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For Economic Commentary and Analysis, go to the Bonddad Blog

I have done an awful lot of thinking and research on the effects of increased trade and the "race to the bottom" - meaning that developed countries are forced to lower their standard of living to effectively compete with less developed countries.  The end result of all this at this point is this: there is no way to stop it from happening.  In other words, we are entering a period of decreased living standards that could last 50-100 years during which the developed world's standard of living decreases while the developing world's standard of living increases.  Until we reach a point of near parity there is little we can do on the policy front to prevent it from happening.  

This is not the type of conclusion anyone wants to read.  But let me explain why I think this is the case going forward.

While we can rail about the effects of free trade all of us benefit from free trade.  Here's my latest example.  A long time ago in a galaxy far, far away (actually a city named Austin, Texas) I was a professional guitarist (What else are you supposed to do with a political science/economics/music major?).  Anyway, I still keep my hand in the game and read Guitar Player Magaine every month.  This month they review budget guitars -- guitars under $500 or so.  Here's the point of all this: all of the guitars are made in Asia, particularly China.  I've played a few of these items and can tell you there are some really fine inexpensive guitars in the lot (particularly the Hamer XT series).  It's a damn fine guitar for the money.  In fact it's a damn fine guitar compared to some guitars under $1000.

This isn't an isolated instance.  Literally every inexpensive product we buy in the US is now made overseas.  Home electronics, kitchen implements, furniture, tools, hell you name it and it stands a good chance of being made in another country.  And the fact that these goods are inexpensive benefits the US by giving us more choices.  In addition -- and be honest -- how many people like getting something for less money?  If you said no, chances are you're saying no simply to disagree with the point.  And that's a central point:  People like getting inexpensive stuff.  That's a central reason why Wal-Mart is now the largest US retailer by a mile.  

So long as foreign made goods are cheaper and better, we're going to import them.  There's no way to stop that from happening.  Any measures we take to stop it will prove temporary and fleeting.

In addition to the inherent benefits, implementing the types of proposals most Democrats argue for in free trade deals runs into large problems.

First, let me paint a picture with a hypothetical country.  Country X is a third world country.  Unemployment is high.  The average daily salary is 10 cents in US dollars.  There is a hodge-podge of infrastructure - roads, water and sewer lines etc....  Like most countries in country X's position, indigenous natural resources are their primary export.  Typically, this is some type of mineral extraction or agriculture.

Let me use wages as an example.  Hypothetically, suppose we argue for a wage of 15 cents a day.  This sounds reasonable from a US perspective.  However, from X's perspective, it is entirely unreasonable.  First, high-unemployment indicates that 10 cents/day may be too high to begin with.  Secondly, with an unemployment rate that high there is no practical reason for an employer to offer higher wages.  He can simply find another prospective employee willing to work for 10 cents a day and with high unemployment the chances are high he will succeed.  Third, an increase of 5 cents a day would increase wages 50%, increasing the possibility of increasing inflation which no country wants in excess.

As Democrats, we would want country X to have labor laws akin to US labor laws - laws that involve child labor standards, minimum wages, safe working condition regulations and maternity leave just to name a few.  Out motives are on solid moral ground.  Laws of this type are for the worker's protection.  Companies have rarely demonstrated a long-streak of compassion when it comes to their workforce.

Here's the reality. None of this is going to happen.  The government does not have the governmental infrastructure or resources to monitor or prosecute a company's behavior.   More importantly, the government has other priorities like building the country's physical infrastructure and maintaining political stability.  Issues of wage parity and working conditions are simply a low priority in this type of political environment.  While it may have something to do with the persons in political power in X, it is also a function of where they are in terms of economic development.

We may argue for a third-party to monitor the countries labor resources - something like the US or another multi-lateral organization.  This runs into problems dealing with the country's sovereignty, making it difficult to achieve.

The point here is that we are arguing about developed world problems and solutions when the other countries have developing world problems and solutions.  The two sets of problems don't look anything alike and from the other country's perspective their problems (high unemployment, poor infrastructure, massive poverty etc...) are more important than ours.    

SO -- what can we do?

Here are some basic ideas.

1.) We need to become more competitive in the "jobs of tomorrow" -- economic areas that will provide goods and services the world wants tomorrow.  Three of my favorites are stem cell research, alternate energy and nano-technology.  There are also many other industry sectors that qualify; these are just my pet favorites.  The US must develop policies that promote these industries.

2.) The US workforce needs massive retraining/education.  According to this paper from the New York Federal Reserve:

While the U.S. manufacturing sector has contracted sharply since the early 1980s, employment in high-skill manufacturing occupations has risen by an impressive 37 percent. An investigation of the growth in high-skill manufacturing jobs reveals that virtually all of the nation’s industries have shared in this trend. Moreover, skill upgrading has occurred in all parts of the country, even those experiencing severe employment losses.

However, the US workforce is not keeping pace:

But manufacturers, regardless of size, specialty or location, across the USA are reporting a dire shortage of skilled workers: people such as welders, electricians or machinists with a craft that goes beyond pushing buttons or stacking boxes but does not require a degree.

In a survey of 800 manufacturers conducted by the National Association of Manufacturers (NAM) last year, more than 80% said they were experiencing a shortage of skilled workers. In October, manufacturers surveyed by the Federal Reserve Bank of Philadelphia said "finding qualified workers" was their biggest business problem.

The point is the change to a more technologically advanced workplace has already started, and we're not keeping up with demand.

Trade deals must be bilateral

When we make deals with other countries, we must insure there are policies in place that benefit US exports.  Just as example, China has fallen behind on implementing parts of its WTO agreements:

At the same time, today’s report to Congress highlights a number of areas of concern about the level of China’s implementation of its WTO commitments in areas such as intellectual property rights, industrial policies, trading rights, services, transparency, and agriculture.

As an additional example, this report from the US Trade Representative highlights high barriers in China's regulatory structure that hamper medical devices, technology, transportation companies, food companies and financial services from competing with local companies.  These are all areas where the US excels.

It's also important that we don't back away form a trade fight.  If a country we deal with makes it incredibly hard for US companies to enter, slap a tariff on their imports until they capitulate -- or take similar measures to force the other country's hand.  There are a lot of examples where US goods have a difficult time gaining access to other countries where they shouldn't.  There are plenty of economic areas where the US excels -- technology and finance being prime examples -- where out companies have a hard time gaining entry.  If we're serious about lowering the trade deficit, it's time to play some offense.

For more information on various countries' policies, go to this page, which provides a report on many country's trade barriers to US goods and services.

In short, the domestic policy alternatives deal with moving the economy forward into new areas that create higher paying jobs.  The foreign policy alternatives deal with leveling the playing field in foreign jurisdictions.

However, the above mentioned suggestions won't prevent the pain.  In short, we are moving into a fast-pace period of world development where the underlying economic fundamentals are going to change rapidly and often.  People will have to develop a whole host of skills to deal with this situation.  Multiple careers will become common place and switching jobs/industries the norm.  

There will be a fair amount of pain along the way for all involved -- but especially the US because it is our living standard that will be hit the hardest.

Update [2007-4-23 15:14:35 by bonddad]:: I wanted to thank everyone for all their comments.  This has been a very good discussion on this very important issue.  

Additionally, I stand by by analysis, not to be difficult, but because after all I have read and analyzed on this topic I think it's the correct conclusion (very passionate debate to the contrary notwithstanding).  As I said at the beginning, I didn't come to this conclusion to be popular but because that is where the facts are heading.  

The central point is this: So long as the US likes cheap "stuff" globalization will continue.  In addition, other countries have clearly benefited from these policies.  China is a classic example, but there are numerous others.  The Asian economies have done very well for themselves because of US consumption.  So long as we consume at current levels, expect this trend to continue.  If you want to stop globalization, then you need to figure out how to get the US consumer to stop buying.  

 

Originally posted to bonddad on Mon Apr 23, 2007 at 04:36 AM PDT.

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Comment Preferences

      •  True (43+ / 0-)

        I was in a hurry, on my out the door for work.  I should have fleshed it out.  As many here know, trade is John Edwards's signature issue.  I should have waited until I had more time to post.

        While globalization is inevitable, the death of the American middle class doesn't have to be:

        Detroit, Michigan – On Saturday, April 21st, 2007, Senator John Edwards will deliver the keynote address at the Michigan Democratic Party's Jefferson-Jackson Day Dinner and will announce his opposition to the South Korea trade deal. The Bush administration is finalizing details of the agreement and is expected to submit it to Congress for approval later this spring. This afternoon, Edwards released the following statement:

        "I believe in trade deals that make sense for American workers. But that does not include a trade deal with a country that refuses to open its market to American cars. We buy 100 times more cars from South Korea than they buy from us.

        "A trade agreement with South Korea needs to start with their willingness to open their market to American automobiles and other U.S. products and agree to trade fairly. It must also include strong labor and environmental standards and lift up workers in both countries.

        "Instead of stubbornly pursuing policies that put Americans out of work, the Administration should focus on making sure new agreements include real labor and environmental protections and should enforce our rights under existing trade agreements. And the Congress should make it clear to the President that it will override any agreement that does not protect American jobs and American interests."

        •  listen, I haven't decided on who (19+ / 0-)

          I'm going to vote for for president.  Quite frankly, ANYONE is better than the bloodsucking mosquito poops that constitute our current administration.

          bonddad did not mention Edwards once.  So stop hijacking a very intelligent and non-politicized diary.

          I think the positive thing to do would be to write your own diary about the very good points you made about Edwards' stance on trade.  Tap me and I'll give you mojo for that.  

          But no mojo for hijacking.

          There may be tyrants and murderers, and for a time, they may seem invincible, but in the end, they always fail.

          by Dania Audax on Mon Apr 23, 2007 at 06:10:50 AM PDT

          [ Parent ]

          •  I don't care about mojo. (23+ / 0-)

            As I said above, my intent wasn't to "hijack" and I should have waited until I could post at length rather than posting simply "John Edwards for President."

            Secondly, several of us where up half the night discussing trade in another thread, wherein someone suggested Bonddad give us his treatment of the issue.  While I may be guilty of picking up the discussion in this thread where it left off in the other, my intent was by no means to "hijack."

            Finally, every single diary on this site is "polticized."  That's kind of the point.  It's a political website.

          •  Read Friedman much? (33+ / 0-)

            I am a big fan of Bonddad, but I refuse to call this diary intelligent. I don't have time to write a response right now, but I will try to do so later. "Globalization is inevitable so tighten your belts" is a trademark Tom Friedman mantra and all the arguments supporting that point of view have been thoroughly debunked. The only reason we should give up is if we decide that our government is so thoroughly sold out to those benefitting from globalization that we can't really win. In other words, the rich have got us by the short and curlies, so just bend over and grab your ankles. We already pissed away half the bargaining chips that we started with when the globalization movement began, and unless we take control of this in the next 20 years we will be fighting for scraps with the Guatemalans.

            As a sidenote, promoting John Edwards' candidacy in comments to this diary is not exactly highjacking because he is the only candidate speaking to the issue of selling out America to corporate profits through globalization.

            (-3.50, -5.23) You know your empire's crumbling when people are getting more religious and less scientific, not the other way around. --David Michael Green

            by mgoltsman on Mon Apr 23, 2007 at 07:44:06 AM PDT

            [ Parent ]

            •  Yes, The Good Mr. Friedman. (14+ / 0-)

              The "Moustache of Understanding", as Atrios calls him.  

              Dear Tom is just as wrong on trade and globalization as he was/is on Iraq.

            •  Well put mgoltsman (0+ / 0-)
            •  bonddad is a noted BEAR (9+ / 0-)

              folks who follow the bondmarket are notably more bearish than most other market-watchers. thus, his view fits his profile.

              there's a whole lot of wisdom in this diary. it behooves us to pay attention to some of these suggestions.

              massive worker retraining? or massive workforce training initiatives aimed at new entries to the system? i prefer the latter, thanks.

              the market does as it will in so many ways. progressives must recognize that standing firmly against it is like trying to fence a mudslide.

              regulation? hell yeah. but there are virtual certainties that this diary touches upon. big kudos for the contrast between solutions for problems of the developed nations and the developing nations. it's damned easy to get ourselves lost in the problems in the United States, ignoring the truth about world poverty.

              yes, corporate dominance in developing US government trade policies has been a huge problem. i very much doubt that John Edwards is "the only candidate speaking to the issue of selling out America to corporate profits ..."

              progressives must find their true voice and express our values. we really must be careful though - populist protectionism is not progressive in any way, shape or form.

              it's about biconceptualism ... Obama08

              by wystler on Mon Apr 23, 2007 at 09:52:32 AM PDT

              [ Parent ]

              •  I like your sober reasoning, but (7+ / 0-)

                populist protectionism is not progressive in any way, shape or form.

                I must ask the question: What is the priority of U.S. government responsibilities? It may not sound sophisticated enough, but I would say protecting the working lives of U.S. citizens ought to have a higher priority than "solving world poverty" or something.

                Remember - we are talking about the U.S. Govt. It's job has to be defined, limited. It is not the world govt. It should offer some form of support to labor in the U.S.

                And I think John Edwards just might have that idea more in the forefront than most other candidates.

                Thanks for the debate...

                Hope is, after all, the currency of popular politics, and a coin surprisingly hard to devalue. -- Fred Anderson, Crucible of War

                by ornerydad on Mon Apr 23, 2007 at 10:08:26 AM PDT

                [ Parent ]

                •  values (3+ / 0-)

                  ... but I would say protecting the working lives of U.S. citizens ought to have a higher priority than "solving world poverty" or something.

                  you're going to run head-long into a VALUES trap here. the image you're bucking is burned into the minds eye of most of us all: hungry children, ailing women, families without shelter.

                  as progressives, we muddle our message if our values end at the rio grande ...

                  that's not an argument in favor of what passes for "free trade" in the current vernacular. the question cuts to the heart of how we, as progressives, can connect with underlying metaphors that help us both short- and long-term.

                  it's about biconceptualism ... Obama08

                  by wystler on Mon Apr 23, 2007 at 10:19:05 AM PDT

                  [ Parent ]

                  •  You have it backwards, wystler (8+ / 0-)

                    ... the image burned into the mind of hungry children, ailing women ...

                    That is right, of course. But it is globalization that perpetuates world poverty. It's purpose is not to create jobs from altruism, but to guarantee the lowest possible wages. Neocons look at people as a labor commodity to be purchased as low as
                    possible.
                    Coffee might cost 2% more if "Juan Valdez" got a fair traded price. But as progressives we just have to work to that end.

                    •  wrong boogieman (1+ / 0-)
                      Recommended by:
                      bluewolverine

                      But it is globalization that perpetuates world poverty.

                      No. It's the lack of appropriate controls on the corporate behemoths that perpetuates world poverty.

                      Meanwhile, access to the US consumer market is mandatory for people worldwide to break out of the poverty cycle. (Though isn't the whole of the solution, it's a vital part.) Unwise application of tariffs and other anti-trade protectionism won't have much impact on the excesses of the multinationals (who will find alternative means to horde sales receipts), but it will stifle access to the broadest base of purchasors for developing nations' producers.

                      What you're doing: defining globalism in a defeatist manner.

                      it's about biconceptualism ... Obama08

                      by wystler on Mon Apr 23, 2007 at 11:40:55 AM PDT

                      [ Parent ]

                      •  wystler doesn't get "it" (0+ / 0-)

                        (having a sybil moment)

                        It's the lack of appropriate controls on the corporate behemoths that perpetuates world poverty.

                        wystler, jeebus!

                        that's only one of many reasons for world poverty. how can you not place the blame at the feet of the local elitist militarists who prop up the banana republics who work in partnership with those corporate behemoths?

                        ~ the young socialist that wystler used to be

                        it's about biconceptualism ... Obama08

                        by wystler on Mon Apr 23, 2007 at 11:45:04 AM PDT

                        [ Parent ]

                      •  As Steigletz notes in Globalization and its (5+ / 0-)

                        discontents, one of the primary problems with globalization is how it has been defined.

                        In return for free trade agreements, US financial firms have demanded de-regulation of financial markets.  This has led to multiple disasters around the world.  

                        More broadly, though, I question the assumption that the only way solution to global poverty is to grant open access to US markets.  This in itself is simply not sustainable.  We cannot continue to borrow money to pay for these goods, and we cannot continue to impose lower standards of living for the vast majority of American workers.

                •  You hit the nail right on its head, (2+ / 0-)
                  Recommended by:
                  GayHillbilly, Jagger

                  we are talking about the U.S. Govt. .. It is not the world govt ...

                  And therein lies the rub. The neocons don't agree with that simple premise. Hence globalization is a must.

              •  you are invited to explain (4+ / 0-)

                why heavy use of trade protectionism hasn't sunk the Chinese economy.

                You are also invited to give examples of any rapidly expanding economy of today which is NOT protectionist.

                Not to say that protectionism can't be overdone, but there's a big difference between "not overdone" and "not overdone".

                Protectionism and "free trade" are just tools, neither is sacred and it interferes with constructive thinking about economy to consider either to be either tools or sacred, never to be questioned beliefs.

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 04:17:53 PM PDT

                [ Parent ]

                •  here ya go (0+ / 0-)

                  why heavy use of trade protectionism hasn't sunk the Chinese economy.

                  as bonddad noted in his diary, there's a marked difference between the economy of a developing nation and a developed nation (ah, the tense of the participle! ... what? don't get so tense!)

                  You are also invited to give examples of any rapidly expanding economy of today which is NOT protectionist.

                  there are no examples of economies on the entire earth, rapidly expanding or otherwise, that are not protectionist at some level

                  no, i'm not a free-trader ... if you thought so, then you've entirely misconstrued both my argument and that of bonddad ...

                  it's about biconceptualism ... Obama08

                  by wystler on Mon Apr 23, 2007 at 08:42:32 PM PDT

                  [ Parent ]

                  •  with manufacturing on its way back to the (0+ / 0-)

                    Americas driven by energy costs, it's time to look at our manufacturing economy as being in the developing stage again.

                    Bonddad left consideration of the dominant force in the next phase of the world economy out of his analysis... triple-digit/barrel oil costs. It is also important to know something about how products are actually manufactured if one is speaking to this issue, and the CW that the truth is otherwise "isn't even wrong".

                    Energy is an important enough factor that until he reworks his analysis to include it and does some research into manufacturing methods and how costs are affected by them, his analysis is essentially worthless except as a basis of discussion.

                    It's a beautiful statement of the CW and contains "tough medicine" that people whose self-image includes being "realistic thinkers". And it's as right as the people who said "mankind will never fly", and for similar reasons.

                    Looking for intelligent energy policy alternatives? Try here.

                    by alizard on Mon Apr 23, 2007 at 09:09:33 PM PDT

                    [ Parent ]

                    •  energy costs will be a big deal, but ... (0+ / 0-)

                      Bonddad left consideration of the dominant force in the next phase of the world economy out of his analysis... triple-digit/barrel oil costs.

                      ... shipping overseas and via rail are not highly impacted by rising fuel costs; that'd be trucking that takes the big hit.

                      it's about biconceptualism ... Obama08

                      by wystler on Tue Apr 24, 2007 at 10:29:07 AM PDT

                      [ Parent ]

                      •  I'm sure that the marine part of the (0+ / 0-)

                        shipping industry will find your comments of interest.

                        http://www.bunkerworld.com/...
                        Rotterdam market tight, prices rising
                        11 Apr 2007, 10:33 GMT

                        BARGE MARKET:
                        Bids up from $295 to $300 mtw. Offers up from $302 to $305 mtw.

                        Nymex crude close: $61.89 (+0.38)    now: $61.95
                        IPE crude close: $67.48 (-0.03)    now: $68.16

                        BUNKER MARKET:
                        Product tight. Congestion at loading...

                        but I think they'll find their increasing oil costs more so. You know and I know that the era of small, incremental increases in fuel costs will end soon.

                        Looking for intelligent energy policy alternatives? Try here.

                        by alizard on Tue Apr 24, 2007 at 02:05:50 PM PDT

                        [ Parent ]

              •  Well being a Guitar player and having sold (2+ / 0-)
                Recommended by:
                Jagger, bluewolverine

                those imported instruments. I can tell you one that I have to do expertise on, Bonddad is wrong. There is a guitar company up in Canada some of the best selling accoustic ( most labor intensive) and electric guitars in the US. They didn't lower wages and lower their standard of living to do or train to do another job.

                They factored in the long lead times importers had to deal with , the long cash cycles, interest rates, transportation costs. A container of guitars cost anywhere from 4-8K to bring in from China. The duties and the inventory requirements of the importers, their mark-up, distributors, their mark-ups and then the retailers time to set the guitar up so it would sell .

                Then they targeted a guitar and a margin for the retailer that would substantially crush imported guitars and they succeeded to where their biggest problem , despite growing 100s of percent in a contracting market, is building enough guitars.

                What's amazing is imported guitars have traction at all. If it has, it's becuase we let it have traction. Importers and distributors who could make a fast buck if they had the credit lines and knowledge undersold American guitar manufacturers - especially in the low end of the market- and retailers ultimately were forced to buy them. Essentially like in other industries, it's US citizens who are unable to make a car or a guitar but can negotiate a credit line to import them that create this imbalance in the US.

                If the Chinese allowed their currency to float, there would be no Chinese guitars. I stopped into few places this last season and looked and they still suck.

                There are also substantial American guitar companies from Taylor to Martin and a slew of new ones that have gotten traction since I left. Vintage American made Martins and Gibson's and many more are still collectors items that appreciate in value. Find me a single Japanese, Korean Indonesian, or Chinese guitar that appreciates in value. Just one. So not only can they be manufactured here but our brand names have equity that is long over looked in the rush to make an extra buck.  

                Conclusion, remove the distibutor and importer, all the do provide a collection point, sell the guitars direct. The cost is more to make, but the over cost to retailer is the same or lower for a far higher quality North American guitar.

                The problem Americans have is that we tend to give in to this sense of inevitability. All one has to do is to look at the labor content of a given product, then add back in lead times, duties, cash cycles, distribution margins and it's very possible to make and sell competitively in the US without giving in to the notion that everytime a low wage country figures out how to copy a product and make it cheaper we have to re-invent ourselves and retrain all of America in whole new profession in a whole new industry. .

                The people we have to train are the leaders in politics and manufacturing who are the first to succumb to the siren sound of free trade as they crash their countries on the rocks and make it difficult to make free trade exist unless the exporting countries allow us the same freedoms that we allow them. No more favored trade status. If your hitting us with 100% duties and ripping our intellectual property, you get it right back.  

                Support the Troops, Impeach Bush
                Oversize Rants Available Overnight at
                The Image Factory

                by Dburn on Mon Apr 23, 2007 at 04:52:27 PM PDT

                [ Parent ]

            •  Bravo (mgoltsman)! Rec,d nt (0+ / 0-)
            •  "globalism is the future" is the CW (2+ / 0-)
              Recommended by:
              Jagger, bluewolverine

              and like any other unexamined CW, tends to calcify into a belief system having less and less to do with underlying reality. The business case for offshoring was never all that great to begin with and is turning into a bad joke now.

              First:

              1. Third World labor costs are in part, a reflection of underlying infrastructure costs. I can't afford to work for $1/hour because that won't even pay my rent. It won't pay my rent because my residence exists within a First World infrastructure and my rent costs reflect that. As the infrastructure gets built, the cost of living goes up.
              1. A newbie programmer happy to accept $5/hour 5 years ago is now a programmer with 5 years of experience, and if you offer him $15/hour, he's going to accept the $20/hour pay down the road.

              Confirmation: India professional pay rates (and incidentally, job turnover) are skyrocketing exactly as this predicts, and companies who underwrote the costs of building Indian infrastructure are now looking for new Third World areas to repeat the cycle in.

              Did companies really save money? Or was offshoring used as a convenient excuse within the context Enron-style corporate accounting to give the appearance of increased profits in order to trigger CEO incentive bonus packages?

              Second
              How much does the price of oil have to increase before it ceases to make sense to ship raw materials thousands of miles from country A to country B and ship finished goods from country B to country C?

              Depends on the product, but in an era of increasing transportation energy costs, the number of products it makes sense to do this with decreases as the price of energy increases.

              As I see it, the future of manufacturing is regional, not global, and not all the Friedmans and Bonddads in the world can stop this coming trend.

              The only products manufactured in a single location and sold globally will be premium products people buy due to perceived quality, not because they're cheapest.

              However, I see a fair number of major corporations whose management is firmly grounded in conventional wisdom TRYING to keep on doing business as usual... and going bankrupt as a result.  

              Looking for intelligent energy policy alternatives? Try here.

              by alizard on Mon Apr 23, 2007 at 04:05:42 PM PDT

              [ Parent ]

              •  You're too optimistic (0+ / 0-)

                If I understand you correctly, you're considering the business case for globalization purely from the point of view of labor arbitrage. I think it is much more than that.

                When all is said and done, even in the unlikely event that labor in China, Malaysia or whatever sweat shop du jour actually becomes expensive enough that there is no money to be made by moving employment there, there are still plenty of advantages to moving your operations out of the developed world. China has ho OSHA (it has the opposite), no EPA (may get one soon, but still easier to deal with that EPA under anyone except Bush), and tax burden is lower because the government wants to lure investment.

                More long-term, I think multinational business will invest in third world simply to have an alternative to developed economies. Start moving key operations to China and all of the sudden EU becomes a lot more "business-friendly". Buy a few jets from Brazil and all of the sudden DeHavilland and Saab are a lot more flexible. It's leverage, and they have it simply because we give it to them.

