Posted on 02/15/2005 6:44:11 AM PST by dennisw
"The Great American Job Sellout By Paul Craig Roberts
Americans are being sold out on the jobs front. Americans' employment opportunities are declining as a result of corporate outsourcing of US jobs, H-1B visas that import foreigners to displace Americans in their own country, and federal guest worker programs
President Bush and his Republican majority intend to legalize the aliens who hold down wages for construction companies and cleaning services. In order to stretch budgets, state and local governments bring in lower paid foreign nurses and school teachers. To reduce costs, US corporations outsource jobs abroad and use work visa programs to import foreign engineers and programmers. The American job give away is explained by a "shortage" of Americans to take the jobs.
There are not too many Americans willing to accept the pay and working conditions of migrant farm workers. However, the US is bursting at the seams with unemployed computer engineers and well-educated professionals who are displaced by outsourcing and H-1B visas. During Bush's entire first term, there was a net loss of American private sector jobs. Today there are 760,000 fewer private sector jobs in the US economy than when Bush was first inaugurated in January 2001.
For years the hallmark of the European economy was its inability to create any jobs other than government jobs. America has caught up with Europe. During Bush's first term, state and local government created 879,000 new government jobs. Offsetting these government jobs against the net loss in private sector jobs gives Bush a four-year jobs growth of 119,000 government jobs. Comparing this pathetic result to normal performance produces a shortage of 8 million US jobs. What happened to these jobs?
Over these same four years the composition of US jobs has changed from higher-paid manufacturing and information technology jobs to lower-paid domestic services. Why?
During this extraordinary breakdown in the American employment machine, politicians, government officials, corporate spokespersons, and "free trade" economists gave assurances that America was benefitting greatly from the work visa programs and outsourcing.
The mindless chatter continues. Just the other day Ambassador David Gross, US Coordinator for International Communications and Information Policy in the State Department, declared outsourcing to be an economic efficiency that works to America's benefit. There is no sign of this alleged benefit in US jobs statistics or the US balance of trade.
Repeatedly and incorrectly, US corporations state that outsourcing creates more US jobs. They even convinced a New York Times columnist that this was the case.
The problem is, no one can identify where the US jobs are that outsourcing allegedly creates. They are certainly not to be found in the BLS jobs statistics. However, the Indian and Chinese jobs created by US outsourcing are highly visible.
On February 13, the Dayton (Ohio) Daily News reported that jobs outsourcing is transforming Indian "cities like Bangalore from sleepy little backwaters into the New York Cities of Asia." In a very short period outsourcing has helped to raise India from one of the world's poorest countries to its seventh largest economy.
Outsourcing proponents claim that US job loss is being exaggerated, that outsourcing is really just a small thing involving a few call centers. If that is the case, how is it transforming sleepy Indian cities into "the New York Cities of Asia"? If outsourcing is no big deal, why are Bangalore hotel rooms "packed with foreigners paying rates higher than in Tokyo or London," as the Dayton Daily News reports?
If outsourcing is of no real consequence, why are American lawyers or their clients paying $2,900 in fees plus hotel and travel expenses and two days' billings to attend the Fourth National Conference on Outsourcing in Financial Services in Washington DC (April 20-21)?
On the jobs front, as on the war front, the social security front and every other front, Americans are not being given the truth. Americans' news comes from people allied with the Bush administration or dependent on revenues from corporate advertisers. Displease the government or advertisers and your media empire is in trouble. The news most Americans get is filtered. It is the permitted news. Many "free trade" advocates also are dependent on the corporate money that funds their salaries, research and think tanks.
Another clear indication that outsourcing of US jobs is no small thing comes from the reported earnings of the leading Indian corporations that provide American firms with outsourced IT employees and engineers. During the recent quarter, Infosys' revenues increased by 53%, TCS grew by 38%, and Wipro was up 34%.
On January 1, 2001, Cincinnati-based Convergys Corp had one Indian employee. Today it has 10,000. Why? Because it can hire Indian university graduates for $240 a month, a sum that is a small fraction of the US poverty level income.
Many Americans think that an outsourced job is an existing job that is moved offshore. But many outsourced jobs are created offshore in the first place. On February 11, USA Today told the story of OfficeTiger, "the sort of young technology company that once created thousands of high-paying jobs in the USA, fueling sizzling economic growth." The five-year old startup business employs 200 Americans and ten times that number of Indians. The company has plans for hiring many more Indians to perform "tech-heavy financial services."
