Op-Ed Globalization isn't killing factory jobs. Trade is actually why manufacturing is up 40%.

Los Angeles Times ^ | August 1, 2016 | Daniel Griswold

[expat_panama]

Foreign trade took a beating at both major party conventions, with speakers blaming free-trade agreements for all but wiping out U.S. manufacturing and eliminating millions of middle-class jobs. Both Donald Trump and Hillary Clinton have promised to renegotiate or abandon trade agreements with key U.S. trading partners such as Mexico and Canada. That would be a colossal mistake.

The number of manufacturing jobs in the United States has indeed been in a long decline since the late 1970s...

American factories and American workers are making a greater volume of stuff than eve...

...America’s 21st century manufacturing sector is dominated by petroleum refining, pharmaceuticals, plastics, fabricated metals, machinery, computers and other electronics, motor vehicles and other transportation equipment, and aircraft and aerospace equipment.

We produce more manufacturing value with fewer employees...

The political anger about lost manufacturing jobs should be aimed at technology, not trade.

The political anger about lost manufacturing jobs should be aimed at technology...

...globalization and trade agreements have made a huge contribution to the ongoing success of American manufacturing...

...more than half of what Americans import each year is not for consumption but for production...

Like technology, globalization has allowed American manufacturing workers to “trade up” to more challenging and better-paying work...

...millions of U.S. jobs are eliminated each year by technology and changing consumer tastes, only to be replaced by new jobs that are being created by the same dynamic forces.

The right response to anxieties about trade is to invest more in education, retraining and enhanced labor mobility, not to pick trade fights with other nations that would put in jeopardy the success of America’s modern, competitive manufacturing sector.

[central_va]

We lived in a different world back then as tariffs was the main source of governmental income as there were no corporate or personal taxes.

Do you acknowledge that tariffs actually work to protect industry from moving offshore?

Funny how it was a different world back then until you mention Adam Smith then every thing he said applies to today trade situation perfectly.

[central_va]

America is lurching towards socialism to be sure, but it has nothing to do with NAFTA.

You believe that...

[central_va]

So by your definition I am not a Patriot but you are. Is that what you think?

[Old Teufel Hunden]

"Do you acknowledge that tariffs actually work to protect industry from moving offshore?"

No, I said it was a different world back then. Do you not acknowledge that? We had to have tariffs to raise revenue for the operation of the government back then. How about lowering the corporate tax rate to attract companies to come and stay here?

[Old Teufel Hunden]

"So by your definition I am not a Patriot but you are. Is that what you think?"

You have been the one that has questioned my patriotism. I never questioned yours. I have only stood up for myself, not attacked your patriotism.

[central_va]

A simple yes or no works.

[central_va]

Ok let's try penetrate your dogma.

Would a complete blockade of all incoming goods create shortages that would eventually lead to domestic supply creation? Yes or no?I am trying to set boundaries for a civil discussion and not your fascistic protectionism is always bad position.

[central_va]

How about lowering the corporate tax rate to attract companies to come and stay here?

Why do that? Who cares? Not you for sure. You Free traders have a solution and that is to off shore all manufacturing.

[Old Teufel Hunden]

You don’t like my answer so now you are dictating the terms of the discussion. So who gave you the authority to dictate the terms of the discussion and then give sarcastic answers when I provide solutions? When did I ever call you a fascist? Following your logic is difficult to say the least....

[central_va]

Is protectionism always wrong? Are there no winners under protectionist trade policy?

I can admit that free trade has a lot of winners. Can you admit that protectionism has a lot of winners? Both systems have pros and cons. Can you at lest admit that?

[rb22982]

The problem with free trade is it really isn't free. Right now we're trading with 8 out of 10 fingers tied behind our back

You can't put forced enormous environmental, other regulatory, and labor costs on US based companies and then allow large MNCs to skirt every last one of them by creating those products in China, Vietnam, etc and then charge no tax to bring those products back into the US. It puts US based manufacturing at a massive disadvantage.

While I am very happy to scale back on all those 3 things, until that happens, we should at the very least charge import tariffs on those type countries equal to the forced labor, environmental, and regulator costs PLUS any currency manipulation costs compared to the country we are trading with - and allow a 10% room for error. That would mean zero tariffs with countries like Canada, Europe, Australia, Japan, etc but large tariffs China, Vietnam, etc.

