Posted on 02/15/2006 10:42:45 AM PST by SirLinksalot
Our hollow prosperity
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Posted: February 15, 2006 1:00 a.m. Eastern
PATRICK BUCHANAN
© 2006 Creators Syndicate Inc.
Now that the U.S. trade deficit for 2005 has come in at $726 billion, the fourth straight all-time record, a question arises.
What constitutes failure for a free-trade policy? Or is there no such thing? Is free trade simply right no matter the results?
Last year, the United States ran a $202 billion trade deficit with China, the largest ever between two nations. We ran all-time record trade deficits with OPEC, the European Union, Japan, Canada and Latin America. The $50 billion deficit with Mexico was the largest since NAFTA passed and also the largest in history.
When NAFTA was up for a vote in 1993, the Clintonites and their GOP fellow-travelers said it would grow our trade surplus, raise Mexico's standard of living and reduce illegal immigration.
None of this happened. Indeed, the opposite occurred. Mexico's standard of living is lower than it was in 1993, the U.S. trade surplus has vanished, and America is being invaded. Mexico is now the primary source of narcotics entering the United States.
Again, when can we say a free-trade policy has failed?
The Bushites point proudly to 4.6 million jobs created since May 2003, a 4.7 percent unemployment rate and low inflation.
Unfortunately, conservative columnist Paul Craig Roberts and analysts Charles McMillion and Ed Rubenstein have taken a close look at the figures and discovered that the foundation of the Bush prosperity rests on rotten timber.
The entire job increase since 2001 has been in the service sector – credit intermediation, health care, social assistance, waiters, waitresses, bartenders, etc. – and state and local government.
But, from January 2001 to January 2006, the United States lost 2.9 million manufacturing jobs, 17 percent of all we had. Over the past five years, we have suffered a net loss in goods-producing jobs.
"The decline in some manufacturing sectors has more in common with a country undergoing saturation bombing than with a super-economy that is 'the envy of the world,'" writes Roberts.
Communications equipment lost 43 percent of its workforce. Semiconductors and electronic components lost 37 percent ... The workforce in computers and electronic products declined 30 percent. Electrical equipment and appliances lost 25 percent of its workforce.
How did this happen? Imports. The U.S. trade deficit in advanced technology jobs in 2005 hit an all-time high.
As for the "knowledge industry" jobs that were going to replace blue-collar jobs, it's not happening. The information sector lost 17 percent of all its jobs over the last five years.
In the same half-decade, the U.S. economy created only 70,000 net new jobs in architecture and engineering, while hundreds of thousands of American engineers remain unemployed.
If we go back to when Clinton left office, one finds that, in five years, the United States has created a net of only 1,054,000 private-sector jobs, while government added 1.1 million. But as many new private sector jobs are not full-time, McMillion reports, "the country ended 2005 with fewer private sector hours worked than it had in January 2001."
This is an economic triumph?
Had the United States not created the 1.4 million new jobs it did in health care since January 2001, we would have nearly half a million fewer private-sector jobs than when Bush first took the oath.
Ed Rubenstein of ESR Research Economic Consultants looks at the wage and employment figures and discovers why, though the Bushites were touting historic progress, 55 percent of the American people in a January poll rated the Bush economy only "fair" or "poor."
Not only was 2005's growth of 2 million jobs a gain of only 1.5 percent, anemic compared to the average 3.5 percent at this stage of other recoveries, the big jobs gains are going to immigrants.
Non-Hispanic whites, over 70 percent of the labor force, saw only a 1 percent employment increase in 2005. Hispanics, half of whom are foreign born, saw a 4.7 percent increase. As Hispanics will work for less in hospitals and hospices, and as waiters and waitresses, they are getting the new jobs.
But are not wages rising? Nope. When inflation is factored in, the Economic Policy Institute reports, "real wages fell by 0.5 percent over the last 12 months after falling 0.7 percent the previous 12 months."
If one looks at labor force participation – what share of the 227 million potential workers in America have jobs – it has fallen since 2002 for whites, blacks and Hispanics alike. Non-Hispanic whites are down to 63.4 percent, but black Americans have fallen to 57.7 percent.
What is going on? Hispanic immigrants are crowding out black Americans in the unskilled, semi-skilled and skilled job market. And millions of our better jobs are being lost to imports and outsourcing.
The affluent free-traders, whose wealth resides in stocks in global companies, are enriching themselves at the expense of their fellow citizens and sacrificing the American worker on the altar of the Global Economy.
None dare call it economic treason.
They hate it when we do that....
So our productivity is decreasing? Our standard of living is dropping? Our wealth is shrinking? I don't suppose you have any proof?
the US now creates the low skilled jobs - services, retail, construction, government, food services, etc.
All service jobs are low skilled? And the last time I checked, construction jobs paid well.
once this runs its full course, we'll find that this pool of jobs cannot sustain a large private sector middle class that has been the hallmark of this economy
You have a time frame in mind? I heard it's all gonna fall apart once NAFTA passes.
