I knew I shouldn’t read Brooks’s most recent column, because he’s talking about the economy, and Brooks is always in over his head when talking about the economy. But then he’s in over his head about just about anything else, too. I suspect he could be quite the authority on many simpler things, such as cheese graters or crew socks, but anything that involves more than a couple of moving parts tends to confuse him.
Nevertheless I waded in, to find Brooks explaining that neither conservatives nor liberals really understand what’s wrong with the economy. But he has perceived that its problems are structural, not cyclical. “Fixing these structural problems should be the order of the day, not papering over them with more debt,” he says.
So what are these structural problems?
“First, there are those surrounding globalization and technological change. Hyperefficient globalized companies need fewer workers. As a result, unemployment rises, superstar salaries surge while lower-skilled wages stagnate, the middle gets hollowed out and inequality grows.”
I hadn’t noticed a need for fewer workers in those globalized companies, just cheaper ones, such as in Mexico or China.
There’s actually a free-market solution for that, though. Once there’s no middle class to play the role of “consumer,” the globalized companies won’t have any “consumers” around to buy their products, and the whole house of cards will collapse. A correction! Or, a depression!, depending on your point of view. But let’s go on.
“The United States, once the world’s educational leader, is falling back in the pack. Unemployment is high, but companies still have trouble finding skilled workers.”
I though they didn’t need workers? But is it true companies are having trouble finding skilled workers? I have heard of some isolated incidents, but I have a hard time believing this is a major trend.
“Over the decades, companies and other entities have implanted a growing number of special-interest deals into the tax and regulatory codes, making it harder for politically unconnected, new competitors, making the economy less dynamic.”
There may be something to this, but essentially it comes down to the big companies rigging the system to eliminate competition from smaller companies. Theodore Roosevelt had a similar problem to deal with, as I recall. In his case, government was the solution.
“These and other structural problems have retarded growth and wages for decades.”
Beside shipping jobs to Asia, what’s suppressing wages are a whole mess of other things, including the decline of unions, which Brooks doesn’t mention.
“Consumers tried to compensate by borrowing more. Politicians tried to compensate by reducing the tax bill, increasing deficit spending, ensuring easy credit for homebuyers”
Yes, blame the poor homebuyers, not predatory lenders, for the financial crash.
“… and by helping workers shift out of the hypercompetitive, globalized part of the economy…”
… since their jobs were lost forever to Bangladesh …
“…and into the less productive and more sheltered parts of the economy — mostly into health care, government and education.”
I hadn’t noticed that government was doing all that much to train people to take jobs in health care, government, and education, and in any case government jobs have been chopped all over the place lately. And I’m not sure what he means by “sheltered.” Is Brooks hallucinating?
“But you can only mask structural problems for so long. The whole thing has gone kablooey. The current model, in which we try to compensate for structural economic weakness with tax cuts and an unsustainable welfare state, simply cannot last. The old model is broken. The jig is up.”
Granted, the tax cuts aren’t doing a hoo-haw to get the economy moving, but the “unsustainable welfare state” is mostly a figment of the Right’s imagination. America is pretty chintzy on “entitlements” compared to a lot of other countries, but if Brooks can’t appreciate the structural role played by Medicare and Social Security and other props to keep the middle class from sinking into a third-world bog, then he truly is an idiot.
“Unlike the cyclicalists, we structuralists … “
“We structuralists.” That’s so … affected.
“… do not believe that the level of government spending is the main factor in determining how fast an economy grows. If that were true, then Greece, Britain and France would have the best economies on earth. (The so-called European austerity is partly mythical.)”
Translation: Brooks can’t believe genuine austerity is failing as badly as it is obviously failing in Yurp, so he assumes the Yurpeans must be doing it wrong. But the only partly mythical thing here is Brooks’s brain.
But let’s go back to “we structuralists do not believe that the level of government spending is the main factor in determining how fast an economy grows.” I don’t think anyone believes just spending a lot of money makes the economy grow. This is a fantasy the Right has pushed for ages; that the Left believes spending lots of money in and of itself is a good thing. If that were true, then let’s role the dice and use the entire federal budget to give ourselves vacations in France. That would certainly be great for the economy … of France.
