An Economic Race to Third-world Wages?
Posted by Gabriel Kent on July 7th, 2008
Recently I had a conversation with Paul_W regarding a piece I wrote for NowPublic. The conversation happened in the comments section of the article, so I will just reproduce it here. Enjoy!
—
Paul_W
at 01:40 on June 12th, 2008
“While Pinker’s questions are valid their conclusions do not appear to be consistent with how China is growing both technologically and scientifically.”
Were it not for Western capital investments in China and greedhead capitalists outsourcing their fellow Americans jobs to China, China wouldn’t have such growth “both technologically and scientifically”. But ‘Muricans are too stupid to realize that. Keep voting Republican and Democrat. Let’s all enjoy our economic race to third-world wages.
futureprogress
at 03:47 on June 12th, 2008
I don’t think invoking the stupidity of Americans is important to your argument. Namely, should jobs be outsourced to China (or anywhere else for that matter)? As a firm believer in free markets, I am inclined to answer yes. Every private organization should do what they feel will bring more value to their shareholders, including capital investments in foreign ventures.
The problems do not really stem from the changing employment patterns in the U.S., the problems stem from government repression in the marketplace, specifically, allowing less money to be controlled by the people to act in their own interests. These policies have a further effect on supporting local monopolies by shielding them from competing with monopolies in other countries which further inhibits smaller competitive growths in those markets.
Small business is adaptable and fuels much of the economy so that the outsourcing of jobs is a temporary adjustment in an open market. Again, the problems you seem adamant about come from the Governments intrusion on our rights, not cheaper labor in China.
Paul_W
at 10:55 on June 12th, 2008
I mean no disrespect to you, futureprogress, but I’m always amazed at the people who believe that sending your friends, your neighbors, and your family’s jobs overseas is a good thing. Not only will your friends, your neighbors, your family and possibly even yourself compete for third-world wages and jobs without benefits such as health insurance, the hard won advances that our workers made over the last century are going down the tubes simply for the benefit of the owner-class. The working class gets nothing out of the deal.
The decision to offshore is made by capitalists and by government- capitalists for the profits and government passes the laws which enable them to do so. If you think that by keeping more of your money from government repression (taxes) is the trick, you are further deluding yourself. Individuals acting in their own interests are impotent against the power of government and multinational interests working against them.We build China’s and India’s economies at the cost of our own, but some think that’s a good thing. Unbelievable.
futureprogress
at 17:57 on June 12th, 2008
Paul, I completely agree with your sentiment… no one wants to see a neighbor, friend or family member suffer.
I think we can also agree that the Government has been the single largest source of economic instability. In reality, it is the desire of the consumer to overwhelmingly ask our elected officials to spend someone else’s money on us but not to spend our own money on anyone else. This is why a free market system is more ideal as it takes money from the Gov and returns it to the people so that each can act in accordance to their principal wants and desires creating an optimized system of micro-managed control with micro-distributed loads. If individuals are able to act in their own interests with more of their money, than that means less money is going to subsidize the loss of our freedoms, namely, into Government controlled programs that do much more harm than good.
“Nobody spends someone else’s money as carefully as they spend their own. Nobody has the same dedication to achieving someone else objectives as they display for their own.” - Friedman
You are correct however, giving less money to the Government is only part of the solution. To really make it stick, we need constitutional amendments for prohibiting state/fed governments from setting price controls and to stop congress from creating tariffs or setting limits. We also need to open our marketplace by unilaterally eliminating all tariffs, ideally over a five year period with a 20% decrease each year. This will ultimately remove many of the Government perversions to the free market and thus remove many of the unfair advantages given to the largest of corporations causing them to actually have to compete.
I have two questions for you:
- How do you propose we stop jobs from going to more competitive markets overseas?
- Do you believe that stopping jobs from going overseas contributes to our economic growth or does it stagnate our growth?
