Exporting Jobs

Capitalism Magazine ^ | August 19, 2003 | Walter Williams

[luckydevi]

Exporting Jobs by Walter Williams (August 19, 2003)

Summary: It'd make far more sense for Americans to start attacking the real sources that have contributed to making foreign operations more attractive to those at home. It's more effective than caving to the rhetoric of leftist and rightist interventionists who mislead us with slogans like, "How can any American worker compete with workers paid one and two dollars an hour?" when in reality our real competition is mostly with European workers earning a lot more.

[www.CapitalismMagazine.com]

Among George Orwell's insightful observations, there's one very worthy of attention: "But if thought corrupts language, language can also corrupt thought." Let's look at a few examples of corrupted language, thought and information.

Pretend you're a customs inspection agent. There's a cargo container awaiting a ship bound for foreign shores. You ask the shipper, who works for a big corporation, what's in the container. He answers, "It's a couple of thousand jobs that we're exporting overseas to a low-wage country."

What questions might you ask? How about, "What kind of jobs are in the container?" or, "Are they America's high-paying jobs?" Most people would probably say: "You're an idiot! You can't bundle up jobs and ship them overseas!"

A job is not a good or service; it can't be imported or exported. A job is an action, an act of doing a task. The next time a right- or left-wing politician or union leader talks about exporting jobs overseas, maybe we should ask him whether he thinks Congress should enact a law mandating U.S. Customs Service seizure of shipping containers filled with American jobs.

Let's turn to the next part of the exporting jobs nonsense, namely that corporations are driven solely by the prospect of low wages. Let's begin with a question: Is the bulk of U.S. corporation overseas investment, and hence employment of foreigners, in high-wage countries, or is it in low-wage countries?

The statistics for 1996 are: Out of total direct U.S. overseas investment of $796 billion, nearly $400 billion was made in Europe (England received 18 percent of it), next was Canada ($91 billion), then Asia ($140 billion), Middle East ($9 billion) and Africa ($7.6 billion). Foreign employment by U.S. corporations exhibited a similar pattern, with most workers hired in high-wage countries such as England, Germany and the Netherlands. Far fewer workers were hired in low-wage countries such as Thailand, Colombia and Philippines, the exception being Mexico.

The facts give a different story from the one we hear from the left-wing and right-wing anti-free trade movement. These demagogues would have us believe that U.S. corporations are rushing to exploit the cheap labor in places like the Democratic Republic of the Congo, Rwanda and Ethiopia. Surely with average wages in these countries as low as $10 per month, it would be a darn sight cheaper than locating in England, Germany and Canada, where average wages respectively are: $12, $17 and $16 an hour.

Let's look at a few of the reasons why some U.S. corporations choose to carry their operations overseas. Much of it can be summed up in a phrase: less predatory government and the absence of tort-lawyer extortion. While foreign governments can't be held guiltless of predation, their forms of predation might be cheaper to deal with than those of our EEOC, OSHA, EPA and IRS. Plus, tort lawyer extortion and harassment in foreign countries is a tiny fraction of ours. With each tort lawyer extortion and expansion of predatory regulations at federal, state or local levels of government, foreign operations become more attractive to U.S. corporations. Free trade helps make those costs explicit. American workers are just about the most productive in the world -- however, our government and legal establishment have reduced that productive advantage.

It'd make far more sense for Americans to start attacking the real sources that have contributed to making foreign operations more attractive to those at home. It's more effective than caving to the rhetoric of leftist and rightist interventionists who mislead us with slogans like, "How can any American worker compete with workers paid one and two dollars an hour?" when in reality our real competition is mostly with European workers earning a lot more.

[Tokhtamish]

Going further, what about the explosive growth of pornography ? In a world of deindustrialization triggered socioeconomic meltdown for former low-semi skilled workers, their female flesh is cheap (but since working class women tend to look like potatoes when they are 30 they have to make the very most of a brief period of beauty). Is it an accident that the center of porn production in the US is the San Fernando Valley ? Where immigration and low wage economics have made flesh cheap ?

[happygrl]

You have really hit on something, no pun intended.

There seems to be no lack of jobs associated with vice now - stripping, porno, gambling...

A real Dickensian America, as the gap between the incomes increases.

I would also attribute the slide to the acceptance of pornography.

The problem is that much of our society is beyond shame.

[jpsb]

I very much admire your skill as a posters. All I know is that in my little town, things are turned upside down and honest hard woking people are not respected but thugs are. Very discouraging.

[warchild9]

On a funny note, our local universities are turning out so many graduates, that they are settling for jobs paying what used to be middle-level blue-collar wages--$11-$12, or less. (Here in central NC, that is low pay--one can't even support an apartment on that.) It's hilarious to see little Suzie or Johnnie blink in astonishment after about 25 years of living off mommy and daddy, suddenly realize the world isn't going to support them.

