Posted on 03/12/2016 6:33:12 PM PST by Jim Robinson
Are we be better off today with the thousands of U.S. factories that have shut down and millions of American jobs lost and the trillions in accumulated debt that we've run up in the last couple decades of free trade?
And, of course, this is due to many factors including such things as:
Big government
Regulations
High taxes
Unions driving up costs
Cheap labor overseas
Fewer regulations overseas
Lower taxes overseas
Trade deficits
etc.,
And doubly exasperated by poor trade deals?
Or is this all a myth?
Are we better off with cheaper foreign (cheap) goods, fewer U.S. factories, fewer U.S. jobs, higher unemployment and welfare, higher taxes and higher national debt?
Will this spiral out of control until we lose our country?
Is ushering in free trade before (or without) reducing our own costs the equivalent of national suicide?
True enough. But consider just like any other business model or machine, volume is one of the most important aspects that makes this (or any) thing work. Cut into the volume or flow of products by producing more domestically and the costs of operating that distribution system are going to get out of bounds rather quickly.
My point is that everything that involves products or money or trade has a number of levers and dials to control it. Hopefully, we can find people to dial in the correct settings with the goal being...Oh I don't know! How about the best interests of the American People ~the middle class?
Instead of a bunch of pocket lining political hacks like the folks who we've had running this system for about the last 40 years or so.
Its due to all of the above including free trade and in the best case scenario a President Trump and Congress will take care of this especially the Federale Gov't regulations and tariffs part.
Cruz saying "free trade" has nothing to do with this is nonsense. He is lost in the Harvard Law School ozone. Obama, Paul Ryan and Mitch McConnell would say the same thing. They are either dumb or being bribed via campaign donations.
Who pays the tax? The corporation just passes that onto the consumer.
For the past five years, trades skills have been identified as the #1 shortage in surveys of manpower executives. I realize you asked for “one area,” the classification trade skills is rather broad.
Surveys of the NFIB (small business) indicate many job openings are going unfilled for lack of qualified people. (The area isn’t specified.)
The Conference Board index of internet job advertising is very high. This is broken down by category and location. Check it out:
https://www.conference-board.org/data/helpwantedonline.cfm
Since the economy crashed, people have been holding on to their old job for fear of not being able to find a new one. Their livelihood rests not in themselves and their willingness to work, but in the fortunes of their company. But, there are no guarantees. Companies are always changing. In a growing economy, people can adapt themselves to changes because while some jobs are disappearing others are opening. But not in this stagnant economy.
America is the most productive and therefore cost effective place on earth to do business. Would America aggressively engage in real actual genuine free trade, that is trade without the government regulations and regulators and without business taxes, the economy would be so much better than the rest of the world that all large businesses would be striving to locate HERE and to employ Americans.
The funny thing is that he does not understand that the job loses are what start communities on a downward spiral.
I may be wrong about this, but I believe that ship isn't even used in Asia-U.S. trade corridors because it's too big for most U.S. ports.
Rotterdam, Antwerp and Hamburg are probably the top destinations outside Asia for ships of that size.
You are kidding about this, right?
But isn't 310 million people a big enough market for American manufacturing...
When I walk into a 'dollar' store and look at all that Chinese junk they sell, and realize all that junk used to be made in America by Americans...And it wasn't junk...
In my view all of the 3rd world countries, China, India, Indonesia and Vietnam included should have been left out of the World Trade Organization until they reached a balance with us and our European trading partners...They should have their own Trade Organization where they can play on their level playing field...
Amen, Amen and Amen!
We now spend more than a trillion dollars per year on means tested, government poverty programs. Those government benefits go to the long-term unemployed, or those employed in lower paying jobs and still qualify for various poverty programs.
We have no prayer of reducing our federal budget deficit without making large reductions in the trillion annually spent on poverty programs.
And just how can we move people off poverty programs? Only one way: move them from welfare to gainful employment. And the only way to generate the millions of needed jobs is to bring back most of the millions of manufacturing jobs that have been relocated to cheap labor nations.
