# Offshoring - the snake that is eating itself. **URL:** \ **Category:** Great Debates\ **Created:** [October 3, 2010, 2:51pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912 "2010-10-03T14:51:53Z")\ **Posts on this page:** 20\ **Page:** 19
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 27, 2010, 6:46pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/361 "2010-10-27T18:46:03Z")
> [@xtisme](#): > > We’ve priced ourselves out of the low end labor market due to labor unions BULLSHIT!!! > [@](#): > > and more importantly our own standards of living and the expectations of our citizens. Yopu’re right, we should all live like Chinese peasants (well, except for the CEOs and the investor class (if you losing every dollar in your 401K would change your lifestyle iin retirement then youa re not in this class)). > [@](#): > > We aren’t ever going to be able to play in that game again. Yeah, sure, if we adopt your attitude. On the other hand we don’t have to just “let market forces prevail” (while the Chinese manipulate those market forces) > [@](#): > > If we want to play at all we have to work towards our strengths, not piss and moan about the fact that other countries are not playing fair and buying stuff from us because we are American’s…or are willing to sell us goods and services cheaper than we can make them here. I’m proposing we engage in the same sort of bullshit shenanigans that China and other countries engage in. > [@](#): > > What’s left to us is quality and innovation…we have to build products and services here that are more niche oriented or that are innovative enough that we’ll have an edge in production for a time. The I[phone is manufactured in China. More and more engineering and design is mving to China and india. You don’t think they have smart people over there? > [@](#): > > Or, we could impose stiff tariffs that a lot of folks in this thread seem to think are a good idea, legislate laws forbidding US flagged companies from outsources or offshoring, and see where that takes us. I don’t know about the second part but the tariffs seem like a great idea for getting countries like China to stop playing dirty. > [@](#): > > Out of US dollars? How so? How could they get their money out of US dollars in such a way that it doesn’t destroy or at least cripple their economy both in the short term as well as in the medium term? Their average maturity on US treasuries is under 2 years (I believe). If they don’t roll over their maturing US treasuries into new US treasuries, they lose 2 years worth of time value of money. unless you think that we are going to let inflation spike to the teens to attract that money back, we are going to defend our currency from freefall (we want our currency to drop but not plummet) and that will let them exit our currency in an ordely manner even if they take a couple of years of time value loss. That’s just one scenario, some scenarios work better others not so much. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 27, 2010, 6:47pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/362 "2010-10-27T18:47:18Z")
> [@RickJay](#): > > … But I can’t help but be rather unconvinced by an argument that amounts to “let’s knock some sense into them.” As long as you want a quick, clear message, why not just launch an attack with nuclear weapons? Lets start with the tariffs and see where that takes us. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 27, 2010, 6:49pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/363 "2010-10-27T18:49:17Z")
> [@penultima\_thule](#): > > No, it will hurt you more than them. No, it will hurt them more than it will hurt us. (Shit that was easy) > [@](#): > > Agreed, I would have thought that incontravertably a good thing for the US? Ahh, yet another person who thinks the answer is to give up our standard of living in exchange for the living standards of Chinese peasants so that CEOs and the investor class can continue to get rich. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 27, 2010, 6:54pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/364 "2010-10-27T18:54:34Z")
> [@xtisme](#): > > It IS a problem…a serious problem, and one that needs to be addressed (don’t ask me how…I haven’t got a clue what we should do). Then why don’t you just sit down and shut up when other people propose a solution that has worked in the past. In fact retaliation works so well that to this day people remember how the rest of the world reacted to Smoot Hawley and folks like you are afeered of what might happen if we light that fuse again. > [@](#): > > I do believe that eventually the Chinese will hang themselves with their own short sighted policy, and not just with the US…our European friends aren’t too happy with them either, for similar reasons (and a lot of Europeans have similar attitudes about free trade and outsourcing to the OP as well). And maybe the Chinese are counting on folks like you to keep saying “no but we shouldn’t impose tariffs or retaliate, that would be bad” Maybe the Chinese know something you don’t know. Noone thnks offshoring is the only problem, but it is a problem and even if unfair trade practices accounts for 2% of our unemployment, that might mean the difference between a vibrant recovery and a lost decade. ---