What some of us believe is that if taxpayer money is invested in things like, oh, I don’t know — education, maybe. Brooks says we need a better educated workforce. Does he think the “free market” will take care of that? On what planet?
Make college more affordable, for example. Make student loans cheaper. Throw some money into failing public schools so that the buildings aren’t falling apart, class sizes are smaller, and at least some of the books in the library were published after 1989.
Throw some money at infrastructure issues such as the energy grid, roads, and bridges; plus information technology. Business needs this stuff to thrive, you know. Plus, it makes jobs.
Let’s go with a single-payer health care system, to get health care costs off the backs of business and prevent medical bankruptcy from ruining so many lives. Plus, a healthy workforce is a more productive workforce.
Invest in scientific research. All that pure science stuff is what provides the know-how for new products of the future.
Etc. etc. There are a few more paragraphs in Brooks’s column, but I lacked the strength to go further. Brooks is a freaking idiot.
I actually do agree with him that the ultimate problems are structural and not cyclical, but as I see it, the whole consumerist-capitalist economic system is unsustainable. We’re going to have to evolve into new economic models. But that’s hard to do when people conflate economic theory with religion. So I’m not hopeful.
Maybe the editors at the NY Times (if there are any left) gave LOL Davy Brooks an assignment to see if he can write the same really insipid, and always wrong, BS columns about the economy as Lil’ Tommy Friedman, so they can outsource ‘The Mustache that talks to foreign cabbies, but probably stiffs them on their tips” job to a bunch of “Snub-nosed” monkey’s with keyboards in Myanmar?
Then, to save money, maybe they can in-source another Canadian into the NY Times, and give him the same Refrigerator Word Magnet Set that Brooks has been using for years – that’s why we all have trouble not falling asleep reading his columns – they’re all the same, with the same words and phrase juxtaposed into the new same sentences and new same paragraphs.
Maybe then, they wouldn’t have to charge those of us readers who’ve been reading the online version for years, for the privilege of reading more than a couple of handfuls of articles a month?
OH!
And we can all be sleep easier knowing that LOL Davy Brooks is one of the ever-shrinking number of people who can keep their heads above water – WELL ABOVE water, in “Our Mr.” Brooks’ case:
http://www.washingtonpost.com/blogs/reliable-source/post/surreal-estate-david-brooks-moves-from-bethesda-to-cleveland-park/2012/05/06/gIQAs27Q6T_blog.html
Save this, and refer to it every time you think of paying for the NY Times, or contributing to NPR, or Public Television.
A $3.95 MILLION HOME!
For a feckin’ columnist, and radio and TV punTWIT!!!
See any structural economic problems with that, Davy, me lad?
gulag — Maybe what’s really systemically wrong with our economy is that it rewards idiocy.
I am still debating with myself over whether Brooks is an idiot. If his purpose were what we are supposed to believe, if he were supposed to sift through information and produce insightful, objective commentary. I would definitely fall on the side of a fool who has been able to convince himself along with some powerful people, that he is wise. — This has made him a wealthy man.
But, on the occasions that I find myself reading his column, I find, as cundgulag mentions, a consistency to his poor logic, substitution of opinion for fact and repetition of shopworn stereotypes. It can’t be an accident. But, he can’t be that stupid. I think he is just aiming at a demographic with a set of cognitive biases which he is adept at exploiting. There is a high degree of craft in his work. I see him use some clever devices. But, once you see through his game, he does seem ridiculous. Rich and ridiculous, I’d say he landed on his feet.
I knew I shouldn’t read Brooks’s most recent column,
You should have stopped right there. It’s easier on the blood pressure. 🙂
Not only does it reward idiocy, but once you get to a certain position, like newspaper columnist, the only way to lose it is to die.
You can be wrong for years and years and keep your job.
