The decade or so after the end of WWII was an anomaly. The US was the only major industrialized country that didn’t have its infrastructure blown to smithereens. And don’t forget that the current workforce represents a much larger percent of adults since many more women work now than did in the 1950s. It’s a testament to the robustness of our economy that we could absorb so many additional workers and still have relatively low unemployment. Naturally, unemployment is going to rise in a recession, and the current situation is almost as much of an anomaly as the 1950s were in that respect.
Not the unemployed, who are earning $0. At least Chinese farmers have their food covered.
Great deal… they can at least afford college. This is falling out of the reach of more and more Americans at a time when a college education is starting to make the difference between a job as a receptionist and unemployment.
If our infrastructure had been blown to smithereens we could actually innovate in construction and public works. There would be jobs galore for decades.
How do you think Japan rose up so fast? They had a clean slate with Tokyo. So high-tech cities arose and the bullet train arrived. Even without that, they have a public transit system that would put San Francisco to shame.
Unemployment was already high before the recession. Our U6 numbers were hovering around 9%. Unemployment is a highly skewed figure in America that doesn’t count a lot of particularly negative issues. We did not have job growth during the Bush years.
No, unemployment in one year in the 1950s was 3%, according to your own cite.
Define “employee’s market.” What level of unemployment is an employee’s market?
I’m sorry, but do you not read the things you’re replying to? Jesus Christ, man. Yes, a gallon of gasoline had a cheaper nominal price in 1955, but then the average wage was a buck fifty an hour. If you adjust for inflation, Americans make more now than they did in 1955.
Again, since it seems I wasn’t clear enough: the $26,000 figure I cited is adjusted for inflation. In 1955 dollars, the average American in 1955 made just $3,301.
This is true in the VERY recent past, but you’d expect that, since we’re in a recession. Over the course of the last number of decades it’s simply not true at all.
Go drive around an older middle class areas and tell me the standard of living was higher.
You’ll find a lot of two-bedroom, one bathroom houses. That’s one bedroom for the parents and one for the kids. You’ll see houses with carports instead of garages, and room for only one vehicle. You will not find walk-in closets or other large storage spaces, because people didn’t have a ton of crap (certainly not enough to need self-storage spaces, which I find an amazing phenomena.) You might, however, find a pantry where people could store the fruits and vegetables they canned when produce was cheap and in season. You’ll see spaces in the backyard for drying clothes on clotheslines. You likely won’t find central heating or air conditioning. The kitchen probably will not have room for all your kitchen gadgets, and stuff like double ovens would be unheard of.
Or think about the stuff that gets deducted from your bank account each month. Chances are you have a cell phone plan, Netflix, and maybe WOW or some other entertainment. You probably have cable and internet to pay for. You might have a gym membership.
Now think about that in the 1950s. They probably had an electricity and phone bill- and that’s it.
[aside]I beg to differ, eh.[/aside]
“since there is no free trade regime with China today”
Let’s say that I have a bulk carrier loaded with sugar which I can sell at world parity price. Do you think making that trade would be easier with China or US buyers?
What does this have to do with whether or not the US has a free trade regime with China?
[quote=“Le_Jacquelope, post:42, topic:555912”]
I know, through experience, that you can eat like a king out of America’s dumpsters.
About 1/3 of Chinese college graduates do not have college-level jobs waiting for them on the other side and will have to find unskilled jobs in factories, restaurants, etc. A greater percentage of people have been tracked into career paths that lead to undesirable jobs. My students, for example, were pretty much forced to become rural primary school teachers. This doesn’t sound so bad, until you realize that a shoe-shine girl in a big city can easily make in a day what a rural primary school teacher makes in a week- but once my students are classified as “rural” residents they cannot legally work in the city or take advantage of the city’s far superior schools, health systems, etc. Moving to a “city” residence permit is comprable to a Mexican farmer legally moving to the States- it can be done through marriage or a few other means, but it’s unlikely.
Trust me, even the American unemployed are MUCH better off.
Well, we could blow it up ourselves. Is that what you recommend? Would that improve things?