                (-3.50, -5.23) You know your empire's crumbling when people are getting more religious and less scientific, not the other way around. --David Michael Green

                by mgoltsman on Mon Apr 23, 2007 at 07:59:12 PM PDT

                [ Parent ]

                •  as I said, it still will come down to regional (1+ / 0-)
                  Recommended by:
                  mgoltsman

                  markets and I haven't said anywhere that governments have no role to play in all this. There are ways that the government can help the process along.

                  Elimination of globalization-related tax breaks, development grants and loans and perhaps purchasing setasides targeted towards 'future-oriented manufacturing', tariffs geared towards encouraging nations to follow environmental practices that don't dump their pollution into their own back yards and a bit of protectionism. (let's treat ourselves as a developing nation in this)

                  Ways to pay for worker training and support workers while they get it, if manufacturing is on its way back, we're going to need people capable of working in the ISO-9001 certified facilities that'll be exporting the premium products of the future. We need "MADE IN USA" to mean something good again.

                  And yes, alternative energy manufacturing and technology sale / licensing plays a role here.

                  There are lots of possibilities once one stops drinking Friedman's Kool-Aid (the funny yellow tasting stuff) and starts looking even at just what we know about the shape of the future almost upon us.

                  IMO, in a sense, the future repeats the past. FDR saved capitalism from itself, and I think we're going through another of those historic opportunities.

                  America doesn't have to go into the toilet unless we let it.

                  Looking for intelligent energy policy alternatives? Try here.

                  by alizard on Mon Apr 23, 2007 at 08:12:43 PM PDT

                  [ Parent ]

        •  It isn't quite that simple (7+ / 0-)

          there can be genuine concerns about imports and exports.  Even simple ones like quarantine costs.  Australia has always tried to minimise the import of unwanted species but trade agreements have been the reason for dropping standards in the past.

          There can be ecological and interactive (GMOs for instance) concerns that get trumped by trade agreements (free and otherwise).

          This has to be considered.

          I believe Japan doesn't import american cars due to fuel efficiency regulations.  Is that unfair?  What do they do if you think it is and slap a surcharge on all you import from them?

          There has to be an effective method of resolvng disputes.  True "free trade" is simply impossible anyway.

          Globalisation should not be a reason for foisting bad decions of others upon us.

          Best Wishes, Demena

          by Demena on Mon Apr 23, 2007 at 07:21:56 AM PDT

          [ Parent ]

      •  Don't criticize that Edwards post. (9+ / 0-)

        They might consider you a troll. :)

      •  Not shilling. (23+ / 0-)

        There is a point.  We won't give up when we are about to win.

        John Edwards is opposed to these free trade capitulations.

        I see in the midst of all this difficulty, I see great possibility. Let's talk about TRADE - listen - free, unfettered trade - we've seen what the consequences of that are. Now we're talking about a new trade agreement with South Korea. No meaningful standards - and I'm announcing tonight - I'm against this. Listen - they put workers in S. Korea in jail by the thousands because they stand up. Seems to me, don't we want our cars to be sold all over? We need trade that works for all of America. There's nobody in this world that doesn't want trade - but we need trade that works.

        Liberal Lucy liveblogging his speech Saturday night before the Michigan Dems.

        The kids in Seattle in 1999 were right.  Don't give up.  We are on the verge of transformational change.

        In shorthand: John Edwards.

        The comment was exactly right.

        "We've got to save America from this President." John Edwards 4/3/07

        by TomP on Mon Apr 23, 2007 at 06:18:12 AM PDT

        [ Parent ]

      •  Oh great (7+ / 0-)

        another self-appointed diary cop.

        If conservatives had had their way we'd still be an English colony.

        by baba durag on Mon Apr 23, 2007 at 08:28:53 AM PDT

        [ Parent ]

    •  As one leaning towards Edwards (8+ / 0-)

      I find your grafitti -- there's no content included, so I can't call it more than that -- in the first comment on this diary counterproductive at best, though the first word that came to mind is disgusting.  When I say I lean Edwards despite some of the actions of his supporters here, this is now exhibit 1.  This is not the place for that sort of drive-by comment and it will not help the Edwards campaign.  But you've made Hillary happy.

      My apologies to students who took my U.S. Government class in the 90s: evidently the Constitution doesn't limit Presidential power after all. Who knew?

      by Major Danby on Mon Apr 23, 2007 at 09:50:59 AM PDT

      [ Parent ]

  •  Another outstanding diary (16+ / 0-)

    I enjoy reading your diaries, Bondad.

    Too bad the administration can't spell bilateral...

    "Free, fair, open and honest elections." -- Jennifer Brunner

    by jump23 on Mon Apr 23, 2007 at 04:40:03 AM PDT

    •  Oh they can spell it.. (1+ / 0-)
      Recommended by:
      gatordem

      but they think it means the same thing as bi-sexual and the religious right won't let them discuss it /snark

      - "When the facts change, I change my mind. What do you do, sir?" - British economist Lord Keynes (1883-1946)

      by Czarvoter on Mon Apr 23, 2007 at 10:04:27 AM PDT

      [ Parent ]

  •  Great diary and great links (3+ / 0-)

    As always Bonddad, thanks.

    Experience may differ in online play...

    by OCD on Mon Apr 23, 2007 at 04:44:47 AM PDT

    •  Dumb diary but it follows the corporate line (10+ / 0-)

      workers don't HAVE to put up with corporate lies unless they begin believing this type of BS.

      •  Neither great nor dumb... (12+ / 0-)

        While I don't agree with Bondad's central point in this diary regarding the "inevitability" of globalization, I also don't think it is wise to dismiss every point that he makes, either.

        Some random observations:

        Offshoring today is being driven entirely by cost, and not by quality considerations.  I'm old enough to remember when the wave of Japanese electronics imports hit our shores in the seventies.  These products weren't much less expensive than their American counterparts, but were much more reliable.  I've got a 1977 Panasonic color TV that still works today -- anyone think a Zenith or RCA of the same era would have lasted as long?  In contrast, the wave of Chinese imports today are notably inferior in build quality and reliability to their Japanese predecessors -- they're just...cheaper.  Most of this stuff won't last ten years, let alone the 30 I've gotten from that ancient Panasonic TV.

        Retraining is the line of BS that has been fed by advocates of globalization for the last 20 years.  Bondad's diary specifically mentions the lack of skilled factory workers, and yet I can't help but notice that the educational emphasis in this country seems designed to steer workers away from those types of jobs in favor of jobs that require a college degree.  I further get extremely cynical regarding claimed worker shortages since I know from experience what a load of wind the alleged shortage of engineers is in this country.  Finally, the push for retraining is also another way of pushing ever more financial risk on individual workers and families in this country -- while government tuition aid is generally proposed by retraining advocates, that kind of neglects the issue of how folks are supposed to cover their living expenses while they're in school.  I went through this a few years back, and it was tough for me as a single person with no dependents...I don't even want to guess how someone with a family could cope.

        As for the "inevitability" argument -- I think it is a crock, because when I look at history, I see that many of the previous trends that were proclaimed as inevitable at the time turned out to be anything but.  Gravity is inevitable -- you can pass whatever laws and regulations you like, but it won't change the underlying physical laws.  Trade, on the other hand, is definitely influenced by laws and regulation -- if the philosophy of the people writing those laws changes, so will the outcome.  Or, to put it another way, globalization today is no more inevitable than communism was 40 years ago.

        Political Compass: -6.75, -3.08

        by TexasTom on Mon Apr 23, 2007 at 10:33:37 AM PDT

        [ Parent ]

        •  Best comment of the day, TexasTom. (0+ / 0-)

          You've got it exactly right, on every point.

          "Do not forget that every people deserves the regime it is willing to endure." -- White Rose letter no. 1

          by keikekaze on Mon Apr 23, 2007 at 01:24:36 PM PDT

          [ Parent ]

        •  how long will it continue to make sense (2+ / 0-)
          Recommended by:
          Jagger, keikekaze

          to ship raw materials thousands of miles and reship finished goods thousands of miles somewhere else when oil goes over $100/barrel?

          IMO, the future of product manufacturing is regional and not all the Friedmans and Bonddads and HRCs can do anything about it.

          Looking for intelligent energy policy alternatives? Try here.

          by alizard on Mon Apr 23, 2007 at 04:33:17 PM PDT

          [ Parent ]

  •  This is the first reasoned assessment I've read (51+ / 0-)

    of our attempts to impose Developed World standards to the Developing World - I've always got irritated by demands from our side saying they're stealing our jobs, they don't have to follow OSHA, child labor laws and federal mandates that we have to, its an uneven playing field,, etc. etc. And I feel like replying they dont have to deal with paved roads and uninterrupted power supply and 2.5 computers per family, and 2500 sq ft of living space per household; they manage to squeeze 10 people per 500 sq ft and praise the lord that they have a roof over their heads; they use water poured over jute mats to cool their bedrooms; boil and filter every single cup of drinking water, and on and on...
    I dont grudge them a single job, though I do worry about my kids and their prospects - I just tell mine, you have to work smarter, but if it doesn't work for everyone, it will not work for just one.

    •  thanks for putting this in more perspective.... (4+ / 0-)

      I guess I'm somewhat selfish in agreeing that we need more protection of our economy. No matter what we do, multinational corporations will always go to where the cheapest resources are.

      I got into a big argument over the weekend with a friend of mine about this, and his argument was that there's nothing we can do about this.  This was a timely reprise of that, but with much better points being made (the written word is good like that).

      The potential here is that we can advance much more rapidly with such requirements for us to be the economic "big dog". History shows (check out Kevin Phillips' books on the subject), however, that at least until now, others have taken the lead after the previous "big dog" falls back, with rather depressing results for said "big dog".

      Every day .... will be a "Constitutional crisis" given we have a president who doesn't give a damn about the Constitution. Kos

      by billlaurelMD on Mon Apr 23, 2007 at 07:06:57 AM PDT

      [ Parent ]

      •  The MULTINATIONALS will MAXIMIZE PROFITS (12+ / 0-)

        If they can't sell products made in China to US markets, they will manufacture them elsewhere. All it takes is figuring out the costs avoided by placing your plants in USA - wages, regulation, taxation - and slapping the tariff on all goods improted into USA to offset that. All of the sudden domestic manufacturing does not seem all that expensive. If these products cant be SOLD to the American consumers, they are worth exactly as much as the landfill they will go into. There is no point in making a DVD player in Malasia if you can't ship it to USA - Malasians can't afford one and they have no electricity.

        (-3.50, -5.23) You know your empire's crumbling when people are getting more religious and less scientific, not the other way around. --David Michael Green

        by mgoltsman on Mon Apr 23, 2007 at 07:50:34 AM PDT

        [ Parent ]

        •  but doesn't this require... (1+ / 0-)

          that ALL countries behave the same way?

          Every day .... will be a "Constitutional crisis" given we have a president who doesn't give a damn about the Constitution. Kos

          by billlaurelMD on Mon Apr 23, 2007 at 07:52:47 AM PDT

          [ Parent ]

        •  Unilateral use of tariffs is illegal (6+ / 0-)

          ...under international treaties that the U.S. has already signed and ratified - NAFTA in 1992 and the Uruguay round of GATT in 1995. Other GATT signatories could overturn any attempt to impose unilateral tariffs by filing a complaint at the WTO.

          Now if you're saying that we should back out of the WTO and start a protectionist free-for-all in which every country follows a beggar-thy-neighbor policy, this is insane. We will all end up poorer, and there are a lot of things the U.S. simply doesn't produce anymore and will still have to buy overseas without the international credit to do so. This is a recipe for economic depression and war.

          "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

          by berith on Mon Apr 23, 2007 at 08:27:24 AM PDT

          [ Parent ]

          •  Oh, so we already promised to get screwed... Well (11+ / 0-)

            Yes, I am suggesting that we back out of the WTO. It is an organization designed to further the development of business without regard to the effect on the people. NAFTA - as one of the more glaring examles - sucked when it was suggested and it sucks now. Funny how everybode laughed at Ross Perot about the "giant sucking sound" until they heard it on their way into the vacuum cleaner.

            We will not ALL end up poorer, at least not if you consider more than 10 year horizon. And I assure you if it makes economic sense the US will again produce ANY things that it does not produce "any more".

            It is true that we are mired deep enough in various trade agreements and organizations that it cannot be simply reversed by throwing the switch. Maybe it needs to become a policy of the US government to revert to an isolationist economic stance over the course of ten years or so. Yes it will inflict as much or more economic pain over these ten years than the slow slide into the abyss that we are engaged in right now. But at least that way US stands a chance of preserving its economic self-determination capability as a nation. The other option is ending up like any banana republic in the Central America, where the government is entirely bankrolled by one or two multinational corporations.

            War? Anything in the economic realm will lead to war? Are you serious? A war with the US? Russia was the weaker of the two superpowers when the standoff ended, it has enjoyed a no-holds-barred theft free-for-all for the past twenty years that decimated its infrastructure, and still nobody in their right mind - not even the USA - would think of a war with Russia on economic grounds. We have maybe twenty years of economic power left - before we become economically irrelevant to the rest of the world and will have to do as told - but AT LEAST 50-70 years (worst case) of military power where we can do what we want and nobody will dream of a military confrontation with the USA.

            (-3.50, -5.23) You know your empire's crumbling when people are getting more religious and less scientific, not the other way around. --David Michael Green

            by mgoltsman on Mon Apr 23, 2007 at 08:47:58 AM PDT

            [ Parent ]

            •  Thats just it (3+ / 0-)
              Recommended by:
              wystler, Idioteque, berith

              And I assure you if it makes economic sense the US will again produce ANY things that it does not produce "any more".

              It doesn't and it wont.  We are not a manufacturing society anymore and we shouldn't try to be.  Our biggest exports are knowledge and Intellectual Property (software code, patents, lawyer and accounting services, things like that) plus entertainment (movie, music, television and professional sports industries).

              Let other countries build their economies around assembly lines and factory workers.  We're already past that.  Also... wait until a global carbon tax comes into play and see how much profit there is to running a manufacturing plant in the US.

              Thinking men can not be ruled. --Ayn Rand

              by Wisper on Mon Apr 23, 2007 at 09:25:34 AM PDT

              [ Parent ]

              •  Nonsense. (6+ / 0-)

                That's literally insanity speaking.  Knowledge is rapidly something where we're NOT the global leader; it's being shipped out and grown abroad.  We're not the trailing edge--yet.  But that's not a national economy industry, anyway.  IP, entertainment... etc.  Ditto.

                You're sucked firmly to the financial capitalism idea, that somehow we can be supported by everyone else for doing things that shuffle money around, largely.  It's been tried by a few imperial societies before and failed disastrously.  

                "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

                by ogre on Mon Apr 23, 2007 at 02:44:20 PM PDT

                [ Parent ]

              •  knowledge and IP developed (0+ / 0-)

                in the Third World and stolen freely by our future competitors profits Americans how?

                With respect to manufacturing, just how does it make sense given increasing costs of energy to ship raw materials thousands of miles from Country A to Country B and finished goods from Country B to Country C?

                Particularly when labor rates in Country B are going up and in general, the REAL cost of a manufactured product built via automation really doesn't have a lot to do with the cost of labor?

                Are you an economist?

                People take for granted that the CW globalization business model is the only workable one AS AN ARTICLE OF FAITH... and that's all it is.

                Find another cult.

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 04:46:19 PM PDT

                [ Parent ]

            •  Congratulations on misreading me so well (1+ / 0-)
              Recommended by:
              Shane Hensinger

              Point one: What you're advocating would have a Great Depression-scale impact on U.S. living standards, not a little recession. Economics 101 says that the greater the scale of markets and the division of labor the greater the overall wealth produced. How many Americans want to voluntarily return to a 1970 standard of living, the last time we had anything close to the sort of restricted international trade you seem to be advocating? Real median wages may not have risen much since 1970 but household income and purchasing power have risen considerably--the result of greater labor force participation and cheap imports. Even the 1970 lifestyle is much better than where we would end up because in 1970 we were far more competitive relative to other industrialized nations, we had a positive savings rate and a positive balance of trade, and oil was still cheap and mostly domestically produced.

              Point two: I wasn't saying that war will arise with China because we don't buy their stuff. It's going to arise because the U.S. has to compete with China, Japan and Europe for oil from Third World nations and those nations that continue to trade will be better able to pay for it than a protectionist U.S. would be. The only way we could balance the scales if, say, Venezuela decided to stop selling oil to the U.S. is by using our military to exert pressure or install a pro-U.S. regime. There's nothing in our history to suggest the American public is suddenly going to become high-minded enough to prefer a loss of living standard to a few little wars. If you think we should invest in alternatives that enable us to move towards a reduced dependence on foreign oil, fine, I agree. But don't pretend we can eliminate this dependence in anything close to ten years.

              "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

              by berith on Mon Apr 23, 2007 at 09:50:18 AM PDT

              [ Parent ]

              •  Say what? (5+ / 0-)

                Real median wages may not have risen much since 1970 but household income and purchasing power have risen considerably--the result of greater labor force participation and cheap imports.

                Wages aren't up... but household income is?  Magic wand?  Cooked books?

                Or are you just referring to the fact that more and more people have to work more and more jobs just to stay in place?

                Purchasing power?

                Odd, that's not what I see.

                Fewer people who feel like they have any idea how they'll retire and survive.  Fewer people with health care.  Fewer people who can imagine buying a house.

                Purchasing power?  For what?  Wally-World crap and McBurgers?

                "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

                by ogre on Mon Apr 23, 2007 at 02:47:30 PM PDT

                [ Parent ]

                •  since you asked so nicely .... (0+ / 0-)

                  Wages aren't up... but household income is?  Magic wand?  Cooked books?

                  Or are you just referring to the fact that more and more people have to work more and more jobs just to stay in place?

                  Greater labor force participation means more people working more hours. It doesn't specify why, but if you look at who is working more hours since 1970 it's mostly women. Why are women working more? Some to contribute to a rising household standard of living, some to pursue self-actualizing careers that weren't open to an earlier generation. Male professionals are working more too, but this is offset by the fact that working class men are working less.

                  Among the things that are cheaper in real dollars since 1970:

                  food
                  clothing/textiles
                  electronics and other consumer durables (excluding cars)

                  Things that aren't cheaper:

                  housing
                  cars
                  college education
                  health care

                  Now you may not feel that Americans spending more on these latter goods since 1970 represents a real increase in welfare, but there are a great number of people who think otherwise or they wouldn't be working more to buy these things.

                  "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

                  by berith on Tue Apr 24, 2007 at 06:46:42 AM PDT

                  [ Parent ]

              •  Did you ever get to Econ 102? n/t (1+ / 0-)
                Recommended by:
                mgoltsman

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 04:47:41 PM PDT

                [ Parent ]

                •  Yes, actually I am an economist. Are you? (0+ / 0-)

                  Or do you just like to make ad hominem attacks from a position of ignorance?

                  "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

                  by berith on Tue Apr 24, 2007 at 06:32:37 AM PDT

                  [ Parent ]

                  •  economics is not a well-respected profession (0+ / 0-)

                    these days. Predictions by economists that rarely match results is why. Remember the Laffer Curve?

                    It could be worse. At least I'm not one of your paying clients.

                    Looking for intelligent energy policy alternatives? Try here.

                    by alizard on Tue Apr 24, 2007 at 02:01:18 PM PDT

                    [ Parent ]

              •  No other option (0+ / 0-)

                First, you are presenting a false choice: 1970 era lifestyle or current lifestyle. The real choice is 1970  era lifestyle in 10 years or 1870 era lifestyle in 30 years. Think about it - you will see your children grovel in poverty before you die. I don't want to see that come to pass. The current lifestyle that we have is given to us through fooling us into borrowing our kids' money and spending it on crap AND by convincing us to trade our future (US manufacturing base) for some instant gratification for a few decades (cheap Chinese goods while we still have credit).

                The war for resources is a much more difficult topic. It may well be inevitable in some form, but certainly we are not helping ourselves by financing our future foes' economic development.

                (-3.50, -5.23) You know your empire's crumbling when people are getting more religious and less scientific, not the other way around. --David Michael Green

                by mgoltsman on Mon Apr 23, 2007 at 07:41:13 PM PDT

                [ Parent ]

          •  You can withdraw from treaties (3+ / 0-)
            Recommended by:
            PaulVA, mgoltsman, KansasLiberal

            Bush did it with the non-proliferation treaty I believe, so we can develop that boondoggle of a defense shield.

          •  from what I understand... (2+ / 0-)
            Recommended by:
            berith, mgoltsman

            there are exceptions for duress from reasons like, say, currency manipulation (China and its lock-in of the yuan to the dollar?). But IANOE (I am not an economist, though I used to be an accountant.)

            Every day .... will be a "Constitutional crisis" given we have a president who doesn't give a damn about the Constitution. Kos

            by billlaurelMD on Mon Apr 23, 2007 at 11:58:34 AM PDT

            [ Parent ]

          •  Simple response then. (5+ / 0-)

            Set out a statement that the US is announcing its withdrawal from WTO in six months (or whatever the period of time is that is required) BUT will rescind that if the tariff rule is modified to allow...

            And if it's not, withdraw.

            The cure may be bad, but the disease is killing the US.  The fundamental health and well-being of the American population economically is being pissed away.

            And the government has an obligation (Constitutionally) to protect the common welfare.

            Negotiated trade is a fine thing.  And people will be perfectly willing to.  The US just needs to negotiate on behalf of the interests of its people, not the transnational corporations.

            "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

            by ogre on Mon Apr 23, 2007 at 02:40:46 PM PDT

            [ Parent ]

        •  If you start slapping Tariffs (2+ / 0-)
          Recommended by:
          berith, Shane Hensinger

          just to protect your internal market, you will need to withdraw from the World Trade Organization first or else you will be paying BILLIONS in fines.

          This is completely isolationist and as a country that RELIES on imports, this is not very sound policy.

          Thinking men can not be ruled. --Ayn Rand

          by Wisper on Mon Apr 23, 2007 at 09:21:57 AM PDT

          [ Parent ]

          •  What about countries that simply don't import US (3+ / 0-)
            Recommended by:
            PaulVA, mgoltsman, Jagger

            made products (what few there are remaining)?   Tariffs=bad, other forms of economic bullying=OK.  

            I call bullshit.  

            •  People who opt to buy elsewhere is fine (0+ / 0-)

              If they are willing to pay for it.  People in this country buy a whole lot of German cars.  They're typically more expensive then American models but they think its worth it.

              However, if you set up a regulatory hurdle that makes a foreign product more expensive, or subsidize your own industry to give them an unfair edge, you will lose in the WTO.

              We have lost so many of these.  We've lost on Cotton.  We've lost on Steel.  We've lost on Timber.  We've lost on Corn.  We're about to lose on Internet Gambling.

              And when we lose, we either have to pay, or the other country is then legally entitled to impose any tariffs they want on your products to offset their loss.

              For instance, when the WTO recently decided that the EU was right about how the subsidies we give to US Steel companies are illegal, the EU came after us in full force.

              They threatened to pose custom tariffs on key US items that would do the most harm in key swing-state industries to inflict the maximum pain on US politicians.  So they threatened things like taxing Harley Davidson motrocycles as a way to further crush Michigan's economy.  They would put a tariff on Rayban Sunglasses to hit manufacturing towns in Oregon.

              In short:  Economic Protectionism Never Works

              Thinking men can not be ruled. --Ayn Rand

              by Wisper on Mon Apr 23, 2007 at 01:50:46 PM PDT

              [ Parent ]

              •  Oh really? (3+ / 0-)
                Recommended by:
                ogre, Jagger, New Deal democrat

                Then maybe you could explain how economic protectionism caused America to fail as a rising global economic power a century ago.

                •  By Last Century (0+ / 0-)

                  Do you mean the 1930's?  Like in 1930 the US passed the Smoot-Hawley Act and raised tariffs on over 20,000 products which deepened the Great Depression and cut the level of imports and exports by half and took decades to undo the layers of retalioatory tariffs almost every other country put on us?

                  Or do you mean the 1940's? When the United States realized Free Trade was one of the best ways to promote global growth and stability and helped forge the General Agreement on Tariffs and Trade (GATT)?

                  So which did you mean?  How economic protectionism helped fuel the Great Depression or how the promotion of free trade spurred the great economic boom of the post-WWII era?

                  Thinking men can not be ruled. --Ayn Rand

                  by Wisper on Mon Apr 23, 2007 at 02:52:34 PM PDT

                  [ Parent ]

                  •  No, the economic protection of the 1800s (2+ / 0-)
                    Recommended by:
                    Jagger, pkbarbiedoll

                    during the time the US rose from nowhere backwater to the biggest economic force in the world.  That century.  Explain that.

                    Once the US became the biggest exporter in the world in the world after WW1, it no longer was in the US's best interest to have a trade barrier.  For the biggest exporter in the world, erecting trade barriers is like shooting itself in the head.  That's what Smoot-Hawley did.  Not pretty.

                    You may have noticed, the US is no longer the biggest exporter in the world by some measures, and is likely to be surpassed in all measures shortly.  That means trade barriers make more sense.

                    "When the going gets tough, the tough get 'too big to fail'."

                    by New Deal democrat on Mon Apr 23, 2007 at 03:19:49 PM PDT

                    [ Parent ]

                    •  You want to compare (0+ / 0-)

                      2007 a post-industrial age informational economy to an agricultural economy based on cash-crop farming, industrial age factory work, and recovering from Southern Reconstruction?  That seems to be a stretch.  Why not ask how the EU has grown to be such a successful world power after all those years of Chivalry-based Feudalism?

                      19th Century America was still adjusting to its own growing size and its ability to work as a fully connected nation.  If you want to look at internal trade in that early era the same way we look at International Trade in today's global era, we can see the same principles apply.

                      In 1887 Congress passed the Interstate Commerce Act to break down trade barriers between states, end secret deals and force the railroads to work within limits to allow trade to work more freely across borders.

