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Exporting Jobs
Capitalism Magazine ^ | August 19, 2003 | Walter Williams

Posted on 08/19/2003 10:13:15 AM PDT by 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.


TOPICS: Business/Economy
KEYWORDS: freetrade; walterwilliams
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To: Willie Green
You, too.
81 posted on 08/19/2003 1:57:01 PM PDT by HiTech RedNeck
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To: comnet
The Mrs., in her role as industry writer, attended a conference with a Federal official who told everyone that one of the steps involved in resolving disputes between "American" companies and "Chinese" companies was asking the Chinese executives if there was any problem at all. If they said no, the matter was to be dropped.
W is selling us out for $200,000,000+ in bribe money (not that the Democrats would be any better).
82 posted on 08/19/2003 2:05:09 PM PDT by warchild9
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To: luckydevi
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....
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.

Looks like Walter Williams is making a flacid attempt becoming a conservative. Unfortunately, he's been an enabler of those who would tyranously remove trade restrictions while leaving burdonsome domestic conditions intact.

Tort reform? Fine, I'm all for it. And I was for it BEFORE NAFTA was enacted. I don't need a wanker like Walter Williams to tell me that we need tort reform. IMHO, Walter fell flat on his face by not insisting that this and other reforms take place PRIOR to undermining our industrial infrastructure. The heck with the moron.

83 posted on 08/19/2003 2:33:36 PM PDT by Willie Green (Go Pat Go!!!)
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To: warchild9
The Mrs., in her role as industry writer, attended a conference with a Federal official who told everyone that one of the steps involved in resolving disputes between "American" companies and "Chinese" companies was asking the Chinese executives if there was any problem at all. If they said no, the matter was to be dropped. W is selling us out for $200,000,000+ in bribe money (not that the Democrats would be any better).

It's been almost 15 years since the Japanese were first going to take over America and have us all speaking Japanese. Almost 10 years since every major American company would have folded up shop in America and moved entirely to Mexico. And we're into about our 5th year of China getting ready to wage nuclear war against us. Ummm... I guess I'm just wondering when you guys are ever going to be right on anything and how we will know. Just curious what I'm supposed to be watching for. Thanks.

84 posted on 08/19/2003 2:38:28 PM PDT by Texas_Dawg (I will not rest until every "little man" is destroyed.)
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To: Texas_Dawg
So what does that have to do with the price of "Western Wear" made in China?
85 posted on 08/19/2003 3:04:20 PM PDT by HiTech RedNeck
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To: Tokhtamish
"Libertarians don't understand that their is such a thing as a community. And a community has a moral character for good or for ill. "

Well put, Comrad!

86 posted on 08/19/2003 3:04:32 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: Texas_Dawg
China has an arrogance that Japan and Mexico can't hold a candle to.
87 posted on 08/19/2003 3:05:33 PM PDT by HiTech RedNeck
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To: Sachem
"What about requiring goods sold in America to have been made in countries complying with minimal regulations for worker safety and environmental responsibility? "

That is a line from the democrat handbook.

88 posted on 08/19/2003 3:06:27 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: MonroeDNA
You're right, I guess we don't care whether Chinese metalworkers are constantly falling into molten metal so long as we get our junk at bargain basement prices.
89 posted on 08/19/2003 4:16:45 PM PDT by HiTech RedNeck
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To: HiTech RedNeck
I personally will not buy from China, or any communist country. I avoid buying from socialist countries, too, like France. Or Massachusets.

The democrats want to force other countries to adopt our rules and regulations on workers in other countries. Do you?
90 posted on 08/19/2003 4:32:03 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: MonroeDNA
We cannot "force" any other sovereign country to do anything (short of a shooting war or its equivalent). But we can certainly "incent" them with more favorable trade treatment for those who don't let, say, their metalworkers constantly plunge to their fiery deaths, or their chemical workers to get poisoned, etc.
91 posted on 08/19/2003 4:38:11 PM PDT by HiTech RedNeck
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To: HiTech RedNeck
Yes, that is what democrats want.

From the democrat, Martin Sabo's page:

"Unfortunately, Republican congressional leaders have made it clear they will protect patent rights for U.S. big businesses, but will not demand that our trading partners adequately pay their workers and provide humane working conditions. Without these worker protections, Americans are at a distinct competitive disadvantage and could be hit with job losses and lower wages. In short, if the Republican majority has its way, the interests of wealthy corporations will be protected in trade agreements, but workers will be left exposed. "

92 posted on 08/19/2003 4:54:51 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: HiTech RedNeck
What do you think about the Kyoto treaty?
93 posted on 08/19/2003 4:57:18 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: HiTech RedNeck
What do you think about the Kyoto treaty?
94 posted on 08/19/2003 5:22:14 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: HiTech RedNeck
What do you think about the KYOTO treaty?
95 posted on 08/19/2003 5:22:57 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: HiTech RedNeck
What do you think about the Kyoto treaty?
96 posted on 08/19/2003 5:35:12 PM PDT by MonroeDNA (No longshoremen were injured to produce this tagline.)
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To: MonroeDNA
Well meaning hot carbon dioxide.
97 posted on 08/19/2003 6:47:56 PM PDT by HiTech RedNeck
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To: MonroeDNA
Well the Rats have one thing pretty much right. Just as a broken clock tells the correct time twice a day.
98 posted on 08/19/2003 6:48:46 PM PDT by HiTech RedNeck
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To: Willie Green; Wolfie; ex-snook; Cacophonous; Poohbah; Jhoffa_; FITZ; arete; FreedomPoster; ...
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."

Who is "buying" those "exported" jobs and for what price?

99 posted on 08/19/2003 7:35:45 PM PDT by A. Pole
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To: A. Pole
A like Williams. He's sharp. And he has an excellent point about the sloppiness of language and thought.

He is also correct about the hostility to business in this country.

He is also correct that increasing the total tax burden is almost certainly counterproductive.

However, his capital-flow argument is very weak, and nowhere does he address non-economic effects of current policy.
100 posted on 08/19/2003 7:43:46 PM PDT by Tauzero (My reserve bank chairman can beat up your reserve bank chairman)
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