The US government and companies moving jobs overseas.

Great Debates
121

Well, actually Gllrnz, I DID give you some options for your theoretical Jorge and so did msmith537…you simply ignored them, as you’ve ignored all the posts from the various people trying to explain this stuff to you. If you want to remain ignorant, thats your affair, but there are enough basics in this tread (and do a search…I’ve seen a similar threads to this about every other week) that you should be able to get at least an inkling on how this stuff works. Its quite obvious that your 9 credits in economics in college were wasted on you, as you aren’t even argueing the protectionist line very well.

From Gllrnz

Ok Gllrnz, how does the free market work in theory (to you) and how does reality not equal theory? Maybe if we start at the basics of what YOU think, we can move from there.

From Gllrnz

Are you claiming that this is a system wide net effect for the country?? Do you have a specific cite that this is in act happening either now or in the past two or three years in the US on a systemic basis?? Or are you merely talking in the theoretical here, as this is patently NOT happening in America, either now or in the past 2 years on a systemic basis. You’d have to go all the way back to the Great Depression to find even a hint at what you are talking about in the US for a systemic problem like that.

These things happen in various regions from time to time no matter WHAT the economy is doing. Its called ‘real life’…give it a whirl sometime. :slight_smile: Neighborhoods rise and fall all over the country. But they don’t do it all at once and together. WHere some areas are hard hit, other are prospering nicely.
From Gllrnz

You are seriously missing the point. Shit happens in the real world. People lose their jobs, people go bankrupt, all kinds of bad shit happens to them. On the other side of the coin, people GET jobs, they make money and even get rich, and all kinds of GOOD shit happens to them. It balances out in the long run. Do I feel bad for the folks that have problems? Sure I do…especially as I’ve been in that boat myself. Thats why various safety nets have been installed into our capitalist system, to easy the pain of losing a job, to tide people over until they can find new employment, to make it so the market doesn’t have the huge highs and crashing lows of the past, etc.

You got one thing right…a lot of people don’t have a clue about how the market operates and only care about their jobs…thats understandable. Luckily for them (and you) there ARE folks that understand that, taken to logical ends, what you are advocating would destroy the US economy and result in the loss of jobs on a scale that would make our European friends proud. As its already been explained to you in this post several times (and as there are MANY threads about this same stuff on this board) I’m not going to go into it again.

As to your Bush comments you are working under some mis-apprehensions. I’m not a Bush fan and could give a shit if he loses the election…I won’t be voting for him. Sailor must be laughing his ass off, as he literally hates the guy. Most of the other posters who have responded to you don’t particularly like the man either, with perhaps John Mace being the only one either neutral or perhaps slightly in favor of him. This has nothing to do with Bush…it has to do with market economics, which its plain you don’t understand.

-XT

122

You are wrong about me.

I have not responded to any of Gllrnz’s posts.:slight_smile:

123

My appologies John, you are correct. :slight_smile: You absolutely have not responded to Gllrnz, and show again why you are a wiser man than I.

-XT

124

Apparently it didn’t stick.
And that’s Master of Business to you (which would be an addition 60 credits to your paltry 9).

125

That’s assuming perfect knowledge. If we could require the true conditions of the factory where something is made to be put on a tag, fine, I would also let the consumer decide. But, just as a consumer cannot be expected to read the research on drug safety, or food safety, I think in the real world we should have prohibitions on the sale of goods made in factories where human rights are violated.

sailor, this is very much on topic. Where does free trade end? Not when there is fair competition, but I think it ends where there is unfair competition, specifically the violation of human rights. It is not feasible to use trade barriers to enforce this, since that is too big a stick. It is feasible to punish US companies abetting human rights violations in factories. If they don’t know, they should. And don’t say it would be too expensive - it is just a cost of doing business.

That is a more general question - how much should companies getting the benefit of outsourcing be asked to cover the social costs now picked up by the government. Right now a lot of companies are dumping more welfare costs on the government, then whining that their taxes are too high. Real free trade should consider all costs.

126

I’m not in the label-requiring camp, but if that’s all you need it shouldn’t be too hard. If we can label the amount of saturated and nonsaturated fats in foods and whether tuna is dolphin safe or not, I think we could get the “no slave labor involved” tag going.

127

That’s all well and good, but it won’t change much. Actual “slave” labor is a tiny tiny fraction of foreign labor. The fact remains that it is simply cheaper for many companies to place their manufacturing facilities overseas. Wages are simply lower in these countries.