                      The railroad infrastructure was properly seen as a way to bridge regions to build a larger market and allow the known capitalistic market forces to play out across the country without artificial interference from railroad companies.

                      We apply the same approach today to global industries that are now connected via voice and data networks and traffickable via the airways.

                      Bigger Broader & Freer is always better.  
                      Smaller, Protected, & Regulated is always worse.

                      The problem is that even though the ENTIRE WORLD has always been successful with this and the entire planet has been moving in that direction, people still want to point to individuals that have not benefited and say "Look!  A mother that can't feed her children!" or "See!  A young adult that can't find a job!" and decide that the system is rigged or evil or anti-American.

                      No one said globalized capitalism was utopia; all we're saying is that its the strongest most durable system and the best fit for Democracy.  If you want class-equality and forced wealth distribution try Socialism or Communism.  (But I warn you:  No one has had much luck with that on any large scale or for an indefinite period)

                      Thinking men can not be ruled. --Ayn Rand

                      by Wisper on Mon Apr 23, 2007 at 06:41:16 PM PDT

                      [ Parent ]

                      •  Your rosy scenario ignores WW1 (0+ / 0-)

                        The very same sentiments were expressed by free traders 100 years ago.  Free trade among Europe meant there would never be another war.

                        Right.

                        There is none so blind as an economist who ignores that which can't be quantified in their eqauations.

                        "When the going gets tough, the tough get 'too big to fail'."

                        by New Deal democrat on Tue Apr 24, 2007 at 04:18:24 AM PDT

                        [ Parent ]

              •  you can explain (1+ / 0-)
                Recommended by:
                Jagger

                how the form of extreme protectionism the Chinese government uses has destroyed the economy of China.

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 04:49:34 PM PDT

                [ Parent ]

                •  China's economy is 1/10th what it should be (0+ / 0-)

                  because of extreme protectionism and in fact the growth we're seeing now is only as the government slowly allows Western-style capitalism into the country.

                  They could be HUGE.  They could be the strongest economical market in the history of the world if they stopped with all the damn regulation and control.

                  Always, they manage a lot of by crushing their population.  They focibly keep the standard of living EXTREMELY low as a way of controlling the masses.  The USSR did the same thing for a while (until they couldn't).

                  But look at something like Hong Kong.  There they remove most of the restrictions and allow them to act autonomously and what do we see?  The biggest richest financial center in all of Asia!!  China could have 15 Hong Kongs if it wanted.  Unrestricted, Shanghai would make New York look like a backwater shanty-town.

                  Look at Taiwan, which China is forced to allow to remain autonomous (mostly).  One of the biggest manufacturing and R/D centers of the digital age!  Their economy is BOOMING.  If they were to become 100% independent they would open thier markets WIDE OPEN and reap the benefits.

                  To answer your question, China's economy is so inately strong that their government's mis-management can only weaken it; not kill it completely.

                  Thinking men can not be ruled. --Ayn Rand

                  by Wisper on Mon Apr 23, 2007 at 06:48:16 PM PDT

                  [ Parent ]

                  •  "Preach it, Brother!!!" (0+ / 0-)

                    /snark
                    I think the Chinese are going to look at your Friedmanian neoliberal cult and back off in horror, if it hasn't already happened. What's going on over there looks a lot more like 19th Century robber-baron capitalism of the sort that laws evolved in the US to control, and whose dissolution and non-enforcement under the last few administration has in large part resulted in the economic chaos we see around here. The dot.com boom was a neoliberal economic policy triumph. So was the dot.bomb bust.

                    The future I see with respect to China is its devoting its manufacturing capability to satisfying pent-up demand from its still largely peasant population, like the US in the post WWII period... a population so large relative to manufacturing capacity that it looks like a self-contained universe.

                    The bad news. . . they'll stop subsidizing our demand and start subdizing their own. What we'll be selling them is more technology and other stuff that can be shipped in bits and bytes more than anything else.

                    Looking for intelligent energy policy alternatives? Try here.

                    by alizard on Mon Apr 23, 2007 at 08:20:23 PM PDT

                    [ Parent ]

          •  But the whole point... (1+ / 0-)
            Recommended by:
            Jagger

            is that we ought NOT be depending so exclusively on imports.

            "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

            by ogre on Mon Apr 23, 2007 at 02:48:20 PM PDT

            [ Parent ]

        •  Europeans can afford them and have electricity (0+ / 0-)

          Developed asian countries (Korea, Japan) are strong markets. Emerging parts of asia and India are growth markets. Latin America is a potential consumer.

          America is arguably the most important single consumer, but it is a long way from being the dominating consumer any more.

          -2.38 -4.87: Maturity - Doing what you know is right even though you were told to do it.

          by grapes on Mon Apr 23, 2007 at 10:08:08 AM PDT

          [ Parent ]

      •  We've done a great job during our time on top... (1+ / 0-)

        Frankly, I'll be happy when we're no longer the big dog.  I don't want our country to go down the shitter, by any means, but our track record as a super power has been nothing but tragic!  

        Don't like XOM and OPEC? What have YOU done to reduce your oil consumption? Hot air does NOT constitute a renewable resource!

        by Asak on Mon Apr 23, 2007 at 07:53:31 AM PDT

        [ Parent ]

        •  One could hope (1+ / 0-)
          Recommended by:
          SarahLee

          that if economic power is more evenly distributed around the world then military and political power will also be evened out. I'm inclined to think that anybody who winds in the role of a super power will eventually behave badly.

        •  That's coming very soon (economically) (0+ / 0-)

          The Euro will start challenging the dollar as the global trade currency.  If the investors of the world switch over (and the dollar doesn't have much going for it) our place at the table of World Economic Powers is gone.  There is no arguing this.  We will crash and crash hard.  

          Its coming.

          Thinking men can not be ruled. --Ayn Rand

          by Wisper on Mon Apr 23, 2007 at 09:27:43 AM PDT

          [ Parent ]

    •  remember that (0+ / 0-)

      our cost of living is largely infrastructure driven. You want to have Third World labor rates? Let America become a Third World nation and we'll get them.

      As Third World nations build their infrastructures and their professional labor gains experience, labor rates will go up to match.

      That's exactly what's going on in India today, it's starting in China.

      Why isn't the part that we haven't financed through foriegn aid showing up in product costs? IMO, it's Enron-style accounting designed to keep triggering the profit/stock price points that trigger CEO options.

      Looking for intelligent energy policy alternatives? Try here.

      by alizard on Mon Apr 23, 2007 at 04:38:40 PM PDT

      [ Parent ]

  •  Lots to chew on (16+ / 0-)

    And those who will be most taken by surprise are those bootstrap-puller advocates/believers.

    The world is spinning and we just ride around on the same Bozo Bus. The economy, the environment, the criminals at the helm - it's going to take a lot to get our society as a whole to wake up and become the un-deniers.

    To call the Commander in Chief detached from reality would be an insult to paranoid schizophrenics everywhere. --billmon

    by vicki on Mon Apr 23, 2007 at 04:48:34 AM PDT

  •  The genie back in the bottle? (31+ / 0-)

    I don't think the globalization genie will be going back in the bottle.

    I agree that we can rail against it, or adapt.  But I also think there is a conversation to be had about a solution that comes somewhere in between.

    By making an sound economic/education/technology approach, I think we can solve several problems here that are on a collision course; namely, global climate change, pollution, health effects, national security, ratio of service/manufacturing/tech jobs base, to name a few.

    We must invent a solution to the energy situation.  Fossil fuels are for fossils.  Continue to use them and become one. Period.

    Let's say we create a 50 year plan for education in America that is based on creating a Manhattan Project for alternative energy development.  Sond crazy?  Well, China is training 350,000 new engineers every year, and they have a 50 year plan for education.  Why can't our kids get the same?

    It's called investment.  

    When large manufacturing countries are dependent upon us for key elements of their enegy technology, then we will be able to leverage human rights issues.  

    Until then, I see little hope for US Trade Policy and Globalization.

    As my father used to say (God rest his soul), "Honey, the toothpaste is NOT going back in the tube."

    DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

    by Casey Morris on Mon Apr 23, 2007 at 04:51:44 AM PDT

    •  Also, let me add... (22+ / 0-)

      That Bonddad and I agree in large part, I only add to his excellent observations by noting what China is doing from the developing side.

      Also, I rarely, if ever, find any discussion in this issue of the human behavior component.  People like cheap stuff. That's the reality.  We can talk all day about the morality of that, but the reality STILL must be addressed.

      Finally, there is at least one state administrator that I know is trying to get us to realize how quickly we are losing ground on the education front, and that is Richard Mills in New York.  He was formerly the head of education in Vermont, and brings those skills plus and expanded program to New York.  The problem, is the property tax issue.

      There has got to be a better way to fund education that the property tax.  It is a blatant conttinuation of concentration the wealth among the wealthy.  This is a HUGE hurdle to overcome, and I would be interested in hearing alternative ideas to solving this issue, or thoughts on how to approach it.

      I can't converse on the comments.  I have to work, but I would like to check back in a couple of hours.

      Thanks.

      DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

      by Casey Morris on Mon Apr 23, 2007 at 04:59:16 AM PDT

      [ Parent ]

      •  The elephant in the living room (7+ / 0-)

        for Democrats on this issue is teacher unions.

        Years ago I taught in a closed union shop. The unions protected the incompetent and did nothing to encourage or incentivize the skilled.

        Democrats make an issue of the value of choice in so many other areas, we should do the same in education. I don't like the idea of vouchers, but I believe their time has come.

        On the funding issue, I agree it needs to be changed and made more of a state wide mandate rather than a local one. But money alone is not the problem.

        •  I agree and also a question... (14+ / 0-)

          I agree with part of your comment.  I agree about the union situation, and effective management of members is an ongoing issue.  My father (god rest his soul) was the president of the teachers union when I was growing up.  The protection of incompetence made him crazy.  The concept of tenure is to help protect creativity, not reward incompetence, and it seems an issue that unions still struggle with today.

          However, I am in an area with charter schools and vouchers.  Interestingly, vouchers further the problem of concentration of education horizontally among the rich, and while charter schools have less security problems and look nicer, they aren't being more effective here.

          Of course, money alone will not solve the problem, but let's try what we know works--smaller class sizes.  That is one area where more money does, in fact, work. And it's an area that in my informal surveys of teachers, all agree on what could universally help education.  These teachers know I work in politics, and I have told them I am looking for to both identify problems and solutions.  

          As a parent, an educator (former early childhood/Montessorian), and political consultant, I don't get the sense that we are bringing all of the stakeholders to the table, let alone do so in an effective manner.

          DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

          by Casey Morris on Mon Apr 23, 2007 at 06:46:36 AM PDT

          [ Parent ]

        •  What a place to put in a pet issue (13+ / 0-)

          I'm sorry you found your experience to be a negative one, but during lunch, while you were ruminating on how bad all the other teachers were, your union was busy making sure you had a lunch break.  

          I regard the right to embarrass each other one of the cherished parts of American democracy. -Barney Frank

          by otto on Mon Apr 23, 2007 at 07:18:45 AM PDT

          [ Parent ]

        •  Not so much an elephant (11+ / 0-)

          ... more of a red herring.

          For how much we hear about the teachers union coddling incompetent slackers, I'm surprised I never met one. I guess maybe there's a couple out there like in almost any profession, but do I think that's why American education is slipping and our competitiveness is slumping? Absolutely not.

          If the teaching profession is such a haven for untalented, uncaring, underperforming losers, why is there such a shortage of teachers?

          •  I dunno about teachers unions... (1+ / 0-)
            Recommended by:
            PaulVA

            ... but the aerospace workers union where I work has plenty of lazy incompetant members. Not the majority of them but a good 10% of them. My dad complains about the same problem in his construction union.

            conscietious objector in the battle of the sexes

            by plymouth on Mon Apr 23, 2007 at 08:24:18 AM PDT

            [ Parent ]

            •  My take on this (15+ / 0-)

              First, if one thinks this sort of thing goes on only at unionized workplaces, that person should talk to my uncle.  He worked in a plastics factory that was nonunion (actually, it had one, but the workers decertified their union) and he could tell you all kinds of cases of poorly-performing workers kept on the job because of nepotism, or good relations with the supervisor, etc.

              (yes, that's only an anecdote, but it seems that when this issue comes up, all of the evidence is anecdotal)

              Second, my father's opinion on this is, I think, a practical one.  He was a union member for over 30 years, and while he saw some workers being retained who probably should not have been, he thought that the overall benefit outweighed the drawback.  Put simply, he thought (and I agree) that it's better to make it harder to get rid of a relative minority of workers than to make it easier to get rid of any and all of them.

              I've got the fever for the flavour, the payback will be later, still I need a fix - Bran Van 3000

              by Linnaeus on Mon Apr 23, 2007 at 08:39:03 AM PDT

              [ Parent ]

              •  Thank you (10+ / 0-)

                it's better to make it harder to get rid of a relative minority of workers than to make it easier to get rid of any and all of them.

                Very well stated. Of course there are assorted drawbacks and inefficiencies associated with unions, as with any form of social organization. But a fair question is whether at a macro level, the benfits outweigh the detriments. In the case of unions, the benefit to the working/middle classes, even for non-union members, has been enormous. Put the other way around, the erosion of union representation and power in the last 25 years has exactly paralleled the massive upward shift of wealth and income to the top 1%, 0.1%, and 0.01% of the population.

                It amazes me that not everyone on this site understands that.

              •  This wins the day... (1+ / 0-)
                Recommended by:
                otto

                absolutely.  Well put and succinct.  I'll be using that.

                Thank you and thanks to your uncle as well.  It's at times like this I really miss my Dad (God rest his soul).  He would have had so much fun here at Kos.  Growing up with him was alot like blogging.  Without the keyboard, of course.  In the olden days, we used phones, and um, dinner tables...

                DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

                by Casey Morris on Mon Apr 23, 2007 at 01:07:59 PM PDT

                [ Parent ]

            •  Everybody has the 10 percenters (3+ / 0-)
              Recommended by:
              wystler, highacidity, 4Freedom

              And everybody is doing what they can to get rid of them or at least minimize their negative impact.  That is why you're seeing a lot of codes of conduct coming out in the Building Trades because of this.

              Pass the Employee Free Choice Act!

              by PaulVA on Mon Apr 23, 2007 at 08:50:34 AM PDT

              [ Parent ]

              •  The 10% solution (2+ / 0-)
                Recommended by:
                wenchacha, bluewolverine

                What to do about the bottom 10% of workplace (or student) performance?

                Everybody would like to get rid of them, as you say. But it can't be done. As soon as you do, whether by improving them or flushing them, there is immediately a new bottom 10%.

                It's like that Lake Wobegon line, where all the kids are above average.

                •  oh my (0+ / 0-)

                  What to do about the bottom 10% of workplace (or student) performance?

                  well, private schools foist 'em on the public system ...

                  then the bottom 10% ... becomes the bottom 15% ... becomes the bottom 20% ... and so on ...

                  it's about biconceptualism ... Obama08

                  by wystler on Mon Apr 23, 2007 at 12:05:49 PM PDT

                  [ Parent ]

          •  As long as this continues to be ineffectively (0+ / 0-)

            addressed, or not addressed at all, it gives opposition a talking point.  It feeds into all of the worst stereo typing of unions.

            And yes, I have run into them in schools.  So deos my sister, my parent friends, blah, blah.  We all discuss how to support good teachers, but we all dread the ones we know need to get out of teaching.

            Now, I will say this for NY States idiotic teacher certification program--it does little in ensure competence, but it's more likely to get teachers who acutally WANT to be teaching.  When I was in public school ( was in private for three years) for Jr. High and High School, I had a number of teachers freash out of college who were only teachers because they were waiting to get a job in their majors.  And brother, did it show.  I think this has significantly changed.  On the other hand, my brothers and sisters who hold doctorates and JD's in a number of fields, are prohibited from teaching, even in their field of expertise, without speacil teacher credentialing.  

            This is sad, because I know a number of people in general, mostly stay at home parents, who would like to transition to teaching from a feeling of public service.  They would love to pass on their knowledge and experience, but cannot go back to school for credentialing for any number of reasons.  There should be some middle ground here. Of course they volunteer in classrooms.  Do you know a family that doesn't these days? That's not what I am talking about though.

            For example, I know several lawyers whose bachelors and masters are in English or History.  Their undergrad was paid for partially by Pell Grants and govt student loans (ahhh remember the old days).  They feel they want to give back, pass that on.  But can't.  There should be a change.

            Just an aside...

            DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

            by Casey Morris on Mon Apr 23, 2007 at 01:05:37 PM PDT

            [ Parent ]

        •  Republican talking points on a Dem site? (6+ / 0-)

          Shocking indeed.

          Success is the child of audacity. --Disraeli

          by ChuyHChrist on Mon Apr 23, 2007 at 07:35:01 AM PDT

          [ Parent ]

          •  Daisycolorado (1+ / 0-)
            Recommended by:
            KansasLiberal

            If you haven't run into the poster yet, is just a Bonddad diary troll.  Almost never posts anywhere else, and... has some really classless things to say about working people and the poor.  

            I guess the poster sometimes trolls other economics diaries.  

            I regard the right to embarrass each other one of the cherished parts of American democracy. -Barney Frank

            by otto on Mon Apr 23, 2007 at 08:54:00 AM PDT

            [ Parent ]

        •  wow, you didn't get troll rated (3+ / 0-)
          Recommended by:
          Eli D, alizard, TastyCurry

          for mentioning vouchers.

          though i disagree that vouchers are the only solution to the problem here; vouchers are but one solution.  i prefer a more flexible charter system, with totally open enrollment, and more power given to individual schools, rather than the central administration. (the latter somehow often escape criticism, even though they make much more than teachers, and do much less)

          mydd straw poll vote: 1. other (gore) 2. unsure 3. richardson 4. obama 5. edwards

          by colorless green ideas on Mon Apr 23, 2007 at 11:42:35 AM PDT

          [ Parent ]

        •  incompetent teachers are a management problem (0+ / 0-)

          that can be addressed by competent managers applying progressive discipline non-discriminatorily, even in union shop.  What exactly are the objective criteria that demarcate a competent teacher from an incompetent:  teacher attendance, student performance (and do all teachers start with students on an even footing in that respect) as a reflection of a teacher's ability or committment, standardized test scores, graduation rates . . . is it reasonable to expect any worker, teacher or otherwise, to have a diminishing productivity curve throughout his career which is undercompensated when young and overcompensated when older but on balance about right?  I don't have the answers but as a former federal civil servant and union member who saw some of the worst worker abuses of the system, I nevertheless made peace with that because on balance the vast majority of my coworkers were hard working folk and dragging along a few of the less motivated was simply the price we paid for a better workplace for all--not something that I allowed to drive me crazy.

          "The fate of the world is in the hands of a bunch of guys I wouldn't trust with a potato gun!"--Armageddon

          by rrheard on Mon Apr 23, 2007 at 03:48:11 PM PDT

          [ Parent ]

      •  people take it for granted (0+ / 0-)

        that "cheap stuff" will always come from shipping raw materials from Country A to Country B and shipping finished goods from Country B to Country C (the USA). That's the Walmart model, and it depends on REALLY cheap shipping.

        Cheap shipping isn't going to be a part of ANYBODY's future.

        Looking for intelligent energy policy alternatives? Try here.

        by alizard on Mon Apr 23, 2007 at 05:02:17 PM PDT

        [ Parent ]

    •  Another way? (10+ / 0-)

      I found an interesting article from The NationThe Establishment Rethinks Globalization. Greider interviews Ralph Gomory, an ex-senior vice president at IBM. He helped manage IBM's expanding global presence as jobs and high-tech production were being dispersed around the world.

      Now president of the Alfred P. Sloan Foundation, he knew something was missing in the "pure trade theory" taught by economists. If free trade is a win-win proposition, Gomory asked himself, then why did America keep losing?

      The explanations he has developed sound like pure heresy to devout free traders. But oddly enough, Gomory's analysis is a good fit with what many ordinary workers and uncredentialed critics (myself included) have been arguing for some years. An important difference is that Gomory's critique is thoroughly grounded in the orthodox terms and logic of conventional economics. That makes it much harder to dismiss. Given his career at IBM, nobody is going to call Ralph Gomory a "protectionist."

      He did not nail his "theses" to the door of the Harvard economics department. Instead, he wrote a slender book—Global Trade and Conflicting National Interests—in collaboration with respected economist William Baumol, former president of the American Economic Association. Published seven years ago, the book languished in academic obscurity and until recently was ignored by Washington policy circles.

      I don't know if bonddad is correct, but I do wonder just how much more can we educate ourselves to be able change or work multiple jobs. Gomory also has that concern:

      As this shift of productive assets progresses, the downward pressure on US wages will thus continue and intensify. Free-trade believers insist US workers can defend themselves by getting better educated, but Gomory suggests these believers simply don't understand the economics. "Better education can only help," he explains. "The question is where do you put your technology and knowledge and investment? These other countries understand that. They have understood the following divergence: What countries want and what companies want are different."

      Corporations want profits which may not be in the best interest of the country if the populace is harmed.

      Gomory and Baumol are elaborating a fundamental point sure to make many economists (and political leaders) sputter and choke. Contrary to dogma, the losses from trade are not confined to the "localized pain" felt by displaced workers who lose jobs and wages. In time, the accumulating loss of a country's productive base can injure the broader national interest--that is, everyone's economic well-being.

      "Our objective," Baumol told a policy conference last summer, "is to show how outsourcing can indeed reduce the share of benefits of trade, not only for those who lose their jobs and suffer a direct reduction in wages but can wind up making the average American worse off than he or she would have been."

      He feels government is the key to the solution:

      1. He'd like government to intervene unilaterally to cap the nation's swollen trade deficit and force it to shrink until balanced trade is achieved with our trading partners.
      1. He feels government must impose national policy direction on the behavior of US multinationals, directly influencing their investment decisions through the tax code—reformed corporate income tax would penalize firms that keep moving high-wage jobs and value-added production offshore and reward those that are investing in redeveloping the home country's economy.

      It's an interesting read.

      It isn't shameful to vote your own self-interest instead of the interests of multi-national corporations--iceman

      by fumie on Mon Apr 23, 2007 at 09:42:17 AM PDT

      [ Parent ]

  •  Bonddad is awesome, as usual. Tough medicine. (9+ / 0-)

    If we Dems want to prove we are the party of good govt then we have to face unpleasant facts like this.

  •  My persistent question: (26+ / 0-)

    Globalization + Peak Oil = ???

    Part of the globalization equation is cheap labor and cheap energy to transport the fruits of cheap labor to market.  One of the implications of rising energy prices is that economies will become less global and more local(relatively).

    So is globalization with us to stay, or just as long as energy prices remain low enough to sustain it?

    We must never lose it, or sell it, or give it away. We must never let them take it from us.

    by Fabian on Mon Apr 23, 2007 at 05:00:21 AM PDT

    •  depends (5+ / 0-)

      on the shape of the curve, in part. Most commonly shown is a 'bell curve', while some I've talked with say there is a long tail, a slow drop off.

      Cargo ships are pretty efficient. They are designed to run in a narrow range of speed, engines and propellers and hull are all in their peak region. Most don't use gearboxes, but direct drive diesel, which also increases efficiency.

      I've read that about one and 3/4 percent of greenhouse gases come from cargo shipping and rail, compared to 10 to 11 percent for road transport.  Transport uses 37% of all energy use, 40% of that is automobiles and 33% is trucking. Numbers are rough, a little hard to find global numbers. But they suggest that rail and cargo ships will be less impacted, if for no other reason than government cutting back on the big consumers to save energy for shipping.

    •  Depends (2+ / 1-)
      Recommended by:
      Eli D, Fabian
      Hidden by:
      ogre

      on how real peak oil is. Develop the tar sands in Canada and the oil shale in Colorado and we will all be long gone before peak oil becomes an issue.

      •  I believe that those sources have been (7+ / 0-)

        debunked as easily retrievable sources of petroleum.   As a last resort, yes.  As a domestic source of high quality, easily obtainable oil, no.  Drilling in the Gulf is cheaper and easier than developing the sand and shale deposits.

        We must never lose it, or sell it, or give it away. We must never let them take it from us.

        by Fabian on Mon Apr 23, 2007 at 06:54:50 AM PDT

        [ Parent ]

      •  Um (1+ / 0-)
        Recommended by:
        bluewolverine

        Don't you mean "how near peak oil is"? Or are you seriously suggesting that there is no such thing as peak oil, that oil supplies are infinite?

        •  According to the oil drum and Kunstler... (7+ / 0-)

          Many posters at the Oil Drum (www.theoildrum.com) have posited that we are already past peak (it occurred in 2005) and we are beginning to slide down the downslope. They have based this on production figures for oil and distillates of oil which have failed to increase over the past year despite increases in demand. The price of oil and gas, according to them, is also behaving in a manner consistent with this hypothesis. Production figures are not verifiable, given the possibility of data manipulation, but the best available suggest that Saudi oil production has peaked and super giant oil fields such as Cantarell (Mexico) and Ghawar (Saudi Arabia) are in terminal decline. Super oil fields are responsible for up to 40 percent of oil production.

          The last time we had gasoline prices behave like this were between 1973 and 1981, at which time we had stagflation. High energy prices today are having the same effect, however I am afraid it might be permanent.

          And, finally, look at how much more we are dependent on petroleum relative to the 1970s, including China. Fewer items are made out of metal, wood, or plant based materials, and more out of petroleum derived plastics. It is not just fueling our vehicles and ships, it is the whole materials scenario that will be impacted by peak oil.

          Take cars, for example Even the cheapest, most fuel efficient car expends vast quantities of petroleum to manufacture (look at all the plastics), for something lasting at best, 15 years. Better to build rail cars and locomotives that will last 50 years or more, and give fuel economies of 100-200 passenger miles for fuel burned (conventional diesel locos, electified trains will be even better).

