America’s Descent Into the Third World

Chronicles Magazine ^ | Monday, July 25, 2005 | Paul Craig Roberts

[A. Pole]

The June payroll jobs report did not receive much attention due to the July 4 holiday, but the depressing 21st century job performance of the U.S. economy continues unabated.

Only 144,000 private sector jobs were created, each one of which was in domestic services.

Fifty-six thousand jobs were created in professional and business services, about half of which are in administrative and waste services.

Thirty-eight thousand jobs were created in education and health services, almost all of which are in health care and social assistance.

Nineteen thousand jobs were created in leisure and hospitality, almost all of which are waitresses and bartenders.

Membership associations and organizations created 10,000 jobs, and repair and maintenance created 4,000 jobs.

Financial activities created 16,000 jobs.

This most certainly is not the labor market profile of a First World country, much less a superpower.

Where are the jobs for this year’s crop of engineering and science graduates?

U.S. manufacturing lost another 24,000 jobs in June. A country that doesn’t manufacture doesn’t need many engineers. And the few engineering jobs available go to foreigners.

Readers have sent me employment listings from U.S. software development firms. The listings are discriminatory against American citizens. One ad from a company in New Jersey that is a developer for many companies, including Oracle, specifies that the applicant must have a TN visa.

A TN or Trade NAFTA visa is what is given to Mexicans and Canadians who are willing to work in the United States at below prevailing wages.

Another ad from a software consulting company based in Omaha, Neb., specifies it wants software engineers who are H-1B transferees. What this means is that the firm is advertising for foreigners already in the United States who have H-1B work visas.

The reason the U.S. firms specify that they have employment opportunities only for foreigners who hold work visas is because the foreigners will work for less than the prevailing U.S. salary.

Gentle reader, when you read allegations that there is a shortage of engineers in America, necessitating the importation of foreigners to do the work, you are reading a bald-faced lie. If there were a shortage of American engineers, employers would not word their job listings to read that no American need apply and that they are offering jobs only to foreigners holding work visas.

What kind of country gives preference to foreigners over its own engineering graduates?

What kind of country destroys the job market for its own citizens?

How much longer will parents shell out $100,000 for a college education for a son or daughter who ends up employed as a bartender, waitress or temp?

[oceanview]

not much longer, its happening now. to be honest, a server at a good, busy restaurant can make alot of money. younger people are starting to see this, its not a bad career choice while you are still young.

[Junior_G]

I come in contact with both foreign and American students...I'd hire the foreign one over the American every time.

Patriotism stops at the pocketbook, huh? You are a true "Citizen of the World".

[Neoliberalnot]

You are definitely being misled. The country is in a tremendous construction boom including billions going into infrastructure. The demand is so great that there is currently a shortage of concrete and steel.

[Happy2BMe]

Need a good job? Get a Trade NAFTA visa . .

=======================

"A TN or Trade NAFTA visa is what is given to Mexicans and Canadians who are willing to work in the United States at below prevailing wages."

[chimera]

Ah, the dreaded "reorganization" kiss of death. Yes, I agree, reorganization has come to be a code word for layoffs and downsizing in the American business lexicon. My experience has been that reorganization generally means laying off people who do actual work in favor of hiring more VPs (to manage the reorganization, I guess).

Here is an interesting story. One time I and one of my colleagues who were working a temporary gig at a research organization (so they said they were) took it upon ourselves on our own time to develop of model of how this so-called business worked. We came up with equations that described the revenue generation, cash flow, costs, etc. Then we started taking partial derivatives to identify the singularities, were the "sources" and "sinks" were, in essence. We had heard of other people who had done this in other venues and wanted to try it ourselves. Well, surprise surprise, almost all of the revenue sinks were at the VP administration line, the sources were somewhat diffuse and distributed among line managers and applications employees (those were the people actually bringing in money). We showed it to our manager (who was an okay guy) and he got a kick out of it. I have no idea if that model ever made it beyond the midline management level because we were both moving on to other work (to be young and foot loose and fancy free again!), but I have a feeling if it did, whomever paid attention to it would probably get the gate.

[iconoclast]

A good friend of mine is making a bundle these days...he has NO degrees, learned how to take apart and put a computer back together on his kitchen table, and now works out of his house.

Ah, the vaunted, Limbaugh dropout, home-based millionaire!

Has it really taken 137 posts for him to show up, or did I miss one?

[traumer]

Good post and some (most of) thoughtfull comments.

[Alberta's Child]

Excellent post.

Today, we have AirBus, where every single plane benefits from a 30% subsidy, with governmental "startup" "loans" that AirBus has never repaid..."loans" which paid for all the industrial plant, the R&D, and product development. All written off. Today, McDonnell-Douglas's commercial planes are gone. Lockheed's are gone. And Boeing, which gets no startup loans, or operating subsidy, the survivor, has been eclipsed in quantitative sales by AirBus two years running...much to the glee of France.