128

Just wanted to note that my earlier story re the Japanese intervention in the currency markets made the front page of The Financial Times this morning, and believe it or not, they’re actually going to spend close to a trillion dollars between now and the end of March to keep the yen from falling against the dollar. On top of that, they’ve raised the amount they’ve budgeted for their new fiscal year, which starts in April, to the equivalent (I checked my math twice this time) of 1.3 trillion dollars:

As I said before, this is out and out warfare. It should be treated as such, both by us and the Europeans, who are bearing the brunt of the downward pressure on the dollar resulting from our current account deficits.
Of course, recognizing this in public would also involve recognizing that the current account deficit is a problem, and is not helped by the fiscal deficit being run by this Administration, so I don’t expect anything to happen. But if the economy stagnates again, you need look no further than the above for the cause.
Either we recognize that Asia in general and Japan and China in particular are waging economic war against the West, or we condemn ourselves to a slow death by stagnation, all the while bickering over this silly free market ideology that fails to take into account what happens in the real world, where real governments do what they can get away with to impoverish others while enriching themselves and the nations they serve.
That’s the way the real world works.

129

So what exactly do you suggest should be done about it?

130

Simple: first of all, WTO rules shouldn’t allow for this sort of thing, and we should be pressing to have them changed to disallow it. Secondly, Bush could get off his ass and embarrass them publicly and often. Ditto for China, Malaysia, and Taiwan, all of whom are also playing this game.
If we made a major stink, something might happen. As it is, unless you’re following this situation closely, you wouldn’t even know it was happening. But it’s a major contributing cause, IMO the major contributing cause to why we’re having this thread in the first place.

131

Nice yellow peril there Pantom. Maybe you should draw a series of comics with the bucktoothed yellowface fu manchu caricature stealing U.S. jobs.

Since when it was it all east vs west? Europe has had several trade rows with the U.S. over the past few years. Including tariff on steel, the poultry industry, and all sorts of other issues. Portraying it as the wiley asians against the west is a little insulting and hardly the truth of the matter.

132

C’mon Quagmire, all your post has to it is an accusation of racism. Pantom has been very specific about what is happening, why it is happening, and what should be done about it. If you can provide us wth some reason for believing that Japan isn’t propping up the dollar to the tune of a trillion bucks, or that if it is doing so that it is not going to work as Pantom says it will, or that they’re not doing it for the reasons Pantom says, that’d be one thing. But for now, you got no thing.

133

Hmm, first time in four years for that one. Oh well.
You know, you really have to stare at those figures for a little bit for it to sink in. They’ve authorized nearly a trillion dollars of funds for intervention in the currency markets between now and March 31. That’s only three months away. At 930 billion, you’re talking 310 billion dollars - a month.
Over a trillion is authorized for the next year after that.
They don’t have to use all that money, but that’s what they’ve authorized.
The Japanese economy has been stagnant for what? 13, 14 years. And all they can think of is this stupid beggar-thy-neighbor policy? That’s shameful.
We have our share in the blame of course, for running these huge fiscal deficits and for having a very low savings rate - the last report was 3.3% of income, and it’s been bouncing between 3 and 3.7% so far this year. (see http://www.bea.doc.gov/bea/newsrel/pinewsrelease.htm)
But manipulating currencies, especially when it involves a threat to use such massive sums of money, is protectionist in the extreme. It’s meant as a subsidy to their exporters. Can you imagine the outcry if we directly subsidized our exports by using such massive amounts of government money?

134

Hi, pantom. I live far from NJ, but today I’m visiting your great state and participating in this thread from here. Isn’t technology great? :cool:

Anyway, I just keep getting back to this idea: People are going to do what they perceive is in their best interest.

Here’s just a brief list of examples:[ul]
[li]Some directors decide to build factories in third-world countries because labor is inexpensive (and transportation of goods, too).[/li][li]Some directors or factory managers decide to cut costs in as many ways as possible, including safety concerns, so long as no one fines them or boycotts them effectively.[/li][li]Some countries (e.g., Japan) spend mucho moola to manipulate currency markets because they can.[/li][li]Some corporate executives steal money from company coffers, mislead investors and regulators, thinking somehow they won’t get caught.[/li][li]Some mutual fund managers conduct similar shenannigans.[/li][li]Some (most?) politicians tacitly or explicitly offer their services in exchange for support.[/li][/ul] And IMHO, there is no reason for the people at large to accept this sort of behavior.

I guess it’s clear that I don’t think a free society or a free market remains free if you truly leave it alone. It seems pretty clear to me that without intervention, power gets concentrated in a few hands and the rest get what’s left. It can be relatively benign or ghastly, but that seems to be the inevitable progression.

And that’s precisely why people band together to petition the government, to boycott, to form labor unions, or even to rebel in some instances, to counterbalance the concentration of power.

