Posted on 12/18/2003 3:32:00 PM PST by sly671
Jobs come and go Walter E. Williams
In 1970, the telecommunications industry employed 421,000 switchboard operators. In the same year, Americans made 9.8 billion long distance calls. Today, the telecommunications industry employs only 78,000 operators. That's a tremendous 80 percent job loss.
What should Congress have done to save those jobs? Congress could have taken a page from India's history. In 1924, Mahatma Gandhi attacked machinery, saying it "helps a few to ride on the backs of millions" and warned, "The machine should not make atrophies the limbs of man." With that kind of support, Indian textile workers were able to politically block the introduction of labor-saving textile machines. As a result, in 1970 India's textile industry had the level of productivity of ours in the 1920s.
Michael Cox, chief economist at the Federal Reserve Bank of Dallas, and author Richard Alms tell the rest of the telecommunications story in their Nov. 17 New York Times article, "The Great Job Machine." Spectacular technological advances made it possible for the telecommunications industry to cut its manpower needs down to 78,000 to handle not the annual 9.8 billion long distance calls in 1970, but today's over 98 billion calls.
One forgotten beneficiary in today's job loss demagoguery is the consumer. Long distance calls are a tiny fraction of their cost in 1970. Just since 1984, long distance costs have fallen by 60 percent. Using 1970s technology, to make today's 98 billion calls would require 4.2 million operators. That's 3 percent of our labor force. Moreover, a long distance call would cost 40 times more than it does today.
Finding cheaper ways to produce goods and services frees up labor to produce other things. If productivity gains aren't made, where in the world would we find workers to produce all those goods that weren't even around in the 1970s?
It's my guess that the average anti-free-trade person wouldn't protest, much less argue that Congress should have done something about the job loss in the telecommunications industry. He'd reveal himself an idiot. But there's no significant economic difference between an industry using technology to reduce production costs and using cheaper labor to do the same. In either case, there's no question that the worker who finds himself out of a job because of the use of technology or cheaper labor might encounter hardships. The political difference is that it's easier to organize resentment against India and China than against technology.
Both Republican and Democratic interventionist like to focus on job losses as they call for trade restrictions, but let us look at what was happening in the 1990s. Cox and Alm report that recent Bureau of Labor Statistics show an annual job loss from a low of 27 million in 1993 to a high of 35.4 million in 2001. In 2000, when unemployment reached its lowest level, 33 million jobs were lost. That's the loss side. However, annual jobs created ranged from 29.6 million in 1993 to a high of 35.6 million in 1999.
These are signs of a healthy economy, where businesses start up, fail, downsize and upsize, and workers are fired and workers are hired all in the process of adapting to changing technological, economic and global conditions. Societies become richer when this process is allowed to occur. Indeed, because our nation has a history of allowing this process to occur goes a long way toward explaining why we are richer than the rest of the world.
Those Americans calling for government restrictions that would deny companies and ultimately consumers to benefit from cheaper methods of production are asking us to accept lower wealth in order to protect special interests. Of course, they don't cloak their agenda that way. It's always "national security," "level playing fields" and "protecting jobs". Don't fall for it -- we'll all become losers.
©2003 Creators Syndicate, Inc.
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On the bat smashing through your windsheild!!!!
Walter Williams lost all credibility as an objective economist when he became a syndicated partisan pundit. IMHO, he's almost as worthless as Oprah.
It would be stupid for people to not try. Fail. Then fail harder.
Raise your hand if you have been homeless, and lived in a car. I have, 1980. I did not give up. And never filed for unemployment. And never blamed anybody, nor whined.
I put my mind to it, and clawed my way up from homeless to making artificial hearts today.
Was I lucky? lo f*in lol! He!! no! I was homeless because I was too stupid to try. People in the service industry get paid what they are worth, or their job goes away. Don't knock service industry jobs, but don't espect a 4-BR house, either. Your choice to do it for a living.
In Michigan, in the dead of winter, snow, cold, etc., I rode my bike to my job at McDonalds. I had no money for gas, for the car I barely owned. In McDonald's uniform. Did I whine about service jobs? He!! no. I was glad to have a job.
The whining of people here about visas, and unfair, and blah, blah, blah, makes me lose respect for Americans. What a bunch of whiners. What a bunch of pansies. My gift to you is to wish upon you that you somehow end up living in your car, so that you can start over and appreciate the opportunity you have. You need to re-calibrate your life, and appreciate the opportunities life here offers.
Freeper #39.
This is the crux of the argument, in my opinion. America is legitimately benefitting from the tremendous windfall of cheap overseas labor. Most of the goods we buy are cheaper because of it. We win.
Since when have the demagogues forgotten the consumer, Walter?
Seems to me that's all you talking-head buffoons ever babble about.
In fact, YOU'RE the one who keeps forgetting that people first need good, productive, well-paying JOBS BEFORE they can become consumers. What the hell can they consume if they can't earn a decent living?
Finding cheaper ways to produce goods and services frees up labor to produce other things.
Yep. Labor saving technology is developed in response to costly, labor intensive production methods.
So what's your point, Walter?
Did you forget that globalization is a regressive force that acts against technological development?
It continually substitutes ever cheaper labor to undermine development and implementation of more sophisticated (and expensive) automated technology.
Go back to watching the Oprah Show, Walter.
Quit pretending that you're a "conservative" economist.
Heck, you might as well quit pretending you're an economist of any type, for that matter.
You really don't like anything that ends the status quo. If you could you'd charge the world for someone to print set a paper. You wouldn't have wanted that automated either since "jobs were lost".
Give it up dear Willie. Your sour notes don't play well.
Who are you to say what anyone is worth?
If you don't think Longshoremen are worth their pay then you don't remember the lockout last year that (sadly) almost brought the country's economy to it's knees...I'd say that's a pretty compelling argument FOR their worth.
The GOP anti-union attitude is embarrassing idiocy.
Who says you're skills/service are worth the rest of us having to pay your 401k contributions?
I have a (non-union) "service" business. Though I do business with all types of people, the majority of the "blue collar" people I do business with are union members (because they can afford it) ...almost -0- non-union (because they can't afford it).
Much as you may not like it, your import was probably off loaded and shipped via union labor.
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