Japan is one of the most densely populated countries on earth. What works in Japan won’t necessarily work in the US. But public transportation isn’t really what we’re talking about in this tread anyway.
The unemployment rate in 2007 was 4.5%.
Wrong. Job growth was slow, but it wasn’t zero. Unless you have a cite that says otherwise…
I definitely feel for the Chinese, but their own currency peg artificially lowers their living standards. It’s in your students’ interests to get rid of the currency peg.
So, what would happen to our standard of living if we negated that artificially low pegging of their currency by imposing tariffs?
The Chinese currency peg affects all imports and exports. My proposal, which is to first litigate at the WTO, doesn’t implement any countervailing tariffs immediately. Even if we did implement tariffs, they would only be against one specific country–China–and not against the entire spectrum of countries on the Earth, so it doesn’t even equate to the currency peg. I also proposed phasing in the tariff to minimize disruption.
So, let’s see what the possible ramifications of this are: (1) manufacturing moves either to other low-cost places with floating currencies, so we get equivalent prices or it moves back to the US which is good for the US and (2) the Chinese might dump some of their bonds which has the effect of quantitative easing on the US, which is also good. All in all, I think the standard of living in the US will survive quite fine.
So, for some reason, you’ve decided to equate a currency peg which impacts all exports and imports across the board with a targeted tariff against one country. I’d like to think you had a particular argument in mind, so why don’t you present it?
ETA: There’s also the third possibility which is the Chinese drop their peg and everyone benefits.
I just asked a question. I don’t know why you’re assuming some ulterior motive.
What would happen to our standard of living if we imposed tariffs on China?
Seems to me that all of your scenarios mean higher prices for goods. You can’t just move operations from one country to another country without incurring some cost.
I rarely leap to defend China, but where do we get the balls to tell China what to do? Why should they have to run their country the way we want them to for our benefit? I promise you, all of our “free trade” rhetoric is not for the benefit of the world on the whole. We push it because it benefits us.
The truth is, we all benefit from trade with China.
As a member of the WTO, China is obligated to play by the rules. Now, we have to make the case to the appropriate body in the WTO, but if the decision is that they are not in compliance, they risk getting kicked out. It was a long time coming for them to get in when they did.
I’ve given you an answer. You want to assume that the standard of living in the US must drop because you like the current trade regime. Fine. But you should start defending it on it’s own merits, rather than trying to equate it with free trade.
I don’t see how it follows that higher prices are a necessary result. Businesses move all the time, and that’s simply a cost of doing business. Market forces should theoretically push prices to their lowest marginal cost, and there are plenty of places in the world with lower marginal costs than China.
But even if the cost rises somewhat, so what? Why is it okay for the Chinese to manipulate the market to produce goods with artificially low prices? Why shouldn’t people actually have to pay the true marginal cost of a good rather than relying on artificial mechanisms to lower the prices?
They have the balls to tell us what to do. They have demanded we turn over our electric car technology before they will consider the next trade talks.
They hold us ransom due to the geniuses of the financial world who they had to bail out. They hold us ransom because they now have the industries and jobs we turned over to them. They have a growing economy. Ours is sucking. I do not see how that benefits us all.
“Why shouldn’t people actually have to pay the true marginal cost of a good rather than relying on artificial mechanisms to lower the prices?”
The Chinese are not dumping goods in the US.
There are provisions in WTO defining the practice of dumping and allowing countries to levy dumping duties where the case is made. There is no suggestion that China is selling its goods below the cost of production. If there was the US would be all over it like seagulls over spilt chips.
No, I don’t “want” to assume anything. I want to understand what will happen.
No, businesses don’t move “all the time”. They move when they have to, and there is an expense to doing so. It takes time and money to move manufacturing from one country to another. Your analysis just hand waves away these costs.
I’m not interesting in punishing the Chinese on principal if it will end up raising prices. If they want to have a crappy standard of living so we can have a good one, I’m not going to stop them.
Trade can be lose-lose when everyone has tariffs. But that doesn’t mean you have win-lose when one puts up tariffs and the other doesn’t.