And even then, death wouldn’t have stopped Safire, or Broder, if their respective newspapers could have stopped their own obituary departments from printing them, and paying off their families, which would have allowed them to rerun their columns in perpetuity – just update the names and places.
“We need to let the war in Vietnam/Grenada/Iraq/Afghanistan/Iraq run its course for the next 6 months before we can judge…”
“President Nixon/Reagan/Bush/Bush II, is a secret genius because of…”
“President Johnson/Carter/Clinton/Obama is mendacious, and prevaricating when he’s speaking about…”
“The Republican controlled Congress has taken bold action on_________ by cutting taxes on the wealthy, and deregulating the ________________ industry. This should put us well on the road to prosperity.”
The Democratic Congress is bungling another crisis. Their lack of bipartisanship regarding tax cuts on the wealthy, and wanting to regulate the _____________ industry, will lead to an economic catastrophe that will…”
See, it’s easy!
Any mook can do this!
I see what you mean. He basically tosses a bunch of loosely related assertions into a blender and purées them in the hope that they’ll somehow coalesce into an argument. He puts both Democrats and Republicans in his blender and calls the result “government”:
“We”? Is there anybody anywhere in the United States who is calling for both more tax cuts and an expansion of the welfare state? Some of us have even begun to suspect that the mania for tax cutting on the right is pretty much exclusively and entirely what is driving the implosion of a welfare state that was sustaining itself just fine.
Have you seen Dean Baker and/or Paul Krugman’s responses? (Apparently, according to New York Time policy, Krugman can’t mention Brooks by name.)
Here’s Krugman taking Brooks behind the woodshed for a good old fashioned ass-whuppin’, and grinding his face in the dirt, making him eat it, until he screams “uNCLE!!!”
http://krugman.blogs.nytimes.com/2012/05/08/structural-flashbacks/
Thanks, anon!
Baker was even better than Krugman!!!
Proof once again, that the only place Brooks gets the “information” he uses when writing his insipid, and always wrong columns, is Otto Hizasc.
Sorry – that’s Dr. Otto Hizasc.
Ah, but there’s no one, NO ONE, as accomplished at openly mocking David Brooks than the great, great Charles Pierce.
Did I mention how great he is?
http://www.esquire.com/blogs/politics/david-brooks-structural-revolution-column-8682328
maha,
Your take-down was great too!
It’s just that Mr. Pierce makes mocking, and beating on David Brooks like a misbehaving red-headed stepchild riding a rented mule, a weekly event, so he’s got more practice than all of us – for which I’ll be eternally grateful.
Have I neglected to mentioned how great he is?
If only there was a way to tell the NY Times, “Ok, I’ll buy your paper, or pay for internet privileges, just shave a few bucks off, and take them out of Brooks’s privileged hide.”
Or tell NPR and Public Television – “Never mind! Keep the feckin’ tote bag!!! Just take that money and pay David Brooks NOT to appear and opine on your programs.”
Sometimes it seems liberals hang on every word Krugman has to say on every topic, except one: the very topic that earned him his Noble Prize.
Long-short…he compares folks who make statements like those above to creationists. Given the massive consensus Comparative Advantage holds among Academic Economists, words like the above bear explanation.
Manju — are you seriously saying that U.S. jobs have not been outsourced overseas? That we’re all just imagining that jobs that used to be done here are now being done in China? I’ll give you one chance to explain yourself. And do be careful to stay grounded in reality, or you will be cast forever into the twit filter.
Wow, I can’t wait to read those links. One thing about David Brooks is that he really can be insufferable. They will almost make it worth having had to read the article.
maha,
I know Manju from L, G & M.
He has a good point about 10-20% of the time.
Something genuine, or funny, to say about 5% of the time.
The rest of the stuff he says is what you’d find as filler in hot-dogs and sausages.
But, he’s generally harmless.
He’s not the average troll.
And, once in a while, has a good to great, point.
I’ll vouch for him – until he says something stupid.
Then, I won’t know the MFer from Adam!
maha,
I’m saying that Paul Krugman will tell you that there are mountains of data effectively demonstrating that, under most conditions, the jobs you perceive as being “lost forever to Bangledesh” are offset by jobs gained here.
