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To: LowCountryJoe

Nice to see the free traitors digging thier own graves these days. Don't worry, you'll only have 10 years of employment problems! Your salary wil increase, but not as fast as inflation! It's interesting that the entire argument is 'Canada is doing well', but are we talking about charity or policy that is in our interest?


11 posted on 01/28/2005 6:57:33 PM PST by sixmil (In Free Trade We Trust)
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To: sixmil
Just because it bares repeating:

As painful as those layoffs were, however, the job losses were a short-term effect. Over the long run, employment in Canada did not drop, and manufacturing employment remains more robust than in other industrialized countries.

"Within 10 years, the lost employment was made up by employment gains in other parts of manufacturing," Professor Trefler found.

While low-productivity plants shut down, high-productivity Canadian manufacturers not only expanded into the United States but further improved their operations. Along the way, they hired enough new workers to make up for losses elsewhere.

"The average effect of the U.S. tariff cuts on Canadian employment was thus a wash: the employment losses by less-productive firms offset the employment gains by more productive firms," Professor Trefler wrote in an e-mail message, citing further research.

Nor, contrary to predictions, did Canadian wages drop because of competition from less-educated, nonunionized workers in the southern United States. Quite the opposite: using payroll statistics, he found that "for all workers, the tariff concessions raised annual earnings" by about 3 percent over eight years.

Admittedly, that is not a lot. "A 3 percent rise in earnings spread over eight years will buy you more than a cup of coffee, but not at Starbucks," he wrote. "The important finding is not that earnings went up, but that earnings did not go down." In addition, he said, "there is absolutely no evidence" that the trade agreement worsened income inequality.

The big story is that lowering tariffs set off a productivity boom.

Formerly sheltered Canadian companies began to compete with and compare themselves with more-efficient American businesses. Some went under, but others significantly improved operations.

The productivity gains were huge. In the formerly sheltered industries most affected by the tariff cuts, labor productivity jumped 15 percent, at least half from closing inefficient plants. "This translates into an enormous compound annual growth rate of 1.9 percent," he wrote.

But closing plants is not the whole story, or even half of it. Among export-oriented industries, which expanded after the agreement, data from individual plants show an increase in labor productivity of 14 percent. Manufacturing productivity as a whole jumped 6 percent.

"The idea that a simple government policy could raise productivity so dramatically is to me truly remarkable," Professor Trefler said.

And the long-run increase in productivity did not result mostly from shutting down inefficient plants. It came from better operating practices.

You're the one who appears to be the anti-growth, anti-freedom 'conservative'...you appear to be more of the traitor than I am by a long shot.

12 posted on 01/29/2005 5:45:40 AM PST by LowCountryJoe (Many things in moderation, some with conservation, few in immoderation, all because of liberation!)
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