Posted on 11/09/2005 7:46:56 AM PST by A. Pole
The October payroll jobs report from the Bureau of Labor Statistics shows employment growth for the month essentially at a standstill. The economy created only 46,000 private sector jobs. The bulk of those—33,000—were in construction.
The domestic service sector of the economy, which has been the source of net new jobs in the 21st century, experienced no job growth in October.
In the 21st century, the U.S. economy has ceased to generate net new jobs in middle- and upper-middle-class professions. This is a serious economic, social and political problem that receives no attention.
There is a great deal of meltdown inside the U.S. economy. Manufacturing is hollowed out. The decline in manufacturing means a decline in the engineering and other professions that serve it. Knowledge jobs are also being lost to offshore outsourcing and to H-1b, L-1 and other work visas. In October, there were 81,301 corporate layoffs.
The government does not keep records of the U.S. jobs lost to offshore outsourcing and to work visas for foreigners. With so few jobs available in the educated professions, the future of U.S. universities would seem to be bleak.
In December 2003, Congress directed the Department of Commerce to complete a study within six months of the impact of jobs outsourcing on knowledge-based industries. The report due in June of 2004 was not released until September of this year in response to a Freedom of Information Act action, and only after the report was gutted by political appointees and reduced to 12 pages of PR quoting reports by organizations and individuals that have been funded by multinationals that benefit from shifting American jobs overseas.
Powerful lobbies that benefit from low-cost foreign labor have invested heavily in public relations campaigns to create the impression that American jobs have to be outsourced and foreign workers brought into the United States because there are shortages of U.S. engineers, scientists, nurses and schoolteachers. It is amazing that the occupations in which shortages are alleged to exist are the very occupations in which qualified Americans cannot find jobs.
Many economists mistakenly claim that offshore outsourcing and work visas for foreigners benefit Americans by lowering costs. But no country benefits from the loss of high productivity, high value-added occupations. The United States runs trade deficits in manufactured goods and advanced technology products. Last year, the U.S. trade deficit in advanced technology products was $36,857,000,000. As of August of this year, the U.S. trade deficit in advanced technology products is running 26 percent higher than in 2004.
America’s volume exports are paper, waste paper, agricultural products and chemicals.
The Oct. 28 issue of Manufacturing & Technology News reports that Procter & Gamble, General Electric, Ford, Kimberly Clark, Caterpillar, Goodyear, General Motors, USG, Honeywell, Alcoa and Kodak combined exported 269,600 containers of goods in 2004. Wal-Mart alone imported 576,000 containers of goods.
The United States allegedly is a superpower with a highly developed economy. China is a newly developing country not far from Third World status. You might think that China would be running huge trade deficits with the United States, as China imports the goods and services necessary to continue its economic development and serve consumer wants. The trade statistics, however, tell a different story.
Last year, the United States imported $196,682,000,000 in goods and services from China and exported a mere $34,744,100,000 to China. The American “superpower’s” trade deficit with China came to $161,938,000,000. To put this figure in perspective, America’s trade deficit with China is 28 percent higher than American’s total oil import bill.
Everyone talks about energy independence as if our future depends on it. Simultaneously, we are told that globalization is good for us in every other respect. But why is energy independence any better than manufacturing independence, or engineering independence, or innovation independence? U.S. imports of industrial supplies, capital goods, automotive vehicles and consumer goods all exceed U.S. oil imports.
In recent years, offshore outsourcing has caused the U.S. trade deficit to explode. Offshore outsourcing means that the production of goods and services for the U.S. market is shifted from America to foreign countries. This turns goods formerly produced in the United States into imports. Between 1997 and 2004, the U.S. trade deficit increased six-fold. Since 1997, the cumulative U.S. trade deficit (including the $700 billion estimate for 2005) is $3.5 trillion. The outsourcing of America’s economy is a far greater threat to Americans than terrorists.
During the 1980s, economists spoke in doom and gloom terms about the “Reagan deficits.” The cumulative U.S. trade deficit for the entire decade of the 1980s totaled $846 billion. The U.S. trade deficit for 2005 alone is 83 percent of the cumulative deficit of the Reagan 1980s. Yet, we hear very little doom and gloom. Economists now declare the trade deficit to be good for us. They mistakenly describe the trade deficit as a mere reflection of the beneficial workings of free trade. Economists have become mouthpieces for the corporate interests who benefit by deserting their American workforce and replacing them with foreigners.