He would also tell you that “shipping jobs to Asia” is not “suppressing wages” because you have to measure wages in real dollars, ie there is an offset due to more purchasing power via cheaper goods.
Re: Your “free-market solution” to outsourced jobs…
…not only completely ignores the creation of a middle class in places like China and India, but, more importantly, flies in the face of all the data that produced a huge academic consensus on Comparative Advantage.
The idea that free trade generally benefits both nations enjoys a concussions among Academic Economists equal to that of the Keynesian Stimulus (around 90%, Source: Mankiw Textbook).
Krugman, as you know, is no free-market ideologue. Indeed, he doesn’t believe free trade is a necessary benefit under certain conditions, like a liquidity trap. But as far as the structural problems you are talking about goes, free-trade does not create them, it assuages them. He is so certain of this that he compares those who doubt it to creationists:
http://web.mit.edu/krugman/www/ricardo.htm
I’ve taken some of my own very short and precious time looking for an example of Krugman saying that. I cannot find it. I’ll give you one more chance to come up with an example. A very specific one. With a link. Because I think you’re full of shit.
The main difference between Ultra-Conservatives and sane people is their approach to problem solving. What’s the first step of problem-solving? Ask any rational person with a smattering of training and he will blurt – “Define the problem.”
But to the ultra-conservative, that step is unnecessary. There are ONLY three possible answers to any problem. Cut taxes – Cut Government – or Remove Government Restrictions on Business. I won’t deny that, on occasion, one of these solutions might be the answer.
But if you consider problems objectively, usually, the only three answers Brooks and his ilk can consider just won’t work! But they are the only three tools in their toolbox. When confronted with a problem that none of those answers can solve, they will always deny the problem! *sigh*
Maha, I’m not a defender of Manju, but – the one thing economists universally agree on is trade, both between individuals and between countries.
Now, this gets into some dicey situations.
No one will say that the workers who lose their jobs get a benefit from offshoring. But there are benefits to the US economy when companies can get goods and services from overseas. So, yes, these workers just lost their jobs, may have to re-train for other jobs, and may lose a lot, and that sucks for them. But refusing to offshore means we’re all spending more money for goods and services because we’re refusing to take advantage of cheaper costs elsewhere. (And, presumably, we’re not doing the stuff that we do better, so we don’t make as much money selling the stuff that we could sell.)
I don’t think there’s any case in history where opening up trade (and offshoring is a form of trade) hasn’t improved prosperity for both partners. Whether Krugman would use the same words or not, he’d support offshoring in most cases, with minimal caveats.
Now, there’s one final thing I’ll point out. Typically, an increase in prosperity ends up being shared by people in the country. But in the US, increases in prosperity haven’t been shared very well in recent years. This is where I (and maybe you?) find an economist’s certainty a bit less comfortable than I might have in, say, the late 60s or early 70s. (Technically, in the late 60s, I was still an infant and found a warm blankie to be more comfortable than all the economists’ certainties in the world.)
But I’m not an economist. And I won’t deny that *if* the pattern holds, offshoring should help the overall economy, and those benefits should be shared. But I’m not convinced that the pattern must hold. I’m seeing more and more cases where the benefits aren’t being shared.
Anyway: Manju is right that Krugman will almost always support trade, including stuff like offshoring, unless there’s some unusual circumstances. It’s not Krugman specific, it’s more economist-general.
Long Hair — Nobody is against trade. That’s not the issue. The issue is that manufacturing and other jobs lost overseas are not being replaced by jobs that pay as well, and one questions they are all being replaced. I’m not seeing it.
Further, as global corporations continue to shop around for the cheapest possible labor to make their products, they inadvertently reduce their own pool of customers.
Maha ! 🙂
Maha – *agreed*. And I think that this is what economists are being blind about.
Me:
maha:
Paul Krugman:
if you hit the link, you’ll see a nuance (krugman believes our current condition, ie a liquidity trap, turns free-trade on its head, as it does many things).