**Author:** ![penultima\_thule](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/penultima_thule/32/3833_2.png) [@penultima\_thule](https://boards.straightdope.com/u/penultima_thule)\ **Post date:** [October 27, 2010, 11:33pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/365 "2010-10-27T23:33:20Z")
> [@Damuri\_Ajashi](#): > > Ahh, yet another person who thinks the answer is to give up our standard of living in exchange for the living standards of Chinese peasants. No, I think it’s clear the solution involves getting Chinese living standards up to where the US’s are now. But if you think that US onshoring the manufacture of textiles, soft toys and commodity chemicals is the way to achieve that, and that 10,20 … even 40% appreciation of the RMB against the USD is going to deliver that dubious dividend, so sorry but it’s not. > [@Damuri\_Ajashi](#): > > In fact retaliation works so well that to this day people remember how the rest of the world reacted to Smoot Hawley and folks like you are afeered of what might happen if we light that fuse again. So you are proposing shooting yourself in the foot as a bargaining ploy on the presumption the US would survive a global depression better than China? That’s good. I’ll put my lunch money on China if that doozey represents the thinking of the best and brightest economic policy wonks in the US. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [October 28, 2010, 1:21am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/366 "2010-10-28T01:21:16Z")
> [@Damuri\_Ajashi](#): > > Then why don’t you just sit down and shut up when other people propose a solution that has worked in the past. > > In fact retaliation works so well that to this day people remember how the rest of the world reacted to Smoot Hawley and folks like you are afeered of what might happen if we light that fuse again. So “works so well” is defined as global depression culminating in the most savage and destructive war in the history of the world. I think we have different ideas of what constitutes a good outcome. Me, I have this thing against mass poverty and war, but maybe I’m funny that way. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 28, 2010, 3:39am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/367 "2010-10-28T03:39:36Z")
> [@penultima\_thule](#): > > No, I think it’s clear the solution involves getting Chinese living standards up to where the US’s are now. But if you think that US onshoring the manufacture of textiles, soft toys and commodity chemicals is the way to achieve that, and that 10,20 … even 40% appreciation of the RMB against the USD is going to deliver that dubious dividend, so sorry but it’s not. > So you are proposing shooting yourself in the foot as a bargaining ploy on the presumption the US would survive a global depression better than China? > > That’s good. I’ll put my lunch money on China if that doozey represents the thinking of the best and brightest economic policy wonks in the US. A 40% increase in the RMB will absolutely move some production from China to the US. I wonder why all the free trade economic gurus are silent on this point. A higher RMB relative to the US dollar is going to affect the balance of trade, its almost like a science. Good luck with that lunch money. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 28, 2010, 3:41am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/368 "2010-10-28T03:41:42Z")
> [@RickJay](#): > > So “works so well” is defined as global depression culminating in the most savage and destructive war in the history of the world. > > I think we have different ideas of what constitutes a good outcome. Me, I have this thing against mass poverty and war, but maybe I’m funny that way. I meant that it has worked well in getting people to change their behaviour. Noone is saying we should stop all trade with the rest of the world. I am saying that retalilation will make China change. ---
**Author:** ![penultima\_thule](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/penultima_thule/32/3833_2.png) [@penultima\_thule](https://boards.straightdope.com/u/penultima_thule)\ **Post date:** [October 28, 2010, 4:50am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/369 "2010-10-28T04:50:52Z")
> [@Damuri\_Ajashi](#): > > A 40% increase in the RMB will absolutely move some production from China to the US. I wonder why all the free trade economic gurus are silent on this point. A higher RMB relative to the US dollar is going to affect the balance of trade, its almost like a science. > > Good luck with that lunch money. True, it will affect the balance of trade with China but as has been pointed out that isn’t going to bring textiles, soft toys and commodity chemicals manufacturing back stateside. The FMGs haven’t gone silent, just gone hoarse talking to neophytes who’s primary attention in class was colouring in the Os in their Econ 101 textbooks. For the sake of the argument, presume the RMB is 40% overvalued. I doubt it, but then nobody actually knows and if the US continues to print USD by the trillion it may eventuate. There’s the scenario that the holders of current US treasury funds will sell them at the current FX rate, allow the RMB:USD to find it’s natural level and then buy them back at a 40% discount. Presumably then there will be the equivalent xenophobia reaction against the high RMB buying the US farms and corner shops. You had this stouch with Japan, not that long ago. And, of course there are all those rare earth metals that the US manufactures need for products you have a competitive advantage in producing, and China controls 90% of world market, then you have just volunteered a 40% price rise. Dem pesky swings and roundabouts eh? ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [October 28, 2010, 6:17pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/370 "2010-10-28T18:17:27Z")
