a levelling effect as capital moves around the world and bids up jobs in one place and another, while the displaced workers who lost their jobs to outsourcing find work in a field in which they are actually competitive.

This may well be true, over the long term. But in the short term it can destroy people’s lives. They lose their homes, their families break up, that kind of thing. And the problem us liberals have is, we find ourselves asking “Is this really a desirable outcome? Is this really what an economy SHOULD do for people?” Is economic ruin for families a GOOD outcome? Isn’t that sort of thing exactly what a well-regulated economy is supposed to prevent?

It seems to me that all these well-regulated, efficient capitalist economies ought to be able to protect those workers somehow. It might be through a social welfare program that makes people’s mortgage/rent payments for them and helps them stay fed for a fixed period of time, or until they find a new job, but let’s face it, that’s a system that might be abused.

Tariffs are appealing because they could be used to both protect US workers and to protect workers in other parts of the world. I don’t care HOW much or how little you pay for coffee or whatnot, there are a lot of Third World employers out there who’ll pay their employees jack shit and just pocket every bit of profit they can. It’s part of macho (or “stupid” culture, y’know. Only tariffs targetted at firms that don’t pay fair wages will work.

What I see right now is a bunch of free market capitalists who want the poor and the middle class to shoulder ALL the risk involved in globalism and outsourcing, so the wealthy can be made mildly wealthier. Can’t say it makes my heart fly like a bird.

I don’t know where in capitalism it says that the poor and the middle class should risk their homes and their families on globalism and outsourcing while the wealthy get to risk whatever portion of their wealth seems appropriate. Perhaps you can point it out to me.

82

Heard on the radio this very morning that Goldman, Sachs made so much money this morning that their performance will come to about half a million dollars per employee! THAT’S sharing the wealth.

Those must be REALLY productive employees! I mean, it can’t be that they’re just a bunch of lucky stiffs born into the right families and getting the right education and jobs to be welathy, can it? Nahhhh … they gotta be SUPER productive, and fine human beings to boot!

83

D’oh!

Let me rewrite that sentence: “Heard on NPR this morning that Goldman, Sachs made so much money this year that their year end bonuses will come to about half a million dollars per employee.”

84

I was at a big three auto company when they brought in a lot of foreign workers, mostly from India. We knew what it was about. We were to teach them our jobs. They taught us nothing . They were not a more educated workforce. They neither has the equal skill levels or a background that can only come from doing something for a long time. They simply worked cheaper. A lot cheaper. The company the development and the product would suffer for a while. But it was a money decision. If you didnt teach them well the company would fight your unemployment and severance and pensions. It is a race to the bottom.

85

we should stay out of worker pay and let their economies take care of that. Good, non-lethal working conditions and a reasonable work-week should be universal.

86

There is, and I’m convinced I just described it - but then it takes all the fun out of arguing. Instead of having massive recessions and having to pay double for domestic goods, we’re just paying a 10-15%(out of my ass guestimate) premium and making companies factor in a slightly higher labor cost before moving jobs overseas. Oh no! That might be reasonable! You can’t get upset about it!

87

It is simply untrue to say that trade only benefits the wealthy. Trade benefits all economic classes. Sure, a few people in non-competitive industries are harmed. However, the fact of economic life is that there are always declines in certain industries. I don’t see too many asbestos plants left in the U.S. They aren’t gone because of trade, but their workers suffered as much from these plants closing as do textile plants that close because of foreign competition. Why are we only singling out those who lost jobs because of trade for special sympathy?

The marketplace is dynamic, and as companies find better ways to meet consumers’ needs and desires, certain companies will expand and certain companies will fail, regardless of where they are located. Consumers benefit by seeing better products at lower prices. Workers benefit by seeing new jobs created. Those who attack free trade are only looking at one side of the equation – job loss. Sure, it’s going to look negative when you focus on the relatively few people who lose their jobs because of free trade. What about all the consumers who benefit by having lower prices? What about all the jobs created because of this trade (both in industries that rely on imports and industries that export American products overseas)?