When answering those I would like to point a few things out to you:
- Empirically, wage and price controls have always failed in practice… and in the end, have shown to always increase inflation
- When the Gov. pays subsidies to unions it creates an environment where smaller groups or individuals cannot (in a lot of cases by law) participate in the market
- A workers real protection is their skills and willingness to work… not unions, tariffs and various other Gov. subsidization
- What protects consumers is alternatives in suppliers, what protects workers is alternatives in employers
Lastly, we do build China and India’s economy at some cost to us however we do so for some benefit to us as well. This idea is no stranger than investing your money into a venture that you firmly believe will bring you a positive return. Again, the issue is not _if_ we should invest in the growth of another country but who should do the investing and in what environment.
The working class is being squeezed; Gov. perversions to the marketplace on one side and a evolving global marketplace on the other. Without one of those the other probably would not hurt as much… but given that both are a reality there is real pain happening today. Should we attack the evolution of the global marketplace or should we attack the perversions that stop us from adapting and thus more greatly benefiting from the evolution?
Paul_W
at 15:50 on June 14th, 2008
Hi futureprogress,
To answer your two questions:
1. We should stop the bleeding of our jobs going overseas either by re-instituting tariffs which we had and our economy flourished with for over 200 years, and/or not doing business with nations which do not meet our minimum labor standards (min wage, 40 hr. work week, etc), standards which American workers fought hard to gain the last century.
2. Stopping jobs from going overseas will increase employment here, increase investment here, maintain or increase wages as well as taxes.
We build competing nations economies at the cost of our own, one current example being that by enriching India’s and China’s economies, they are now able to compete with us for oil which is one of the factors in high gas prices now. Brilliant, huh?
—
I appreciated this volley with Paul. Though I do not agree with his solutions, I do believe he echoes the sentiments of many Americans. However, we must judge policies on the merits of their results and not their intentions. History shows that opening the marketplace to the world is a good thing.
I recommend this EconTalk podcast as being relevant to this thread.
Thanks again Paul 
Posted in Economics, Free Market, conversation, government, jobs, overseas, price controls, subsidization, tariffs, wage controls, wages, working class | Comments (0)
Public Comments
2010 DEHISTROY.US | Share & Share-alike.
Recently I had a conversation with Paul_W regarding a piece I wrote for NowPublic. The conversation happened in the comments section of the article, so I will just reproduce it here. Enjoy!
—
at 01:40 on June 12th, 2008
“While Pinker’s questions are valid their conclusions do not appear to be consistent with how China is growing both technologically and scientifically.”
Were it not for Western capital investments in China and greedhead capitalists outsourcing their fellow Americans jobs to China, China wouldn’t have such growth “both technologically and scientifically”. But ‘Muricans are too stupid to realize that. Keep voting Republican and Democrat. Let’s all enjoy our economic race to third-world wages.
at 03:47 on June 12th, 2008
I don’t think invoking the stupidity of Americans is important to your argument. Namely, should jobs be outsourced to China (or anywhere else for that matter)? As a firm believer in free markets, I am inclined to answer yes. Every private organization should do what they feel will bring more value to their shareholders, including capital investments in foreign ventures.
The problems do not really stem from the changing employment patterns in the U.S., the problems stem from government repression in the marketplace, specifically, allowing less money to be controlled by the people to act in their own interests. These policies have a further effect on supporting local monopolies by shielding them from competing with monopolies in other countries which further inhibits smaller competitive growths in those markets.
Small business is adaptable and fuels much of the economy so that the outsourcing of jobs is a temporary adjustment in an open market. Again, the problems you seem adamant about come from the Governments intrusion on our rights, not cheaper labor in China.
at 10:55 on June 12th, 2008
I mean no disrespect to you, futureprogress, but I’m always amazed at the people who believe that sending your friends, your neighbors, and your family’s jobs overseas is a good thing. Not only will your friends, your neighbors, your family and possibly even yourself compete for third-world wages and jobs without benefits such as health insurance, the hard won advances that our workers made over the last century are going down the tubes simply for the benefit of the owner-class. The working class gets nothing out of the deal.