> [@Damuri\_Ajashi](#): > > I meant that it has worked well in getting people to change their behaviour. Noone is saying we should stop all trade with the rest of the world. I am saying that retalilation will make China change. Well, it might. It might cause them to change their behaviour in ways you don’t expect. It might cause offshoring to simply shift to India, Indonesia, or other countries. It might cause a fucking war. The truth is that you don’t really seem to have a clue what it will do - which is understandable, because nobody could say for sure what such a sudden about-face and shock to world trade would do. Retaliation DOES change behaviour, but quite often in ways you don’t expect or want. If you punch someone in the face, don’t be surprised if they punch back. Hellestal has provided a detailed, honest, clear and sometimes even passionate explanation of why the USA’s first moves should be getting its OWN fiscal and monetary house in order, and using its OWN currency to address its trade deficit (which, importantly, has the advantage of affecting all of America’s trade relationships, not just the one with China.) It has been further pointed out that there exist international and diplomatic mechanisms that exist for precisely these sorts of problems, and that exploring solutions though those channels has barely even been started. You ignored, or didn’t understand, those points, and simply want “retaliation.” I know which of those solutions sounds smart to me and which sounds childish. ---
**Author:** ![XT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/xt/32/456_2.png) [@XT](https://boards.straightdope.com/u/XT)\ **Post date:** [October 28, 2010, 7:31pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/371 "2010-10-28T19:31:11Z")
Since you’ve decided to go all hostile, I’m happy to oblige, especially in light of the fact that the rational posts by more knowledgeable posters have pretty much bounced off the heads of you and the OP and the small numbers of others on the side of chicken-little… [QUOTE=Damuri Ajashi] Then why don’t you just sit down and shut up when other people propose a solution that has worked in the past. [/QUOTE] Probably for the same reasons you won’t admit you don’t have a clue on this subject…because we both like to hear ourselves talk. The solution you have proposed has not worked in the past, and it won’t work now either, yet you keep bringing it up, despite the fact that you’ve repeatedly been shot down. > [@](#): > > In fact retaliation works so well that to this day people remember how the rest of the world reacted to Smoot Hawley and folks like you are afeered of what might happen if we light that fuse again. Yeah…they fear it alright since it caused one of the worst world wide depressions in history. And, coincidentally, it caused our own economy to further melt down as well. THAT’S a great solution to the problem, no doubt. 😛 > [@](#): > > And maybe the Chinese are counting on folks like you to keep saying “no but we shouldn’t impose tariffs or retaliate, that would be bad” I doubt it. They think they have a winning formula going, and are trying to stick with it. What’s going to be funny is when they hit the wall and can’t figure out why everything changed. What will be even more funny is when folks like you and the OP switch to ranting about India next, or some other country…the same way folks all chicken-little frantic about Japan have now switched their tune to China instead. Hm…maybe you had a glimmer there with your history repeating itself schtick after all… > [@](#): > > Maybe the Chinese know something you don’t know. Perhaps they do. Have you considered that the majority of the worlds economist might (MIGHT mind you) know something you don’t? And, possibly something the Chinese don’t? They are sort of new to this whole Capitalist game thingy, after all, so perhaps they don’t know everything. And you…well, the less said there the better, ehe? > [@](#): > > Noone thnks offshoring is the only problem, but it is a problem and even if unfair trade practices accounts for 2% of our unemployment, that might mean the difference between a vibrant recovery and a lost decade. This thread is ABOUT offshoring…that’s the topic of the OP’s rant. S/he certainly seems to think that it’s the ‘only’ problem, or, at least that it’s the most significant part of the problem. > [@](#): > > BULLSHIT!!! Um…did you step in some? You’ve been tossing out quite a bit, so it’s not much of a shock. Thanks for the warning and all, but I already knew you’d be tossing out more… > [@](#): > > Yopu’re right, we should all live like Chinese peasants (well, except for the CEOs and the investor class (if you losing every dollar in your 401K would change your lifestyle iin retirement then youa re not in this class)). Seriously…WTF are you on about? Do you not speak and read English? Or were you deliberately trying to twist my point into a pretzel that doesn’t resemble what I was saying in the slightest? On the up side, it’s a really good appeal to emotion. To bad it really has nothing to do with what I was saying, but, hell, with the OP that probably scores you double points. > [@](#): > > Yeah, sure, if we adopt your attitude. On the other hand we don’t have to just “let market forces prevail” (while the Chinese manipulate those market forces) Offshoring has nothing to do with China manipulating market forces. Their currency policies do. If China stopped manipulating their currency tomorrow it wouldn’t substantially change offshoring, wouldn’t bring back the blue collar manufacturing bacon to the US…it would simply shift low wage manufacturing to another country, if anything. Another country that still wouldn’t be the US. > [@](#): > > I’m proposing we engage in the same sort of bullshit shenanigans that China and other countries engage in. Then your position is foolish and would lead to the destruction of the US. If we tried to manipulate our currency to artificially drop it’s value it would do so against every currency in the world. This would have catastrophic consequences. The fact that you are seriously proposing this is a pretty good indication that you don’t have even the first idea of what you are talking about on this subject. Ironic that you told me to shut up and listen. > [@](#): > > The I[phone is manufactured in China. More and more engineering and design is mving to China and india. You don’t think they have smart people over there? The iPhone was designed and developed here. Once it was designed and developed, and the manufacturing processes