I started this thread with a simple posting last night -- my first on FR. My apologies to FR -- I actually thought I was just posting a reply to another article -- didn't understand how the forums were organized. Imagine my surprise when I woke up today to find all the replies here.
Contrary to the claims of some of the less "tolerant" postings, I am the furthest thing from a Marxist I can imagine. I am not anti-trade, nor for overall protectionism.
I am for a return to our consitutional principals, for free markets, low taxes, elimination of progressive taxes, if not all income taxes, and large-scale deregulation.
While I generally favor free markets, it seems they are causing the very problem the founders envisioned. I do not believe in blindly holding fast to a belief while ignoring the consequences of an action is positive. The rapid lowering of trade barriers with virtually every low wage country has consequences. I posted the message because I fear that we as a nation are entering an era of severe economic and social problems caused in large part by the wholesale movement of our top-paying jobs to super-low wage countries. Here's the problem as I see it.
We've already seen the loss of a large segment of our manufacturing jobs. Fine, say the free traders. The rest of us get identical products for much less money. True. And look at the bright side. We have thousands of former manufacturing workers to greet us at WalMart.
According to the Business Week article (about jobs moving overseas) posted here and other places, the next to go are our IP (intellectual property) jobs, such as software, biotech, engineering and artistic design, etc. IMO, it actually would be easier to keep manufacturing jobs in the U.S., within the context of a complete free trade world, than it is to keep IP development jobs here. The reason is that the labor portion of many manuf jobs are a very small component of the total product cost, overshadowed by such things as legal liability, and compliance with environmental and other regulations. So, if we eliminated these "problems" by relaxing our own regulations (but who wants dirty air and water), or forced similar regulations on our competitors with $2 a day wages (through the WTO, presumably) we might actually be able to keep some manufacturing in our country.
But, what about intellectual property development? Software, hardware design, biotech, and even legal research -- yeah, the lawyers are not home free either. Just wait until the large law firms start training large legal staffs in India to do their non-courtroom research work at $6K a year instead of $120K.
IP development takes hands, or rather, brains-on labor. It can be sped up by design or development tools, but in essence - it's one brain against another in the world of open competition. If I can buy a brain in China for $10 a day or in India for $40 a day, how can an American compete? I don't think many Americans would be happy making $40, or even $80 per day, assuming we can be 2X as productive, or work 16 hour days.
Consider this. What happens once all the IP devel jobs are shipped out of the U.S., the next generation of students will not study those fields because there's no job potential. How, then, is America to maintain it's lead in technology development? Will we even stay in the game? Consider me a neanderthal, but I don't believe that the concept of the nation-state is dead.
I don't have an answer to these trends and perceived problems. Wholesale protectionism is not the answer. That would simply tank our economy. But, look forward to a giant backlash as more IP workers are displaced from their $60K and up jobs, with nowhere to go but Walmart. My best guess at an answer to this is for the U.S. to create a two-tiered trading system. I have no problem with complete and open trade with other countries with similar standards of living, environmental regulations, and salary levels. That might even force a reduction in business-killing regulations, as we attempt to compete with those countries.
That's all.