Under pressure from venture capitalists who fund new companies, American startup firms are starting up abroad. Thus, the new ventures, which "free trade" economists assured us would create new jobs to take the place of the ones moved offshore by mature firms, are in fact creating jobs for foreigners.
As a consequence, tech jobs in the US are falling as a percentage of the total. Clearly, tax breaks for venture capitalists are self-defeating when the result is to create jobs for foreigners, not for Americans. Why should the American taxpayer subsidize employment in India and China?
These developments have obvious adverse implications for engineering and professional education in America. The BLS jobs forecast for the next ten years says the vast majority of US jobs will not require a college education. University enrollments will decline and so will the production of PhDs as fewer professors are needed.
As India and China rise to first world status, the US falls to third world status where the only jobs are in domestic services.
This has enormous implications for the US balance of payments. Americans' consumption of manufactured goods is heavily dependent on foreign manufacture, whether that of foreign firms or that of US multinational firms that supply their American customers from offshore. How does an economy in which employment growth is concentrated in nontradable domestic services pay for its imports with exports?
Since 1990 the US has been paying for its imports by giving foreigners ownership of its assets. In the last 15 years foreigners have accumulated $3.6 trillion of America's wealth.
America has been able to pay for its consumption by giving up its wealth because the dollar is the world's reserve currency. As America's high-tech and manufacturing capabilities decline and its red ink rises, the dollar's role as reserve currency must end.
When the dollar loses its reserve currency role, America will not be able to pay for the imports on which it has become dependent. Shopping in Wal-Mart will be like shopping at Neiman Marcus.
Until recent years, US companies employed Americans to produce the goods that Americans consumed. Employment supported sales, and sales supported employment. No more. By their shortsighted policy of moving US jobs abroad, our corporations are destroying their American markets.
Economists give assurances that the dollar's decline and fall will bring jobs and industry back to the US. Once Americans are as poor as Indians and Chinese are today, the process will reverse. Multinational corporations will locate in America to take advantage of cheap labor and unserved markets. By becoming poor, the US can become rich again.
You might want to ask the economists and our "leaders" in Washington why we should put ourselves and our descendants through such a wrenching process."
--Jerry Leslie Note: les...@jrlvax.houston.rr.com is invalid for email
Would you like fries with those charts?
Offshoring as an engine for producing greater profits is growing. Unemployment is not the only marker. The number of new jobs created overseas instead of here that are serving our market that undercuts/subverts business operating here to the point that it is unwise to either go into said lines of business or to work for them knowing it will eventually mean the axe cometh. This is precisely what our forefathers were trying to prevent, the running of America out of it's own marketplace.
You're trying to tell us that now that you've outsourced us up to 5-6 percent unemployment, we should just be happy that only 19 million people are being written off and not worth their jobs or livelihoods... It was lower than what it is now and we were working toward full employment. You are essentially arguing that kicking out up to 6 percent isn't bad as long as it's in the range of prior norms. No, that isn't acceptable. The minute you do it to One person it's unacceptable. When we were squatters under despotism, you had no right to move in and take a man's home and livelihood from him. Higher forms of governance evolved to escape that happenstance. And now that we have the best one on the face of the earth, you're taking men's livelihood away from them and giving it to a foreigner in another land for profit. No different than despotism. If it's no different, how is it better. But it isn't bad enough that this kind of treason is done at all, you're doing it during a tough cycle and in wartime. Not only that; but, when the object isn't staying afloat; but, to make more profit. I don't know how much deeper you can go with that betrayal. If there was profit in it, I'm sure ya'll could imagine it though. I do not understand how you cannot get that.
I don't accept the 5.2 percent number as it, in my understanding, stops counting people as unemployed when they fall of the unemployment roles. There are other problems with it IMO; but, I've never believed those figures from either side because both spin it anyway they can to try for the best face on it.
19 million people. No, it isn't acceptable and it isn't right.
Ahh, did you major in hyperbole?
OK so let me get this straight:
You are saying that outsourcing has caused our emplyoment numbers to worsen due to the dropping of tariffs with the NAFTA agreement correct?
This is asked for clarification because your point seems to be flailing about.