This process of substituting foreign workers for American workers cannot go on for too long before the U.S. consumer market dies from lack of income and purchasing power. U.S. policymakers have no clue. The Nov. 4 edition of “Market Watch” reports that “wage growth is a chief concern of the Federal Reserve, which fears that wage pressures could imbed an inflationary psychology in the economy.” This is amazing. U.S. wages are not keeping up with inflation. Real wages are falling, and the Federal Reserve is worried about wage pressures!
The Bush administration is squandering our few remaining resources fighting an insurgency in Iraq that the Bush administration created by invading Iraq. Meanwhile, globalization separates Americans from the production of the goods and services that they consume. Americans are expected to buy the products without having the incomes associated with their production. If the war in Iraq lasts another 10 years, as the Bush administration keeps telling us, the United States will find itself without the industrial capacity or borrowing power to continue with the conflict.
Free trade bump!
We still manage to make plenty of lawyers and plenty of legal jobs...</s>
A blueprint for making the US a 3rd world backwater.
And we are following the plan to the letter.
When you do away with wealth creation, you lose your wealth. Plain and simple.
Ours is fading fast. The crash is coming real soon and then the glee of the one worlder's will be complete. We'll be just as poor as everyone else. Probably "balkanized" too.
Twenty years, tops.
Gloom and doom? I don't think so so long as present trends remain as is.
There are lies, damned lies, and statistics.
Quote: "We still manage to make plenty of lawyers and plenty of legal jobs...</s>"
No more comments like that or I will go to law school and then sue you.
Worst economy since Hoover!!!
Don't expect many here to even understand what Dr. Roberts is writing. Unfortunately, he is viewed as a crank.
I fear for the future of our country.
hey, who needs productive capacity. debt is the new wealth. you mean to say we all aren't going to get rich swapping real estate to each other?
Because the sources of imported oil are concentrated in a few unstable areas while manufacturing can be done almost anywhere.
GDP growing at 3.8% compared to that economic powerhouse in europe, growing at less that 1%. You can't compare china to the USA in percentage terms because in china, you are starting with each person owning one pair of tennis shoes and the economy doubling when they get their second pair. It's apples and watermelons. When dog and rice is the national dish, horse is a step up.
"This process of substituting foreign workers for American workers cannot go on for too long before the U.S. consumer market dies from lack of income and purchasing power."
"All is lost" --more wisdom from Paul (Bush worse than Bin Laden) Craig Roberts.
You could even point out that the US created 60 million jobs while all of Europe created only four million new jobs. I'm not sure that it's reality that matters here when people are so intent on proving that America is weak and helpless. Personally, it's fine with me when a sicko wants misery above all else. The problem is when a bunch of these sickos get together and form a movement-- that's when they can be dangerous.
Nothing to see here. Lock your doors and windows. Put out the cat. Go back to bed, people. Pull the covers over your head. Repeat after me: "There is no real estate bubble. What, me worry? NAFTA is good, NAFTA is good, NAFTA is good . . . "
PING
For better or worse, people overwhelmingly vote their pocketbooks. Yesterday, GOP candidates and GOP issues nationwide took a trouncing in the off-year elections. GOP voters do not switch to DEM, they just don't bother showing up when the RINO neo-cons are just as economically destructive as the Democrats, and there is no viable third option.
Unless Congress starts representing the American citizens who vote, it won't matter which party wins in 2008.
I'm sure PCR is doing just fine though churning out doom and gloom pieces like this that provide the attention he craves and, no doubt, believes he deserves.
Paul doesn't explain how, if outsourcing is so deleterious to our economy, our GDP continues to expand or how our absolute manufacturing output is still at a higher level than at any other time in history. Nor does he explain how our standard of living continues to increase or how our per capita consumption steadily grows. Consumption does not increase unless real incomes do.
This is amazing. U.S. wages are not keeping up with inflation.
By ignoring total compensation in favor of a single category (wages) PCR leaves no doubt that he is agenda driven. Company supplied benefits have increased 16% since 2000. The average hourly wage is a little over $16 an hour, according to the Bureau of Labor Statistics. When benefits are counted, the average worker earns nearly $26 an hour. The median family income has risen to $52,600 a year.
PCR also chooses to ignore that since 1980 the percentage of American workers owning stock has increased from 25% to 52%. Americans have many other sources for income now than just wages. Finally, and not surprisingly, PCR conveniently ignores that the Bush tax cuts have increased the average take-home pay for a median family of four by $1,450 a year.
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