and logistics of production were worked out, THEN it was manufactured in China. I think there are plenty of smart people in China and India. That’s sort of the point…we can’t force other countries to give us a free ride. I also think that the US can still play a role in design and development. And if we can’t, then we can’t…c’est la vie and welcome to the world, post-US superpower. > [@](#): > > I don’t know about the second part but the tariffs seem like a great idea for getting countries like China to stop playing dirty. Yeah…I got that from you already. That seems to be the only hammer in your chest, and all the economic problems seem to be nails, where you are concerned. As a last resort and if they are focused narrowly, then perhaps that will end up being the way to go. But we haven’t gotten there yet. And, as I said, even if we do manage to get China to chance their monetary policies and open up their currency and allow it to adjust to it’s natural level that STILL won’t solve the offshoring ‘problem’, nor will it bring all those low paying manufacturing jobs back to the US. You don’t seem to get that, and certainly the OP doesn’t get it at all. > [@](#): > > Their average maturity on US treasuries is under 2 years (I believe). If they don’t roll over their maturing US treasuries into new US treasuries, they lose 2 years worth of time value of money. unless you think that we are going to let inflation spike to the teens to attract that money back, we are going to defend our currency from freefall (we want our currency to drop but not plummet) and that will let them exit our currency in an ordely manner even if they take a couple of years of time value loss. That’s just one scenario, some scenarios work better others not so much And when they want to continue to sell goods and services here in the US? How will that help them? -XT ---
**Author:** ![Le\_Jacquelope](https://avatars.discourse-cdn.com/v4/letter/l/e0b2c6/32.png) [@Le\_Jacquelope](https://boards.straightdope.com/u/Le_Jacquelope)\ **Post date:** [October 29, 2010, 10:05am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/372 "2010-10-29T10:05:21Z")
> [@RickJay](#): > > Well, it might. It might cause them to change their behaviour in ways you don’t expect. It might cause offshoring to simply shift to India, Indonesia, or other countries. If our currency collapses because of over-printing of money or the Republican victory in November causing a stop in the raising of the debt ceiling, it’s going to be mighty damned hard for Indonesia or anyone to sell us anything… what with the price of imports skyrocketing. China’s already starting to bitch about our dollar devaluing. But it’s their fault to begin with, and the fault of our greedy corporations. > [@](#): > > It might cause a fucking war. Oh for God’s sake. A war with the world’s biggest military superpower? Our navy will sink anything that tries to start shit over here. But if overseas hostilities force our troops to get out of other nations’ business and puts an end to American Imperialistic meddling in other nations then I’m all for it. Oh wait, we’ll probably find a way to not get it [tm] and fuck things up. Sigh. > [@](#): > > The truth is that you don’t really seem to have a clue what it will do Oh that’s rich, you don’t even have a clue about what offshoring is doing to America right now and you’re accusing Damuri of being clueless? Really? > [@](#): > > If you punch someone in the face, don’t be surprised if they punch back. We’re being punched in the face now. What you’re looking at is America considering punching back. Your “China can do it but we can’t because nobody understands the consequences if we do the same thing back” game is astoundingly… wait… how old are you anyway? Hellestal’s “solutions” don’t involve any of the KEY necessities toward negating the plutocracy that is developing in the United States: how to get back the MILLIONS of jobs that we lost overseas, the 40,000 factories that shut down here and reopened there, and how to protect the next Big Thing (see: biotech) so that the jobs from this next thing come HERE and not go over THERE. Neither you nor Hellestal can answer this: where are all those great, better paying jobs _that offshoring was supposed to give us?_ Hmmmm? Where are they? America’s workers are waking up to the bullshit of globalism and the race to the bottom. Your sales skills are seriously not strong. American voters better have answers soon or their wrath will force arguments like yours aside. ---
**Author:** ![penultima\_thule](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/penultima_thule/32/3833_2.png) [@penultima\_thule](https://boards.straightdope.com/u/penultima_thule)\ **Post date:** [October 29, 2010, 11:39am UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/373 "2010-10-29T11:39:04Z")
> [@Le\_Jacquelope](#): > > American voters better have answers soon or their wrath will force arguments like yours aside. _“When the facts are on your side, argue the facts. When the law is on your side, argue the law. And when you have neither the law or the facts on your side, bang your fist on the table!”_ ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [October 29, 2010, 2:22pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/374 "2010-10-29T14:22:05Z")
> [@Le\_Jacquelope](#): > > If our currency collapses because of over-printing of money or the Republican victory in November causing a stop in the raising of the debt ceiling, it’s going to be mighty damned hard for Indonesia or anyone to sell us anything… what with the price of imports skyrocketing. Which would be precisely what you want. **You are confidently predicting the exact thing that will solve the problem you allege is causing the recession.** ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 29, 2010, 3:18pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/375 "2010-10-29T15:18:21Z")