[harpseal]

What about requiring goods sold in America to have been made in countries complying with minimal regulations for worker safety and environmental responsibility? We write the sensible regs.

Well I do have a problem with this one because if we get to write some of their regs they get to write some of our regulations. this is why I rejected it for this 13 point plan I was trying to build soemthing that was coservative in nature and more regulations to impose on others is in many ways teh antithesis of consservatism.

Further, the manufacturers cannot be government subsidized but must be authentic profit enterprises?

Well the Constitutional means is to subject those subsidized foreign entities to paying tariffs as teh price of admission to our nation.

Finally, foreign manufacturers not just American retailers, must be legally responsible for unsafe products due to their design or construction

Now here we have a problem because how do we deal with an importer who buys product from a foreign manufacturer without the manufacturer locating in the USA I am not against all trade I am for a level playing field with the leg irons off the American economy. with reasonable tort reform teh importer of an inherantly dangerous product which would normally be subject to tort action would bear the responsibility for the harm done in this nation and need to indemnify those harmed.

This is my logic on these proposals.

[harpseal]

I have proposed a plan that advances what you say you wish it is in many senses a compromise proposal that addresses a number of issues that IMHO and the opinion of many others will if adopted address teh problems of export of jobs by providing an envirornment in teh USA wher ethe Free Market is fostered.

[harpseal]

I agree with the rise in pornography, prostitution and other sex trades. I have seen such in many third world nations. Just think without doing something to fix it we can look forward to an America when seeing Young boys on the street saying "Hey mister you want my to buy my sister?" will be commonplace. I do not find that a pleasent prospect thus my remdiation plan.

[Voltage]

I guess whipping businesses until they pack up and leave wasn't so good an idea after all.

Maybe a 'Berlin Wall' would work...yup...need to try that.

[WilliamofCarmichael]

"Get rid of government subsidies for offshore investment of US companies. OPIC is the first such program which should go but support of World Bank programs that subsidize the outflow of Capital would be another."

Thank you, harpseal.

All your points are excellent. Maybe I missed it but I will "add" that transfer of vital defense technology is often via H1B, etc. workers.

BTW, though I do not agree with the low opinion many have of Dr. Williams' column it's good to see a majority here would not agree with a very popular competitive neo-con site where it's all too common to blame "stupid and lazy" American workers. Some Indian posters there suggest Americans should work harder and smarter if they want their jobs back.

Boy, there are so many good posts here with links to facts -- not just BS like that other site.

[warchild9]

Mr. Seal, we already have boys offering passersby their sisters--Mexican kids, out on Capitol Boulevard. A friend of mine who was propositioned thought the kid mistook him for a sailor in Tijuana.

[harpseal]

Well for teh future we have 4. An immediate end to guest worker programs. If people wish to come to the USA to work and make a life let them immigrate according to the rules.

If there are not any H1B's here they will have a difficult time picking up technology to pass.

[harpseal]

Mr. Seal,

Please call me Harp. mr was for my father.

we already have boys offering passersby their sisters--Mexican kids, out on Capitol Boulevard. A friend of mine who was propositioned thought the kid mistook him for a sailor in Tijuana.

What can I say I do not get out to the big cities that way very much anymore. I live in a small toen in CT and it has not gotten that bad here YET

[harpseal]

BTW, though I do not agree with the low opinion many have of Dr. Williams' column it's good to see a majority here would not agree with a very popular competitive neo-con site where it's all too common to blame "stupid and lazy" American workers. Some Indian posters there suggest Americans should work harder and smarter if they want their jobs back.

I actually have no idea what site you are talking about and since it is another site I would request you not promote it here on Free Republicas it would be discouteous to our host.

If you would like to Freep mail me the sites name I mught even look there just to see it.

Boy, there are so many good posts here with links to facts -- not just BS like that other site.

That my friend is the Free Republic tradition.

I guess it is sort of like comparing Free Republic, the Rolls Royce of Conservative web sites to that Cheap East German car with the two cycle engine.

[harpseal]

Mr. Seal, we already have boys offering passersby their sisters--Mexican kids, out on Capitol Boulevard. A friend of mine who was propositioned thought the kid mistook him for a sailor in Tijuana.

If we are lucky we will avoid having some Free Trade advocate post Those who want a tariffs would be having this girl and her brother pay more for the things they want to buy. Tariffs will hurt this girl.

[american spirit]

It's always nice to read about someone finally understanding the reality of the free trade situation vs. those who cling on to the nonsense spewed by useful idiot talking heads, media and academics........most of whom have never had to meet a payroll.

[Nowhere Man]

Going further, what about the explosive growth of pornography ? In a world of deindustrialization triggered socioeconomic meltdown for former low-semi skilled workers, their female flesh is cheap (but since working class women tend to look like potatoes when they are 30 they have to make the very most of a brief period of beauty). Is it an accident that the center of porn production in the US is the San Fernando Valley ? Where immigration and low wage economics have made flesh cheap ?