There are many other nuances. LHW touched on the most important (distribution of real income due to trade with low-skill/wage nations) but before we get to that we have to understand the fundamentals: “trade between two nations normally raises the real incomes of both “, in Krugman’s words.
I’ll try to unwrap it all later in the day.
Manju — and then Krugman says,
And YOU had said earlier,
You aren’t “unwrapping” anything here, dear, because you’re an asshole, and I’m banning you from the site. Good bye.
manju,
You’re new here, and are doing ok.
So far.
Keep being specific, and have examples that support what you say.
Don’t make me look like an ass for vouching for you.
I don’t need any help in being made to look like an ass, and do that just fine on my own. 🙂
I started to write a long-assed opinion on this subject, but decided to save everyone time, and shortened it to this – which is STILL long:
Globalized trade, by increasingly more global companies who have no particular allegiance to any one particular country, is the paradigm shift that old economic models don’t account for.
Without prohibitive tariffs to protect home markets, which “free-trade” ended, or minimized, companies can purchase mined raw materials cheaply, and ship them to make supplies, parts, etc., and then ship those to anywhere in he world where it’s advantageous to assemble them cheaply. And then ship the finished product to be sold in the parts of the world that will maximize their profits.
If it’s American – great!
But if it’s not, then who cares?
That car, boat, PC, etc., can be sold, without tariffs, cheaply, and the profits, largely untaxed to encourage continued “free trade,” go to the shareholders, exec’s, and the banks.
And here’s the problem with that:
Ever decreasing national and global taxes on corporations. They hold countries hostage, by threatening to leave if taxes are not decreased, or are actually increased..
Taxing too much may make that company go to another country instead of staying, and thus, the money that government once made of taxing those companies, decreases, thus making that government less efficient for citizens. And if the company DOES move, citizens lose jobs, which means less taxes for government, which makes that government less efficient for citizens, who are increasingly jobless.
So, in short, it’s like a snake eating its own tail.
It’s not just offshoring and hiring.
To me, the largest part of the problem is the Global Trade Stockholm Hostage Syndrome.
Companies are taking countries and their citizens hostage.
“Your government wants a strong economy, right?
Then decrease your taxes, and we’ll bring jobs, and improve your economy by improving the purchasing power of your citizens – let THEM pay the taxes.
And if you f*ck with us, we’ll look around for a better deal – which we’re already looking for, so we need you to lower taxes some more, or else we’ll increase our search. Capiche?”
This has been done intrastate in America for decades.
Sweetheart land deals, tax breaks, non-union work forces, etc. to lure companies to a particular city/state.
And when the company threatens to leave that state for lower taxes, lower wages, elsewhere, state government have cut taxes, and let companies lower wages, just to keep them there, so the politicians of that state don’t lose that company and it’s jobs, and lose face – and then, THEIR jobs.
American companies learned from that, and as they went international, that IS NOW BEING DONE ON A GLOBAL SCALE – BY ALL COMPANIES.
And the American states, and international countries, now suffer from what I call the Global Trade Stockholm Hostage.
Governments held hostage, are threatened into continually lowering taxes, and decreasing wages. And, end up cooperating, and eventually, sympathizing with the companies – the hostage takes.
And governments grow weaker and citizens share of taxes increases to offset the losses of corporate taxes. And as the government weakens, it looks the other way as companies continue to lower wages/benefits. And governments say, ‘Hey, at least some people here still have jobs!’
But the companies want still more.
And the global downward spiral for the 99% increases.
Long, I know. Sorry…
Capiche?
gulag — another side effect of the “hostage” scenario you describe is that the tax burden of maintaining things like infrastructure and a criminal justice system — which businesses need to survive — increasingly is falling on the workers. So, again, the corporations are making profits on the back of people who are also their pool of potential customers. IMO anyone with a head ought to be able to see that this is not sustainable.