          And, in a post-peak economy, driving will have to be replaced by trains for long distances, and for short distances, walking or human power (bikes) will be the rule....time to accept that reality.

          I believe the trend towards cheap Chinese plastic goods will be reversed within the next 10-15 years by peak oil, as costs of oil go through the roof. The mantra is to economize, localize and produce. Stuff will need to last longer, and less will need to be produced in the first place. If we do not accept this and begin coping now, the crash will be that much harder.

          Free trade paradigm depends on an economy of cheap energy, waste, and endless expansion, which cannot be sustained in the era of peak oil, since subsitutes are either too expensive, too small in scale or take too long to ramp up to support endless economic growth. We need to work and hope for a steady-state economy....or TSHTF in a big way, beyond our control. Deal with the peak, or it will deal with us (as the peak oilers are fond of saying).

          FDR gave us the new deal. GWB and GOP gave us the screw deal.

          by NoMoreLies on Mon Apr 23, 2007 at 09:26:45 AM PDT

          [ Parent ]

    •  good point (3+ / 0-)

      How will globalization be affected by $200/ barrel oil?? How will America's sprawling suberbia be affected?? It will be a different way of life folks.

    •  Peak oil affects how not whether we trade. (2+ / 0-)
      Recommended by:
      Fabian, deathsinger

      It will certainly change the economics of transporting physical goods, creating greater incentive to produce heavier and low value-added material goods closer to their point of consumption or consume them closer to their point of origin. For lighter and higher value-added goods, transport may be too small a share of the delivered product price to make much difference.  Likewise peak oil's effect on the economics of transporting information is small, and I expect we'll continue to see accelerating trade in services, and further substitution of information transport for the transport of persons and physical goods. With broadband connections and good virtual conferencing technology it's just as easy for a U.S. firm to employ subcontractors in India as telecommuters in a U.S. suburb, assuming they have the same language and professional skills.

      "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

      by berith on Mon Apr 23, 2007 at 08:45:49 AM PDT

      [ Parent ]

      •  IT People Retrain as Plumbers? (10+ / 0-)

        According to bonddad, this is globalization at its finest.  Steps to save my career:

        1.  Toss my college education and 10 years IT experience in the trash because some overseas person can do my job for a third the cost via the internets.
        1.  Go to trade school to learn to be a plumber
        1.  Work my way up from the bottom in my bright shining new plumbing career
        1.  Be replaced by a Guatemalan H1-B visa plumber because we have a shortage of skilled plumbers

        Future is so bright I need my shades.

        On the positive side, $500 a barrel oil is REALLY great, talk about upsetting the apple cart, WOW!  The old Chinese proverb:  May your life be interesting.

    •  peek-a-boo oil (1+ / 0-)
      Recommended by:
      4Freedom

      the reason oil appears to be peaking is that oil producint countries are being cheated on the currency exchange, and the price manipulations of the US govt, through Goldman Sax and the SPR, and they have decided to hold back a bit of production, when the dollar falls further, they will hold more, and soon there will be an embargo, and everyone will blame it on politics, and they will correct, but for the wrong reasons. we've been trying to cheat the rest of the oil producint world out of their due payment for thirty years. there is plenty of oil, just not for greedy yankees and their fiat dollars.

      "Everything is chrome in the future..." Sponge Bob Square Pants

      by agent double o soul on Mon Apr 23, 2007 at 08:54:35 AM PDT

      [ Parent ]

      •  interesting (0+ / 0-)

        could you perhaps, sometime, explain that in more depth for a layperson?

        mydd straw poll vote: 1. other (gore) 2. unsure 3. richardson 4. obama 5. edwards

        by colorless green ideas on Mon Apr 23, 2007 at 11:48:30 AM PDT

        [ Parent ]

        •  some brief points (1+ / 0-)
          Recommended by:
          colorless green ideas
          • ) the methods which measure the oil reserves outside of this country are beyond our scrutiny.
          • ) since the inception of the SPR Presidents have used this device to smooth out the supply demand curve, and as Bush did last year, drive down gasoline prices ahead of the election.
          • ) the expansion of the money supply, (dilution) makes that money which we use to pay for oil worth less.
          • ) in any supply demand economy, when monetary inflation is rising, and commodity prices are falling, (in this case in real terms, and sometimes even in nominal terms)

          just suppose that for instance oil fell to $40 a barrel while the money supply expanded. If you were a producer you would probably decide to hold supply off the market until things improved.
          When there is a long term policy in place, you begin misreporting, or underreporting your reserves, to try and jawbone prices higher.

          "Everything is chrome in the future..." Sponge Bob Square Pants

          by agent double o soul on Mon Apr 23, 2007 at 01:55:22 PM PDT

          [ Parent ]

  •  Peak Oil? (39+ / 0-)

    So long as foreign made goods are cheaper and better, we're going to import them.  There's no way to stop that from happening.  

    I suspect Peak Oil is going to put a crimp in eating salads shipped in from 3000 miles away, not to mention plastic crap shipped from SE Asia.

    I envision markets that are much more local in the future-- unless an energy source as plentiful and cheap as 20th century oil is found/created.

  •  Two thoughts plus... (25+ / 0-)
    1. You can stop Americans buying cheap stuff by taking away their access to easy credit. The huge trade deficit is as much the fault of America as it is of China. If savings were encouraged and spending penalized the trade deficit would drop pretty quickly.
    1. A lot of China's "gain" has come from the ripping off of IP (intellectual property). One of the "assets" a developed economy has is its IP, but when a developing economy steals the IP and then bankrupts the domestic IP owner you know something is wrong (there are many many small scale stories of this phenomenon that you never hear about, but they all add up.)

    In general I totally agree with your thesis. We live on ONE planet where communities are increasingly interrelated. It is hard to justify/keep large differences in standards of living over the long term (though not impossible).

    Just because you can doesn't mean you should!

    by taonow on Mon Apr 23, 2007 at 05:06:36 AM PDT

    •  Why does it have to be one planet? (8+ / 0-)

      Seriously - I've heard many people grip about these kinds of problems, and it always comes back to the point of "we have limited resources on this planet".  

      So my question is, why don't we start talking about colonizaing space?  OR rather, thats what I've argued for and is the solution to the issues that globalization creates.  To quote Narayana Murthy (chairman and CEO of INFOSYS) "You don't eliminate Poverty by redistrbuting wealth - you do it by creating new wealth"  

      The amount of wealth that can be found off planet is increadible.  The amount of minerals from 1 asteroid could concivably wipe out the national debt.  The energy from solar satellites would make coal and oil a thing of the past.  The research and production that can be done on ISS, or more likely on Bigelow Aeropsace's Space Stations would make Menlo park look like a garage tinkerer.  

      But all of this is predicated on using off planet resources, and realizing that in fact, it is cost effective to move off planet.  Most people seem to think that any sort of off planet activity must be expensive, because it has always been expensive.  But there is plenty of evidence that that doesn't have to be the case - there were ideas for cutting the price in the 70s and 80s that were never implemented.  We are seeing it now.  But if we ignore this huge potential, everyone will lose.  

      •  We'd better (5+ / 0-)

        Considering what we are doing to this planet we'd better find another 1 or another 10.

        As for cost, your are right, compared to fighting a war in Iraq the cost is minimal!

        The other solution, which no one will address (for obvious reasons) is that there are too many humans on this planet. We have had the most benign climate over the last 10,000 years that has existed over the last 400 million years. we have expanded to the max, now if the climate becomes more variable the population will become unsustainable....so...let's start exploring.

        Just because you can doesn't mean you should!

        by taonow on Mon Apr 23, 2007 at 06:15:14 AM PDT

        [ Parent ]

    •  This is a prescription (2+ / 0-)
      Recommended by:
      PaulVA, BobOak

      for a massive recession.

    •  IP ripoffs (5+ / 0-)

      Part of the problem with China is that enforcement is so sporadic & random that hardly anybody there takes it seriously.  They just don't have the infrastructre to enforce intellectual property.  And, if you hear of somebody arrested for it in China, it was most likely somebody that got caught on the wrong side of a local party boss.

      I mean, I could go to China this weekend and buy a good quality DVD of the big Hollywood movie that opens this coming Friday - and, I'm not talking about those crappy DVDs you buy from a street vendor in New York or LA where you can see people in the audience getting up from their seats, hear coughing, etc.  Jay Leno had a joke on that a few years ago when Bush met Hu Jintao, and they photoshopped a copy of Mission Impossible 3 into Hu's hands presenting it to Bush before it's American release.  It's not too far from the truth.

      In other words, it's almost impossible to stop unless the government undertakes a MASSIVE initiative to do it.  And, even then, it will take years, if not decades, to change the attitudes Chinese have formed over centuries.

      I'm not a member of an organized political party, I'm a Democrat - Will Rogers

      by newjeffct on Mon Apr 23, 2007 at 07:19:11 AM PDT

      [ Parent ]

      •  Government ... people (3+ / 0-)

        The government has a lot more important things to worry about. Imagine running an economy with 1.3 billion people as you rush from peasantry to modernity.

        There is also an educational/cultural divide. The concept of IP is foreign,as are some other modern concepts. I remember having a guy in Hong Kong, when we were talking about insider trading say "Why would you ever buy a stock unless you had inside information".

        Essentially all companies should be very careful making anything in China if there is ANY IP involved. You will soon face competition from companies that you have never heard of making your product for much less than you can.  

        Just because you can doesn't mean you should!

        by taonow on Mon Apr 23, 2007 at 07:37:49 AM PDT

        [ Parent ]

  •  You Are Totally Powerless (31+ / 0-)

    We don't live in a Democracy.

    You have to right or responsibility to exercise your democratic powers to regulate the economy for the common good.

    What Daily Kos readers do not understand is that we live in a system of economic absolutes and inevitabilities that exclusively benefit economic elites.

    We are basically chattel.  This is the purity of our unified theories of economics.

    Real power is for the rich.  Free trade is where you must compete, but where powerful individuals and institutions can enact laws that make sure that money flows into their pockets and not yours.

    Free trade is natural slavery.

    It is the natural law of inevitability.  It has been proven by physics.

    Democracy is by nature fake.  You must not try to use your votes to interfere with the processes of free trade, which aim to impoverish you.  You must submit to the inevitability of your demise.

    This is the purity of our natural law economic system.

    I recommended your comment. And then I un-recommended it.

    by bink on Mon Apr 23, 2007 at 05:07:30 AM PDT

    •  Er (16+ / 0-)

      You don't have the right or responsibility to exercise your democratic powers to regulate the economy for the common good.

      Please, every one, just lay down your votes and let the financial services industry use the law to enrich a few already very rich people.

      This is our amazing economic truth system.

      I recommended your comment. And then I un-recommended it.

      by bink on Mon Apr 23, 2007 at 05:08:32 AM PDT

      [ Parent ]

      •  In Other Words (9+ / 0-)

        This diary entry is transparently nonsensical.

        I recommended your comment. And then I un-recommended it.

        by bink on Mon Apr 23, 2007 at 05:09:12 AM PDT

        [ Parent ]

        •  Recommended? (8+ / 0-)

          People are recommending this thing?

          I recommended your comment. And then I un-recommended it.

          by bink on Mon Apr 23, 2007 at 05:09:48 AM PDT

          [ Parent ]

        •  For once, I disagree thoroughly with bonddad (44+ / 0-)

          I have to run, so I can't follow up on this comment.

          Bonddad's solution #1 was already tried in the Clinton years.  It doesn't work.  I diaried recently about how asia is copying our research parks.  Here's a clue:  they're willing to work in the "jobs of tomorrow" more cheaply than we are just as much as they are willing to work the "jobs of today and yesterday."

          As an example, the US "Council on Competitiveness found:

          .The astonishingly fast rise of international competitors, they warned, has meant that the American economy has reached an “inflection point,” a “unique and delicate historic juncture” at which America, “for the first time in our history…is confronting the prospect of a reverse brain drain.”

          For decades, the United States ranked first in the world in the percentage of its GDP devoted to scientific research; now, we've dropped behind Japan, Korea, Israel, Sweden, and Finland. The number of scientific papers published by Americans peaked in 1992 and has fallen 10 percent; a decade ago, the United States led the world in scientific publications, but now it trails Europe.

          “We no longer have a lock on technology,” David Baltimore, a Nobel laureate and the current president of the California Institute of Technology, wrote recently in the Los Angeles Times. “Europe is increasingly competitive, and Asia has the potential to blow us out of the water.”
          This is a fundamentally new threat. In the '70s and '80s, Japanese and European firms adopted American technology and made key improvements in process and design to shave cost and increase quality. Now, foreign companies are making many of the most important breakthroughs themselves. This shift is part of a change in strategy: instead of copying our innovations, foreign governments have decided to copy our very model of innovating.

          Same thing for solution #2.  You can retrain all you want (viz Clinton again) and your job can still be taken by anyone willing to work more cheaply than you are.

          So, bonddad's recommendations, quite simply, don't work.  The demise of much of IT labor in this country is the best example.

          We must be allowed to: (1) levy real penalites for violations of trade deals by developing low wage countries. (2) join together with the EU, Japan. Canada and Australia to work out a global "wage equalization" tariff that ameliorates some of the disastrous effects on workers in the developed countries, diverting some of the economic gains of cheaper foreign labor to the white and blue collar workers in developed countries (as opposed to ALL of the economic gains being obtained by financial and capitalist classes as has happened in the US).

          "When the going gets tough, the tough get 'too big to fail'."

          by New Deal democrat on Mon Apr 23, 2007 at 05:21:30 AM PDT

          [ Parent ]

          •  While I agree that we need to do that (2+ / 0-)

            I would also argue that we need somewhere for people who are faced with a crappy living situation to be able to move and start over.  We need a real frontier.  That has helped immensly in the past.  

            •  A real frontier (3+ / 0-)
              Recommended by:
              sayitaintso, Jagger, bluewolverine

              Will not return until space travel is a cheap as getting a wagon and a couple of horses was to move West in the late 1800s.

              Don't see it happening any time soon.

              It's still TESTER TIME!

              by Ed in Montana on Mon Apr 23, 2007 at 10:25:46 AM PDT

              [ Parent ]

              •  Then you should need to take a closer look (0+ / 0-)
                And not, mind you, at the currant Nasa plan (which is a complete joke)

                A lot of stuff is coming from the private spaceflight sector - companies like SpaceX, The SpaceShipCompany (and associated Scaled Composites), Armadillo Aerospace, PlanetSpace, Masten Space Systems, Xcor, Spacedev and Benson Space - there are others - all of these guys are working on making space travel much much cheaper.  A couple of them have said something to the effect of they are pledging their fortunes (specifically Elon Musk and Jeff Bezos) to making us a multi-planet speices.  Someone from Virgin Galactic (can't remember if it was Branson himself, or Will whitehorn, the president of VG) expects the ticket price to get to $50,000 in a short amount of time, and John Carmack, co-creator of Doom and Quake, has a company that has publicly said that they can do ticket prices to sub-orbital for between $10,000 to $20,000.  Yes, this is sub-orbital, but sub-orbital can translate into orbital.  And Carmack has said he thinks he can do a ticket price of $350 per pound to orbit.  

                Yes, a lot of this would be a significant personal investment, but don't think that any sort of major move across country or to a new frontier won't have significant personal investment.  

                •  people actually investing in such? (1+ / 0-)
                  Recommended by:
                  bluewolverine

                  what a wealth of material this makes for building a case against the wildly wealthy ...

                  these people have far too much money ... with the weapons of world poverty - hunger, homelessness, pestilence - running rampant among humanity, these folks need to have their taxes boosted ...

                  significant personal investment? sure looks like pissin' away assets to me ...

                  it's about biconceptualism ... Obama08

                  by wystler on Mon Apr 23, 2007 at 12:23:34 PM PDT

                  [ Parent ]

                  •  Investing in space is (0+ / 0-)

                    a way to fight poverty, hunger, and pestilence.  Espcially on the pestilence front, that is something that could see significant benefits from.  Read about it here.  As for things like poverty, thats a resource issue, but then the space option can help us deal with that.  

                    Elon Musk, mentioned above, personally views this a part of a larger green campagin.  He has also founded Tesla motors.  

                    So if you wanna right off space colonization, then your writing off humanity lasting much longer.  Space can and will benifit everyone.  Or maybe you have some secret knowledge that proves space colonization can't work?

            •  Frontiers (1+ / 0-)
              Recommended by:
              bluewolverine

              were illusions formed through genocide.  We haven't had a real frontier for millenia.

              The world is full.  The only way to avoid a crappy living situation is to work to prevent one from occurring.

          •  one correction (13+ / 0-)

            This shift is part of a change in strategy: instead of copying our innovations, foreign governments have decided to copy our very model of innovating.

            Not "instead of" but "in addition to".

            The odd thing is that we are participating in that wholeheartedly. The US is training the foreign scientists who are repatriating, usually knowing that they will repatriate (I am not talking about immigrants, but specifically about foreign nationals). Foreign companies that set up shop in China must team up with a Chinese company, which copies (basically, steals) all of the foreign company's intellectual property then is able to go solo. China does not respect copyright laws, so software piracy and wholesale copying of books is rampant. Most universities in China do not have policies against plagiarism. Time and again, undercover investigations have shown that Chinese factories force their workers to work much longer hours and for much less pay than they claim publicly. Naturally, it's impossible to compete fairly against such tactics.

            Individuals cannot act against these trends, and government intervention is necessary. If you can't buy those 99-cent flip-flops made in China because they're not on the shelves, you'll buy the $3 flip-flops made elsewhere. You'll buy less and produce less waste, and you'll indirectly be funding  fairer jobs somewhere, either in the US or in another country where the workers aren't disposable.

            •  Exactly. (2+ / 0-)
              Recommended by:
              DrReason, Jagger

              Individuals cannot act against these trends, and government intervention is necessary. If you can't buy those 99-cent flip-flops made in China because they're not on the shelves, you'll buy the $3 flip-flops made elsewhere. You'll buy less and produce less waste, and you'll indirectly be funding  fairer jobs somewhere, either in the US or in another country where the workers aren't disposable.

              Globalization == increased waste and increased consumerism.

              Spread the meme.

          •  asdf (4+ / 0-)

            1.) The loss of IT jobs is an issue, but the large pre - 2000 build-up was partially caused by Y2K issues.  In other words, it was a disproportionate build-up that would have fallen anyway.  That is not a complete reason for the fall-off, but it does partially explain it.

            2.) The US only focused on 1 economic area of development in the 1990s -- technology.  We need a far more broad-based approach to industrial/personal investment covering an entire range of possibilities.

            3.) All that being said, there is no way to prevent some of the losses.  As I mentioned above there has been a fundamental paradigm shift in the way economies work.  They are far more interrelated now and far more competitive.  In addition, things are going to move far faster than before.  

            "You think you can intimidate me? Screw you. Choose your Weapon." Eliot Spitzer

            by bonddad on Mon Apr 23, 2007 at 06:18:15 AM PDT

            [ Parent ]

            •  IT employment is back up (4+ / 0-)

              By 2005, IT employment had surpassed the level it was at pre-9/11, pre-recession. It continues to grow.  It's not the guaranteed gold mine it was in 1998, but it's still a good career with well above average wages for anyone with ambition and intelligence.

              The Cubs WILL win the World Series in '07. I'm not saying which century, though.

              by nightsweat on Mon Apr 23, 2007 at 06:22:56 AM PDT

              [ Parent ]

            •  not so (8+ / 0-)

              bonddad you're drinking the kool-aid.  I'm sorry, I always recommend your diaries, you're even on my blogroll,  but this time, you need to get out more and read more trade analysis and economists who because of their results, are basically not published by MSM.  Their work is solid, stats accurate.

              For IT job market fluctuations, read the IEEE-USA or Norm Matloff on overall aggregate numbers in the IT job market and it is not due to "Y2K" at all, the industry is growing and offshore outsourcing is the reason the aggregate number of jobs have declined, not "Y2K".

              http://www.noslaves.com http://forum.noslaves.com

              by BobOak on Mon Apr 23, 2007 at 09:17:58 AM PDT

              [ Parent ]

            •  In that case, we're screwed. (2+ / 0-)
              Recommended by:
              Jagger, bluewolverine

              In addition, things are going to move far faster than before.

              The fundamental problem with this is that the limiting fact for mobility is the rate at which workers can be trained.

              People can work for maybe forty or fifty years, max.  At the same time, they need to raise a family and save for retirement.  As a result, people simply can't afford to retrain themselves every decade or two to suit the whim of the market.

              "Things moving faster" means more people getting screwed over faster.

          •  There was a great article (6+ / 0-)

            in the Financial Times a week ago.  

            What it compared was the percentage of income afforded to capital, skilled labor and unskilled labor. On the graph were 4 contries/territories: the US, the UK, Europe and Japan.

            In all four the decline in income to unskilled labor dropped dramitically.  The percentage of income that went to skilled labor in all four had been about constant over the last 20 years.

            What is striking is the pace of change was about constant everywhere.

            Bush is an idiot - and I hate his tax cuts - but the forces creating income inequality are much larger than tax cuts.

             

          •  How can "free market economics" have won... (12+ / 0-)

            when countries like China, Japan, etc. Have neither free, or fair market policies? Bonddad, your "solutions" are not solutions, because solution 1 and 2 are not solutions themselves and solution 3 (unnumbered as it is) ignores the fact that the multinational conglomerate has no interest in making bilateral trade agreements.

            Solution 1+2 We need to become more competitive in the "jobs of tomorrow"/The US workforce needs massive retraining/education
            This has been argued since at least the mid-70's with the collapse of the "rust belt" economies, when steel manufacturing collapsed. The problem with these "solutions" is twofold.
            First, there is no way to say today exactly what the "job of tomorrow" is going to be. It is only after these jobs start emerging and the demand for their services is greater than the supply of labor, that these professions, become a "hot job" to have. Would the vast majority of the workforce in 1970 have known that IT was a "job of the future"? No, but Steve Jobs, Steve Wozniak, Bill Gates, etc. gambled and that worked to their advantage. Does anyone really remember Ronald Wayne? No, because he didn't want to gamble and sold his share of Apple back to the two "fathers" of Apple, before they incorporated.
            Second, companies have no interest in retraining or reeducating their workforce. This is because it would be admitting that they are not in the right business themselves. It also is a severe drag on both sides of the profit equation, it increases expenses of the company and decreases the productivity of their workforce. So we get the government to do it? Well, that's what JTPA was supposed to do. But, of course this was scotched by the Republican Congress with the WIA (Workforce Investment Act) which tried to shrink governments role in this area, by placing more responsibility on the industries that were already struggling, to retrain their workers.

            The best I can say here is that none of the solutions advised take the realities of market economics into account, but rather if it were a utopian market, with no other forces acting upon it. I apologise for jumping on top of my soapbox and shall break off here.

          •  Levy real penalties... (2+ / 0-)

            implies that we have something to leverage, for example, with China, our largest trade deficit partner.

            What do we have to leverage? I don't mean this as a smart ass remark.  I mean this as a real question.  

            DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

            by Casey Morris on Mon Apr 23, 2007 at 06:51:03 AM PDT

            [ Parent ]

            •  What the US has been leveraging is the dollar. (0+ / 0-)

              By allowing it to fall against foreign currencies our debt is deflated.

              Ultimately the US consumer pays for more expensive imports, but it diminishes our trade deficit and makes US goods more attractive in the global marketplace.

              China has slowed its acquisition of dollars as national policy, and over the weekend I read that Japan is considering similar moves. As Japan and China hold huge US foreign exchange reserves, this will further devalue the dollar.

              In America, politics is big business. - J P Morgan

              by 4Freedom on Mon Apr 23, 2007 at 10:00:11 AM PDT

              [ Parent ]

              •  Okay, but that's my point... (1+ / 0-)
                Recommended by:
                4Freedom

                we can no longer do that?

                Or am I just being dense here and you need to write s l o w e r so I will understand?  Use little words if necessary.

                DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

                by Casey Morris on Mon Apr 23, 2007 at 12:48:54 PM PDT

                [ Parent ]

                •  I think you have it - I think most people (0+ / 0-)

                  get it - that the dollar buys less than it used to. We pay more for gas, and not just because oil prices jumped, it is because our dollar iw worth less.

                  I'll take a try at an explanation.

                  The reason usually given that the dollar is worth less is because our government and its agencies have decided to put more dollars in circulation, to literally issue more dollars than have ever been issued before. This has been done to make the value of the dollars that countries and institutions already own due to our trade deficits cheaper dollars, therefore easier for our government to repay. Too much of anything drives down prices, and dollars are no different.

                  The trade deficits came about in a way that may appear roundabout, but that way had direct consequences on the value of the dollar.

                  For quite some time we have had easy money available to middle America through home equity at low interest rates. We spent billions of our hard-earned home equity dollars rebuilding, traveling, re-decorating or whatever those dollars got spent on.

                  We borrowed against our primary asset, our home, to do this spending.

                  *The money that was loaned to us got translated into securities like certificates of deposits by the banks and mortgage companies that loaned us the money.

                  *This was done in order to get the money loaned out back returned quicker to the lending institution than waiting for the home equity loans or mortgages to mature.

                  *Those securities then got sold to foreign countries and banks and institutions around the world as dollar-based securities like stocks and bonds and CDs other foreign exchange instruments.

                  Now we have literally trillions of dollars of various kinds of securities and trade instruments owned by central governments and other institutions, and our government has issued extra dollars to repay that debt with our devalued dollars.

                  Does that clarify anything for you?

                  In America, politics is big business. - J P Morgan

                  by 4Freedom on Mon Apr 23, 2007 at 06:19:38 PM PDT

                  [ Parent ]

                  •  Yes. In essence... (1+ / 0-)
                    Recommended by:
                    4Freedom

                    it's the microeconomic effects of globalization on monetary policy (as opposed to fiscal policy)  fiscal policy.

