Why 'Buy Local' Is Really Bad Economics

RCM ^ | 12/30/2014 | By Brian Brenberg & Chris Horst

[SeekAndFind]

Coca-Cola's "Share a Coke" campaign is the latest effort by multinational companies to de-emphasize their global reach. By replacing the logo on its cans with colloquialisms and common names in markets it serves, one of the world's most recognizable brands is hoping to look and feel a bit more "local."

Coke's marketing strategy is just one example of companies responding to growing public sentiment that buying local is synonymous with doing good. Indeed, more than 150 groups representing more than 30,000 U.S. businesses are promoting ‘buy local' campaigns with slogans like "Don't Buy from Strangers, Buy from Neighbors."

Of course, suspicion of foreign goods is nothing new. Phrases like "Made in China" have long been associated with poor quality. But when did shunning foreign made products become a matter of conscience?

The truth is, the growth of international trade over the past 30 years has sparked a revolution in living standards for hundreds of millions of people around the world. Stigmatizing global trade threatens to undo hard won gains.

History and research show that as trade increases, poverty decreases, and China is a prime example. Since 1978, when the country opened to foreign investment, China has grown to become the world's largest trader - measured by total imports and exports. The results have been striking.

In 2012 alone, average factory wages in China rose 14 percent. In manufacturing, specifically, worker wages have increased 71 percent since 2008. Over the last thirty years, Chinese families living in extreme poverty dropped from 84 percent to under 10 percent. To put that in perspective, 680 million Chinese people-over twice the entire population of the United States-are no longer living on the edge of catastrophe and dying from preventable problems like diarrhea and malnutrition.

[cripplecreek]

I don’t care if global trade is good for China.

[grania]

How nice for the Chinese that Chinese wages have increased at a time when US debt has become insurmountable. Except, why should I be anything but outraged that this his been enabled by government policy? How many excellent manufacturing jobs have been lost in the US, impoverishing the US middleclass?

Bring back US jobs, to be filled by US citizens!

[pepsionice]

Only to share an economic story on Coke and getting around gov’t regulations.

Here in Germany...well over a decade ago, they started a deposit requirement on every single can of soda. You had to return the can to some store, to get your ‘quarter’ back. Same deal with bottles...to include even water bottles. If the drink was bottled or manufactured here...it had the symbol and was a ‘returnee’ item. All of this was to clean the environment (yep, hard to believe but they bought into this).

This year, I’ve come to note a number of stands and street-side shops are selling sodas with no deposit. How? They’ve been buy Austrian-bottled sodas....trucking them up into Germany and selling them locally. Probably another cent or two of cost for the trucking involved, but it’s cheaper than maintaining this stupid ‘return’ program for sodas. By the end of 2015, I expect ten-percent of all canned sodas to probably be Austrian-imports, just to avoid this deposit requirement built into German law.

[cripplecreek]

We need to entice them back by killing the regulatory tax monster.

[SeekAndFind]

RE: I don’t care if global trade is good for China.

Read on, the article also explains why it’s ultimately good for America.

[Lurkina.n.Learnin]

BFL

[sr4402]

“Buy local” is to keep the small businesses in your area going. You know - the Baker, the small hardware store, the Barber etc. It’s not meant for Coca-Cola.

[cripplecreek]

One of the things I like about Meijer stores is the fact that they sell locally grown produce when it’s in season.

Global trade is fine but it shouldn’t be managed by big socialized trade organizations. Our trade with the rest of the world should always have American best interests in mind.

[HarleyLady27]

Bring back US jobs, to be filled by US citizens!
______________________________________________________

The whole reason why the jobs went to other countries was because of the Unions in this country....they wanted all this money and the manufacturers said, we can make this product cheaper in another country.....

[central_va]

I am not a citizen if the world. I am a US citizen. Screw the world.

[central_va]

Free trade is good for the investor class that see themselves as world citizens. They could care less about the middle class, the poor they need however to trim their lawns and wash their babies.

[central_va]

Only 10% of the manufacturing labor force is unionized. The offshored jobs were overwhelmingly non union. You’ve been brainwashed by Free traitors.

[central_va]

Complaints that overseas workers are stealing jobs are short-sighted and unfair - why is someone less deserving of work simply because he's willing to do it for $2 an hour instead of $20? Why does it matter if his name is Jin instead of Jim? Is the humanity of a worker in Beijing of less worth than the humanity of a worker in Cleveland?

Well there you have it.

Free Traitors your time is coming:

[gingerbread]

Free and open competition is always the best way to go. It leads to innovation. The complaints by those people making $20/hr, that we should buy their products, when there are cheaper products of the same quality available. If you’ll all notice, this is why the unions of this country has moved away from the production line to the government. There are more unionized GOVERNMENT employee, than those employed in the private sector. By the way, those unions are the ones complaining of the “CHEAP CHINESE LABOR”

[SeekAndFind]

RE: Free and open competition is always the best way to go. It leads to innovation.

I think there’s a legitimate complaint that when it comes to China, we DO NOT have free and open competition because their TARIFFS on our goods are so high that it is sufficient barrier to entry into their markets.

We on the other hand, practically give them free access to our markets.

[PieterCasparzen]

Bump.

[Georgia Girl 2]

I’m with you. I don’t give a rat’s bazoo about China. I don’t (knowingly) purchase anything that goes into my body from China.

They have poisoned thousands of our pets why wouldn’t their crap poison us too? God the way they fish farm is so sickening the thought of putting their stuff in my mouth is too much. Now they are going to be processing chicken and sending it here and no labels required so you won’t even know you are getting it from China.

We are going to start supporting our local farmers by buying locally raised beef. We buy a lot of our veggies from local farmers markets. I urge everyone to try it.

Last but not least we are growing some of our own stuff. Moving into chickens soon.

[HarleyLady27]

Really???? Then why aren’t the jobs in America????

[cripplecreek]

The offshored jobs were overwhelmingly non union.

The vast majority of jobs lost in Michigan over the last 20 to 25 years were non union jobs. When I worked in a print shop, 99% of what we printed were automotive technical manuals and we even printed UAW contracts in our non union shop. I made a whopping $7.50 per hour in 93.

As NAFTA was being debated the owner warned us that if NAFTA passed our shop would close. He even told us that the company had already bought a plant in Mexico and our contract jobs would go there.

Within 2 months of NAFTA passing we finished out final runs and began disassembling the machines. About 5 of us were offered jobs at the HQ in Midland Michigan but none of us accepted.