As an English Major (note capitals), I feel fullly qualified to comment on economic theory, since it is just as squishy as literary analysis because of its multiplicity of facets: Yes, a middle-class benefit arises in places that did not have much of a middle class before offshoring of middle-class jobs from other places. I am intentionally ignoring the first-world, second- third- issue, which fuels globalization at its beginning in places where offshoring goes. Too many facets. No, importing doo-dads we used to manufacture does not do much for our job situation. When the raw material development and procurement part of the manufacturing process is also subtracted out along with the manufacturing, the loss is even larger, isn’t it? Globalization is almost exactly what the globalization proponents say it is, except that it is also trickle-down at its finest. That is to say, it is such a dispersed trickle at such a distance that only those holding the hose (known as hosers) get much immediate benefit in the country from which the offshoring departed. Now hurry on down to your local big-box import store and save 62 cents. You’ll need it.
Manju?
WHO DAT?
No, it’s not sustainable.
But rich and corporate rich “persons” don’t care.
If the infrastructure in one country fails, another one will build a new one, promising citizens jobs if they pay a bit more in taxes. And when the companies move in, they’ll want lower taxes for themselves, and lower wages – hence, less tax income from working people, and that infrastructure starts to crumble, and another country will build a new one, promising citizens jobs if they pay a bit more in taxes…
And on and on it goes.
The endgame?
I don’t know.
All I can see is this:
A ruined, economically and ecologically ravages planet, with only the rich having the resources to survive – with all existing governments in disarray, and being financially bankrupt, in no position to help anyone but the richest people still living there – who will demand protection from the surviving diseased, and starving, masses.
It’s a Corporate ‘Heaven on Earth.’
Hell, for the rest of us.
I’m not worried though.
We humans are about done.
The Earth will make “corrections.”
It always has. Dinosaurs were the dominant species for millions and millions of years.
Our “run” will only be a few thousand years – with the starting sbeing the development of agriculture, and domestication of animals. We’ve been on the road to ruin ever since those times. We were no longer “natural,” because we had begun to become above nature by taming it nature.
Well, we haven’t tamed all of it yet!
And now comes, “The Revenge of Mother Earth.”
And maybe, millions of years from now, the roaches or rats who will have evolved, will create a more “holistic” society.
Ok, that’s enough optimism from me for the day! 😉
It is NOT just manufacturing– the guys over across those those railroad tracks from us. Corporations are out-sourcing knowledge work overseas. Ask people in software what is going on. Ask where all the IBM jobs have gone. Soon, there will be nobody left with jobs in the US except doctors, plumbers, CEO’s and illegal landscapers/farm workers. I fear for my children. The Gov’t is unwilling (on the GOP side) and unable (on the Dem side) to even honestly address the problem. But without SOME kind of Gov’t regulation of off-shoring practices, we are DOOMED.
maha,
Sorry about vouching for Manju. I should have known he’d muck it up!
tom b,
You forgot to list WallMart greeters!
The luckiest among us who have that job will probably be kicking-back part of our meager salaries to keep that prestigious, and relatively high-paying job.
I always feel like I am wrestling with something bigger than I am when I think about economics, but that’s part of the appeal.
Thinking of what tom b and BILL B (are you guys related?) wrote, I read back in the Dubya days that corporations were starting to outsource knowledge work. They began with labor, moved to product development and product development. Some research and development is now outsourced. So an “American” corporation builds a huge factory in China or sends blueprints over together with plans for R and D, etc. They’ve pretty much given away the store. They expect that the Chinese will send the finished products back and the corporation can put its label on it. Sooner or later the Chinese domestic market will hit a growth spurt, local demand will grow and we’ll have plenty of time and reason to think about where we went wrong.
goatherd,
We also are “insourcing” foreign workers into jobs in America.
http://www.cis.org/h-2b-guestworkers
And not all of them are migrant farm workers, or plant workers. There are high-paying tech jobs also, that are going to ‘cheaper’ foreign workers.
After all, why pay an American $ 8-10, or $30-40 an hour, when people from other countries will take the lowest paid jobs at below minimum wage or near there, and $5-25 and hour cheaper on the high-end jobs?