                    Am I getting warmer?

                    DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

                    by Casey Morris on Mon Apr 23, 2007 at 08:51:54 PM PDT

                    [ Parent ]

                    •  In order to get a real overview on what our (0+ / 0-)

                      government can do in global money markets and its blowback on our economy, the interaction between our Federal Reserve system, which is privately owned, our government, and the corporate interests influencing our government (note the Sec. Treas. Paulson once headed the powerful investment banking firm Goldman Sachs) would need to be explored. I would need to do some digging to refresh my memory on all this, because I have not been active in the market for years. I'll add what I can to try to expand on what I've said.

                      The effects of US monetary policy has had definite macroeconomic effects on the globe. As usual, the lower down the fiscal food change, i.e. if you were holding dollars as an inflation hedge or as a safe currency, and you didn't sell those dollars before the Bushites decided to devalue it to keep our economy afloat in order to both wage war and keep our consumers happy, you lost much value.

                      As an example, I live close to Canada, and from a 35% discount of the Canadian dollar against the US dollar five years ago, we are now almost at parity. So Canadian purchasing power has jumped, but Canadians' holdings of dollar-denominated securities has dropped by the same amount.

                      That is why a savvy currency trader like Warren Buffet made over a billion dollars just a few years ago betting that the dollar would be devalued far in advance of the currency markets. This was because his holdings extend around the globe and he had a far clearer perspective on what this government would do to fiscally enable its pernicious policies.

                      The Federal Reserve has "eased" money as an aspect of monetary policy implemented for the reasons stated above, while issuing more dollars at the weekly Federal Reserve dollar auctions.

                      The amount of the discount or interest these new dollars yield ties into the Federal Funds rate, set by the Fed, which is the rate at which banks loan each other funds overnight. Rates have been kept artificially low to encourage American consumers to consume, which has proved very effective at providing asset protection to lenders because homes were the basis of much consumer debt.

                      Now our inflated real estate market is slowing. Homes are going into default, and American real estate is being devalued as was the over-heated Japanese market over a decade ago. The Fed has tightened interest rates to support the dollar, but that hasn't kept the dollar from falling significantly because so many extra dollars have been issued.

                      So from both a macro and a micro perspective, our managed economy is in somewhat of a state of freefall, with the Fed's monetary policy supporting our government's warmongering global fiscal policy of aggressive intervention as a means to keep the over-hyped "terrorists" from our shores.

                      As can be readily seen as homes default and Katrina victims remain disadvantaged, this policy benefits only the few at the expense of the many.

                      In America, politics is big business. - J P Morgan

                      by 4Freedom on Tue Apr 24, 2007 at 07:47:52 AM PDT

                      [ Parent ]

                      •  Thank you so much for this mini brushup... (0+ / 0-)

                        One of the things I really appreciate about the Kos community, is the generosity people show in sharing their area of knowledge and the patience, time and caring they are willing to take to educate one another.  Your kindness in explaining this to me is truly appreciated.

                        It's not that I am not aware of economics on this level, it's just that I don't do this stuff anymore.  I can easily understand it when I read it, as I familiar with all of the terms from my college econ (macro and micro) and math classes, and I can understand your explanations completely.  And of course, one can get a pretty clear sense of what is happening to people if you just start talking to strangers at the supermarket or the gas station.  Especially the gas station.  The hows and the whys might need to be filled in, but the what is obvious.

                        Again, many thanks, and if you want to recommend an article, monograph or text for me to read, please leave it here and I will check back.

                        Again, many thanks for your generosity.

                        DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

                        by Casey Morris on Wed Apr 25, 2007 at 01:51:00 PM PDT

                        [ Parent ]

              •  What U.S. goods? (0+ / 0-)

                Genetically modified corn and Hollywood movies?

                "The great lie of democracy, its essential paradox, is that democracy is first to be sacrificed when its security is at risk." --Ian McDonald

                by Geenius at Wrok on Mon Apr 23, 2007 at 04:34:56 PM PDT

                [ Parent ]

            •  Leverage (0+ / 0-)

              America leverage is a consumer marketplace.   Companies and countries want to sell their products in our marketplace.   As long as we have money to spend, access to our marketplace is our leverage.  Once we are broke, we no longer have leverage.

    •  Maybe the issue here is (5+ / 0-)

      capitalism.  China uses capitalism in a mix - controls it on the world level.  Capitalism uses us - and its ultimate truth may well be globalization.  Our politicians - do they think historically?  Are they interested in their citizens?  How many guitars do we need?  Note diary on Michael Moore and Cuba up.  

      I have no patience with people who grow old at 60 just because they are entitled to a bus pass. Mary Wesley, British novelist

      by xanthe on Mon Apr 23, 2007 at 05:57:52 AM PDT

      [ Parent ]

    •  Not true, so you miss something. (0+ / 0-)

      What Daily Kos readers do not understand is that we live in a system of economic absolutes and inevitabilities that exclusively benefit economic elites.

      Sorry, that's not true.  Cheap goods manufactured overseas are desired by all Americans, as is the power to sell assets and instruments to foreigners, as is cheap guest worker/illegal immigrant labor.

      If you don't recognized that, you don't realize that democracy itself resists attempts to change the trade imbalance.

  •  Thanks, bonddad. I understand... (2+ / 0-)

    ...not that I don't understand a lot of things, mind you - but this is one topic where my eyes glaze over and my brain turns to mush.

    OK - logically the two extremes have to meet in the middle.  but how do we help the developing countries to  move in the right (developing) direction?  I am reading about Nigeria slipping away and while I'm sure there are some  develping countries where things are on more solid footing - how do we help the process along so that (1) it happens (developing countries actually develop) and (2) what, exactly do you mean by we will have to decrease our standard of living (give up cars; start eating off of paper plates, etc.)?  What does our future standard of living look like?  (Any thoughts?)

    I mean what can and should we - average Americans - be thinking of...your fine recommendations seem out of our individual hands.  Oh, except for us to quit complaining!!

    Thanks, again.

    •  I have some thoughts. (6+ / 0-)

      Creative thinker here.

      Peace Corps-type environmental education workers teaching energy-wise solutions to developing countries.

      Creative Recycling. (I wrote a book if there's a publisher anywhere.. Taunton was interested until 9/11) It's an art to live well on nothing. We need to get this across. Do we need to own so many "toys" most of which are crap? Why not make wonderful useful things from stuff people throw out?

      Living in a natural non-polluting way can actually RAISE our standard of living and very entertaining to use our brains again for the creative problem solving required in the handmade life. These solutions could be adapted for cities also.    

      A society of sheep must beget in time a government of wolves. Bertrand de Jouvenel

      by Little Red Hen on Mon Apr 23, 2007 at 07:10:12 AM PDT

      [ Parent ]

      •  or we could 1) elect officials... (3+ / 0-)
        Recommended by:
        Little Red Hen, Jagger, KansasLiberal

        ...that resurrect the "Made in America" concept,

        1. elect officials that don't sell America to the highest multinational bidder,
        1. elect officials who is accountable to middle class Americans rather than the bank-rolling lobbyists (AKA the "K-street project") and the nefarious industries that have corrupted American democracy
        1. reject such investor-class hogwash such as this diary and get to work doing the above
        •  This comment shows what's wrong. (2+ / 0-)
          Recommended by:
          wystler, side pocket

          The diary is based on math and economics.

          Sure, it's upsetting, and it also happens to be what has been clear to me since the oil shock in 1973, which I (correctly, it seems) interpreted as "when the United States and the high standard of living nations will have to start paying for energy instead of stealing it."

          From there the economic logic is inescapable. Standard of living goes down. Sorry.

          Your solution: Kick the can down the road to someone who agrees with your incorrect economic analysis, which is that standard of living is not based on energy and payment for it.

          Your next presumption, also wrong, is that technology can break the law of physics that energy can neither be created or destroyed, only changed in form.

          Well, technology can increase the efficiency of the toys we call our standard of living, but if we refuse to adopt those new efficient means, and give them the name of "high standard of living", then we are stuck back in the inescapable economics of energy.

          Now we also have global warming, which limits standards of living based on energy consumption, like big this and big that, SUV and McMansion and far-away vacations and jetskis, powerboats, motorcycles and all kinds of (energy-intensive) clothing to match the (higher standard of living) sports.

          In "Brave New World" the World Controller explains carefully that the games the children and adults are conditioned to play must always require bigger and more expensive equipment to play with, to "keep the economy going" but Huxley didn't have global warming on his radar.

          I was very cheered to hear a MSM commentator yesterday attack carbon credits (Terrapass) as indulgences, money paid to engage in sinful behavior. That's a tremendous advance in economic understanding and honesty in the MSM.  

          Solicit.Agreement.First.

          by ormondotvos on Mon Apr 23, 2007 at 11:43:13 AM PDT

          [ Parent ]

  •  Natural Advantage (19+ / 0-)

    The US no longer has the natural advantages it did during its formative years. Our oil is past peak and coal and iron ore are needed to maintain our level of economic activity.

    The undeveloped land is also gone, it is either developed or used for agriculture.

    So there are no special reasons why the US should be able to out compete other nations either in manufacturing or agriculture. We still have a slight lead in technology, but this is shrinking rapidly. Recent advances in areas like cloning have come from the UK and Korea. The blue laser was invented in Japan. Advanced mobile phone technology exists in Asia, but not the US.

    The level of science and engineering students is not keeping up, both China and India now graduate more students than we do in these areas.

    Soon the Chinese domestic market will be big enough that they won't need to sell us stuff financed with borrowed money. There is already a middle class in China of about 300 million people, this equals the entire US population.

    We can expect the US to start to look like other former empires in the next 30-50 years. Places like the UK survive on fake Olde English tourism and financial services. Our natural wonders should provide a destination for foreign visitors as well.

    The only question is are we all going to moderate our lifestyles together or are we going to become like the banana republics with a small plutocracy in walled enclaves and poverty elsewhere?

    •  China's natural advantage (5+ / 0-)

      China now has the natural advantage in manufacturing. They have built up economies in scale in so many industries that it will be impossible for anyone to compete with them. They are making stuff for the entire world, so once they have the production facilities set up no one can get the same volumes or same low costs.

      Of course with manufacturing comes pollution and the requirement for raw materials and labor. They have labor and they are buying up raw materials everywhere. The pollution...well the time will come when it is no longer acceptable or ...

      Just because you can doesn't mean you should!

      by taonow on Mon Apr 23, 2007 at 05:13:49 AM PDT

      [ Parent ]

    •  There is plenty of avaliable land (2+ / 0-)

      And luckily, we need lots of science and engineering student to reach it.  There are plenty of possiblities for land usage off planet.  

      But we've got to do much more investing in space technologies (along with dealing with the legalities of off planet commerce), and we can't keep thinking that anything with space is wasted money.  

    •  One advantage America still has are Americans. (2+ / 0-)
      Recommended by:
      mbguenth, opinionated

      Someone who wants to be an American and can get admitted for citizenship becomes an American. As a result we have a global, not just a national, talent pool.

      That is part of what has made America a global economic force and is part of what I believe is America's strong economic future. We have global intelligence working for us in our own economy creating new technology, new ideas and new products.

      In America, politics is big business. - J P Morgan

      by 4Freedom on Mon Apr 23, 2007 at 10:07:38 AM PDT

      [ Parent ]

  •  standard of living (4+ / 0-)

    There are some aspects of a declining standard of living that don't bother me. Computers will always get cheaper, so spending less isn't necessarily getting less. And communications infrastructure doesn't just evaporate.

    Is the ability to purchase oil on the global market the biggest problem for a depressed US economy? In my very primitive reasoning about this:  farms, doctors, and computers will still be here as we get poorer, but the dollar becomes worthless, and everything from overseas costs more? Forget driving.

  •  The reality is that the entire architecture (16+ / 0-)

    economic, financial, political, and military has to change and change quickly to avoid impending disasters like global warming, the proliferation of WMD, huge economic imbalance, the spread of epidemic diseases, the irreversible altering of environmental equilibrium through, e.g., GMO's, etc.

    The biggest problem, however, is sustainability. The basic premise of globalization is that the entire world can rise to the living standard enjoyed by the present First World, which is simply not possible because there aren't sufficient resources the way they are presently being used and also the consequences in terms of pollution and other offal that can't be adequately managed, so that humanity is drowning in its own shit.

    The change that is required not going to happen short of real catastrophe or impending catastrophe that grips the global mindset that enables a complete structuring of wealth and power. Ad hoc solutions are simply band-aids to buy a bit more time and allow humans to burrow their heads a bit deeper in the sand, thereby further exposing their backsides to Nature's impending kick in the ass. At this point, probably a lot of people are hoping it happens to their kids or grandkids rather than them, but that's looking increasingly like wishful thinking.

    There are people who are proposing solutions, but they are mostly from the scientific community, which has been neutered by BushCo, and splinter groups like the Greens, who remain a blip on the screen.

    I personally don't think this is going anywhere until either catastrophe hits or enough people start taking it to the streets. Don't the young people of this country see a draft building? Aren't people living in cities -- about 70% of Americans -- aware that the level of invisible particulate matter in the air is unacceptably high? And so on.

    Where's the outrage? Until there is some real outrage, and leaders emerge who are capable of dealing with the level of complexity, humanity is screwed.

    In the meantime, there will be protectionist "solutions" enacted comparable to the "solution" of shutting US borders that is presently underway. This may be myopic but it is about as far forward as most people can think.

    Live unity, celebrate diversity.

    by tjfxh on Mon Apr 23, 2007 at 05:19:01 AM PDT

    •  Sustainablity is inherently flawed (1+ / 0-)

      It wont' work.  I know that there are a lot of people who think that we can somehow alter things and make sustainablity work.  But we can't.  I've argued that in a diary entry, and you can read it here, if you want.  I'll give you the short version - basically, to make it work, we would need a level of planned economy that just won't work - we've seen over and over that planned economies don't work.  

      So whats the solution?  Again, I present it in the diary - space colonization.  This is, IMHO, the missing componant needed to deal with the problem that globalization presents.

      The point is, to really deal with these issues, we need a bigger house - so lets build some add-ons - Lets move further to colonize space.  

      •  Are you familiar with costs and benefits? (6+ / 0-)

        Please outline here how the benefits of space colonization outweigh the costs.

        Success is the child of audacity. --Disraeli

        by ChuyHChrist on Mon Apr 23, 2007 at 06:24:08 AM PDT

        [ Parent ]

        •  Well, if you don't mind (1+ / 0-)

          I think I'll let someone else do it.  Go here to read about it.  I think that deals with quite a few things.  

          As for actual cost, well,
          1 - you can go into space without doing damage to the enviroment (or at least, you can limit it to the level that any man activity won't impact the enviroment - and I for one don't have any intention of commiting suicide to reduce my impact on the enviroment)
          2 - In terms of money costs, the traditional idea is that it is hugely expensive to get into space.  This idea is really a myth. Read here, here, and (while I don't actually like citing him, Rand Simberg is right about this), here

          I can't think of any other real costs, but if you see some, let me know.  

          •  Energy costs. (0+ / 0-)

            I'd love space travel, but in an era of decreasing fuel supplies, it's simply not viable.  The problem with space travel is simple: no matter who is paying for it, it takes a lot of energy to get into even a near-Earth orbit.

            Apart from that, the number of people we'd have to send off-planet every day just to stay at the same population level that we have today is simply ridiculous.  Space may be fascinating, but at least in the medium-term, we're going to have a token presence at best.

            •  Actually, its more power than energy, however (0+ / 0-)

              thats a side issue.  First of all, fuel itself is not a fixed supply.  Petroleum based fuel is a fixed supply, although you can put things in place of it (ie bio-deisal)  that allows you to get around that problem.  And things like Hydrogen don't face this problem.

              However, fundementally to these things is energy to create the fuel.  This is one area where space can help us.  Space Based solar power satellites would be increadibly easy and cheap to do.  And with the low cost orbital transports I've sited, it becomes practical - this has always been the sticking point, because cost to orbit has been so expensive.  And as Simberg pointed out, its NOT fuel costs that have made space travel so expensive.

              Concerning your second part - its not just an issue of moving people off planet - each of those people will need some form of support back on the ground.  When Alan shepard launched into space, he had a ton of people looking over his shoulder.  Now, that number probbably will be smaller, but it will not be eliminated for some time to come. So a worker who has gone off planet acts much in the same way that a manufacturing job acts.  So, while, yes, its only practical in the medium to long term for dealing with over population, its entirely practical in the short term for dealing with the economic effects of globablization.

      •  I don't disagree, but (4+ / 0-)

        first, it would probably take more time than we have available before catastrophe strikes, even if we started a Manhattan Project today;

        secondly, the whole idea is too much of stretch short of catastrophe, when it's probably already too late.

        The alternative seems to be that the world population is going to decline precipitously, perhaps by 75%.

        Live unity, celebrate diversity.

        by tjfxh on Mon Apr 23, 2007 at 06:27:05 AM PDT

        [ Parent ]

        •  See, I don't think we need a Manhattan project (1+ / 0-)

          for the very simple reason, there are already significant development going on for space development.  You can read about some of it here.  Of course, there are more things that we can be doing to encourage this, but we don't necassarily need a mass moblization for space colonization to be realized.  One of the best things liberals could do is to start embracing space, and some of the poeple who are trying to change the current space architecture (Elon Musk, John Carmack - there are others), in much the same way we've embrace alternative energy people.  

          Also, we could push for some major reforms at Nasa, and not view all manned spaceflight as a waste.  

          I've often, and do, argue that we've already started colonization.  We just have to take the next steps.

          •  Well, I hope you are right. (3+ / 0-)

            You have Stephen Hawking on your side.

            But I remain pessimistic, in that even if humanity successfully colonizes space, most of the Earth's population is still in deep shit.

            Space colonization might save enough genes for the race to continue though, if there is a complete extinction on Earth, which I tend to doubt. I think there will be a massive population decline instead.

            Live unity, celebrate diversity.

            by tjfxh on Mon Apr 23, 2007 at 06:50:40 AM PDT

            [ Parent ]

          •  Not going to happen (3+ / 0-)

            The space program is an artifact of cheap energy.  It's going to be mostly history, along with a lot of other very expensive things.

            •  Its not going to be a program (1+ / 0-)
              Recommended by:
              TastyCurry

              anymore than expanding society has been a governmental program, and thats your mistake.  Its going to have parts that are governmental, that I don't deny, but it will have a much larger role from private industry.  Private industry, and more importantly private individuals, will have need to go into space.

              As for cheap energy, we can find plenty of it off planet, and we can export it back to earth no problem.  

            •  go to the page linked to in my sig (0+ / 0-)

              for discussion of space power satellite projects, costs per pound for orbital shipping are getting into the ball park requirwd to make this long-term solution to world power needs cost-effective.

              While you could be right, it'll be an artifact of collective human leadership stupidity that kills space industrialization, not inherent technological impossibility or energy costs.

              Looking for intelligent energy policy alternatives? Try here.

              by alizard on Mon Apr 23, 2007 at 07:11:45 AM PDT

              [ Parent ]

  •  bonddad speaks the truth (9+ / 0-)

    Just recently my company anounced that it would be hiring 400 new employees. 40 locally, the rest overseas, China, India, Eastern Europe.

    This is a high tech company. We have struggled to survive since the tech collapse. The whole industry is doing this. If we don't do it, we will be gone in a few years.

    It used to be that all our competition was in North America and Europe. Not anymore. We now compete with Chinese and South Korean companies. We have sales all over the world. If we can't keep our cost low to compete with the new players, we are finished.

    For now, all the 'high value' jobs are staying here. The people who make the decisions will be here. The 'commodity' jobs are moving off-shore.

    •  Altough companies often get burned by that (4+ / 0-)
      Recommended by:
      cotterperson, mollyd, nasarius, bricoleur

      happened during the earlier outsourcing boom of the 1980s, many US companies discovered that there were hidden costs to them. Communications problems, cultural differences, sometimes an overseas contractor would not renew and become a competitor, or the overseas branch would mostly resign to join a competing startup.

    •  "high value jobs" staying (12+ / 0-)

      Only as long as offshore contractors are willing to accept contract payments, aka the crumbs off the table of Fortune 1000 CEOs in exchange for providing manufacturing, customer service, design, and everything else once defined as "core business services".

      One of these days, offshore contractors are going to realize that there's no reason to accept contract payments when they can have all the profits instead by kicking out a crowd of parasitic C-level American corporate suits who NO LONGER ADD VALUE TO THE PRODUCTS AND SERVICES "THEIR" COMPANIES SELL.

      Already happened once, google on the end of Schwinn Bicycle as anything other than a once-American brand owned by a Taiwanese company.

      I project a lot of takeovers... where C-level people get golden parachutes in exchange for recommending stockholders accept 10 cents on the dollar on what the stockholders thought their stocks are worth and that many Fortune 1000 companies will become brand names for Chinese and Indian corporations.

      Looking for intelligent energy policy alternatives? Try here.

      by alizard on Mon Apr 23, 2007 at 05:49:26 AM PDT

      [ Parent ]

  •  This kind of diary, (9+ / 0-)

    thoughtful, carefully reasoned, and (most importantly) challenging, is exactly why I come to DKos.

    Thank you, bonddad.

  •  Here is Where I Disagree (18+ / 0-)

    I look forward to your posts Bondad, but this time I disagree.  What actually happens in "free trade" borrowing from your example, is that the international employer who was building whatever in America and moves down to the third world country forces the local population to accept not 10 cents but 8 cents an hour, threatening to locate its manufacturing somewhere else if the demands for wage concessions arent met.  Various third world nations are "gamed" this way so even their workers dont benefit.  

    However, trade deals with enforceable protection for labor and yes, forced increases in wages are a requirement in order for the benefits of free trade to be realized by everyone. Will this somewhat slow the growth in jobs in the hypothetical third world country?  Yes, because fewer jobs in the US will be lost.  Will there be a temporary increase in inflation?  Probably, depending on the price competition (for example, I think we can have a strong increase in US wages without much higher inflation because of the fierce competition in prices due to...yes...free trade).  But what does inflation mean in this context.  Inflation will result because suppliers of consumer products have not the supply of goods because workers have had such low wages.  Once this is factored in, inflation will be controlled.  So, partially the increase in wages will be eaten up by higher inflation, but much of the wages increase will only result in lower profits for the international businesses, which is why they fight these type of trade deals. Will enforcement be a problem?  Yes.  But if the WTO and other mechanisms can be used by governments and international corporations to enforce anti-worker provisions, why cant the same mechanisms be used to enforce pro-worker provisions.

    I agree that globalization is here to stay, that there are some benefits to it and that we need better education.  But education itself-the universal solution of free traders like Greenspan and Rubin-is not going to make enough of a difference to make the trading system work for everyone.

    Ultimately, the world economy can be compared to the 1920s United States.  Then, even most liberals believed that the national government had not the power to create any standards to protect workers.  Then, even most liberals believed, along with Adam Smith, that any intervention into the market by a minimum wage or assisting in the growth of organized labor would be counterproductive.  In fact, I cant think of a single argument free traders can make regarding the economic effect of intervening in third world countries to better the lot of its workers that would not have been made in the 1930s in this country, or are still used today by the right to reject any government intervention to improve the economic lot of its citizens.  Just as such intervention, which helped create the great middle class of the 50s, 60s, and 70s, and just as the creation of this middle class was an important componnent of the post war economic boom, the pro-worker intervention into the third world via trade policies will ultimately assist the economy as a whole.  

    No one has demonstrated the economic downside of wealth concentration better then you Bondad.  Spreading the wealth helps, not hurts an economy, whether you look at the economy of one country or the world.  Unregulated free trade is the cause of the concentration of wealth and such concentration will continue until the trading system is designed to assist everyone.    

    •  What about wealth creation (0+ / 0-)

      as opposed to redistribution?  Wealth is not a fixed resource.  

      I do agree that unregulated free trade isn't the answer, but we shoudln't run from trade either.

    •  Wrong, because most jobs in the US (3+ / 0-)
      Recommended by:
      berith, Lesser Dane, Richard Lyon

      are lost to automation and technology not going overseas, which is really a strawman argument of the anti-globalization crowd.  Companies in the US are automating everyday and would only do so at a greater rate with any type of trade protectionism.

      •  I am Pretty Sure You Are Wrong But Whatever. (1+ / 0-)
        Recommended by:
        skrymir
      •  Come On (3+ / 0-)
        Recommended by:
        nasarius, BobOak, pkbarbiedoll

        You were factually corrected more than once on many of the points you made in the diary which you wrote yesterday.

        Yet you have chosen to come over here and spew the same tired shit.

        Yesterday I thought you were simply misinformed or naive. Today I believe you are simply being dishonest.

        <div style="font-size:10px;text-align:center;background-color:#ffd;color:#f33">If the terriers and bariffs are torn down, this economy will grow - G. Bush

        by superscalar on Mon Apr 23, 2007 at 08:24:25 AM PDT

        [ Parent ]

        •  I was never factually corrected (0+ / 0-)

          in my diary.  All I got was a bunch of people who didn't like what I had to say so they questioned my economic background.    I work with manufacturers and see the effects of automation every day.  I have been to dozens of facilities that are operating at triple the production with 1/4 of the workforce they had 5 years ago.  You simply don't get headlines about this as its not "exciting" news.  

          •  No (3+ / 0-)
            Recommended by:
            rick, nasarius, BobOak

            All I got was a bunch of people who didn't like what I had to say so they questioned my economic background.

            What you got were a lot of very well informed and well educated people who told you that you had no idea what you were talking about.