You won't solve the employment problem with education, though that could help make some gains, but we need jobs for those aren't and never will be highly educated. And manufacturing can provide more jobs of that type than any other sector of the economy.
Our government has been blathering about education and retraining displaced workers for thirty years and what has all that actually accomplished?
Most of them going to Europe - for now.
http://www.latimes.com/business/la-fi-ports-megaship-20151229-story.html
Only when an apparel (sewing factory) industry is reestablished in the US of a size to produce a significant percentage of the clothing purchased in the US. During their primary, it was said several time that SC has lost 300,000 textile jobs in recent decades. That's why Trump and many others who have a clothing line have little choice but to seek overseas producers.
Some of those nations on your list you say Trump uses are definitely not cheap labor nations, but apparently still have a significant apparel industry.
Many in my family worked for IBM. Until IBM was no longer in the game.
IBM.
Our region was gutted.
Welfare reform was a big part of the turn-around in the economy during the 1990s. Following the Crash of 2008, Congress extended unemployment benefits out to 2 years. EITC and food stamp programs were made more generous. Medicaid expanded as part of Obamacare. Illegals were qualified for welfare programs. Refugee programs became big business for welfare programs and the non-profits that are involved. It is not a mistake that dependency increased. It was policy. And, with so many moochers supplementing their earnings with welfare, companies don’t have to pay enough for people to actually live off their earnings. This all ties together. And, what is more, it all can be fixed. We only have a few months now until the election. Don’t give up on the country yet.
Businesses always pass the cost on to the consumer...It is still tariffs regardless of what name you put on it...
Our fracking innovations have made natural gas cheaper than ever. This creates industry here at home and makes energy costs lower than China. That attracts manufacturing.
When is that manufacturing going to show up??? I thought the fracking process resulted in higher energy costs...As long as gas was selling for 4 bucks a gallon, fracking could be profitable...Energy independence doesn't necessarily mean cheap energy...
Thank you for your service Tallyhoe.
Have a good night.
The principle of free trade is absolutely solid. Competition is one of if not the most important elements of capitalism. Just look at free trade between the states for example. If Pennsylvania was the leader in producing toasters, but suddenly New York figured out how to make toasters cheaper and better, free trade between the states will mean Pennsylvania will face closed factories and job losses in the short term. If Pennsylvania reacted to this by putting a big tax on toasters made outside the state, then New York would retaliate by doing the same with other Pennsylvania goods and Pennsylvania would retaliate again with more tariffs. Suddenly both states’ citizens have less choice on what they can buy and their businesses are unnaturally protected from having to compete with each other.
As barriers are put up, each state also loses the chance to take advantage of unique talents or natural resources that another state might have that they don’t. These principles apply between countries just as they do between states. Every invention starts in only ONE place. If we don’t have the opportunity to trade with the place that makes the invention, we’re deprived of something that might help our lives.
In our system, the states also have to compete with each other in the regulatory and tax atmosphere. Free trade within the states means states have to keep the atmosphere for business friendly there or that business might close down and move to another state. Greater international trade means we also have an incentive to de-regulate business here as well as another argument to make to stop NEW “carbon” taxes and other regulations from being passed that would make us less competitive with other countries. The argument is always made that China and India aren’t subject to the same penalties in some of these climate change schemes that we are, and that’s a very effective argument.
Barriers to trade bring back memories of the Soviet Iron Curtain that built walls to keep its citizens trapped inside. Freedom doesn’t mean adding in more rules and more opportunities for the government to tax and punish you for things that aren’t even biblical sins. We don’t want a government trying to control the free exchange of goods and services or picking winners and losers in businesses.
The example above about Pennsylvania and New York does show that free trade itself creates winners and losers. Increased competition means some once successful companies will fail. But this is the dynamic nature of capitalism. Companies fail all the time because of basic supply and demand. Jobs are lost all the time because of things like technological advancement. Ultimately, the fundamental purpose of capitalism is to provide people with the goods and services they desire. Jobs are a side-effect of capitalism but not its purpose or goal.