So called "free trade" to be fair, even despite the handicap on US production highlighted above, is probably good for the US economy overall but the benefits flow basically to execs and shareholders (which is terrifically good for me with my income in the top 2% at a young age). That's while real income for the top 1, 5, and 10% has skyrocketed in the last 30 years but for the middle 50% has stayed flat despite overall GDP skyrocketing. This problem is only going to get worse - and short of a universal income - I don't see how this doesn't lead to massive unrest over time if we don't put up tariffs on these third world countries.

I think the problem a lot of large company free traders don't realize that they have an IQ of 120+ and are setup to succeed in this type of environment. It doesn't work well for the IQs of the 70-110 that make up 50% of the population.

[Old Teufel Hunden]

"So called "free trade" to be fair, even despite the handicap on US production highlighted above, is probably good for the US economy overall"

On this we can agree. As for the things you outline, I agree. We need to get rid of a lot of stupid regulations that shackle companies operating here. We need to lower corporate income tax which is merely a tax on you and I the consumer. As for the income disparity gap between the top 10% and everyone else, in a word who cares? Make yourself valuable and you will earn income. What I care about is crony capitalism, the unholy alliance between government and big business. I also care about corporate welfare. I don't believe in it.

"It doesn't work well for the IQs of the 70-110 that make up 50% of the population."

I have alluded to this in another post. I didn't base it on IQ, because I don't believe it is. IMO, I have met a lot of people with supposed high IQs who are pretty stupid and visa versa. I based it on people who worked in the factories all their lives and then become displaced. Free trade proponents need to do a better job of addressing these people's needs. As a true conservative, I think everyone should depend on themselves and not the government, but I understand that in order to make this work we have to come up with an answer to this problem. The answer is re-training and better education. The answer is more home schooling and getting people a choice in their education and not being tied to government schools. That's the start, it doesn't address people in this situation now, but for those people we have to find a way to re-train and incentivize them to get other careers.

[central_va]

we should at the very least charge import tariffs on those type countries equal to the forced labor, environmental, and regulator costs PLUS any currency manipulation costs compared to the country we are trading with - and allow a 10% room for error. That would mean zero tariffs with countries like Canada, Europe, Australia, Japan, etc but large tariffs China, Vietnam, etc.

Agree. This has to be done.

[semimojo]

Have I covered all the Free Trader scare tactics?

As always, you fail to deal with all the jobs lost when other nations retaliate and cut way back on the $2T in goods and services they buy from us each year.

[hawg-farmer - FR..October 1998]

Your comment makes no sense at all...heh heh Delusional..

[central_va]

They(the world) need our market way more than we need theirs. Domestic consumption would go up. The tariff would be deflationary for domestic made goods. Inflationary for imports. Other nations already tariff our exports so there is little danger of retaliation since they already are.

Your Free Trader just want to go down the toilet bowl and hang on to your failed economic theories. You guys are worse then Keynesians. At least you can reason with them.

[Toddsterpatriot]

The tariff would be deflationary for domestic made goods.

It's deflationary when the price of domestic goods increases?

[semimojo]

Other nations already tariff our exports so there is little danger of retaliation...

Whistle louder, you'll be past the graveyard soon.

[rb22982]

As for the income disparity gap between the top 10% and everyone else, in a word who cares? Make yourself valuable and you will earn income. What I care about is crony capitalism, the unholy alliance between government and big business. I also care about corporate welfare. I don't believe in it.

Income gap on a level playing field, sure, I agree 90%. Income gap when the field is leveled to support high IQ + high work ethic + cut throat?

I didn't base it on IQ, because I don't believe it is. IMO, I have met a lot of people with supposed high IQs who are pretty stupid and visa versa.

IQ only goes so far but it is a HUGE prerequisite. IQ of 110 with perfect work ethic and good personality will go as far as 125 IQ with average work ethic and personality but on AVERAGE, an American is born within parameters based on their IQ. IQ of 130 + good work ethic and a bit of luck? Literally sky is the limit. IQ of 70 + good work ethic = $12/hr.
Why do I care despite the fact I make top 1% adjusted for COL before I'm even 35? I don't believe the system survives without a strong middle 25-75%. We're just headed to a revolution, IMO, especially with automation in the mix. When you put laws in place that support MNC/Globalism vs home grown, you are just asking for it. At the least, we should put tariffs that cost of regulations, labor, tax + "cheating."

[central_va]

If China cancelled every contract with Boeing would Boeing INCREASE the cost to domestic airlines?