I'm guessing that this refers to the quality of wages being paid? If so, you have an excellent point:
Series Id: CES0500000049 |
|||||||||||||
| Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Annual |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1994 | 7.54 | 7.56 | 7.54 | 7.55 | 7.55 | 7.53 | 7.52 | 7.50 | 7.50 | 7.53 | 7.52 | 7.52 | |
| 1995 | 7.51 | 7.52 | 7.52 | 7.51 | 7.50 | 7.52 | 7.54 | 7.54 | 7.55 | 7.55 | 7.56 | 7.55 | |
| 1996 | 7.55 | 7.54 | 7.53 | 7.54 | 7.54 | 7.56 | 7.56 | 7.58 | 7.58 | 7.57 | 7.58 | 7.58 | |
| 1997 | 7.59 | 7.60 | 7.63 | 7.64 | 7.67 | 7.67 | 7.68 | 7.71 | 7.70 | 7.74 | 7.76 | 7.78 | |
| 1998 | 7.79 | 7.83 | 7.86 | 7.88 | 7.88 | 7.88 | 7.88 | 7.92 | 7.93 | 7.93 | 7.94 | 7.94 | |
| 1999 | 7.95 | 7.98 | 8.00 | 7.98 | 8.00 | 8.02 | 8.01 | 8.01 | 8.00 | 8.00 | 8.00 | 8.00 | |
| 2000 | 8.02 | 8.01 | 7.98 | 8.03 | 8.03 | 8.01 | 8.02 | 8.04 | 8.03 | 8.05 | 8.06 | 8.07 | |
| 2001 | 8.03 | 8.06 | 8.09 | 8.09 | 8.06 | 8.07 | 8.10 | 8.13 | 8.11 | 8.16 | 8.20 | 8.24 | |
| 2002 | 8.22 | 8.23 | 8.22 | 8.19 | 8.21 | 8.23 | 8.23 | 8.23 | 8.24 | 8.25 | 8.26 | 8.29 | |
| 2003 | 8.26 | 8.25 | 8.21 | 8.23 | 8.28 | 8.29 | 8.31 | 8.27 | 8.25 | 8.27 | 8.31 | 8.30 | |
| 2004 | 8.27 | 8.26 | 8.24 | 8.24 | 8.21 | 8.19 | 8.23 | 8.25 | 8.25 | 8.21 | 8.21 | 8.23(p) | |
| p : preliminary |
|||||||||||||
Wages in the private sector have been stagnant for three years; in fact, from 1994-2004, in real terms they have appreciated about 9%, or less than 1% per year.
For what it is worth, the public sector pays better than the private one; average hourly wages in the public sector are just over $22. For the private sector, it's more like $16.
I say we revisit permanent MostFavoredNation trading status fer the Chi-Coms...on humanitarian grounds.
FReegards...MUD
No, the point isn't flailing about. I have stated that from the beginning and have been stating it for some time. There was falloff due to the bubble burst which put us into recession. There was falloff due to 9/11. And there was falloff due to you guys throwing people out of work for higher profits (offshoring). 9/11 we can't fix. The bubble burst we understand. But, a hand up to bin laden by disowning americans in the business sector for profit - that's treason WHETHER intended or not. And yes, your free trade junk is responsible. The tariffs need to be put back in place and our relationship with the WTO should be severed for the unconstitutional garbage it is.
OK it is hard to follow so again I ask for clarification is the above answer a YES, to the question listed here: "You are saying that outsourcing has caused our emplyoment numbers to worsen due to the dropping of tariffs with the NAFTA agreement correct?"
MD -- FYI, have you seen the new book on China? Front page review in NYT today.
"What's the Truth?!"
(To be sung to Johnny Cash's "What is Truth?")
Rush Limbaugh's talkin' on the Rad-ee-oh...
Sayin', "Where did our sense of Justice go?
Slick sure seems to be inventin' new ways...
Of keepin' the Truth from gettin' airplay!!"
Said, "They're crooks, you see, and their motives're Vile!!"
Still, the Medyuh says, "Bill's OUR Flower Child!!"
Country, can't you see thru these Lyin' Boys?
We gotta FIGHT to be heard o'er their LeftWing Noise!!
While the Lonely Voice of Youth cries..."What's the Truth?!"
My little boy of five, playin' in the yard,
Looks up and says, "Daddy, who's Ken Starr?" [yeah, it's an old song, circa 4/99...I'll fix it.]