The decision to offshore is made by capitalists and by government- capitalists for the profits and government passes the laws which enable them to do so. If you think that by keeping more of your money from government repression (taxes) is the trick, you are further deluding yourself. Individuals acting in their own interests are impotent against the power of government and multinational interests working against them.We build China’s and India’s economies at the cost of our own, but some think that’s a good thing. Unbelievable.
at 17:57 on June 12th, 2008
Paul, I completely agree with your sentiment… no one wants to see a neighbor, friend or family member suffer.
I think we can also agree that the Government has been the single largest source of economic instability. In reality, it is the desire of the consumer to overwhelmingly ask our elected officials to spend someone else’s money on us but not to spend our own money on anyone else. This is why a free market system is more ideal as it takes money from the Gov and returns it to the people so that each can act in accordance to their principal wants and desires creating an optimized system of micro-managed control with micro-distributed loads. If individuals are able to act in their own interests with more of their money, than that means less money is going to subsidize the loss of our freedoms, namely, into Government controlled programs that do much more harm than good.
“Nobody spends someone else’s money as carefully as they spend their own. Nobody has the same dedication to achieving someone else objectives as they display for their own.” - Friedman
You are correct however, giving less money to the Government is only part of the solution. To really make it stick, we need constitutional amendments for prohibiting state/fed governments from setting price controls and to stop congress from creating tariffs or setting limits. We also need to open our marketplace by unilaterally eliminating all tariffs, ideally over a five year period with a 20% decrease each year. This will ultimately remove many of the Government perversions to the free market and thus remove many of the unfair advantages given to the largest of corporations causing them to actually have to compete.
I have two questions for you:
- How do you propose we stop jobs from going to more competitive markets overseas?
- Do you believe that stopping jobs from going overseas contributes to our economic growth or does it stagnate our growth?
When answering those I would like to point a few things out to you:
- Empirically, wage and price controls have always failed in practice… and in the end, have shown to always increase inflation
- When the Gov. pays subsidies to unions it creates an environment where smaller groups or individuals cannot (in a lot of cases by law) participate in the market
- A workers real protection is their skills and willingness to work… not unions, tariffs and various other Gov. subsidization
- What protects consumers is alternatives in suppliers, what protects workers is alternatives in employers
Lastly, we do build China and India’s economy at some cost to us however we do so for some benefit to us as well. This idea is no stranger than investing your money into a venture that you firmly believe will bring you a positive return. Again, the issue is not _if_ we should invest in the growth of another country but who should do the investing and in what environment.
The working class is being squeezed; Gov. perversions to the marketplace on one side and a evolving global marketplace on the other. Without one of those the other probably would not hurt as much… but given that both are a reality there is real pain happening today. Should we attack the evolution of the global marketplace or should we attack the perversions that stop us from adapting and thus more greatly benefiting from the evolution?
at 15:50 on June 14th, 2008
Hi futureprogress,
To answer your two questions:
1. We should stop the bleeding of our jobs going overseas either by re-instituting tariffs which we had and our economy flourished with for over 200 years, and/or not doing business with nations which do not meet our minimum labor standards (min wage, 40 hr. work week, etc), standards which American workers fought hard to gain the last century.
2. Stopping jobs from going overseas will increase employment here, increase investment here, maintain or increase wages as well as taxes.
We build competing nations economies at the cost of our own, one current example being that by enriching India’s and China’s economies, they are now able to compete with us for oil which is one of the factors in high gas prices now. Brilliant, huh?
—
I appreciated this volley with Paul. Though I do not agree with his solutions, I do believe he echoes the sentiments of many Americans. However, we must judge policies on the merits of their results and not their intentions. History shows that opening the marketplace to the world is a good thing.
I recommend this EconTalk podcast as being relevant to this thread.
Thanks again Paul
Posted in Economics, Free Market, conversation, government, jobs, overseas, price controls, subsidization, tariffs, wage controls, wages, working class | Comments (0)
Public Comments
2010 DEHISTROY.US | Share & Share-alike.