“Free Trade” is only free when there is a level playing field. That’s not to suggest all the world will have level or equal regulations in three key areas – pollution, workers rights and global responsibility. But where the differences are the glaring and deliberate result of national policy, the US needs to make trade expensive.
Let me take that apart. If a county has lax regulation and enforcement of toxic by-products in manufacturing, that becomes a magnet for companies with no conscience. It puts companies with a conscience at an economic disadvantage. The US has no authority to discourage a multinational from building a plant which will dump carcinogens in the local environment of say, China. Except through tariffs.
The US has a minimum wage – we have child-labor laws. We require overtime pay to make it expensive to impose swear-shop conditions. We have workplace safety laws. We have (for the moment) the right to form or join a union and bargain with the owner(s) for fair wages and working conditions. Just talk about a union in China, and you will lose your job, possibly wind up in prison.In other places less benign than China, you wind up dead.
Very few in the US are in favor of lower wages, working children at cutthroat low wages, or letting the work place become a death trap in the interest of higher profits. But US jobs are outsourced to places where those conditions are reality. The only way the US can affect it and discourage it is with trade policy.
The whole world, through the UN, is trying to regulate dangerous actions by rogue nations in ways other than war. Sanctions against Iraq, for example, are working. Some countries want to buy oil from Iraq (India) and their support is keeping some dangerous nuts in power who are producing nuclear weapons. There are a host of other issues that are global in nature – overfishing, whaling on the high seas, industrial actions that contribute to global warming.
There is no other way to compel countries to do the right thing when it is in their economic self-interest to do the wrong thing except to make the wrong thing more expensive – too expensive to be profitable, through tariffs.
An aggressive international policy which is intended to serve notice on countries and companies that the US, as the biggest consumer in the global market, is going to give preferred treatment to products produced in countries who have a level playing field (Canada for example) compared to the US. And there will be an escalating set of trade barriers on products from countries who are not improving their standards.
Nod. It’s very complicated, in a lot of ways. One key issue is that free trade is only supposed to be free in the sense that it doesn’t violate policy. On the other hand, policy gets tricky.
If we had a carbon tax, and someone wanted to manufacture in a country without one, we should put a tariff equal to the carbon tax… otherwise, we’re not actually engaging in free trade, we’re just letting people dodge the carbon tax.
(A lot of people will argue with this, based upon an implicit assumption that carbon taxes are useless. They aren’t, but, alas, a lot of people are proudly ignorant.)
On the other hand, offshoring jobs to places where labor costs are cheaper is a very dicey area. Sometimes, that’s all a nation has – cheap labor. And without providing that cheap labor, it’ll never have the money to build the infrastructure to have an economy where its workers get to be paid more.
I’d like to think that a nation would rise out of poverty by providing for their citizenry. I’d like to think there’s a way that a nation can prudently build up an economy where all of its people can have comfortable lives without going through a phase were workers are put in slave conditions and where labor organizers’s lives are in danger, and so forth. I’m just not sure if it happens.
LHW – You read my post. I think a lot of people ignore my rants. But I did not suggest a tarriff if workers were willing to accept lower wages. The unfair tilt happens when foreign governments persecute for attempts by labor to organize or governments allow employers unfair advantage in suppressing workers rights.
The world isn’t going to look like the USA. But the US consumer should not encourage and subsidize the rape of the environment or exploitation of workers overseas so they can get a widget for a nickle discount at Wal-Mart.
Doug – sorry if it sounded like I was disagreeing or suggesting you were incorrect – I was just, well, thinking out loud. That a country might improve, eventually, after it provides cheap labor with hideous conditions is a real source of painful conflict with me – the kind that kinda makes me glad I’m just a database administrator and don’t have to worry about those issues. (Then again, that means I’m letting those issues be decided by those who don’t care about ’em. Sigh.)
Don’t think Tom B. and I know each other. Tom B., are you in NC or VA? Family from Caldwell County, NC? That should do it, but there was a TN branch, too.
Are you guys any relation to the killer B’s?