Free Trade: Fight It, or Embrace It

[dmek25]

you were the one to draw the comparison between Iraq, and free trade. and the only reason to have consistencies in free trade is to keep the playing field as equal as possible. the other countries involved don't have to absorb the cost of clean air. the minimum wage we have is to try and keep a certain level of life possible for those making below average wages. all American companies pay for this, one way or another. why shouldn't these other companies involved in free trade have to follow some sort of guidelines? doesn't it bother you when you see child labor being exploited? the work related death counts at most of the countries is far greater then we have here. shouldn't those businesses have to follow some safe work practices then would insure the workers a much safer work environment? and about the war and recession, you take the 100's of millions of dollars being funneled into the war, and put it back into the American economy, and see what happens

[GTripp0012]

Originally Posted by dmek25

saden, you are right on the money. these other countries have NO rules to follow as far as emissions, work safety, and child labor laws. it needs to be established by someone, to keep the playing field level. and gtripp, i respectfully disagree with your statement that outsourcing jobs creates unemployment is a myth. i have seen this first hand in Pennsylvania. Armstrong flooring was a mainstay here in my hometown. it employed over 6500 people. now, that production facility is on the verge of being torn down. fewer then 200 people work there. both of my grandfathers, my wife's grandfathers worked there for over 40 years. these guys earned good enough money to raise their families, and live part of the American dream. i work at Alcoa. when i started, 15 years ago, there were about 1300 employed. now we are under 700. they always talk about how cheap everything we do, can be done in china. Hershey foods shipped 100's of jobs to Mexico. with probably thousands more in the future. our economy isn't able to sustain this drop in employment, with new jobs behind it. the production jobs leaving are all fairly good paying jobs. the jobs replacing those jobs are all 10.00 jobs. going from 50,000.00 a year, or better, to under 40,000.00 a year, or less, is a helluva change in life style

Good points dmek, and I'm not saying that there won't be people that get screwed by job outsourcing because their professional skills are the ones getting outsourced. The point here is that additional jobs are being created because of the capital that is being created by cheaper labor costs. Because corporations aren't pouring millions of dollars into domestic labor that could be done for thousands of dollars overseas, they can re-allocate costs to other areas of product development and improvement...which of course creates jobs.

It's unfortunate for those who are moving into unemployment, and it doesn't speak any ill about how hard they work or how deserving they are of the American dream, it simply means that the free market has deemed their skills obsolete, and that's going to happen (unfortunately) to good people.

[dmek25]

that i agree with. it doesn't seem fair that the C.E.O's keep getting bigger and better bonuses. while the ordinary Joe's basically have to take a pay cut, to keep their jobs

[GTripp0012]

Unfortunately, the American consumers seem to prefer a lower cost over quality in production. I, personally, am not like that, but that's what the market values--so it's tough to prevent the people from getting the benefits/consequences of the choice they made.

[Schneed10]

Originally Posted by dmek25

you were the one to draw the comparison between Iraq, and free trade. and the only reason to have consistencies in free trade is to keep the playing field as equal as possible. the other countries involved don't have to absorb the cost of clean air. the minimum wage we have is to try and keep a certain level of life possible for those making below average wages. all American companies pay for this, one way or another. why shouldn't these other companies involved in free trade have to follow some sort of guidelines? doesn't it bother you when you see child labor being exploited? the work related death counts at most of the countries is far greater then we have here. shouldn't those businesses have to follow some safe work practices then would insure the workers a much safer work environment? and about the war and recession, you take the 100's of millions of dollars being funneled into the war, and put it back into the American economy, and see what happens

I think if you're going to take a hands-off approach in foreign policy, you have to take the same hands-off approach when it comes to telling other countries what their labor laws should be. Otherwise you contradict yourself.

[Sheriff Gonna Getcha]

Originally Posted by Schneed10

I think if you're going to take a hands-off approach in foreign policy, you have to take the same hands-off approach when it comes to telling other countries what their labor laws should be. Otherwise you contradict yourself.