> [@penultima\_thule](#): > > True, it will affect the balance of trade with China but as has been pointed out that isn’t going to bring textiles, soft toys and commodity chemicals manufacturing back stateside. Of course we won’t ever have the textile industry we once had. But even marginal increases in GDP would make a large difference in our economy. Our GDp grew at a 2% rate last quarter. We need that much just to tread water on the unemployment front. China’s peg might be slowing our growth 1 or 2%, if our growth were 1 or 2% higher, we would see unemployment shrink pretty dramatically. The recession was a self inflicted wound but the slow recovery is at least PARTLY (bold, double underline italizize flashing neon lights on the PARTLY before anyone says i am blaming it ALL on China) the result of unfair trade practices. > [@](#): > > The FMGs haven’t gone silent, just gone hoarse talking to neophytes who’s primary attention in class was colouring in the Os in their Econ 101 textbooks. > > For the sake of the argument, presume the RMB is 40% overvalued. I doubt it, but then nobody actually knows and if the US continues to print USD by the trillion it may eventuate. > > There’s the scenario that the holders of current US treasury funds will sell them at the current FX rate, allow the RMB:USD to find it’s natural level and then buy them back at a 40% discount. Presumably then there will be the equivalent xenophobia reaction against the high RMB buying the US farms and corner shops. You had this stouch with Japan, not that long ago. So who do you think is going to let the current Chinese holders of treasuries to sell their treasuries/ They don’t even have to sell, they can just wait for their treasuries to mature. Their weighted average maturity is under 2 years. > [@](#): > > And, of course there are all those rare earth metals that the US manufactures need for products you have a competitive advantage in producing, and China controls 90% of world market, then you have just volunteered a 40% price rise. Dem pesky swings and roundabouts eh? We used to be the world’s leading supplier of rare earth metals until China undercut the world market. Its not like we don’t have it (rare earth metals are not actually rare at all), we simply can’t engage in this labor intensive, toxin producing activity as cheaply as China where life is cheap and the pollution is free. > **[Mountain Pass Rare Earth Mine](https://en.wikipedia.org/wiki/Mountain_Pass_rare_earth_mine)** > > The Mountain Pass Rare Earth Mine and Processing Facility, owned by MP Materials, is an open-pit mine of rare-earth elements on the south flank of the Clark Mountain Range in California, 53 miles (85 km) southwest of Las Vegas, Nevada. In 2020 the mine supplied 15.8% of the world's rare-earth production. It is the only rare-earth mining and processing facility in the United States. It was the largest single known deposit of such minerals. > From 2022, processing capabilities began again for lig... Besides these rare earth elements are primarily used to manufacture semiconductors, flat screen TV, and other stuff that we simply don’t make here anymore, because they are mostly made in China these days. Sure there are some high end military applications that require rare earth metals but we produce enough for this stuff. The total global market for rare earth metals is 2 billion dollars, the prices will creep up a bit and more mines will be opened around the world. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 29, 2010, 3:40pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/376 "2010-10-29T15:40:14Z")
> [@RickJay](#): > > Well, it might. It might cause them to change their behaviour in ways you don’t expect. It might cause offshoring to simply shift to India, Indonesia, or other countries. It might cause a fucking war. The truth is that you don’t really seem to have a clue what it will do - which is understandable, because nobody could say for sure what such a sudden about-face and shock to world trade would do. Retaliation DOES change behaviour, but quite often in ways you don’t expect or want. If you punch someone in the face, don’t be surprised if they punch back. Yeah but the alternative you propose is to keep letting them flick our ear on the bus every morning. I think in a punching match, we kick their ass and take names, they won’t risk it, they’ll back down. > [@](#): > > Hellestal has provided a detailed, honest, clear and sometimes even passionate explanation of why the USA’s first moves should be getting its OWN fiscal and monetary house in order, and using its OWN currency to address its trade deficit (which, importantly, has the advantage of affecting all of America’s trade relationships, not just the one with China.) It has been further pointed out that there exist international and diplomatic mechanisms that exist for precisely these sorts of problems, and that exploring solutions though those channels has barely even been started. You ignored, or didn’t understand, those points, and simply want “retaliation.” Do YOU understand what he proposed? Tell me, what exactly did he propose? As far as i can tell, he is proposing inflationary policy in a Post ZIRP world. The Fed have vocally expressed their concerns about deflation and STILL we don’t see inflation. One thing that will do the trick right now is significant wage inflation (as pointed out by Hellestal (citing other authority), wage inflation WILL pull us out of this recession, wage inflation will even reduce unemployment. But there is little apetite for increased and prolonged unemployment or welfare and there is no chance that we will give government employees a raise so what do we do? Well, the fed seems to be heading towards quantitative easing in the from of buying longer maturity treasuries, which will serve the dual purpose of injecting more cash into the system while lowering interest