Reality-based common sense
http://www.theatlantic.com/business/archive/2014/01/if-you-really-care-about-ending-poverty-stop-talking-about-inequality/282906/
For later.
2) He assumed that unemployed would always be able to find other productive employment. And while the economy's labor markets do try to find a new equilibrium, we are now at the point that we are off-shoring jobs faster than we are creating new ones. Unemployment is growing. Real wages have stagnated since we lowered the import tariffs in the 1960's. And now we are seeing real wages fall.
"John Hawkins: Let me ask you about this — what do you say to people who claim that free trade will eventually lead to high unemployment in the US as large numbers of jobs move to cheaper labor markets overseas?"
"Milton Friedman: Well, they only consider half of the problem. If you move jobs overseas, it creates incomes and dollars overseas. What do they do with that dollar income? Sooner or later it will be used to purchase US goods and that produces jobs in the United States."
The stores are full of Chinese made goods and Americans are unemployed. Thanks Freedman.
1) He assumed dollars would eventually come back to the U.S. to buy trade goods. Instead they are coming back to buy U.S. manufacturing firms and know how and U.S. debt.
2) He assumed that unemployed would always be able to find other productive employment. And while the economy's labor markets do try to find a new equilibrium, we are now at the point that we are off-shoring jobs faster than we are creating new ones. Unemployment is growing. Real wages have stagnated since we lowered the import tariffs in the 1960's. And now we are seeing real wages fall.
"John Hawkins: Let me ask you about this — what do you say to people who claim that free trade will eventually lead to high unemployment in the US as large numbers of jobs move to cheaper labor markets overseas?"
"Milton Friedman: Well, they only consider half of the problem. If you move jobs overseas, it creates incomes and dollars overseas. What do they do with that dollar income? Sooner or later it will be used to purchase US goods and that produces jobs in the United States."
The stores are full of Chinese made goods and Americans are unemployed. Thanks Freedman.
When A proposes to do B to C for the benefit of D, A is a scoundrel. - H. L. Mencken
Why didn't I learn about this economist in high school? Seems to me the educational motives of the public school system are meant to churn out loyal obedient subjects and discourage critical thought and dissenters.
Breaks my hear to hear this question asked. But it looks like this person is on the right track, thankfully.
My intellectual journey began with Milton Friedman and ended with Thomas Aquinas. Truth will set you free.
ping