You do have a point. Shouldn't other countries' governments be able to dictate the scope and nature of their own laws?

On a related note, it seems somewhat paternalistic to say, "We are opposed to companies sending jobs to third world countries on the grounds that those jobs entail the exploitation of the foreign laborers." Shouldn't the foreign laborers decide for themselves whether they want to be "exploited?" Working in a dirty and sometimes dangerous factory for 50 cents per hour might sound awful, but if it isn't better than other available options no one will work there.

[saden1]

Originally Posted by Schneed10

Only in the sense that it's forcing our way of life on someone.

Using military force to push democracy, or using economic force to push our labor laws. The killing people part certainly is a glaring difference, but they still have one big thing in common: in both cases we're pushing an aspect of American life on other countries.

I am inclined to believe that it is acceptable to have standards and require others to meet your standards before conducting business. This is business 101. As a matter of fact this principle can be and is in fact applied in all phases of ones life. We consistently do it with respect to the politicians we vote for, the goods we buy, the companies we work for, what we choose to believe in, and even the kind of people we associate with. It's not a crime to have expectations.

[saden1]

Originally Posted by Sheriff Gonna Getcha

You do have a point. Shouldn't other countries' governments be able to dictate the scope and nature of their own laws?

On a related note, it seems somewhat paternalistic to say, "We are opposed to companies sending jobs to third world countries on the grounds that those jobs entail the exploitation of the foreign laborers." Shouldn't the foreign laborers decide for themselves whether they want to be "exploited?" Working in a dirty and sometimes dangerous factory for 50 cents per hour might sound awful, but if it isn't better than other available options no one will work there.

If that's the case, let's call them what they really are..modern day serfs living in a surfdom.

[dmek25]

Originally Posted by Schneed10

I think if you're going to take a hands-off approach in foreign policy, you have to take the same hands-off approach when it comes to telling other countries what their labor laws should be. Otherwise you contradict yourself.

i disagree. we have a ton of the Saudis money pouring into our economy everyday. it is a proven fact that they support terrorist camps in Saudi Arabia. our administration doesn't seem to have that big a problem taking their money

[Schneed10]

Originally Posted by saden1

I am inclined to believe that it is acceptable to have standards and require others to meet your standards before conducting business. This is business 101. As a matter of fact this principle can be and is in fact applied in all phases of ones life. We consistently do it with respect to the politicians we vote for, the goods we buy, the companies we work for, what we choose to believe in, and even the kind of people we associate with. It's not a crime to have expectations.

Agreed. All I'm saying is that if you can force other countries to meet your expectations in order for them to get jobs, you can't really get mad at President Bush for forcing other countries to govern in a way that meets American expectations.

[Schneed10]

Originally Posted by dmek25

i disagree. we have a ton of the Saudis money pouring into our economy everyday. it is a proven fact that they support terrorist camps in Saudi Arabia. our administration doesn't seem to have that big a problem taking their money

I don't think you're hearing me. Or maybe you're just skipping past what I'm saying. What Bush and his Administration are doing has nothing to do with your philosophical beliefs and arguments. If I read you right, you're saying that to take manufacturing jobs to other countries, we should expect those countries to enforce American labor laws. Otherwise, we should deny those people the manufacturing jobs our companies can bring.

But at the same time, we should expect our government to allow other governments to rule however they choose, even if it's dictatorship?

It just doesn't add up.

[FRPLG]

At the end of the day isn't this a simple economics problem? Or maybe not so simple? I think Schneed made a decent economic argument as to why free trade is what it is and how it works and I haven't seen much of an argument against it. At the end of the day after all of the emotional and moralistic arguments are made economics rule. We could try and use policy to even the playing field labor wise but economics wise it won't work in the long run. Rather than debate what is right or wrong I think what needs to be figured out first is what actually works. Or even if there is any real economic problem with the current state of free trade.