As Brink Lindsey of the Cato Institute put it (http://www.freetrade.org/node/65):

88

I don’t care about lost jobs here going to other countries that have lower wages. What I care about are US companies exploiting children and unsafe working conditions in other countries just to provide us with cheaper goods (and to make more $$). Yes, making more is good, but not when it involves 16+ hr work days, 7 day work weeks, child labor and unsafe working conditions. Is that really so much to ask? If it is, should we really be doing business with these people?

89

Suppose the Chinese decide to dump their dollar holdings-and the US Dollar crashes. all of a suddne, the cheap sneakers at WALMART are now 3X the previous price. Will this lead to US manufacturing of footwear? Or will people just not buy, and WALMART cannot sell its imported stock. Interesting questions.

90

No, not all that interesting since that would never happen. Why would the Chinese want to sabotage our economy? They have much more to lose than we do.

91

How did I miss this thread?

It is the individual people who place social self-importance in their job. I would like to think that they should put it into themselves, but people have confidence issues. However, that is neither here nor there…

What you, Kimstu and Evil Captor are trying to do is cut corners and expound social policy via the economy. I’ve said before, and I’ll say it again, economics is not a political tool. It should not be used to effect social change. This leads to corruption and communism/managed economies (see North Korea). Economics should solely be used to maximize wealth.

Social change and social services, therefore, are easily divorced from economic policy. You can have a government that allows for a free market, and, at the same time, allow a government that will re-train and re-educate the people to enter different industries and jobs. This is much different than forcing people to buy from a less than competitive business/industry.

You misspelled Communism.

This is where government wealth redistribution comes in, i.e. taxes. I’m all for government giving aid to the dislocated, depressed and disinfranchised, but you shouldn’t make businesses do it.

92

I have this same argument with one of my doctor friends. It’s to the point where she can’t find any athletic shoes made in the US anymore. You do realize that the US went through this same transition, right? I’m positive that this is a condition of becoming an industrialized economy.

Anyway, I would gladly, gladly, gladly pay for a shoe made in one of these countries if: [ul]1) It keeps prices low (because I’m a greedy American, right? :stuck_out_tongue: )
2) Their local government isn’t exploiting the tax dollars to set up presidential suites for its rulers. (This shouldn’t be a problem because a goverrnment that steals from its people will just as easily steal from foreign investors).
3) The “sweatshop” wage is higher than anything they could produce locally. (Most likely true in all cases).[/ul]

The point of the matter is that these workers will now have money in the local economy and the government grows its tax base. It can provide things like roads, water, sewage, and dependable power. As more money plows in, and as more of its citizenry survive hurricanes, typhoons, malnutrition, etc., the work force becomes stronger and more capital is attracted to country. The country can then build schools, thus increasing the efficiency and productivity of its populace. Countries didn’t magically become industrialized over night.

93

And as I said already, I think the distinction you’re making there between economics and “politics” or “social change” is artificial and misleading, at least in the case of jobs. A job, as I noted, is both a social factor and an economic one, and has profound implications for its holder both economically and socially. Theoretical pretensions that we can somehow separate economics from politics do not change that fact.

I think you missed my point. When I talk about the fundamental impact of meaningful work on workers’ social and intellectual identities, I’m not talking about mere shallow status-seeking through the prestige of one’s job.

Huh? Are you saying that a “minimally-regulated capitalist economy”, of the sort Sam Stone is advocating, is actually Communist? That’s a new one to me. Or are you saying that the only way meaningful work can be well integrated with such an economy is through Communism?

94

I realize that, and I also realize that our economy was originally built upon slave labor. Does that mean we should allow other countries to explore and exploit slave labor to get themselves on their feet? Our past generations struggled through a bunch of bullcrap specifically so that we wouldn’t have to. I think its a slap in the face of progress to say that ‘well we had to go through cancer causing-life shortening working conditions to get where we are, so they should have to too’. Why can’t we learn from our history instead of forcing others to relive it? We see what those types of working conditions do to populations, so why the hell are we OK with other people suffering the same fate? Why can’t they start off with good conditions instead of needing revolution to achieve them? Why can’t we learn from history?