"Son, he's trackin' bad men who Cheat and Lie!!"
Little man of five says, "Slick Ain't Right!!"
Young men of seventeen killin' kids at school,
As Courts outlaw the Golden Rule...
No prayer in school, teachers puttin' Faith down,
While Slick Willie jokes, "Let's pass a Joint aroun'!"
Can you blame the Voice of Youth fer askin' "What's the Truth?!"
EX-Prez'dent's sittin' on the Witness Stand,
The man with the Book says, "Raise yer hand...
Repeat after me, 'I solemnly swear...' "
Yet the Nation said, "We just don't care."
'Cuz although Clinton solemnly swore,
Nobody really trusted Slick no more.
Culture's got so sleazy that America's unaware...
That EX-Prez'dent sold China missiles that're aimed at Bel Air!!
Still the RightWing's called uncouth fer askin', "What's the Truth?!"
Young girl internin' with the White House Sleaze...
Doin' Bill's job while on her knees!!
FReepers protest in the Public Square,
While fightin' 'gainst this Lib'ral Nightmare!!
Yeah, these young'uns that yer callin' "WILD"...
Are gonna be yer Leaders in a little while!!
The Whole World's Wakin' to FReedom today,
And I solemnly swear that it'll be OUR way!!
We gotta help our Voiceless Youth find, "What is True?!"
'Cuz the future needs more Youth askin', "What's the Truth?!!"
A little Johnny Cash never hurt anyone...MUD
Because they're stupid...
There are so many well paying IT jobs right now,just begging for Americans to take, that headhunters are NOW and have been swamped for over a year.It's a boom time and any American who can't get a good job today,is either not willing to move,or is incompetent.
Yet, more Americans are employed than at any time in our nation's history.
Nope, got a link or a book title?
Nice LOL.
Blasphemer!
Heretic!
Get ye down unclean beast...
[
[
[
Sorry, I was channeling Havoc there for a bit...
;-)
Here's the first couple of graphs of the review..
CHINA INC.
How the Rise of the Next Superpower Challenges America and the World
By Ted C. Fishman
342 pages. Scribner. $26.
f the 20th was the American century, then the 21st belongs to China. It's that simple, Ted C. Fishman says, and anyone who doubts it should take his whirlwind tour of the world's fastest-developing economy.
The numbers are staggering. From 1982 through 2002, the United States economy grew at an annual rate of 3.3 percent, he writes, well above average for the world's most prosperous nations. China's economy grew at an annual rate of 9.5 percent, meaning it "doubled nearly three times over," in the generation since market reforms were introduced. In 2003 it bought 7 percent of the world's oil, a quarter of its aluminum and steel, almost a third of its iron ore and coal, and 40 percent of its cement. It makes 40 percent of all furniture sold in the United States. Its 3,000 Christmas-decoration factories exported more than $900 million tree trimmings and plastic Santas in the first 10 months of 2003.
"China still only makes one-twentieth of everything produced in the world, but on the world stage it plays the role of a new factory in an old industrial town," Mr. Fishman says. "It can spend, it can bully, it can hire and dictate wages, it can throw old-line competitors out of work. It changes the way everyone does business."
One of the most powerful weapons in China's economic arsenal is what businesses have come to know as "the China price." A stampede from the countryside to China's new industrial boomtowns has created a vast low-wage army, working for an average of 40 cents an hour, that can turn out consumer goods of every description even cheaper than Mexican or Malaysian factories can. American factories that cannot deliver to Wal-Mart or General Motors at the China price often face two stark choices: they can go under or set up shop in China.
I think I specifically said offshoring - not outsourcing. Outsourcing is moving business to another market to produce for that market with employees in that market and under that market's rules. Offshoring is evading a market's rules/laws and workforce while going to another market to produce with their labor and reimport to the original market to try and outdo the home market for profit. And Offshoring is what I credited with nafta/free trade/WTO nonsense. Perhaps I missed defining my terms or you missed it. I've been in too many discussions today here and elsewhere on this, so I'll assume the failure was mine.
It is treason.. pure and simple. Selling out your home market and subverting it for profit. If that isn't treason, then there is no such thing and you need to go resuscitate the Rosenbergs and a bunch of other people.
OK good enough lets us clairify even further.
Did NAFTA cause unemployment to rise in the USA? Yes or No.
It isn't treason. It may be unpatriotic, but it still isn't treason.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.