But the questions remain:[ul]
[li]In a free society with a free market, how do you prevent people from using every means at their disposal to further their interests at the expense of others?[/li][li]How does a society decide where the line is on fair versus unfair practices?[/li][li]Given any enforcement or incentive mechanisms, how do you prevent its co-option?[/li][/ul]I really think we should be spending our considerable creative energies on these sorts of questions and not on debating whether free markets by themselves lead inevitably to prosperity for the masses. They don’t. Every process (trade, governance, worship, whatever) leads to a concentration of power unless something balances it.

(Which just happens to be why our system of government has worked as well as it has the past 200+ years.)

135

First of all, outsourcing overseas has nothing to do with fraud, theft or other corupt business practices and shouldn’t even be in the same list. Outsourcing is a perfectly acceptible and legal business practice.

Second, many companies are rethinking the idea of overseas outsourcing. There is a benefit to having services physically close to the customers. Travel costs money. Long distance communication costs money. Shipping costs money. Compensating for cultural diferences cost money.

136

Long before anything went offshore, jobs moved from the relatively expensive north to the cheaper south. Given a fair market, why should consumers pay a tax to support work done at $x an hour here when it could be done for $x/3 an hour somewhere else? Eventually wages there will rise, the people there can buy more, and the entire world economy can grow. Specialization is the name of the game. Sometimes it is hard for people - what happened to those tens of thousands of people taking care of horses when the auto came in? But it is best for the world economy.

137

Your preaching to the choir. There is no rational reason for a company not to move facilities where they can minimize costs.

138

Your selfless devotion to the starving Third World masses – even at the expense of your friends and neighbors – is duly noted. You must be some kind of super liberal. I salute you and the somewhat surprising array of other fellow travelers who have aligned themselves with the radical left on this issue. Together we shall march forward in brotherhood to bring not just Third World values, but Third World lifestyles and incomes to America!

There is just one little doubt I have. Maybe you can help me resolve it. It has occurred to me that, as America is the world’s largest marketplace for most everything except rice, most especially consumer goods, it might not be a good idea to, like, TOTALLY destroy their purchasing power until we have had time to tranfer a goodly portion of that purchasing power to the Third World. Shouldn’t we keep the American middle class at least halfway healthy economically until we have some healthy middle classes going in places like India and China?

Sure, once we have healthy middle classes in the Third World, the American middle class can and probably should be destroyed if only for having the temerity to have attained a halfway affluent lifestyle before anyone else did. But until then, maybe the American middle class serves a useful purpose for us leftists, eh?

Oh, and let me express my admiration for the dodge of seeking the destruction of the American middle class under the banner of free market conservatism. No one will EVER suspect.

139

You got it all backwards. Protectionism is a Third World value which is guaranteed to bring Third World incomes to America. Protectionism does much more harm than good.

140

I have some questions I’d like answered by the many free-traders posting here:

  1. Completely free trade will quickly even out differences in standards of living from country to country, except those resulting from a locally high per capita amount of natural resources, like oil in the Middle East. Therefore, countries that are rich now are facing a long-term, steep decline in their standards of living. Do you suppose this might lead to political instability (the kind that results in angry mobs breaking windows)? Should this be considered in making trade policy?

  2. Much of the technology that makes modern methods of production possible was financed by U.S. taxpayers. Are these taxpayers entitled to a return on their investment, or are they just pathetic suckers, like the guy who paid for an education in a field where nobody is hiring?

  3. It’s been stated that America will generate wealth in the future using new technologies, the way we’ve done in the past. But the conditions that gave America an advantage in coming up with new technologies (high education and research expenditures) are no longer limited to America, and besides, any great new idea is immediately exportable now anyway. Is there any reason to think America has an advantage in this area any longer, and if not, how are we going to maintain our standard of living? Or is this not to be considered by policy makers?

  4. Rights cost money. For example, giving people the right to a safe workplace means that coal mines have to spend money on safety equipment that does not contribute to profits. (If it did, there would be no need for occupational safety laws.) Doesn’t a democratic society have the authority to establish a reasonable set of rights, knowing full well that these rights are an economic drain? And doesn’t that society also have the authority to refuse to do business with companies that move production to foreign countries specifically to evade the costs associated with workers’ rights, even if it means sacrificing economic gain? It’s pretty easy to see whose interests are served by free trade, when you consider that most workplace rights peculiar to America are to the benefit of workers and to the detriment of owners. I posed this question in a more concrete form in the Wal-Mart thread, but mysteriously, it was ignored.

Also, spare me the sneering and arrogance. There are posters in this thread who are so eager to boast their supposed intellectual superiority, it makes one think they harbor some secret doubts about their position.