I'd support an even field in terms of tariffs because it drives me nuts that it is so uneven. That type of external force on the free market is destructive and should be balanced.

[Schneed10]

Yeah this is about making the most money possible for our country. Some of what I say in this post may hit home for those in manufacturing positions, but skirting around the issues only serves to inhibit our understanding of the economic principles involved. Here's what happens with free trade:

Country A has highly skilled and highly educated workers, and thus the cost for their services is high. To make a widget in this country, it costs $20 per widget.

Country B has workers with few skills and little education, thus the cost for their services is low. To make a widget here, it costs $5 per widget.

Anyone making a widget would choose to make it in Country B and market the widgets to Country A. So Country B benefits by:
- Having plenty of jobs available that pay more than what they're citizens are capable of earning now.
- The increased wages in Country B means improvements in standard of living, greater investment in education, and the further development of skill sets in Country B's children. So because of these jobs, the children of country B's workers will get a better education, and add skill sets, allowing them to compete for even more jobs in the future.

Benefits to Country A:
- Cheaper widgets. Much, much cheaper widgets. In our modern economy, this plays out in the form of low inflation (we've managed to keep inflation at historically low levels for the last 15 years).
- The money we save on our widgets means consumers have more money to buy and invest in other things. Standard of living improves. More money is available to invest in education. Etcetera.

Country B is where America was during the 1800s and early 1900s. Country A is where America is now. Reason? Our workers have gained skill sets and education made possible by making a good living as a developing nation. In a nutshell, Americans are too highly skilled to be wasting our time manufacturing widgets. Our skills can be better used by managing the Widget Factories overseas, or as lawyers, doctors, researchers, accountants, insurance adjusters, salespeople, teachers, media distributors, etcetera.

Our country has moved ahead when it comes to skills. To live in this country and miss the boat when it comes to developing your skill sets to meet changing demand for services is a tough way to live. If your skills aren't keeping up with our country's progressing economy, I can see why that's a very emotional problem. But that's what economics is all about: competition.

Manufacturing is on the decline in this nation. It's a tough deal. But that's the direct result of our collective skill set developing. To inhibit that competition only serves to put us at a disadvantage. You want to keep the manufacturing jobs here? OK, it will cost our companies $20 per widget. Widget prices will go up, and we'll have no extra money to invest in education and our standard of living will stall. In the meantime, Country B is SOL, they don't get the manufacturing jobs. They're stuck in their crappy standard of living, with no new money available to invest in skills and education.

And the end result is the world makes no progress.

Free trade and competition are necessary for the world to make progress. The tough thing is some people naturally don't compete and get left behind. And that's sad because they struggle. But it would be even worse if our entire nation struggled to find ways to fund a good education for our kids.

[dmek25]

scheed, i hear what you are saying. i just don't believe its in the united states best interests to be the worlds policeman. if we are ask, that's one thing. but to go into Iraq, and force our beliefs upon a lifestyle, isn't in our best interests. in that case, why aren't we invading North Korea? there are plenty of dictatorships thru out the world. why just Iraq? I believe all business should play with the same set of rules. the Chinese are very innovative. you set certain guidelines, in order to compete, and they will adjust. it makes me sick that the American company always has to be the one doing all the adjusting. its just not fair

[Schneed10]

Originally Posted by dmek25

scheed, i hear what you are saying. i just don't believe its in the united states best interests to be the worlds policeman. if we are ask, that's one thing. but to go into Iraq, and force our beliefs upon a lifestyle, isn't in our best interests. in that case, why aren't we invading North Korea? there are plenty of dictatorships thru out the world. why just Iraq? I believe all business should play with the same set of rules. the Chinese are very innovative. you set certain guidelines, in order to compete, and they will adjust. it makes me sick that the American company always has to be the one doing all the adjusting. its just not fair

Actually, you wouldn't like what would happen if every country had to enact the same labor laws we have here. Prices for everything would be SO much higher. Your standard of living would take a direct hit because of it.