            You made no attempt to refute Robert Drake's excellent rebuttal to your diary, yet you insist on coming over here and repeating the same talking points.

            Why?

            <div style="font-size:10px;text-align:center;background-color:#ffd;color:#f33">If the terriers and bariffs are torn down, this economy will grow - G. Bush

            by superscalar on Mon Apr 23, 2007 at 08:43:53 AM PDT

            [ Parent ]

            •  Probably because I was asleep (0+ / 0-)

              I signed off at around 10:30pm EST.

              •  Please Do (1+ / 0-)
                Recommended by:
                BobOak

                Do go back and refute Drake's comments. I would be very interested in what you have to say, as I am sure others would.

                By the way, why did you choose to come here and regurgitate the same talking points this morning as opposed to going to your own diary and refuting the very excellent points which were made there?

                I think it would have shown much more integrity than simply coming here.

                <div style="font-size:10px;text-align:center;background-color:#ffd;color:#f33">If the terriers and bariffs are torn down, this economy will grow - G. Bush

                by superscalar on Mon Apr 23, 2007 at 08:54:50 AM PDT

                [ Parent ]

        •  Oh and since you questioned my reference (0+ / 0-)

          to Ricardo, why don't you read the diary again.  Ricardo's theory of comparative advantage is recognized as one of the foundations of modern free trade theory even though it doesn't apply directly.  I only used Ricardo as a date reference for when the beginnings of free trade theory began.  

  •  Except that not all Americans will lose (3+ / 0-)
    Recommended by:
    keestone, cotterperson, bricoleur

    their standard of living - the elite and wealthy will continue to live well - and become more ruthless and competitive to keep it for themselves and children.  The lower middle class/ the working class - yes.  Frankly, I don't even have a car and have good public transportation where I live - but cities, towns have to address this.  Education may become scarce for the coming generations - well, that's nothing new.  The education of our middle class is really a new phenom.

    Aggressiveness, anger, deep competitiveness - that would be one result.

    But what you say is true - sins of the father -

    Our politicians are clueless if you ask me - it's either or -- no, we should begin planning as one poster mentions.  

    I have no patience with people who grow old at 60 just because they are entitled to a bus pass. Mary Wesley, British novelist

    by xanthe on Mon Apr 23, 2007 at 05:35:32 AM PDT

  •  shortage of skilled machinists (30+ / 0-)

    at the price they want to pay, which is according to my roommate 30-50% less than they paid 6 years ago.

    That's right .. less.

    My roommate worked as a skilled machinist for 20 years, until took time off to go to college. Now that he is trying to get a job, he is seeing offers as much less than they were paying previously.

    BTW even at that price they won't hire him because he is too old (48) and been away from the field for 6 years.

    It seems there really isn't a shortage of workers, rather bosses have unrealistic expectations.

    fact does not require fiction for balance

    by mollyd on Mon Apr 23, 2007 at 05:35:49 AM PDT

    •  One of the best comments (2+ / 0-)
      Recommended by:
      bluewolverine, pkbarbiedoll

      in these diaries in years.

    •  exactly what I was going to say (10+ / 0-)

      Everytime I hear that there is a "shortage" of workers for some kind of job or other, I figure whoever is making that statement is lying in order to have an excuse to use work visas to bring in people from foreign countries who will work for less. Or to encourage Americans to go to graduate school in the sciences---where there is often low pay relative to the training (as a researcher) and not a lot of job security.  (My favorite line is that there is a "shortage" of physicists.....)

      Americans aren't stupid. If there is a job out there that will pay they decent money, they will get the training to do it. On the other hand, if there is no work, they aren't going to waste their time.

      My father majored in forestry in the 1930s because he was told that there were jobs available in forestry. He never worked for one day in the industry because it turned out that those promised jobs weren't there. I'd often wondered whether the "shortage" that he'd heard about was another one of these made up stories trying to increase the labor pool so they could manage to pay people less.

    •  Don't worry (5+ / 0-)

      It seems there really isn't a shortage of workers, rather bosses have unrealistic expectations.

      Flake/Gutierrez whatever new 'comprehenisive immigration reform' legislation that Ted Kennedy is cooking up will address this.

      Everybody seems to think that these new guest-worker visa programs will be applied to only low-skilled low-wage labor. Nothing could be further from the truth, and those people involved in the process have stated as much.

      <div style="font-size:10px;text-align:center;background-color:#ffd;color:#f33">If the terriers and bariffs are torn down, this economy will grow - G. Bush

      by superscalar on Mon Apr 23, 2007 at 08:28:11 AM PDT

      [ Parent ]

  •  you're taking for granted that today's world (31+ / 0-)

    is going to look just like tomorrow's.

    First, you're drastically overestimating the labor component of the cost of manufactured goods and underestimating the infrastructure cost components..

    15 cents an hour for labor sounds really great, until one finds out the hard way that the reason why Third World labor is so cheap is that the infrastructures we take for granted in the first world either have to be purchased, built, or their absence has to be worked around.

    If the cost of manufacturing labor is much more than 10% or so of the wholesale price of a manufactured item, I'd be looking at the manufacturing process, it's a dead giveaway that somebody hasn't designed and implemented automated processes properly.

    Second: You haven't taken into account the fact that the economics of transportation energy are going to make some drastic changes in what's cost-effective in manufacturing goods.

    It isn't going to make sense to ship raw materials thousands of miles to build products that are going to be shipped as finished goods thousands of miles to the American market with the price of oil going over $1xx a barrel, and you know and I know that's only a matter of time, if it doesn't happen in Bush's remaining time in office, the Democratic successor will have to deal with it.

    Walmart's offshore manufacturing business model will either change or they'll be replaced by vendors buying American or Mexican or Canadian vendors running hard and robotic automated assembly lines.

    I don't expect China or Taiwan or South Korea to go away, but they'll become mainly regional suppliers, with only premium products whose perceived value means people will be willing to pay more including shipping to buy them. And that's exactly the kind of product the US will be selling into regional markets outside our own.

    Third: Offshoring contractors themselves say that offshore savings are largely illusory:
    Read what offshoring contractors themselves say about REAL offshore savings in the real world:

    The bitter end of outsourcing

       9/25/2003 5:00:00 PM - There comes a limit to what you can farm out

       by Shane Schick

       Cost savings? What cost savings?

       At every Conference Board of Canada event, it is customary that the chair offers a recap of each day's presentations the following morning. On Day 2 of this week's Business Process Outsourcing event those responsibilities fell to Blake Hanna, a partner with Accenture in Toronto, who tried to whittle down a series of presentations into a few bullet points. When he was finished he asked the audience if any key issues hadn't been addressed so far. A hand went up.

       "I didn't get the impression anyone was saving any money," one guy said.

       This was a great comment, because it went straight to the heart of why many people had probably registered for this conference. The best response came from one of the previous day's presenters, Scotia Group vice-president of strategic sourcing Linda Tuck Chapman, who said many enterprises say they expect cost savings of 30 per cent or more from outsourcing. "I don't know where these comments come from," she said. "Sometimes we've managed to see savings of 10 per cent or a little bit more, but it's usually been much more about the value (outsourcing) brings to the company."

       [rest at the URL]

    I've suspected for some years that offshoring has far more to do with generating apparent savings that can be added to largely imaginary profits that can be used to trigger quarterly bonuses and options for C-level people than it is about increasing shareholder value..

    I believe that the reason why people are not pushing themselves with respect to education or training is because if any decent jobs they get are getting offshored, why bother?

    Looking for intelligent energy policy alternatives? Try here.

    by alizard on Mon Apr 23, 2007 at 05:35:53 AM PDT

    •  Great Comment! (14+ / 0-)

      Most excellent.

      I especially like:

      I've suspected for some years that offshoring has far more to do with generating apparent savings that can be added to largely imaginary profits that can be used to trigger quarterly bonuses and options for C-level people than it is about increasing shareholder value...

      People need to understand this. The whole outsourcing phenomenon is the latest fad. Companies who have no business whatsoever outsourcing jobs for short term profits at the expense of their core business brands are just now waking up to some of their mistakes.

      Plus, the whole transportation piece cannot be overstated, in many cases.

      Finally - companies here use outsourcing to keep wages down in the US. A huge reason we haven't seen wages rise at the pace of inflation is the marketing of such 'global reality' ideas. My company does it every day. Almost everybody does now.

      C-level people indeed.

      If they didn't want a political circus, maybe they shouldn't have foisted Bozo the Clown on us as president. - Digby, March 18, 2007

      by Stranger in a strange land on Mon Apr 23, 2007 at 05:51:15 AM PDT

      [ Parent ]

      •  Democratics who think about economics (11+ / 0-)

        need to realize that a great many things we think we know about the "benefits" of offshoring are happy horseshit, even when looking at the business case for it. The great majority of people who talk about its benefits in the area of manufacturing have never seen an assembly line, manual, automated, or robotic.

        As I see it, "offshoring increases profits" is part of the Conventional Wisdom. . . and it's time to start asking serious and pointed questions about it.

        If the USA were the most expensive possible place to manufacture products in, WHY HAVE JAPANESE COMPANIES PUT AUTO FACTORIES IN THE USA?.

        Looking for intelligent energy policy alternatives? Try here.

        by alizard on Mon Apr 23, 2007 at 05:56:52 AM PDT

        [ Parent ]

        •  Because it is cheaper for them to build the cars (5+ / 0-)

          in the country that buys them.  China will probably start doing the same thing once it has a stable middle class.

          We need to stop buying their stuff.  

          This reminds me of those who rail about global climate change yet drive a car which gets low mileage.  Act locally people.

          •  read an article the other day (1+ / 0-)
            Recommended by:
            alizard

            about China planning on doing just that. I'll have to go find it now though.

            all Along the Watchtower...... blogroll

            by terrypinder on Mon Apr 23, 2007 at 06:54:49 AM PDT

            [ Parent ]

          •  Avoids import tarrifs (0+ / 0-)

            As I understood it, to protect the Detroit auto industry, there were fairly stiff import tariffs on imported cars -- when the whole car was imported. This was certainly true a decade or two ago, I don't know about now. Of course, if they're made here--or assembled here, some parts may be made elsewhere--then they don't get hit with that tariff. Which is a good reason to establish manufacturing plants in the nation that is your biggest customer.

            The car I drive (American company) was made in Mexico, but that would avoid the tariffs under NAFTA, I suspect.

            "Everyone is entitled to an opinion... What most people fail to realise is that they are not entitled to have that opinion taken seriously." --Adam Tinworth

            by JanetT in MD on Mon Apr 23, 2007 at 09:46:30 AM PDT

            [ Parent ]

      •  I think you're wrong about outsouring (4+ / 0-)
        Recommended by:
        sayitaintso, BobOak, zorba, Brass Tacks

        electronic outsourcing of clerical jobs, and even professional jobs (like having Indian radiologists read American xrays) costs very little.

        Success is the child of audacity. --Disraeli

        by ChuyHChrist on Mon Apr 23, 2007 at 05:57:59 AM PDT

        [ Parent ]

        •  You know more about offshoring (4+ / 0-)

          than offshore contractors and consultants do?

          That article  I cited was based on reports of an offshoring forum.

          If you know more than the pros do, go market your expertise, you're wasting your time here.

          Not to say that it's always more expensive, but people who make those kind of decisions have to consider both direct and indirect costs, and they usually don't.Generally because a CEO who makes this kind of decision will probably have cashed out by the time any bad consequences can bite the company on the ass.

          Looking for intelligent energy policy alternatives? Try here.

          by alizard on Mon Apr 23, 2007 at 06:09:26 AM PDT

          [ Parent ]

        •  I would add to alizard's rebuttal (3+ / 0-)
          Recommended by:
          mimi9, opinionated, alizard

          In some cases, it works to the advantage of the company's bottom line.

          In many cases, C-level managers are trying to copy the latest fad in a misguided effort to save the company 'lots of money', and get their annual bonuses as a result.

          It doesn't work nearly as well as advertised.

          If they didn't want a political circus, maybe they shouldn't have foisted Bozo the Clown on us as president. - Digby, March 18, 2007

          by Stranger in a strange land on Mon Apr 23, 2007 at 06:15:05 AM PDT

          [ Parent ]

          •  I started reading articles about (4+ / 0-)

            companies that were offshoring returning jobs to the USA several years ago.

            The most recent and conspicious example was when Dell returned its corporate customer service operations to the USA a few months ago.

            Why not the home customer service as well? Because it matters to Dell if they get repeat corporate business.

            Looking for intelligent energy policy alternatives? Try here.

            by alizard on Mon Apr 23, 2007 at 06:18:15 AM PDT

            [ Parent ]

            •  Dell (7+ / 0-)

              Is a great business case to use as an example for the pitfalls of outsourcing.

              I know several medium to large companies who have switched away from Dell back to HP for the service issues associated with their wholesale change to offshore support. In these cases, bringing the corporate support back 'home' is too little too late.

              Globalization has been oversold as a solution in this country.

              If they didn't want a political circus, maybe they shouldn't have foisted Bozo the Clown on us as president. - Digby, March 18, 2007

              by Stranger in a strange land on Mon Apr 23, 2007 at 06:32:38 AM PDT

              [ Parent ]

              •  for individuals and small businesses (1+ / 0-)
                Recommended by:
                bluewolverine

                I say "buy white box locally". They use standard components, you can throw them in the car without serious packing and drive them to your customer support, and if the shop goes out of business or if you move out of town, given standard components, you can get them fixed anywhere.

                And their prices for hardware comparable to Dell's will be in the same ballpark or maybe even lower.

                There is NO upside to buying name brands for computer, with the possible exception of Apple.

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 06:42:03 AM PDT

                [ Parent ]

                •  Not my experience (0+ / 0-)

                  My spouse's computer was shop-built by local "professional" computer-building people who vaguely knew what they were doing, I guess.  She's had problems with it for years now, and every time they came to service it, they screwed it up worse.  I bought a brand-name off the shelf years ago and haven't had a single problem with it.  

                  It is the mark of an educated mind to be able to entertain a thought without accepting it - Aristotle

                  by gatorcog on Mon Apr 23, 2007 at 09:04:26 AM PDT

                  [ Parent ]

                  •  there are plenty of people (1+ / 0-)
                    Recommended by:
                    bluewolverine

                    pissed off at Dell and HP and other name-brand computer companies.

                    If everyone's Dell boxes worked as well as your spouse's, NOBODY WOULD HAVE NOTICED how bad their customer service was because nobody would have called them.

                    Actually, the only real answer is to develop enough expertise to do one's own customer service.

                    The last time I took my K-6/350 Mhz Windows 98SE computer in for warranty service was in 1999. It is now an Athlon 64 dual core 4200+ Debian (Linux) Etch box. The vendor couldn't work on this thing even if I felt like paying them to, the only original part left is the floppy drive cable.

                    That's the other advantage of boxes with standard parts, easy and relatively inexpensive incremental upgrades. If I'd bought Dell, I'd be on my 4th Dell box since them.

                    Looking for intelligent energy policy alternatives? Try here.

                    by alizard on Mon Apr 23, 2007 at 12:59:27 PM PDT

                    [ Parent ]

                  •  Mine, however. (2+ / 0-)

                    My wife's experience with Dell has resulted in a firm understanding that we will never EVER purchase ANYTHING which is made (for/by) Dell or supported by Dell.

                    "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

                    by ogre on Mon Apr 23, 2007 at 03:17:10 PM PDT

                    [ Parent ]

    •  The article was from 2003. C'mon now. (0+ / 0-)

      The infrastructure for offshoring is even better than it was, and workforces overseas are training specifically for offshored American jobs (as with India's "Americanization" schools).

      Success is the child of audacity. --Disraeli

      by ChuyHChrist on Mon Apr 23, 2007 at 06:17:13 AM PDT

      [ Parent ]

      •  the case for offshoring is weaker than it was (2+ / 0-)
        Recommended by:
        bluewolverine, rolandzebub

        Indian hourly rates have gone up drastically. One reason why customer service from India sucks is that call center turnover rates are 35% a year.

        What's your personal financial interest in offshoring?

        Looking for intelligent energy policy alternatives? Try here.

        by alizard on Mon Apr 23, 2007 at 06:46:49 AM PDT

        [ Parent ]

        •  They are going to Egypt, Brazil, (0+ / 0-)

          and other now.

          And when Russia and China get some infrasturcture,
          watch out.

          Rick
          08 - Leaning Gore, Edwards, Clark, Kucinich, Obama
          -7.75 -6.05
          Fox News - We Distort, You Deride

          by rick on Mon Apr 23, 2007 at 08:30:21 AM PDT

          [ Parent ]

          •  the fun part about this is (1+ / 0-)
            Recommended by:
            bluewolverine

            there's a batch of expenses every time one changes contractors, and if one is changing nations in the same time, it's a lot more money.

            Then, one gets to build / buy the same infrastructure issues one had the last nation around, and that nation will be building infrastructure as well. While this is going on, the newbie programmers who were happy at $5USD are becoming more experienced programmers who'll bail if they're only offered $20.

            IMO, the race to the bottom ONLY ultimately profits CEOs permanently and professional employees in the affected countries temporarily... those employees eventually get to join a new highly skilled professional class of unemployed. (IIRC, Ireland went through that cycle a generation ago and has only recently recovered)

            Looking for intelligent energy policy alternatives? Try here.

            by alizard on Mon Apr 23, 2007 at 12:52:46 PM PDT

            [ Parent ]

  •  Retraining adult workers is a cruel joke (25+ / 0-)

    Retraining adult workers is a cruel joke.  

    If you're out of work, where are you going to get the money to pay for school AND make the mortgage, utilities, food, etc?  If you're working fulltime, how can someone in their 40's or 50's or 60's work fulltime AND find the time and energy to go back to school fulltime too?

    And who the hell is going to hire them when they get that new piece of paper?

    •  Retraining for adults fails because of our failed (9+ / 0-)

      social policies. I worked with DOL programs that included defense conversion and other "displaced" workers. The people, any age group, are usually very willing and able to be retrained. The problems you identify are very real though. The US unemployment insurance benefits are the lowest of the developed countries, add the loss of health insurance to loss of job, and there are real serious problems.

      Also, the current retraining program, the Workforce Investment Act (WIA) funded by the DOL is targeted at getting people off welfare roles, not preventing them from getting there. Further, the incentive for WIA's administrators are to keep things the way they are.

      IMO, the US had a reasonable retraining program under CETA, but like all other socially reasonable things, it was killed under Republican presidencies. And no Democrat cared enough to make improvements.

      I agree, it is a cruel joke! Campaign finance reform is the only hope for change, otherwise, any and all government programs will benefit those who have the most influential lobby, not those with the most needs.

      •  I think health care (4+ / 0-)

        drives a lot of that.

        For a small company, all it takes is ONE older worker with some minor, but chronic, condition to drive healthcare costs through the roof.

        Take healthcare out of the equation, and suddenly those older workers look real good. They show up, they don't have daycare problems, they work hard, and while they might not want to work til 2 AM, they tend to get as much, if not more, accomplished.

        •  Health care does play a major role, but.. (0+ / 0-)

          it is just part of the way our social policies neglect so many. I worked with many people who were victims of budget cuts (think space program and defense ) that were highly educated and skilled. Dual phds and the like, who were labeled "over specialized". Of course when developing the space program or weapons, the specialized skills were needed. When they were no longer needed, they were just tossed out the door. I think that's the real tragedy of a too "free market" system as opposed to a more balanced steady state economy. The human tragedy is expressed in an ever increasing poverty rate, and disproportionate income distributions.  Such a waste of human resources.

          BTW, I understand that the post 60 year olds rate of chronic conditions is only 15% through about the age of 75. Also, chronic conditions in the elderly have been decreasing globaly. Guess we can all live longer and healthier, albeit in an impoverished condition.

    •  Amen (7+ / 0-)

      I have heard this stuff peddled for years.

      It's primary purpose is to make free trade advocates feel better about themselves.

    •  They can always bag groceries (3+ / 0-)
      Recommended by:
      opinionated, pkbarbiedoll, lemming22

      or greet the other poor people at Wal-fart.

      It is the mark of an educated mind to be able to entertain a thought without accepting it - Aristotle

      by gatorcog on Mon Apr 23, 2007 at 09:06:37 AM PDT

      [ Parent ]

    •  Retraining for what ? (0+ / 0-)

      Most of the jobs that have shortages of workers are service jobs that don't pay beans or jobs that require advanced degrees. Nursing may be an exception, but not everyone is cut out to handle other peoples bodily fluids.

      Patriotism consists not in waving the flag, but in striving that our country shall be righteous as well as strong. ~James Bryce

      by california keefer on Mon Apr 23, 2007 at 05:33:20 PM PDT

      [ Parent ]

  •  Globalization may be a good thing (2+ / 0-)
    Recommended by:
    Yoshimi, truong son traveler

    Great diary!

    I particularly appreciated the point about consumer products being cheap because they are imported.

    There is a very different way of looking at the situation (ignoring taxes, management and the like to keep it simple, even at the expense of accuracy).

    A $500 guitar costs one week's wages of an average US worker (give or take a few days). The same guitar made in the USA would cost $1000, or two weeks worth of wages.

    On the other hand, a US craftsman will no longer spend the same two weeks making the guitar.

    Since this is the situation today, in 2007, and has been for at least 10 years, the pain has already happened.

    Yet, at the same time, the standard of living in the US has increased by the same amount. A US worker today can buy 50 guitars per year, instead of the 25 he could afford before manufacturing went to China.

    So I would argue that the pain isn't actually a reflection of overall deterioration, but rather occurs because while all Americans benefit from the lowered prices, only some pay the price.

    The good news is that it is actually much easier to deal with that type of imbalance, because no international agreements are involved.

    In fact, trying to act on the international level may actually be counterproductive. We may simply end up with the same lower standard of living that we started with.

    •  We all pay the environmental price, however. (2+ / 0-)
      Recommended by:
      opinionated, bluewolverine

      I shudder whenever I read an article about what Chinese manufacturing is doing to the environment. And no, I don't have any good solutions to that one.

      Success is the child of audacity. --Disraeli

      by ChuyHChrist on Mon Apr 23, 2007 at 05:59:08 AM PDT

      [ Parent ]

    •  uh, you think that budget guitars (4+ / 0-)
      Recommended by:
      nasarius, bluewolverine, BobOak, lemming22

      are BUILT BY HAND by skilled craftsmen over weeks?

      Not even in China.

      Try thousands of guitars per hour with the major components shaped by CNC machinery and assembled on (probably) manual assembly lines.

      If you want a hand-built guitar, find a skilled luthier and be prepared to pay thousands of bucks.

      Don't expect to buy one at Walmart.

      Somebody else needs to break the bad news to you about the Easter Bunny, I just haven't the heart.

      Looking for intelligent energy policy alternatives? Try here.

      by alizard on Mon Apr 23, 2007 at 06:04:55 AM PDT

      [ Parent ]

      •  I bought a handmade US guitar for $99! (0+ / 0-)

        I really did. There's a guy in New Jersey who started a company called Krappy Guitars and makes each of them by hand in his garage.

        Success is the child of audacity. --Disraeli

        by ChuyHChrist on Mon Apr 23, 2007 at 06:12:55 AM PDT

        [ Parent ]

        •  true... but a trifle incomplete (1+ / 0-)
          Recommended by:
          BobOak

          http://krappyguitars.com/...

          Here's what their real guitars start at:

          TRAVEL GUITARS are not just for travel anymore! Hey, you can . . .  The maple mini tends to pivot around a bit with heavy strumming, but it is absolutely the smallest full scale length instrument we offer. Travel guitars are $200.00 plus shipping.

          and from their main page:

          Our instruments are built for frugal people who aren't very concerned with regard to quality, construction, materials, or safety.

          Looking for intelligent energy policy alternatives? Try here.

          by alizard on Mon Apr 23, 2007 at 06:25:26 AM PDT

          [ Parent ]

        •  On the lighter side (6+ / 0-)

          Here's a handmade Asian guitar for less than a dollar. Despite its crude appearance it sounds pretty good.

          Photo Sharing and Video Hosting at Photobucket

          On a more serious note. I think a lot of the comments about "slave" labor, sweat shops, absence of environmental standards, child labor, etc. belong in the era of a decade or more in the past. I've lived in Southeast Asia for many years. There are many multi-nationals in the region. Generally speaking working conditions and pay are significantly better than those in the old local economy. Most of the products from those multi-nationals are sold locally in the region. Some others such as automobiles and clothing are exported outside the region.

          I have a friend who is German but lives here. He has just returned from a business trip to China and told me he was amazed at the progress he has seen in the just the past year. He visited some factories that manufacture wood products, parquet flooring, and said the factories are all clean, efficient and as well run as any in Europe.

      •  Funny you should mention the Easter Bunny. (0+ / 0-)

        Now that the Bushies are proposing to redefine "chocolate" because it's cheaper and more profitable to produce it with vegetable oil, rather than cocoa butter. Link here.

        - What happens on DailyKos, stays on Google. - 11/7 changed everything.

        by Jon Meltzer on Mon Apr 23, 2007 at 06:57:11 AM PDT

        [ Parent ]

      •  Actually, that's part of the point (0+ / 0-)

        Although I didn't say it explicitly: from an economic standpoint, production in China is exactly the same as using machines instead of making goods by hand. The pain of moving production to China is the same as the pain to cobblers when we started mass producing shoes. Or the pain to tailors when we started mass producing clothes.

        Here is where the week came from - and, yes, I do know that it is a simplification that is only valid in this particular context to illustrate the point, not in general.

        So $1000 buys you a US-made guitar. The average worker in the US makes, what, $25k? $1000 is roughly two weeks worth of income.

        But on the other side of the equation, that means that the guitar maker has to make approximately 25 guitars per year to make an average living. Again, this is simplified - in reality, he'd have to make more, due to raw materials, taxes, management overhead, sales margins, etc. Since those complicating factors don't fundamentally change anything, I neglected them in this example. I never meant to give an exact accounting of the price of a guitar.