95

So, then, correct me if I’m wrong, you’re arguing that merely having a job imports identity? If so, then we are going to have to agree to disagree. Sure, there are people out there that take pride in what they do, just as there are people who have much pride in having any job. There are others, like my other lawyer and doctor friends, that love telling people that they’re lawyers or doctors. There are going to be people in between both extremes, where telling others their job only really matters to others in their industry. Should we change economic policy such that everyone has a job? Should we all make $50/hr? Just like we all can’t be (at least not on the planet, unless we find another planet to trade with) doctors and lawyers, we all can’t have jobs. Even in a perfect capitalistic system, the reality is that there is constant change and transition, and this will cause unemployment. That’s why it’s better just to get people situated easier and ease them through transition. The alterntive is to prop up their non-competitive, inefficient industry and slowly take everyone down to the bottom as the economy gradually collapses.

What is meaningful work? What better way to have meaningful work than what the state tells you that it is? In a fluid, capitalistic economy, a job is a job, just like a dollar is a dollar, just like a bone is a bone. People go to work, earn money, and spend their time and money exactly as they want to. The value of a job is exactly related to what the market can bear to pay for it. No one creates jobs just as no one decides what the exchange rate is.

96

Are we going to take over their country, too? Why not make them a protectorate? I’m sure the Philippines would like that. Maybe Camobida? The point is that to raise their standard would take massive cash infusion (and probably cause some inflation). We can continue to give them handouts and crush them under the weight of IMF interest rates (debatable, but I’m not too versed on that subject, perhaps I should talk to Bono). In the past, according to some articles I’ve read in The Economist, too much money causes inflation and corruption (I might be mis-remembering on this latter point). At the same time, the populace cannot adjust to this new found wealth. The surprising point was that these countries do not learn fiscal responsibility. It makes sense, it’s not their money. I’m all for sending over humanitarian aid: teach them to build roads, schools, and power grids. Set up free health care and clinics until their own populace can take over (this will take a generation). But, I would not give them any stuff, because that’s just like giving them money. There is no overnight solution to this problem. Just time and development.

97

Who the hell said anything about taking over their country. The only thing I mentioned was encouraging better working conditions by taxing imports proportionally to their human rights/workers rights. When they get it up to a certain level, its free trade. I’m not suggesting interfering with economies or nations - I’m encouraging dangling a carrot to countries to encourage them to give their workers basic protections. Lets cool it with the straw men and hyperbole.

98

You’re wrong. Having a job doesn’t necessarily strongly impact one’s identity; in particular, low-skill and low-paid jobs tend to be difficult for workers to identify with or care about (as I already noted in an earlier post). However, for many workers, their jobs do strongly impact their identity, and losing their jobs or having to change their careers is often a big identity upheaval for them, especially when the background, skills and expertise that they worked hard and long to acquire are no longer part of their lives.

No, and no. This is a strawman argument, since I never suggested that we should have a full-employment economic policy or that we should all make $50/hour.

Right. My point is that especially in a perfect capitalistic system, there will be constant change and transition that will significantly increase career and job instability.

This is not a bad thing in all ways. Despite your strawman arguments, I’m not really arguing for a centrally planned economy or one with 100% guaranteed job security. I do see the numerous benefits of having workers and industries being more adaptable and faster-responding to economic changes, in order to keep labor markets humming along more efficiently.

However, my point is that I think free-market enthusiasts tend to get so fixated on the advantages of a freer labor market, and particularly the long-term benefits once extreme standard-of-living disparities get somewhat evened out, that they don’t pay enough attention to the accompanying problems it brings.

Face it, the conditions of actual, real-life work, especially skilled work, do not conform very well to the theoretical demands of perfect capitalistic labor markets. Many people invest lots of time in specialized training, skills and experience in the particular kind of work they do. They build up relationships with co-workers and in their shared communities. All these things make workers less readily mobile and adaptable in response to sudden changes in the labor market. But on the other hand, they also tend to foster positive results like stability, security, deep expertise, and pride and enjoyment in skills developed over long periods of time.