The article isn't favorable to their God President Bush's economy, so they're trying to kill the messenger.
We export more than ever before. Shhhhh, don't let the ignorant people know. Ruins their rant.
Ouch...I think I hurt something inside I was laughing so hard at your BS.
"Unless your main source of income is playing the markets (in which case you're pretty much a parasite anyways),"
Agree with your comments except for this characterization.
traders (people playing the markets) provide tremendous liqudity in our financial markets. Trading is not riskless - traders put their OWN or MPO capital at risk continuously.
Do you think the markets would function better if there were no traders at all? Would this help the average investor for the average volume in his stocks to get cut in half, or maybe much more on some small-caps? Can you imagine how much book depth would simply vanish if all the parasites quit?
I am not trying to characterize trading as some saintly occupation, but I do feel that your characterization misses the primary public benefit of having traders.
Pat does that every time he pulls his head far enough out of his ass to stick his foot in his mouth.
Welcome to Free Republic, BTW.
(I have to use percentage figures in order to save wear and tear on my keyboard)
I posted to you in #587. Sorry. I didn't realize you were the same person offended by my other post to you. No need to answer it.
Good question! I would say that there are five levels of values.
The lowest ones are hedonistic like indulgent pleasures, or fun.
Then above it are utilitarian like wealth, cleverness or thrift (it is better to restrain desire for pleasure in order to do something useful and for the future).
Then the higher ones are vital values like health, beauty, family life or joy (it is better to be healthy and joyful than rich)
Still higher are moral values like courage, honor, loyalty, generosity (It is good to sacrifice your health or life for your friends or country).
And the highest are spiritual values like holiness, repentance, humility (It is better to suffer dishonor in order to please God).
Lower levels should serve higher and within each level there are smaller, greater or related values.
AND....If Jane had three apples, and Ted had six, How many apples would Pat have?
how is wage growth? take the wage growth figures - remove the people at the top who have seen a concentration of higher wages, and government employment where workers get contractual automatic wage increases - ask the BLS to publish that statistic and we'll talk.
construction jobs pay well - for unionized positions or licensed trades like plumbing and electrical. want to be a roofer, or a framer, or a bricklayer - competing for wages with a bunch of central americans standing at dunkin donuts every morning?
time frame you ask? let's hope the baby boomers leave nice inheritances for their kids and grand kids, because this is a generation pheonomena. older americans, who worked in the era of strong wages, who secured pensions and other retirement benefits, who are receiving a high multiple social security check compared to their contributions - are going to alot better off then their kids and grandkids (many of whom are living in their basements) are going to be when they reach that age.
let's hope the old folks don't blow it all at the casinos and the nursing homes.
My apologies. I've apparently offended many on this thread. This is my last post to it.
I wanted to correct one point. Most of the export trade from China (I think around 75%) are from foreign joint ventures. So US and European companies are also getting rich manufacturing in China and selling to the US and Europe. That too creates jobs back in the US.
So a factory that produces for Mattel in China using American Mattel designs that counts as a trade deficit. I am not so bothered by the trade deficit as I am by the budget deficit. Which by the way is coming down, but I don't think Pat wants to mention that.
One of the most absurd posts ever addressed to me on FR.
From a business having the right to move their production offshore we jump to their selling human organs. Too crazy to merit a response
To the points of others. When corporations make a profit they give back in the form of taxes. In addition, they often pay dividends that are taxed and finally the shareholders profits are taxed.
I have never before noticed, maybe because except for his anti Semitism I pay Buchanan no mind, how his socialist views are predominant in his cult of believers. The same ones who most frequently raise the banner of their perverted sense of patriotism. Patriotism for an America that exists only in their strange interpretation of reality.
The arguments presented here by his minions could be found on any far left forum.
That on this forum people who consider themselves Conservatives argue that corporations are responsible for feeding the poor is beyond comprehension.
Socialist and communist countries believe that production is for the good of the masses.
I believe in capitalism.
Capitalism brings good to the masses. A business does not owe you a job. A corporation sole purpose is to make a profit for it's owners in any way that is legal. Moving to where it is cheaper to produce is neither illegal nor immoral. If one person loses a job, that's sad, but happily many others are able to afford cheaper goods.
And the businesses take a chance. Nothing is foolproof. I know of manufacturers who have moved almost solely to China and are in deep financial trouble. Likely they would be in similar trouble had they stayed home. But they took a chance and they and their shareholders lost.
Capitalism is not easy. Socialism is stifling.
There is nothing wrong to fight honestly for the interests of your group or for the others for whom you feel compassion or solidarity.
What is wrong is hatred, envy, injustice, cruelty and hypocrisy.
Damn. You just condemned 90% of pat's articles over the last six years.
That's right, if you subtract people who got raises, you'll make the average raise look smaller. That's funny.
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