        Also note that mechanization does not fundamentally change the picture - instead of a lone guitar maker, you'd have 1000 assembly line workers making 25000 guitars per year. The numbers remain the same, or at least in the same ballpark.

    •  We are not living in the same country (5+ / 0-)

      "Yet, at the same time, the standard of living in the US has increased by the same amount. A US worker today can buy 50 guitars per year, instead of the 25 he could afford before manufacturing went to China."

      And personally, I don't care how many guitars I can buy.

      I rather have affordable medical insurance than 100 guitars from the 3rd world

      And since so much of my income goes to medical insurance, I have less money to buy 50 guitars. Hey, I can't even afford one cheap one(really) :)

      •  These two things are independent (0+ / 0-)

        And I agree about the medical care.

        Point is, though: if guitar production was still in the USA, medical care would still be as unaffordable as it is today.

        Except that with the remaining dollars, you could buy even less.

        •  We have lower incomes now (5+ / 0-)

          I understand your argument: it says, "today we have lower incomes, but the bite is not as strong because things are so much cheaper."

          This, to a certain extent is right. But what the analysis fails to show is that, when globalization depresses your income, there can still be costs that are rising which make the savings from the cheaper articles meaningless.

          I can live without guitars, ipods, boom boxes, and the other cheaper goodies that are out there. Do having them make my life nicer? Yes, but not having them will not kill me, as it didn't kill the millions of humans that lived before there was a TV.

          When the cost of essentials needs, such as housing, education and medicine, rise  yet our incomes fall because globalization is reducing income for the ex or soon to be ex-middle class, the net result is slide into poverty.

          •  Agreed (0+ / 0-)

            I think we largely agree on what you are saying when it comes to the facts, and also when it comes to the pain. Some goods will always be domestically made - houses, for instance, and medical services, and consequently not get cheaper (and, incidentally, continue to create US jobs). In a way, that actually illustrates the point: imagine that the cost of all goods had kept pace with housing.

            And you are absolutely right that it does create a HUGE imbalance - and pain.

            In addition, though, my point, though (and if I understand him correctly, also bonddad's) is that

            1. Globalization is inevitable. That may not be what you (or me) like to hear, but there is no turning back on it.
            1. The consequences needn't be, with some fixes to policies.
            1. We've been through this before; this is not much different from the Industrial Revolution. And our standard of living DID increase back then. I think it will now, too.

            The one thing where I disagree with bonddad is that I don't think it needs to be a race to the bottom.

            BTW, just as background, I was a software developer for 20 years who has been through outsourcing, lost three jobs in two years. And, yes, it's painful. I'm still financially down, although finally on the road to recovery.

            •  I agree on the globalization issue (0+ / 0-)

              And you are right: it would have been worse with the cost of articles much higher as well.

              I do agree that there is a race to the bottom. That is the direction of the economic forces.

              But I also agree with you that doesn't have to be like this. Granted, we are going to lose something, maybe access to stuff, but we must make sure that the essentials are covered.

  •  Yuk (16+ / 0-)

    Economies are created by humans.  Globalization is not some act of god, it's created by humans.  You've simply set up a strawman of "those who want to stop globalization."  I don't know who that is and you haven't named anyone.

    What we need to do is use the current economic power that we have to push the successes that the West has made in labor, health, safety, environmental and wage standards on the rest of the world.  Achievable standards, and ones that increase.  It's really that simple.

    •  We've lost our street cred to push anything (3+ / 0-)

      on the rest of the world!

      Success is the child of audacity. --Disraeli

      by ChuyHChrist on Mon Apr 23, 2007 at 05:59:42 AM PDT

      [ Parent ]

      •  It wouldn't be George Bush (6+ / 0-)

        it would be John Edwards or Barack Obama and the world will once again look to the US as a light and leader if we return to our ideals.

      •  ever heard of buying power? (3+ / 0-)
        Recommended by:
        rick, cotterperson, jjellin

        The Chinese or Indians can't force us to buy their products.

        Looking for intelligent energy policy alternatives? Try here.

        by alizard on Mon Apr 23, 2007 at 06:10:47 AM PDT

        [ Parent ]

        •  The CEO of Wal-Mart would need to agree (1+ / 0-)
          Recommended by:
          onemadson

          to whatever cunning plan is being contemplated here.

          Success is the child of audacity. --Disraeli

          by ChuyHChrist on Mon Apr 23, 2007 at 06:13:58 AM PDT

          [ Parent ]

          •  The CEO of WalMart (10+ / 0-)

            Used to be Sam Walton. He had a strict 'buy US' policy for years.

            I remember we were trying to sell something to WalMart but we lost out because the label (the label!) would have been imported from Canada. This was only 11 years ago.

            When Sam died and the new guys took over, it was a very sad moment for the American manufacturer.

            If they didn't want a political circus, maybe they shouldn't have foisted Bozo the Clown on us as president. - Digby, March 18, 2007

            by Stranger in a strange land on Mon Apr 23, 2007 at 06:51:17 AM PDT

            [ Parent ]

            •  My wife's old company (10+ / 0-)

              My wife worked for a 100+ year old company in Massachusetts that had always had its own display in Wal-Marts across the country.

              However, even though they could make the products just as cheaply here in the US, Wal-Mart eventually forced them have their products made in China, as Wal-Mart wanted everything shipped through Guangzhou (Canton) - the massive port city in southern China.  So, they could pay to have the goods shipped to China from the US (where they would then go back to the US) or they could make the goods in China and send the goods to Wal-Mart China in Guangzhou where they could be packed into a container and shipped to the US.  (I would assume it's cheaper for WM to have everything packed onto their own ships)

              The first option was unrealistic, as it would have them go out of business because of the increased costs.  Or, if they passed the increased price onto the Borg, I mean Wal-Mart, WM would have dropped their business and the loss of revenue would have bankrupted the company.

              So, it was either move their manufacturing to China or go out of business in a year...  and, even though they moved the manufacturing to China, they still had to lay off all those people in the US who did do the manufacturing.

              I'm not a member of an organized political party, I'm a Democrat - Will Rogers

              by newjeffct on Mon Apr 23, 2007 at 07:36:39 AM PDT

              [ Parent ]

              •  I'd love to hear more about this (1+ / 0-)
                Recommended by:
                newjeffct

                having run a small business myself where i was selling a product into large chain stores (or,more accurately, trying to and failing) I understand how these companies want to minimize the variables in their distribution but this seems insane.   are there any articles about Guangzhou out there?

                •  Not sure exactly what you mean... (0+ / 0-)

                  But, I do remember reading an article a year or two back on how Guangzhou, as a port, was busier than all of the west coast of the US.

                  Wal-Mart is extremely demanding of everybody that does business with them - there is some sort of lengthy checklist that Wal-Mart has to qualify its vendors.  100% is mandatory - however, it is almost impossible for somebody to hit 100% on all the qualifications.  So, that is kind of held over your head the whole time you're working with them - they can threaten to fire you if you're not hitting 100%. Or, if you're at 95% or 98% or 92%, WM will force you to accept even lower prices for your goods.

                  And, because WM has a liberal return policy, they also asked for a 3% return allowance because that is the average amount of these goods that are returned.

                  I'm not a member of an organized political party, I'm a Democrat - Will Rogers

                  by newjeffct on Mon Apr 23, 2007 at 01:41:44 PM PDT

                  [ Parent ]

                  •  Guangzhou (0+ / 0-)

                    does every product that hits an american walmart shelf go through Guangzhou?   I'm assuming their groceries don't.  

                    I imagine they are tough negotiators.   Not many people can afford to lose the Walmart account.

                    It is funny, in hindsight, that I thought I might have a chance to sell my product directly to Walmart.   Some lessons are learned the hard way.  But I couldn't stomach corporate america anymore so I had to try something.    

              •  But I thought free trade was good? (0+ / 0-)

                Pass the Employee Free Choice Act!

                by PaulVA on Mon Apr 23, 2007 at 12:56:37 PM PDT

                [ Parent ]

              •  I decided a long time ago (2+ / 0-)
                Recommended by:
                newjeffct, lemming22

                that if I ever got a business to the point where WalMart wanted to be my customer, I'd just say no.

                IMO, it simply isn't worth it to have WalMart run my business. . . most likely into the ground.

                Better to sell to all of WalMart's competitors.

                Looking for intelligent energy policy alternatives? Try here.

                by alizard on Mon Apr 23, 2007 at 01:02:57 PM PDT

                [ Parent ]

        •  boycott? n/t (1+ / 0-)
          Recommended by:
          cotterperson
          •  what I actual favor is (4+ / 0-)

            "fair" trade agreements.which say "if products aren't built according to trade and environmental standards in this agreement, sell them to some other sucker".

            I think it's time for entrepreneurs who got rich by ignoring the CW to step up to the plate and start looking at building factories in North America again, at least in the lines of business that most favor this.

            For instance. . . imagine starting an automated computer keyboard factory next to an American plastics plant, using largely automated fulfillment (think Amazon) for the North American market.

            And we need to start leading instead of following on alternative energy... and building for the North American market.

            IMO, the future of manufacturing is regional, not Asia or India.

            Looking for intelligent energy policy alternatives? Try here.

            by alizard on Mon Apr 23, 2007 at 06:32:01 AM PDT

            [ Parent ]

  •  I didn't see anything about the place of (2+ / 0-)
    Recommended by:
    Thom K in LA, smkngman

    trade unions...
    additionally, high unemployment doesn't always mean that 5 cents a day is too high a differential if there are artificial forces keeping it low.  For instance very low levels of education/training in large portions of the population.  Once trained, the workforce becomes much more valuable then the average population.  Trade agreements that encourage worker based investmets, and worker enpowerments help increase wages and thus buying power in underdeveloped countries, otherwise we're just making the powerful more wealthy.

    •  Trade unions offer accountability (4+ / 0-)
      Recommended by:
      opinionated, PaulVA, dvx, bluewolverine

      One of my favorite roles when I was a chapter officer on campus for the Cal State University Employee Union was being able to ensure accountability by administrators.

      Imagine how having strong unions of professionals like accountants would help to ensure corporate accountability.  

      I have to disagree with Bonddad's analysis that Democratic approaches to ensuring a level playing field are impractical.  They are very practical when you put unions into the equation.  We can see that from the positive changes that happened in the first half of the 1900's when labor rescued capitalism.

      Since the second half of the last century we can see the decline of unions and the train wreck that the greed of capitalism is.  

      Think socialism: capitalism without the greed.

      Formerly of Los Angeles, now in the FL Panhandle(Lower Alabama) I blog at ThisIsWhatDemocracyLooksLike.com

      by Thom K in LA on Mon Apr 23, 2007 at 06:33:29 AM PDT

      [ Parent ]

  •  The Master Plan (10+ / 0-)

    Thanks for the diary.

    The master plan, it seems, is to move perhaps 40 million high-skill American jobs to other countries. U.S. workers have not been consulted.

    Princeton economist Alan Blinder predicts that these choice jobs could be lost in a mere decade or two. We speak of computer programming, bookkeeping, graphic design and other careers once thought firmly planted in American soil. For perspective, 40 million is more than twice the total number of people now employed in manufacturing.

    Blinder was taken aback when, sitting in at the business summit in Davos, Switzerland, he heard U.S. executives talk enthusiastically about all the professional jobs they could outsource to lower-wage countries. And he's a free trader.

    What America can do to stop this is unclear, but it certainly doesn't have to speed up the process through a government program. We refer to the H-1B visa program, which allows educated foreigners to work in the United States, usually for three years. Many in Congress want to nearly double the number of H-1B visas, to 115,000 a year.

    New threat to skilled U.S. workers

    •  I'm skilled labor and most of my work is overseas (1+ / 0-)
      Recommended by:
      berith

      This is the new reality.  We need to train workers who will be able to work globally, not locally.

      •  i consulted (2+ / 0-)
        Recommended by:
        rick, bluewolverine

        with a fortune 500 company doing search engine optimization.  My company also did some web design/development initially.  Then all the development work ended up going to South America.  Company policy.  

        It is amazing (to me) how quickly prices for web development came down from the late 90s to now.    For a while there it was a license to steal.  Now there really isn't that much money in it in the areas I have experience with.

      •  If only that would work out. (2+ / 0-)
        Recommended by:
        nasarius, lemming22

        When the company I used to work for was sending tech writing jobs overseas, I offered to move where the jobs were going. Response? "No."

        So I quit ahead of the huge purge and went back to college. $20k later I'm qualified for more types of work, but it would be at a lower pay scale. So, I'm back to tech writing again, hoping that my current company (that I love working for) keeps me around. If not, an alternate job at lower payscale.

      •  You have made this point twice now (2+ / 0-)
        Recommended by:
        nasarius, BobOak

        We need to train workers who will be able to work globally, not locally

        In this diary.

        Please enlighten us all and tell us - what the hell does this mean?

        <div style="font-size:10px;text-align:center;background-color:#ffd;color:#f33">If the terriers and bariffs are torn down, this economy will grow - G. Bush

        by superscalar on Mon Apr 23, 2007 at 08:56:53 AM PDT

        [ Parent ]

      •  uh huh (4+ / 0-)

        so you're saying the answer is to force workers to move around the globe per a corporation's whim?

        Now that will build up community and quality of life...I'm sure they can take care of their kids, their aging parents...even attend little league under those conditions.

        http://www.noslaves.com http://forum.noslaves.com

        by BobOak on Mon Apr 23, 2007 at 09:25:32 AM PDT

        [ Parent ]

      •  I helped move skilled labor jobs overseas (1+ / 0-)
        Recommended by:
        bluewolverine

        China pumps out more Phd's than we pump out college grads.  There is no retraining a 40 year old American Phd to a new technology, yet their wages are flat because they compete globally now.

        Labor rights are for everyone, not just the bolt-turners and broom-pushers.

        Please read my series on Labor, the GOP's #1 fear. Organized, we shall overcome!

        by try democracy on Mon Apr 23, 2007 at 10:39:51 AM PDT

        [ Parent ]

    •  I wonder what the pro-free traders (0+ / 0-)

      will think when it's their jobs that are sent overseas?

      Pass the Employee Free Choice Act!

      by PaulVA on Mon Apr 23, 2007 at 12:57:43 PM PDT

      [ Parent ]

  •  Bullshit, bonddad (19+ / 0-)

    You are beating a straw man. The global justice movement is not "anti-globalization"; we ARE a global movement.  

    We are against the unregulated flow of capital.

    We work with grass-roots social movements in the developing countries, and have done for a couple of decades now. They are the ones who tell us about the ravages of "free" trade in their lives, forests, and seacoasts.

    There is no reason to believe that more schooling will save the USA's economy. To be honest, the huge numbers of highly-educated immigrants driving cabs in the nations of the global North should have put that silly myth to bed along time ago.

    Love your housing market diaries, dude, I'm seeing a dose of snake oil in this one.

    Cuando a merda tiver valor, pobre nascera sem cu.

    by sayitaintso on Mon Apr 23, 2007 at 05:52:15 AM PDT

  •  I hope all the naysayers posting here only buy (7+ / 0-)

    American made products.  And I hope those American made products only include parts made in America.    That means your computer, I-pod, stereo, clothing, car, everything...

     

  •  What this shows (4+ / 0-)

    that the world has outrun our ability to understand it.  

    What this diary really means is this:
    We (economists) do not have a theory that would allow us to stop the inevitable decline in living standards for 90% of the population.

    So we will trot out the same tired prescriptions that we have been repeating since Clinton was President. None of these will really work.

    Here is the bottom line: we (Democrats) really don't have anything to say to the majority of Americans.  Oh, we can rant and rave about tax cuts, but income inequality is rising on a pre-tax bassis.  And sure, it would be good to get the deficit under control.

    But the FUNDEMENTAL TRUTH OF THIS DIARY IS THAT DEMOCRATS REALLY HAVE NO SOLUTIONS.

    •  all it really shows is (1+ / 0-)
      Recommended by:
      PaulVA

      that an expert is just like the rest of us outside his field of expertise, and if Bonddad has manufacturing expertise, it didn't make it into his diary.

      Looking for intelligent energy policy alternatives? Try here.

      by alizard on Mon Apr 23, 2007 at 06:14:22 AM PDT

      [ Parent ]

  •  Great subject to consider. (4+ / 0-)

    I hope you do follow ups on this issue. I agree with many of your premises: globalization is here to stay and that we are in a 50-100 year period of leveling off. I also very much want to see an increase in manufacturing in the US. I hope the alternative energy market will lead to more manufacturing, ie wind turbines.

  •  bonddad rocks? (1+ / 0-)
    Recommended by:
    cognitive dissonance

    We all know bonddad rocks when it comes to the numbers but who knew he actually rocked!!  

    Here is my plan.  I've yet to hear a good chinese rock and roll band (i'm sure they exist, but I haven't heard one yet).  So, time to pick up my guitar and play (just like yesterday?)  And while the Flaming Lips "Yoshimi Battles the Giant Pink Robots" was a concept album about a Japanese girl fighting robots, it was made by guys from Oklahoma.  

    rock on.

  •  I disagree with the first point (3+ / 0-)

    In other words, we are entering a period of decreased living standards that could last 50-100 years during which the developed world's standard of living decreases while the developing world's standard of living increases.

    While wages might decrease (to date the median wage has not decreased during times of expansion), the percentage of ones income that is disposable continues to increase because the prices are decreasing in relation to wages.  Electronics are the easy example, but even cars are cheaper (relatively speaking) today than they were 20 years ago.

    The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.

    by deathsinger on Mon Apr 23, 2007 at 06:03:04 AM PDT

  •  A rejoinder to the inevitability argument (11+ / 0-)

    If business execs that outsourcing the jobs were also taking the hit in their standard of living, people might be more inclined to view globalization as an inevitable equalization of global standards of living.  But the system is being gamed. The globalizing business class has cut corporations off from any allegiance to nation states and freed them from the demands of good corporate citizenship.  But impoverishment is not inevitable.  See the article on Alertnet about Ralph Gomory and his challenge to the high priests of globalization.

    •  But the system is being gamed. (5+ / 0-)

      You think?

      We cannot stop the globalization game but we do need to "win it" at least with respect to progressive values.

      This is spot on:

      The globalizing business class has cut corporations off from any allegiance to nation states and freed them from the demands of good corporate citizenship.

      And therefore progressive values must be global values.

    •  did I get snookered? (2+ / 0-)
      Recommended by:
      opinionated, PaulVA

      I wrote on April 13, The Emperor Has No Clothes in which I use the phrase Church of Free Trade plus talk about Gomory and Blinder.  Then, I have also written a huge analogy about Martin Luther walking up to the papal steps.

      William Greider is one of the great writers exposing truth on US economic and trade policy, but I find this to be very very strange.  I have to say something and am not casting accusations as of yet, maybe I ripped off the analogy and just don't remember.  I don't know but I find this too coincident.

      http://www.noslaves.com http://forum.noslaves.com

      by BobOak on Mon Apr 23, 2007 at 10:08:58 AM PDT

      [ Parent ]

      •  Church of Free Trade (1+ / 0-)
        Recommended by:
        PaulVA

        Well, I can't answer for Greider, but I googled "Church of Free Trade" and came up with 170,000 hits, many going back years.  Let's hope that it is actually a case of a meme growing into common understanding.  It's time to pull the curtain back on the free market wizards and expose their irrationality for all to see, and the more hands pulling the curtain, the better.

        •  asdf (1+ / 0-)
          Recommended by:
          PaulVA

          I just googled and I find just his and mine and references, even posted dated, to his article.  I found Thomas Frank wrote a book 7 years ago using this analogy, so I'm going to read it.

          Honestly I think the fact he is using this phrase, PLUS reviewing Gomory, which is my diary, I think something is fishy.

          http://www.noslaves.com http://forum.noslaves.com

          by BobOak on Mon Apr 23, 2007 at 11:01:47 AM PDT

          [ Parent ]

  •  Welding? (4+ / 0-)

    Give me a break. Certified welders in SW Va make 10-12 bucks an hour.

    •  Electricians? Machinists? (8+ / 0-)

      Get real.

      All these jobs will be done by immigrants, probably undocumented, in the next 20 years. They'll follow the drywall and siding installers and the carpenters. There's a reason all the signs in Lowe's and Home Depot are in English and Spanish.

      Construction used to pay well, back when it was union work. As soon as we finish breaking the Electricans and Machinists unions, the pay for those jobs will crash to the bottom, too. Doesn't matter how much skill it will take to do them.

      Point is, in this country, if you can't outsource the job, you in-source the labor. Either way, it's a race to the bottom.

      You measure a democracy by the freedom it gives its dissidents, not the freedom it gives its assimilated conformists. -- Abbie Hoffman

      by frostyinPA on Mon Apr 23, 2007 at 09:31:57 AM PDT

      [ Parent ]

      •  Laborers in the DC area (2+ / 0-)
        Recommended by:
        bluewolverine, lemming22

        Once made $18 an hour 20 years ago.  Today, they make $15 an hour while people doing the same work in nearby Cumberland, MD earn $25 an hour.

        The difference is that the employers used immigrant workers to break the back of the unins in the DC area while successfully turning both groups of native and immigrant workers against each other.

        Pass the Employee Free Choice Act!

        by PaulVA on Mon Apr 23, 2007 at 01:17:22 PM PDT

        [ Parent ]

      •  Electricians, journeyman? (0+ / 0-)

        13-15 bucks.
        Machinists the same. Considered great pay hereabouts.
        Mostly done by trained yet illiterate hillbillies. Of course, no unions, this being a "right to work" state.

        Most of the Mexicans around here work the Christmas Tree "Plantations". Or in the Mexican restaurants.

  •  You can't educate and dumb-down @ the same time (4+ / 0-)

    All the education will ruin decades of resistance to real education. It will ruin what the GOP has worked on for the past 30 years.

    The entrenched stupidity now demonstrated by America everyday would be at serious risk of dissipating should actual education be allowed to break out. Again.

    Then more people will vote; more people will make educated choices rather than running on a near-unconscious drive to aquire the latest shiney thing on the TV.

    No... this education and training idea is bad. and should not be allowed to occur.

    •  The political effects of education are global (0+ / 0-)

      ... and this is going to be one of the unintended consequences of nations attempting to remain competitive by investment in education. Casey Morris upthread talked about China's investment in engineers. But China, Russia, the Middle East nations, and other nondemocratic nations will not be able to educate their populations to maintain global competitiveness without at the same time raising the expectations of their populations for better living standards and for greater political self-determination. Undemocratic government is incompatible with global competitiveness, and ultimately these nations will have to choose between the political destabilization of failing to meet economic expectations and the political destabilization of failing to meet political expectations.

      "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

      by berith on Mon Apr 23, 2007 at 09:18:50 AM PDT

      [ Parent ]

  •  Hope versus Despair (7+ / 0-)

    I diary on this all the time.

    Here's to all the "we don't have any new ideas" people:

    I wrote a diary a year ago, citing the cautionary tale of the Greenland Viking civilization and why, despite every good reason to take a gander at how the Inuit did things, the Vikings simply could not, would not accommodate, and in fact made a point of alienating beyond distraction their (it's true) newer neighbors who, migrating from even colder, nastier climes, had a thing or two to teach the Vikes...but they wouldn't listen.


    I was comparing Jared Diamond's case study to the issue of peak oil, but recently I've perused a copy of Toynbee's Study of History, and realized that somewhere along the way, Diamond probably had a copy of the book, too.



    Okay, enough foreplay. Let's get to the nookie. :)

    We're running out of cheap energy, water, viable habitat, natural resources, and air. There are too many of us, all of us wanted more and more and more of both basics and luxuries, we want them affordably, and we want them immediately. Weaker individuals are willing to do violence to other persons over the crumbs. Powerful individuals are willing to do violence to entire civilizations to keep the cake to themselves.


    We insist on outmoded modes of existence, a cargo cult (another diamond from Diamond) that worships consumer totems such as big cars, hot clothes, the latest gadgets and as big a house in as fashionable a school district as we can afford. The retort is a fossilized one: "So, what's the matter with nice things?" Nothing, so long as they are in fact worthy goals that add value, as oppose to enfeud you to other people's cash flow in a condition of debtor-servitude. The counter: "What's good about making yourself poor?"



    Expensive energy leads to high transportation costs leading to a diminution of transcontinental, never mind global trade networks. Given that people have been trading luxuries across extreme distances for going on 10,000 years, using far more expensive (read: slower and more dangerous) modes of traffic, I do not anticipate a termination of commerce...but self-sufficiency (a polite way to say autarky or import-substituting development) will enjoy a renaissance.



    With reduced commerce will come reduced association, and more alienation and conflict between groups. This will not be exclusive to interstate and international relations, but a pattern of alienation that will percolate throughout all strata of society...and between them. Got class struggle troubles? Ethnic unrest? Sectarian strife? You ain't seen nothin' yet.



    Something often missed by the ecological karma crowd: The developed economies, the ones most dependent on important energy, will also be the very societies best situated to develop alternatives. Middle economies will be stuck belting it out over oil and coal and natural gas -- or doing without. Lower-tier economies will continue as before: Shut out of the global energy economy, they will convert as much timber and offal and dung into charcoal and desert wasteland as they possibly can, until the only thing left to eat and drink and burn for fuel is one another. Middle and upper-tier economies that either cannot or will not either (a) restructure their fossil fuel situation or (b) develop alternatives will join the lower tier in its race to the other, more terminal kind of oblivion.