rates. However if people are willing to accept low interst rates because of deflationary concerns, they won’t use that cash, they’ll jsut roll it into longer maturity bonds. E.g. bank is told to sell half its 5 year treasuries to the Fed, they get cash and normally would lend it out but these days, they just turn around and buy 10 year treasuries. They aren’t going to increase everyone’s credit card limit, they aren’t going to make loans that they wouldn’t be making today just because they have more cash on hand. We need jobs, not lower interest rates and there is almost nothing the fed can do to spur demand if people are satisfied with almost zero interest rates. Once you are in a deflationary spiral, what can the fed do exactly. Maybe I’m missing something here. Please enlighten me because you seem to want to put off the one course of action that while painful in the short term, is almost sure to work. BTW, its not really a useful argument to just call me childish. I may think you’re being stupid but I don’t make that my argument. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [October 29, 2010, 6:21pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/377 "2010-10-29T18:21:01Z")
> [@Damuri\_Ajashi](#): > > Yeah but the alternative you propose is to keep letting them flick our ear on the bus every morning. You need to stop assigning to me things I have not said, or even suggested. I have not stated that nothing should be done about it. I have, in fact, corrected you on this again and again. Are you imagining things, or confused in some way? > [@](#): > > I think in a punching match, we kick their ass and take names, they won’t risk it, they’ll back down. Again, I don’t see how starting a damned war isn’t just really stupid. You’re assuming (wrongly) that people who don’t see things your way want to do nothing at all, and suggesting - without evidence, or for that matter anything approaching a solid case - that the solution is to “kick ass.” History would strongly suggest that countries that try to solve their problems by “kicking ass” usually end up losing more than they gained. > [@](#): > > Do YOU understand what he proposed? Tell me, what exactly did he propose? You seriously want me to **retype a post in this thread?** ---
**Author:** ![Le\_Jacquelope](https://avatars.discourse-cdn.com/v4/letter/l/e0b2c6/32.png) [@Le\_Jacquelope](https://boards.straightdope.com/u/Le_Jacquelope)\ **Post date:** [October 29, 2010, 7:54pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/378 "2010-10-29T19:54:35Z")
> [@RickJay](#): > > Which would be precisely what you want. **You are confidently predicting the exact thing that will solve the problem you allege is causing the recession.** Read this very carefully: in the eyes of capitalism, the collapse of the dollar is neither good nor bad: it is merely a point of data. It is merely a case of cause and effect. The cause of the US dollar’s collapse is already here; the arrival of the effect (the actual collapse) is, at this point, a matter of when, not if. No country can maintain a healthy economy when its imports vastly exceed its exports into perpetuity. Don’t get all bold faced at me because I’m the messenger. You should be glad the mods haven’t kicked me out of here yet before I could advise you to prepare. Get to know your local farmers. Know who you can rely on when shit hits the fan. Invest in solar for your home. If I’m totally wrong then at least you’ll get your basic necessities at a discount: you can’t lose, man. I’m tellin ya this because I love ya. In a brotherly way and all. > [@penultima\_thule](#): > > _“When the facts are on your side, argue the facts. > When the law is on your side, argue the law. > And when you have neither the law or the facts on your side, bang your fist on the table!”_ Your response is truly amusing, you know that? In a passive-aggressive “you’re banging your fist on the table but I don’t wanna get busted for saying that outright” way. And to think that it was guys on your side that first pulled the “99% of all economists disagree with you” argument. Now you’re offended that the same tactic is being used in retaliation. Like I said… how amusing. And totally predictable. So… if the facts are not on my side, then why don’t you answer this, since no one else can: Where are all those great, better paying jobs that offshoring was supposed to give us? Isn’t it kind of odd that such a simple question posed by a guy that all liberals and conservatives here despise, turns out to be so hard to answer? ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 29, 2010, 8:02pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/379 "2010-10-29T20:02:55Z")
> [@xtisme](#): > > Since you’ve decided to go all hostile, I’m happy to oblige, especially in light of the fact that the rational posts by more knowledgeable posters have pretty much bounced off the heads of you and the OP and the small numbers of others on the side of chicken-little… You have no idea what you’re talking about do you? You have adopted an orthodoxy that does not brook any dissent. > [@](#): > > Probably for the same reasons you won’t admit you don’t have a clue on this subject…because we both like to hear ourselves talk. Yeah the difference is that I have some idea what I’m talking about. Those rational more knowledgable posters you talk about (Hellestal is the only one as far as I can tell but if you’d like to identify others please do so) agrees with almost everything I say except they prefer a different approach than I do. An approach I may add that has been proposed by nobel prize winning economists. So no I’m not some ignorant uninformed nutjob, you’re just having trouble seeing past your own orthodoxy. > [@](#): > > The solution you have proposed has not worked in the past, and it won’t work now either, yet you keep bringing it up, despite the fact that you’ve repeatedly been shot down. It has worked plenty of times, in fact the WTO recognizes the efficacy of the approach and uses it to compel countries to stop infair trade practices. > [@](#): > > Yeah…they fear it alright since it caused one of the worst world wide depressions in history. And, coincidentally, it caused our own economy to further melt down as well. THAT’S a great solution to the problem, no doubt. 