It’s easy to say airily “oh, just give the workers more tax-supported retraining and unemployment benefits to cope with more job instability”, but I don’t think that’s a complete solution. Job stability is not just an economic issue, but also a quality-of-life one. No, people shouldn’t be guaranteed permanent jobs—some adaptability and flexibility is always necessary—but neither should people be expected to change careers every five years and rack up years of unemployment over the whole course of their working life.

Most workers want at least a reasonably likely prospect of some stability and long-term vocational/professional development during their working years. I don’t think they should be buffaloed out of standing up for that perfectly natural and understandable desire by trade-liberalization advocates scolding them for not being sufficiently devoted to the cause of market efficiency. I don’t know what kind of economic setup would be best for providing such a prospect—I’m by no means convinced that protective tariffs are in fact the way to go here—but I do know that the issue is a serious one and shouldn’t be just hand-waved away in the name of “fluidity” or “efficiency” or “competitiveness”.

Do you have a cite for this? After all, there are lots of economies where job stability is somewhat more protected than in the US (due to labor regulation, stronger unions, etc.), which are not collapsing.

Could you please answer my question before getting into further rhetorical questions of your own? What is it that you were referring to as “Communism” in my earlier post?

99

Kimstu: So, if we should regulate trade to minimize worker dislocations, on the assumption that doing so is a societal good, should we also not regulate industries to protect them from other forms of competition? Should we have had a Telephone Operators Protection Act, making it illegal to install automated switching devices? Would our economy be better off? Would our society be better off?

If you answer no, consider this thought experiment: Let’s say there’s a building down the street, marked “Automated Switching.” All the operators lines are routed into this building, the operators are fired, and properly routed phone calls come out the other side. Fantastic. We’ve just replaced 10,000 workers with a device that can do their job for 1/10 the cost.

If you think that’s okay, now imagine that the ‘automated switching’ consists of an underground cable that extends…to India. And the automated switching is actually 10,000 Indian workers doing the same switching the Americans did, for 1/10 the cost.

From the standpoint of Americans and American society, what is the difference? Why is one bad and needs to be regulated away, while the other is just modernization and a healthy function of an increasingly technological society?

Another example: The “Iowa Car Crop”. Imagine that someone made a machine that you poured grain into, and fully finished automobiles came out the other side. What a fantastic invention that would be. Would you try to stop it to protect the auto workers? Maybe suppress the invention for the good of the nation?

If no, what is the difference if that grain is loaded onto a barge and shipped out to sea, and it comes back 2 weeks later loaded with cars? Do you care where the cars came from? Is it somehow worse if they are built by Japanese auto workers, rather than by a fantastic grain-eating invention?

But what about all those displaced auto workers? Well, how about all the displaced telephone operators? All those employees of ComputerLand when it went under? All the employees of Enron? Buggy makers? Blacksmiths? Do you have even the slightest idea how many jobs were destroyed by the personal computer?

Why single out jobs lost to outsourcing? Why not protect them all? Or if you don’t think they should be protected, why protect jobs from outsourcing?

100

I didn’t say that the goal was to minimize worker dislocations. As I’ve said several times already, I am not in favor of manipulating the economy in order to reduce job insecurity as much as possible. I’m simply pointing out that levels of job insecurity higher than some reasonable maximum have a serious negative effect on workers’ quality of life. And I don’t think that that problem becomes trivial or irrelevant just because market flexibility is so kewl.

All these questions are red herrings, based on the false premise that I’m advocating policies designed to produce zero job dislocation. You’re trying to argue that since any given level of interference in labor markets to encourage job stability is necessarily arbitrary, therefore we have no justification for choosing to interfere at all. And I call bullshit.

You guys would increase your productivity in this debate if you didn’t rely so much upon strawmen, IMHO.