It's sad to see that but as many pointed out, we are headed that way. The first step was that a lot of the "do jobs" disappeared like factories and all. I've seen it here in Pittsburgh. First, you need the "do jobs" for entry level people out there who need a start in life and they work their way up to better "do jobs" or even "think jobs" as they become a manager or something. Not everyone is cut out for a "think job" but there are some who made the transition from "do to think jobs." Now we are seeing our "think jobs" disappearing too so in addition to idle blue collar hands, you see idle white collar hands and this does not bode well.

This is the world that a lot of free-trade is creating for us. If this is uber-capitalism, I don't want no part of it. Yes, capitalism is great but without morals or ethics, it is just as inhuman as socialism/communism, all it boils down to is which thugs are calling the shots.

It also makes people feel worthless, i.e., taking jobs in the "vice sector," or from being out of work for so long, it hurts their self worth.

[comnet]

Free Trade is not Free

[meadsjn]

The statistics for 1996 are:

Is this article from 1996, or is WW trying to pretend that his writings in 1996 were the universal timeless gospel truth, or is WW pretending that nothing has happened to our economy since 1996?

A job is not a good or service; it can't be imported or exported. A job is an action, an act of doing a task.

I would like to see Walter Williams explain how a job is not a service. Is a "service" performed only by some elite member of society, like a licensed manicurist or attorney or bureaucrat? Just what is the economic difference between a laboror who contracts for x amount per hour or per task, and a professional services provider who contracts for x amount per hour or task?

It does seem that in the recent few years, some of my former favorite economists have become the elitist monsters they previously chastized in their articles.

Land, labor, and capital are still the resources that make an economy work, but there is no place in a civilized world for the attitude that the humans who make up the labor part are as expendable as the dirt and rocks.

Throughout history, that kind of elitist attitude has led invariably to events like our revolution against England, and to the French version where people's heads fell right off.

Maybe that is what it will take for the Free Traitors to see the light.

[comnet]

Bush administration faces "litmus test" on Chinese textile dilemma

By JEFFREY McMURRAY
Associated Press Writer
August 17, 2003

Email this story.


• Discuss this story


Over the next several months, the Bush administration could send its strongest signal yet about how it plans to handle conflicts between the struggling American textile industry and China, which it is trying to appease as a new favored trading partner.

On Monday, the administration will open a 60-day comment period to consider three petitions by textile companies asking it to restore quotas on certain Chinese clothing imports that were removed Jan. 1, 2001, as a condition of China's membership in the World Trade Organization.

After that, the Committee for the Implementation of Textile Agreements - a coalition of five federal agencies - will vote on whether to impose the quotas for a year on knit fabrics, cotton and manmade fiber dressing gowns and robes, and cotton and manmade fiber brasseries.

Lobbyists for the textile industry contend the decision should be a slam-dunk. Those products were selected from the 29 where quotas have been removed because industry leaders figure they present the best proof that China's new trading freedom has disrupted the American market.

The real concern is how willing the administration will be to restore quotas when the rest of them are stripped in January 2005. If the three up for consideration now are stalled - not to mention rejected - textile companies fear a rocky future that could close more plants and push the industry nearer to collapse.

"We need to see whether they're serious about doing something," said Parks Shackelford, president of the American Textile Manufacturers Institute. "This will be the first test."

Last week, the committee agreed to consider the industry's request on the three categories, although it rejected its application for quotas on gloves because some woven gloves still have quotas through 2004. Textile lobbyists plan to submit a new, more specific glove request.

James C. Leonard III, CITA's chairman, said it could be November before a final decision is reached - a pace textile companies consider far too sluggish. However, he dismissed the idea that the committee's ruling on the three categories would be a test signaling how the administration will react in 2005 when Chinese imports could flood the American market.

"We will look at each case on its own merit," Leonard said. "These just happen to be the cases the industry chose to present."

Many lawmakers from Southern textile states have spoken out about the plight of the textile industry and how China's new trading powers could make matters worse. Rep. Cass Ballenger, R-N.C., called the petition a "litmus test as to whether laws will be enforced or ignored."

"China unfairly manipulates its currency, undermines international trade laws and undercuts U.S. workers with cheap labor," Ballenger said. "On a fair playing field, U.S. industries will remain competitive - but we don't have a fair playing field now."

Allen Gant Jr., chief executive officer of Burlington, N.C.-based Glen Raven Inc., said he fears the negative Chinese impact on a once-vibrant American industry could create more doubt about whether the United States has bartered away top trading status to too many countries.

"We're beginning to find out free trade is not the utopian idea they thought it was," Gant said.

---

On the Net:

American Textile Manufacturers Institute:

[HiTech RedNeck]

Come over here, Chihuahua.