😛 ONCE AGAIN, I am not (and I don’t even think the OP is ) suggesting ressurecting Smoot-Hawley. I would add that the only reason Smoot Hawley was so disatrous was because people retaliated. We are in effect letting China get away with a Smoot Hawley beggar thy neighbor approach without retaliating. Do you really not understand the differences here or are you just being obstinate? > [@](#): > > I doubt it. They think they have a winning formula going, and are trying to stick with it. What’s going to be funny is when they hit the wall and can’t figure out why everything changed. Right because the Chinese are notoriously short sighted… pffft. The Chinese think decades ahead. They have already figured out how they are going to get out of the corner theya re painting themselves into. > [@](#): > > What will be even more funny is when folks like you and the OP switch to ranting about India next, or some other country…the same way folks all chicken-little frantic about Japan have now switched their tune to China instead. There’s a difference between China and Japan. China has a BILLION people. > [@](#): > > Perhaps they do. Have you considered that the majority of the worlds economist might (MIGHT mind you) know something you don’t? There seems to be this assumption that you and Rick jay have the backing of the world’s economist and yet I (along with the OP) am the only one that has cited an economist. The economist seem to be unamimous in saying that China is manipulating its currency and that this is slwoing our economy. SOME economists think we should follow one course of action and others think we should follow another course of action. Some of those economists think that my course of action is exactly the one to pursue. So please cite the overwhelming support you have from the world’s economists (if you can exclude the economists that believe in supply side economics or thin that Ayn Rand is a quasi deity, it would be appreciated). > [@](#): > > And, possibly something the Chinese don’t? They are sort of new to this whole Capitalist game thingy, after all, so perhaps they don’t know everything. And you…well, the less said there the better, ehe? You are talking about some pretty basic economic principles. You can find this sort of stuff in intro to econ textbooks. You don’t think they study that stuff I in China? You don’t think the Chinese are farsighted enough to have some sort of plan? Economics is not static, it evolves as societies evolve. For example, lets say that trench warfare was the epitome of military strategy at one point in time. Then someone invented the tanks and bombers and people had to reevaluate the role of trenches in warfare. People still used foxholes and pillboxes but people generally stopped using trenches. In much the same way, people no longer engage in full blown mercantalism but that doesn’t mean that you can’t have SOME mercantalistic elements of your economic policy. If your reaction to economic input is formulaic, others will be able to use that against you. > [@](#): > > This thread is ABOUT offshoring…that’s the topic of the OP’s rant. S/he certainly seems to think that it’s the ‘only’ problem, or, at least that it’s the most significant part of the problem. I don’t agree with the Op and wouldn’t have gotten very involved with this thread if I didn’t heard such blind adherence to the orthodoxy of the lesson of smoot-hawley. > [@](#): > > Seriously…WTF are you on about? Do you not speak and read English? Or were you deliberately trying to twist my point into a pretzel that doesn’t resemble what I was saying in the slightest? Oh? Really? Then what did you mean when you said that we have priced ourselves out of the labor market (and its all the fault of the labor unions according to you) and that our expectations for our standard of living were unrealistic? How much would we have to lower our standard of living to be competitive with teh Chinese? How far back would we have to dial back the clock on the labor movement to become competitive with the Chinese? Are these things preferable to eliminating Chinese market manipulation? > [@](#): > > On the up side, it’s a really good appeal to emotion. To bad it really has nothing to do with what I was saying, but, hell, with the OP that probably scores you double points. Yeah, because my argument is purely based on xenophobia. > [@](#): > > Offshoring has nothing to do with China manipulating market forces. Their currency policies do. So you don’t think that what theya re doing to suppress the value of their currency is market manipulation? > [@](#): > > If China stopped manipulating their currency tomorrow it wouldn’t substantially change offshoring, wouldn’t bring back the blue collar manufacturing bacon to the US…it would simply shift low wage manufacturing to another country, if anything. Another country that still wouldn’t be the US. Why don’t we see what Hellestal has to say for the notion that rise in the RMB versus the dollar would not shift some production to the US. I think you’re wrong. I might be mistaken but I am pretty sure that a dropping dollar and rising RMB is going to shift production from China to the US. You see what China is doing not only suppresses their currency, it boosts our currency. So when they stop doing it, our currency will drop (making us more competitive versus teh entire rest of the world) and raise Chinese currency (making them less competitive versus the entire rest of the world). Do you even know HOW they are manipulating their