Yet, jobs are something that any functioning economy will always create. It’s not in the nature of human beings to be satisfied with what they have. We used to have 3 TV channels, now we have hundreds plus home video. People will always want more. That desire for more will come in many forms. To get something that doesn’t currently exist requires people be employed to create it. Just think of how you run a household. If someone used to do a chore that you then bought a machine to do instead, you don’t let that person sit on their butt all day. You find something else for them to do to make your home better in some other way.
That does, of course, beg the question of why there is any unemployment. First of all, the labor participation rate that candidates and pundits often mention is a number that has very little analysis out there unpacking it. Some of it comes from a greater number of older retirees and from younger people staying in school longer. Some comes from stay-at-home moms who don’t want or need to work. It’s not clear to me that unemployment is at a crisis level. I think we can perhaps all agree that if a factory closes down for any reason, but everyone working there is able to quickly find jobs that are equivalent elsewhere, then nothing bad happened for the economy.
Obviously, there is always a transition period after some jobs go away before those people can find work again. This is something that we should be prepared to deal with WHENEVER it happens, not just when it happens due to offshoring or imports undercutting a domestic company’s prices.
Our welfare system is broken. People being allowed to park on welfare means that labor is less available and costs more. This only gives more incentives for companies to offshore or beg for foreign labor to be imported. Welfare absolutely has to be made to require community service as a prerequisite for receiving it. Studies have shown that when this is tried, welfare use goes down dramatically because people refuse to do the work and don’t really need the welfare. They may realize that getting a real job will pay them more.
Our education system is also broken. Like any industry that’s socialized or subsidized, we get low quality at high prices. We absolutely need school choice to revolutionize our economy and create more innovators and entrepreneurs who will employ people in jobs we can’t even imagine now (outer space truckers?). Every public school needs to be privatized and every student should have the right to leave and go to the school of their choice. We also need student aid for college to be based on what jobs are actually in demand by businesses and not given out for vanity educations. Extra consideration for aid can be given to people who get laid off because an entire business or location closes down.
Whatever else you can say about our economy, most human beings possess a greater abundance of goods and services than they did 5, 10, 25 or 50 years ago. The cell phone is ubiquitous and performs an enormous amount of tasks that used to take many more products and much more effort to do. Even if people are making less money now or wages have been flat, that might be offset by how much more stuff they can buy for their dollar. Inflation is under control and we might even be getting more bang for our buck when all things are taken into account.
In terms of taxes and debt, I don’t think free trade is much of a driver of that. I think recent numbers have shown that our government is receiving record tax revenue. The economy is working well enough to deliver big tax revenue to the government. It’s the spending that’s the problem.
I would look at federal entitlement programs as the number one cause. Social Security by its very nature is constantly expanding to cover more and more people than it was ever intended to, including through the much-abused disability segment of it where young people are ripping off a program meant for the retired. Social Security is a Ponzi scheme that is headed to insolvency. The constantly expanding health care entitlements are of course another big problem.
Our military expenditures are also very high. Perhaps getting reimbursement from other countries for receiving our military protection can address that. South Korea is a booming economy now so they should be able to chip in something for having our military protection.
As you know the official unemployment rate is low, and there are real shortages in the labor force.
See the word “official”? You’re not going to say you disagree with that part of the sentence.
I believe you mean “in spite of the official unemployment rate being low, the REAL or TRUE unemployment rate is very high.” I would agree with this. This is why I looked at the supply of labor as well as the demand for labor. A lot of people who SHOULD be looking for work aren’t. Why aren’t they anxious to find work? I think we agree on that as well. Because if you’re a working Joe, it doesn’t pay to work. You get as much stuff and/or money by not working or working only part-time, as by working.
We know that life isn’t about getting stuff and/or money. It’s really about standing on your own two feet, as a self-supporting person. Then, you can look any man in the eye. Sure some people make more than others. And some people inherit a lot, or get paid enormous gobs of money because they’re really good at football or something. Good for them, I say. As long as everybody who is willing and able to work can find their place in life, and provide for themselves and their family.
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