The Airbus/Boeing story has been in the news quite a bit lately, and I'm still not sure what the far-reaching implications of these Airbus subsidies will be. The irony is that when you think about it, the ultimate result of the French subsidy is that airlines all over the world -- and airline travelers by extension -- are enjoying the benefits of reduced capital costs at the expense of the taxpayers of France.

And do you know why BMW built its plant in the U.S.? Because our labor was cheaper than theirs.

Labor costs were certainly a factor, but there is also an underlying reality at work in the auto industry that -- unlike most other manufacturing sectors -- makes it very practical to manufacture automobiles as close to their point of sale as possible.

[colorado tanker]

I think I misled you by failing to include a sarcasm tag in my last post.

[Alamo-Girl]

Thanks for the ping!

[iconoclast]

Actually, higher education is a club. Almost anyone can join. I will admit, there are those that aren't suited for college, but there are also skilled trades available as a career

I think we oughta meet in Sandusky for a frosty! ;-)

[iconoclast]

In the 70's and 80's economists declared that 5% unemployment was "full" employment, that the rate could not possibly go lower. Of course, Reaganomics proved them wrong.

Has it ever varied by more than +/- 2% since the depression?

[tx_eggman]

good enough to die in war but not good enough for a descent job, got to give those to the working Chinesse, of Japanese of Indians.

No one is giving jobs to these folks, they're competing for them in the market place ... and winning them because they offer better bang for the buck.

How else is it supposed to work? Throwing up tariffs and other protectionist barriers is what "gives" "high paying subsidized" jobs to people, not the market place.

[Dat Mon]

YOU SAID..."You can bark at "us guys" all you want ... spell out an alternative that works in today's world."

We have..till we are blue in the face...its called making AMERICA more competitive by doing stuff to help ALL business HERE in the US.

Stuff like TAX REFORM....REAL TAX REFORM...WHERE IS IT?

REGULATION REFORM...WHERE IS IT?

LIMITING GOVERNMENT SPENDING...WHERE IS IT?

TORT AND LIABLILITY REFORM...we have started on a first step...NOW FINISH THE JOB.

No...guys like Bill Thomas...a huge disappointment, are spending their energies doing cronyism trade agreements to help selected major contributors....whether in China or in our southern borders.

BOTH PARTIES have been part of the problem up till now. Create a problem...then offer a crony type of solution for it.

No...as evidenced by the last Omnibus pork spending bill...and the recent Kelo vs New London SCOTUS decision...we are going the wrong way over here.

[swampfox98]

Thank you for telling the truth. I have relatives who studied computer science and now they are up the creek without a paddle. Job after job has been sent to India, Mexico, and other third world nations.

Little by little America is going to realize that the redistribution of our jobs and wealth, along with the care of millions of illegals will indeed bring America down to third world status.

The alliance of government and business will bring wealth and power to the elite of this nation, but not to the hard working citizens.

[iconoclast]

for if we were to bounce all the "don't belong here" students from TinkerToy College(s), THEN what jobs would they hold?

I have a friend right here in my home town who attended our local vocational high school (it has since been eliminated, shutdown! Can you believe it?)

He took Auto Transmission Repair, a few years later started his own business, retired (literally) a multi-millionaire!

[colorado tanker]

Oh, as I recall we were up near 9% in the mid-70's and near 10% in the early 80's, but generally your observation is true. Most of this is an effort by politicians on the outs to try to convince the most prosperous people in the world that things are so bad we have to throw the b#$tards' out - and put them in.

[Alberta's Child]

You're in a difficult position because you have to walk such a fine line between knowing what he should be doing, and realizing that he has to develop the maturity to make his own decisions. Things like this will often work out in the long run.

I once worked for a guy who had a son in a similar situation. The kid barely made it through high school, then spent a couple of years drifting from one menial job to another. He ended up working at a gas station just because he wanted to work on his car during off-hours, and from that he learned some good automotive skills. A friend of my boss recognized the kid's skills and suggested he could get him into a top-rated school for airplane mechanics. The kid gave it a shot, and after a few months of school his instructors told him that he was capable of far more than just the hands-on mechanical stuff.

To make a long story short . . . he eventually got through one of the top aeronautical engineering programs in the world, and the last I heard he was one of the leading avionics experts for one of the big U.S. airlines.

[Dont_Tread_On_Me_888]

Roberts is very respected.

You are the nobody.

U.S. manufacturing lost another 24,000 jobs in June. A country that doesn’t manufacture doesn’t need many engineers. And the few engineering jobs available go to foreigners.

Might be "BS" to the shallow brained, but Roberts states the obvious and unfortunate truth. Once again, Paul Craig Roberts syndicates nationally, in part due to his reputation and the respect he ahs earned--you are the nobody.

[iconoclast]

But saying we should put the nation on a war basis is a meaningless term, in this day and age.

Codswallop! Would that be why we are short on troops, bullets, and armor?

I'm sitting about three blocks from the White House, if you need to know.

The defense rests! ;-)