currency? > [@](#): > > Then your position is foolish and would lead to the destruction of the US. If we tried to manipulate our currency to artificially drop it’s value it would do so against every currency in the world. This would have catastrophic consequences. The fact that you are seriously proposing this is a pretty good indication that you don’t have even the first idea of what you are talking about on this subject. Ironic that you told me to shut up and listen. Well, then you dont understand my position. My position has been that we should engage in retaliatory tariffs against the Chinese. Hellestal is the one I think is suggesting that we manipulate our currency with quantative easing > [@](#): > > The iPhone was designed and developed here. Once it was designed and developed, and the manufacturing processes and logistics of production were worked out, THEN it was manufactured in China. Yeah, I know. Where do you think Apple is sourcing most of the income assiciated with the production of the Iphone? Here or China? > [@](#): > > I think there are plenty of smart people in China and India. That’s sort of the point…we can’t force other countries to give us a free ride. I also think that the US can still play a role in design and development. And if we can’t, then we can’t…c’est la vie and welcome to the world, post-US superpower. A couple of points. If I was perfectly fine with relinquishing our dominant position ebcause it was the globally efficient thing to do, I would STILL object to Chinese currency manipulation as being sub-optimal. On the other hand, if I took the perspective that EVERY OTHER COUNTRY IN THE WORLD takes that the domestic economy is more improtant than the rest of the world and we only support free trade to the extent it is to our benefit (and it is generally to our benefit), thenI think there are things we can do to maintain our position. Or do you think that everything is determined at the micro level, that national polcies and diplomacy have nothing to do with how economies evolve. I guarantee you that after over a century of economic domination by western powers, the Chinese are VERY cognizant of the fact that the playing field can be warped to the advantage of one party or the other. > [@](#): > > Yeah…I got that from you already. That seems to be the only hammer in your chest, and all the economic problems seem to be nails, where you are concerned. This has been going on for years. We have tried diplomacy, I think we have exhausted all politically viable monetary policy. You seem to think there are all these other better more viable options to address the problem that we haven’t been using. What are these tools that are in your toolbox? Specifically what are they? > [@](#): > > As a last resort and if they are focused narrowly, then perhaps that will end up being the way to go. But we haven’t gotten there yet. > > And, as I said, even if we do manage to get China to chance their monetary policies and open up their currency and allow it to adjust to it’s natural level that STILL won’t solve the offshoring ‘problem’, nor will it bring all those low paying manufacturing jobs back to the US. You don’t seem to get that, and certainly the OP doesn’t get it at all. You seem to think that I’m in favor of getting back every job that we ever lost. Everything from buggywhip making to electronics manufacturing. Our economy needs about 1 or 2% extra growth a year for perhaps a decade to get back into the saddle. Chutting down Chinese currency abuse may not get us all the way there, but its a big chunk. Economies grow at the margins, the shift in currency exchange rates will shift more than a marginal amount of production to the United States, we will either import less or export more or both, but in any event it will be more efficient over the long term. I don’t think our economy is doomed over the long term, I think that our challenge is to regulate the rate of change so taht domestic displacement does not overwhelm our economy’s ability to absorb that duisplacement. In 50 years, China and india are going to vibrant trading partners but in the meanwhile we have to survive the transition and we are a few percentage points worth of growth short of that goal. > [@](#): > > And when they want to continue to sell goods and services here in the US? How will that help them? Didn’t you jsut say that they could replace their US$::RMB peg with a EURO::RMB peg? I’m just sayign that there is an exit strategy from the US $. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 29, 2010, 8:11pm UTC](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912/380 "2010-10-29T20:11:32Z")
> [@Le\_Jacquelope](#): > > Neither you nor Hellestal can answer this: where are all those great, better paying jobs _that offshoring was supposed to give us?_ Hmmmm? Where are they? America’s workers are waking up to the bullshit of globalism and the race to the bottom. Your sales skills are seriously not strong. American voters better have answers soon or their wrath will force arguments like yours aside. With all due respect, I don’t think that’s a China problem. I think that is an American problem. China doesn’t let companies dictate terms to them; they dictate terms to corporations who want to do business in China. I guarantee you that corporations are much more interested in the American market than they are in any other market in the world but we act like corporations won’t want anything to do with us if we impose a few rules on them or if we tax them or if we tax their CEOs. And then they move their operations to China anyway after they take advantage of all the tax incentives we threw at them to cash out of the US and double down somewhere else. [Previous page](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912.md?page=18) [Next page](https://boards.straightdope.com/t/offshoring-the-snake-that-is-eating-itself/555912.md?page=20)