    And this is the tragedy -- there is so much energy on Earth it's just plain pitiful that lack of same may precipitate both an economic and ecological collapse (see: desert-making, biomass-destroying hordes above). And why a problem: The ignorant kind of oblivion: People either incapable of seeing or refusing to acknowledge that there sure is a lot of sun and wind on this planet, and perhaps somebody ought to consider building a panel or windmill farm or two, to take advantage of that several thousand Terawatts of energy we get for free every day.



    Why refuse the obvious? Cultural bias. The dominant mode in the dominant (Americentric) global culture is a contempt for all things...hippy. What could a bunch of pot-smoking, peace-outing, God-hating, free-loving counterculture freaks teach real Amurricans about a complex civilization and how to save it? Why, just about everything you need, thanks for asking. But that's just it. The people who need to know are not only not asking -- They're doing their utmost to eliminate from the discussion the very people who have something constructive to say.



    As for the simple things: Suggesting that one cut back on consumption is received as if someone floated the idea that we trade American daughters for Saudi petroleum upon their reaching puberty. No, strike that: The idea of conservation is treated worse, on account human traffic (slavery) in and around the Middle East actually occurs. Why the hostility to saving? Because spending creates growth and the current global culture has, a, er, growth fetish. Very manly...or insecure. No, both.



    So what's going to happen if we refuse to cut back on energy, or accept the advice to come up with alternative energy production? Why, we'll import even more oil and coal, of course! And since we need to keep growing, we'll drive SUVs and buy McMansions and even when we see this is patently bad medicine, we'll keep popping the high-consumption pills, regardless. Anything and everything to keep the music playing. And once imports start drying up, we'll convert coal, then oil shale, then all our plastics to oil.



    To keep spending on new big-ticket consumer items going, we'll skimp on maintenance of, well, everything else. Use of energy for food, schools, hospitals, even heating will be taxed, rationed or just plain banned. Anything to keep the cars running, and America's economy growing on the backs of home industry!



    At this point, someone might remark that there sure are a lot of cold, sick, shivvering people in America these days...but the have-energy people will be calling the shots. To second-guess them is to become one of the have-no-energy multitude. This is not an Emperor's New Clothes moment; people who criticize will be given new clothes and kicked to the curb. And it's cold out in the cold.



    As mentioned above, the coal, the oil shale, the plastics will be scavenged for conversion to fuel. Forgot to add one: vegetable oil. Oh, you didn't think people were going to get to eat, did you? Anything to provide energy for the benefit of the energy-haves, handed over to them for a few crumbs and some cargo cult totems to the homegrown coolies...that's most of us.



    Juxtapose this sad, sordid decline against the parallel trend -- post-contemporary societies, with advanced technology, abundant alternative energy, with a focus on energy as the unit of value as opposed to a fiat currency. Societies that remain communicative, and save, and create ideas and energy and values, rather than eat into the obsolescent culture's seedcorn to preserve the practices but not the ideals of the older culture.



    New energy, new economics, new societies are on the move. They will be the threat that breaks the back of the cargo culture. And they will be fought off with a ferocity that what currently transpires in the Middle East will not even hold a candle to -- for the very basis of the declining civilization will be condemned and sentenced to capital punishment by the existence, then success of the new paradigm.



    As a result, wars will occur, small tiffs, then threats and occasions for full-scale conflict -- missile exchanges are a real possibility. And yet again, the new civilization will be vastly more capable than the old to absorb such terrific punishment and prevail. For this reason, such threats, even making good on same, will be done in a desultory fashion, as we have seen when the last superpower, the USSR, checked out for keeps.



    "So Whaddya Saying?"



    There is no reason that the United States, as a government and as a society, cannot remarry itself to reality, rather than remain divorced from it. However, not all Americans will do anything of the sort; what we see in the ongoing (cough, choke, yack) debate on global warming is that some people will rather die, and send others to die, rather than acknowledge error, accept a new paradigm, or tolerate others doing so.



    Regardless, sooner or later all Americans will have to face the consequences of deferring -- thirty years so far -- the moment when it simply will not be affordable for the average U.S. resident (maybe we'll still be citizens) to travel by car to shop, to afford the goods that are available, to visit friends and family, or (since the electricity comes from the same source) communicate often via phone or internet. So sorry. Snail mail will be expensive, too.



    And if you think the job drain is bad now, just you wait and see what happens when investors must choose between developed economies with working public transportation infrastructure (and therefore, less exposure to the pinch of expensive energy) and a post-developed America which cannot even afford to maintain its once-glorious interstate highway system.



    This is not hyperbole. There will be no magic bullet that cures the petroleum economy, not so long as so many remain addicted to it, both for their comfort and their self-identity, and an entrenched elite requires that nothing change, in order to continue their profit and their power...except that which must change to continue said profit and power a little while longer.

    M-O-O-N! That spells Iran!

    by cskendrick on Mon Apr 23, 2007 at 06:27:26 AM PDT

    •  Cargo cults... (0+ / 0-)

      ...date from WWII, but Diamond makes good use of the meme. I'm stuck in the MI-complex and I see cargo-cult development and management everyday. Our tiny group of hardware engineers is the diaper-changing station for the entire company.

      Welcome to the New AND Improved World Order! Now with 110% MORE One World Government!

      by bluewolverine on Mon Apr 23, 2007 at 06:25:25 PM PDT

      [ Parent ]

  •  Hooray, we're saved! (13+ / 0-)

    Skilled jobs have increased 37% since the 80's!  After population growth, that makes up for at least two or three factories that have shut down.  

    Thanks for the standard lame recommendations, though.  Adult retraining for non-existent jobs; sink money in wonder industries where the manufacturing is being off-shored as we speak; you got them all.

  •  R&D and something else you left out... (5+ / 0-)

    The rest of the world, oddly enough, or at least most of it, still can't do basic R&D like we can.

    This too, will probably eventually change, but take it from me, the rest of the world still by and large can't ask the Big Questions, and therefore can't get the Big Payoff that comes from the Big Answers.

    I'll give you one idea: In 1968 a man named David Forney had published a paper entitled "Exponential Error Bounds for Erasure, List, and Decision Feedback Schemes" in the IEEE Transactions on Information Theory.

    That paper made the internet possible, as well as the wireless LAN, although 99.99% of all folks working in the area never heard of the paper.

    Of course, with too much bottom line, quarter to quarter emphasis, basic research has suffered. But we need more of it.

    There's one other thing you left out which generalizes the above: there are just some things that ought to be made here, because it can only be made here for this market.  Slow food.  Basic R&D. Other things too.

    "It's better to realize you're a swan than to live life as a disgruntled duck."

    by Mumon on Mon Apr 23, 2007 at 06:28:28 AM PDT

    •  that's why Japan (2+ / 0-)
      Recommended by:
      bluewolverine, BobOak

      based its R&D shops for the US market in . . . the USA.

      Looking for intelligent energy policy alternatives? Try here.

      by alizard on Mon Apr 23, 2007 at 06:35:03 AM PDT

      [ Parent ]

      •  Yep. (1+ / 0-)
        Recommended by:
        alizard

        Although oddly enough, and I can speak from personal experience, looking at several companies, their results have been a mixed bag.

        Sometimes they get a home run, sometimes they're funding junk.

        Ultimately it seems many of them have a problem with even asking about asking about the Big Questions.

        "It's better to realize you're a swan than to live life as a disgruntled duck."

        by Mumon on Mon Apr 23, 2007 at 06:38:16 AM PDT

        [ Parent ]

    •  That was forty years ago (2+ / 0-)
      Recommended by:
      cognitive dissonance, PaulVA

      and, I'm sorry, but one example of innovation then has no relevance to what's happening in today's America. Something published in the last five years or so would better support the argument.

      - What happens on DailyKos, stays on Google. - 11/7 changed everything.

      by Jon Meltzer on Mon Apr 23, 2007 at 06:36:57 AM PDT

      [ Parent ]

      •  But it's true today too. (0+ / 0-)

        Nanotech is one area. Basic R&D in communication systems is indeed another.

        Something published in the last 5 years or so will make its impact twenty years from now.

        "It's better to realize you're a swan than to live life as a disgruntled duck."

        by Mumon on Mon Apr 23, 2007 at 06:39:53 AM PDT

        [ Parent ]

        •  Oh, yes, I agree. R&D is great. (0+ / 0-)

          But is America still truly a leader in R&D? Is there R&D at American corporations to a degree even near what there was forty years ago?

          Those questions need to be answered.

          - What happens on DailyKos, stays on Google. - 11/7 changed everything.

          by Jon Meltzer on Mon Apr 23, 2007 at 06:51:28 AM PDT

          [ Parent ]

          •  Nope... (0+ / 0-)

            ...corporate R&D is all but dead in America. I also disagree with the idea that America still has a lead in basic research.

            Go read some IEEE and Physical Review papers from the last 5 years. There are tons of papers originating from Europe, India, and China. One of the best I've ever seen was singlehandedly written by a professor from Shanghai.

            Welcome to the New AND Improved World Order! Now with 110% MORE One World Government!

            by bluewolverine on Mon Apr 23, 2007 at 06:58:43 PM PDT

            [ Parent ]

      •  I recommend to you (0+ / 0-)

        that you find out what American high-tech startup projects VCs are currently (NOT 40 years ago) funding in America.

        Looking for intelligent energy policy alternatives? Try here.

        by alizard on Mon Apr 23, 2007 at 07:00:47 AM PDT

        [ Parent ]

        •  By the time it gets to the VCs (0+ / 0-)

          it's about 10 years down the pike already, at least in electronics & communication.

          And I know that because, yes, I do have an idea what VCs are currently funding.

          There are some more forward-looking things VCs are currently funding, in particular carbon nanotubes, but in my field, the VCs don't get to it 'till it's 10 years old.

          At. Least.

          "It's better to realize you're a swan than to live life as a disgruntled duck."

          by Mumon on Mon Apr 23, 2007 at 07:24:17 AM PDT

          [ Parent ]

          •  tell me about it. . . (0+ / 0-)

            I'm looking for investors right now for my own high-tech startup.

            However, the point I was trying to make is that R&D is still going on in the USA.

            Looking for intelligent energy policy alternatives? Try here.

            by alizard on Mon Apr 23, 2007 at 12:47:17 PM PDT

            [ Parent ]

    •  Sorry, but Claude Shannon made... (0+ / 0-)

      ...the Internet possible years before Forney in his seminal 1948 paper, "A Mathematical Theory of Communication".

      Welcome to the New AND Improved World Order! Now with 110% MORE One World Government!

      by bluewolverine on Mon Apr 23, 2007 at 06:55:43 PM PDT

      [ Parent ]

  •  CEO salaries? (10+ / 0-)

    I have done an awful lot of thinking and research on the effects of increased trade and the "race to the bottom"

    If the problem was globalization, why haven't CEO salaries raced to the bottom like everyone else's?

    Poster child for the "If I'm so Smart, Why Ain't I Rich" Syndrome.

    by Judge Moonbox on Mon Apr 23, 2007 at 06:32:49 AM PDT

  •  sorry (6+ / 0-)

    I always enjoy your posts Bondad, and usually learn a great deal from them but I think you have ignored the elephant in the living room, (or the crazy aunt in the attic) and that is oil.
    It simply will not make any kind of sense to be shipping raw materials all over the world, so that various sub assemblies, made in 6 different countries can come together in China and be shipped to the US when oil prices start reflecting the reality of Peak Oil.
    I am afraid I do agree with your conclusion that standards of living, especially here in the US are headed for a long term decline, but that's because we are going to be forcibly weaned from the cheap oil our economy has been feeding on for the last 100 years or so.
    Our current way of living will have to change dramamtically, shifting away from long distance shipping and towards more diversified, local manufacturing again.
    Goodbye to cheap off season vegetables from Mexico, goodbye to absurdly inexpensive electronic gadgets from China, etc. Our future will require more local goods and foods, and less travel for both goods and people, and many many people will have their lives utterly disrupted until we settle into a new model that isn't dependant on ultra cheap transportation, or until we figure out another way to provide that ultra cheap transport.
    I don't see either happening real soon.

    •  Agreed! Too often economist overlook the limits.. (3+ / 0-)

      externalities place on reality. Net energy adheres to the laws of physics, not free markets.

    •  You are ignoring (2+ / 0-)
      Recommended by:
      berith, ChuyHChrist

      the increasing role of services in the globalized economy. They can be provided over the internet without heavy demands on energy resources. A dramatic rise in the cost of energy would not bring glbalization and its impact on the American economy to a screeching halt.

      •  Yes (0+ / 0-)

        I really think the service economy is utterly dependant upon the underlying assumption of cheap transport for goods.
        A company in Vt, that manufactures it's product with local workers, and gets it's raw materials and sub assemblies from other nearby companies is not going to hire a phone bank in India to do it's customer service.
        When you take overseas manufacturing out of the equation, Globalization shrinks to insignifigance.
        None of this will come "screeching" to a halt. It will be slow and laborious and painful and ugly, with people denying it every step of the way, but I stand by my main argument.
        Our economy is founded directly upon the assumption of cheap reliable transportation of goods and materials and people, and unless we develop new ways to provide that cheap transport, we will be forced into a new economic model whether we like it or not.

        •  There is a large (1+ / 0-)
          Recommended by:
          ChuyHChrist

          of services being provided over the internet that have no connection to manufacturing at all. Examples include financial services, legal services, medical technology, information technology etc. The internet is the model that is being developed. This is the 21st century not the 19th.

          •  I have a calendar (0+ / 0-)

            I still believe that when the manufacturing sector takes a big hit, financial services, leagal services, and many IT jobs will be deeply hurt as well.
            People still have to eat and be able to have jobs. If modern agriculture, which is also extremely dependent on cheap transportation finds it can no longer deliver food as cheaply as we have come to expect, and you can't afford to commute to work
            (and lets be honest only a small minority of jobs are amenable to telecommuting) and you can't afford to buy many non-critical goods we are going to find the economy making a lot of steps back towards the 19th century.
            The internet will still be here, and there will undoubtedly be people who still make a living from it, but it will not be enough to prevent large scale dislocations and disruptions that affect millions upon millions of people.
            The information economy is not trivial, but compared to the number of jobs that will be lost it's not enough to save us either.

  •  Globalization will die as cheap energy disappears (6+ / 0-)

    I've been following energy issues very closely and I'm personally convinced that we are, for all practical purposes, at global peak oil production right now.  Global oil production has plateued since late 2005 and once it begins to slide, all bets are off.  It is quite possible that the amount of oil available for global export will decline by 50% over the next decade, and the USA needs to import 2/3 of its petroleum supply.  

    Could shipping cheap stuff from Asia survive if oil goes up to $300/barrel or more - if you can even get supply?? What will happen to the American economy and related international petro-dollar based financial systems that underwrite globalization?  

    Globalization will not survive as the age of oil draws to a close, IMHO.  We'll be too busy dealing with a long, steady, insidious energy crisis to worry about plastic shit made in China for our Happy Meals.  There will come a time when that concern will seem so very quaint.  

    The solution: go into a WWII-style national effort into carbon-neutral energy production and transportation systems.  That's the future and we can use it to economic advantage if we get in front of it rather than trying to protect the old oil-based system, which America rode to the top over the past 100 years, with self-defeating tools such as war, international subversion and subterfuge.

    The intrinsic nature of Power is such that those who seek it most are least qualified to wield it.

    by mojo workin on Mon Apr 23, 2007 at 06:38:08 AM PDT

  •  This diary is total bullshit! (9+ / 0-)

    I'm sorry, but I don't agree at all with the idea that we should concede and allow the current race to the bottom to continue without a fight.

    Globalization must either be stopped in its tracks, or else we must require that if it does continue that it becomes a force for good in the world rather than a race to the bottom that takes us all into the abyss.  The bottom line is that we demand that the nations we trade with actually pay their workers something other than slave wages.  There is no "middle ground" on this issue for me.  We must restore the American middle class for it is what made this nation great.  We need fair trade, not free trade.  We should trade only with countries that protect their workers with comparable labor laws.  We should also slap corporations like WalMart, who buy all of these cheap goods produced by slave labor, with huge penalties that force them to either start buy American or go out of business.  There is nothing that prevents us from doing this other than the corporations that are exploiting slave laborers in the third world.  This argument that globalization is "inevitable" is just as ridiculous as the arguments used by right wing wackos who always predict a huge increase in unemployment anytime an increase in the minimum wage is discussed.  It's the same argument used by right wing wackos against any type of new regulations on industry whether they be safety, environment, or economic in nature.  It's simply not true.  We can control our own economic destiny, and we must again do so.  This is one area where I am staunchly patriotic.  We must all show pride in our nation by buying American.

    However, I also want to call bullshit on the argument that developing countries are "incapable" of treating their workers fairly.  Sure they can.  What we must do is demand that international corporations treat workers around the world fairly.  We must expand the labor movement worldwide.  Workers in these developing countries must be allowed to band together to demand more rights and better paying jobs.  If goverments don't allow their workers to collectively bargain and go on strike, then we impose economic sanctions on that nation until their despotic leader compies with our demands.  If an internation corporation is treating workers in another nation poorly by paying them slave wages and/or forbidding them to unionize, then we forbid that corporation, it's parent corporation, and it's subsidiaries from doing any business in this nation.  I think that we still have enough economic clout as a nation to pull this off.  The only problem is that currently corporations are given more rights than human beings(corporate personhood must be abolished as Thom Hartman suggests), and our politicians (including all too many democrats) are bought off by coporate lobbyists.  We must dethrone these corporations and bring the power back to the people.

    As far as the argument that we can simply "retrain" in order to deal with the "inevitable globalization" of our world, I would point to the fact that many of the newly outsourced jobs are in fact high tech jobs, where people actually spent many years of their lives beyond high school developing a skill that no longer affords them the opportunity to make a living due to globalization.

    Finally, I actually believe that the term "globalization," which is frequently used to describe the rapid takeover of our entire planet by an elite few transnational corporations, is actually a misnomer.  Globalization suggests that all the nations of the world are coming together to work toward a common good, but what is currently happening is that a few transnational corporations are exploiting us all in order to maximize the wealth of a very elite few while maximizing the misery of everyone else.  These transnational corporations are essentially trying to enslave the world, and we can't let them do it.  So with all due respect bonddad, I couldn't disagree with you more on this issue!!

    •  Demand that workers be treated fairly? (3+ / 0-)
      Recommended by:
      berith, gatorcog, ChuyHChrist

      The US demands this?  

      How is this supposed to work, realistically?

      Imposing sanctions on developing countries hurts the very people you seek to protect.  Not that the US, currently engaging in torture, would be anything other than laughed at for even mouthing the words, "human rights".

      You seek to leverage something that the US does not currenly have--higher moral ground.

      DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

      by Casey Morris on Mon Apr 23, 2007 at 06:58:52 AM PDT

      [ Parent ]

      •  You are talking about two different things. (0+ / 0-)

        Yes I too am appalled by our secret prisons and the torture carried out at these prisons.  However, quite frankly that has nothing to do with labor law.  U.S. labor law is certainly not perfect, but thanks to FDR and other Democrats who followed, we do at least afford our workers certain protections that are not afforded to workers in third world nations.

        As far as the argument that we are hurting those you seek to protect, this sounds like a typical right wing argument any time one talks about economic regulations on the free market.  The typical right wing argument against any economic regulations (be it minimum wage, safety regulations, environmental regulations, ect., ect.) is that by imposing these regulations you will hurt big business who will lay off more workers and increase unemployment.  This argument is total bullshit as has been demonstrated time and time again.  Our middle class came into being because enough people finally stopped listening to this typical rightwing, laizzez faire bullshit and decided to make things a little better for the average working man and woman.

        •  Your response to my... (0+ / 0-)

          pointing out that imposing sanction hurts the people you try to protect as rightwing smack of kneejerk crap.

          I am not talking about US labor laws.  I am talking about trying to impose trade sanctions on foreign nations.  Completely different.

          In order to impose trade sanctions, one has to actually have something to leverage, which would be what?  What is the US in control of that it could leverage against China?  That's the substantive question that needs to be answered.

          Then, there is also the issue of trade agreements and ratification.

          My point is not that something shouldn't or can't be done.  My point is what, by whom, and how?

          And our middle class came into being because rich people used to have a conscience and a sense of duty, and also because we had the GI Bill.  Which was essentially a parallel point that Bonddad was making.  After WWII, for example, our economy changed.  It had to.  And what made that transition possible in large part, was the GI Bill.  Where's today's GI Bill?  Where's today race to the moon?  Where are today's exciting moral challenges set forth by the leaders of a nation?

          And please don't accuse me of rightwing argument where not exists.  THAT is real bullshit. You know, I love good debate here at Kos, but let's be clear here--you are not my enemy and I am not yours.  We are both people who seek to improve both the definition of the questions and the formation and implementation of solutions that seek to bring relief without additional damage.  Would it kill you to adopt a tone of, say, a little fuckin' courtesy?

          :)

          DISCLOSURE: After being a supporter and volunteer for John Kerry for years, I now work for John Kerry's PAC.

          by Casey Morris on Mon Apr 23, 2007 at 12:46:02 PM PDT

          [ Parent ]

          •  What are we in control of? (1+ / 0-)
            Recommended by:
            bluewolverine

            We are the ones who consume the cheap products that they produce with slave labor.  Without our consumptions, their demand for goods and services goes down considerably.  We don't have to allow consumption of these cheap products.  There is nothing to stop us from placing tarrifs on Chinese goods that make it impossible for them to sell their products in stores here in the U.S.  We can certainly use our buying power as leverage to demand that they begin paying their workers better before we agree to reduce our tarriffs and allowing their goods to be sold on store shelfs in our country.

            I am sorry for using the word BS, but I have to admit that I get emotional when people start attacking our educational system and using it as a scapegoat for all of our societal problems, which one of the other posters did upthread.  My wife is a school teacher in an inner city school, and she does well with what she has to deal with, but she can not help the fact that many of her students get absolutely no help at home with their homework or with subjects in which they may be struggling due to the fact that their parents work 2 or three minimum wage jobs just to make ends meet.  That has nothing to do with our educational system, but it is instead a problem with greed at its root.  Yet, the GOP would have you believe that school teachers are to blame for all of our societal ills, when nothing is further from the truth.

          •  By the way, I still disagree about the reason the (0+ / 0-)

            middle class came to be.  I don't think it had anything to do with "rich people having a conscience."  I do think that it has everything to do with labor laws that granted working class people the right to organize.

    •  You Ignore Demographics (2+ / 0-)
      Recommended by:
      berith, ChuyHChrist
      Either we find a way to help the less-developed nations improve their standard of living or their youth will be joining a local terrorist cell and coming after us simply because they have no hope otherwise. The US makes up 5% of the world's population and uses 20% of the world's resources. The US needs globalization where we produce ideas and products which reduce the average ecological footprint while letting the developing countries grow and produce jobs for their people. Selling the cheap stuff to us is the easiest way to accomplish the latter goal.

      Burying your head in the sand and preventing the developing world from creating the jobs they need is not an option. It is a recipe for disaster. Some huge percentage of the developing world's population is under the age of 25. If we don't provide them with hope that they will have a better life, they will come after us.

      -- You are all individuals! -- I'm not! -- Shut up! Be quiet!

      by Skjellifetti on Mon Apr 23, 2007 at 07:08:21 AM PDT

      [ Parent ]

      •  I'm fine with them having jobs so long as they (0+ / 0-)

        aren't being paid slave wages.  We need to reinvigorate our labor movement, and then we need to take the labor movement international.  Also we need to say NO to the transnational corporations that want to enslave all of us by taking us down this path toward a race to the bottom while CEO salaries continue to escalate.  We can do all of these things, but it won't be easy.

        But I believe that many on this board including this diarist are "burying their heads in the sand" by failing to recognize that transnational corporations are exploiting the desperation of starving people in third world countries by "offering them the 'opportunity'" to work at slave wages along with their children.

        This argument about not doing business with countries who refuse to protect their workers is akin to the Bush administration's argument about cutting off funding for our troops.  It's pure folly.

        •  What might qualify (1+ / 0-)
          Recommended by:
          berith

          as slave wages in the US or Europe is not necessarily slave wages in other places. The issue is not how the compare in absolute terms but what you can buy with them.

        •  Wage Rates Are Rising (0+ / 0-)

          The coastal areas of China are already experiencing labor shortages. This is driving up wages exactly as econ 101 predicts. Same thing is happening in India where there is a shortage of qualified programmers. China has a 10% growth rate which implies that China's GDP will double approx. every 7 years. 50 years ago, Korea and Taiwan were not much different from China and India. Today, they are nearly fully developed with a large middle class. China will match that in about a 30 year generation. What we are witnessing (and promoting through globalization) is an explosion in the growth of these economies. This is a GoodThing. Let's make everyone rich instead of trying to hoard it all ourselves.

          I've been working as a programmer and software architect for the past 12 years or so. If any profession should be terrified of globalization based on third-world competition (especially after the 2000/1 dot bomb collapse), its mine. But my wages have tripled in the past 12 years putting me in about the top 10% of US per household income levels. I get about one phone call a week asking if I'm available. And most of my skills are self-taught. My formal degrees are in Economics. If I can compete on a global level, anyone can.

          -- You are all individuals! -- I'm not! -- Shut up! Be quiet!

          by Skjellifetti on Mon Apr 23, 2007 at 10:37:34 AM PDT

          [ Parent ]

          •  Nope, not everyone can! (0+ / 0-)

            Your assumption that anyone can compete on a global level is just plain wrong.  Not everyone is cut out for college or high tech jobs.  Some folks simply don't have the know how to work as an engineer or a high tech computer expert.  Instead they end up working a dead end job in the service sector, due to the fact that all of our manufacturing jobs are being outsourced to cheap labor abroad.  These folks deserve to make a descent living so that they and their spouse don't have to work 2 or three jobs just to make ends meet!!

    •  Developing countries governments (0+ / 0-)

      are often incapable of enforcing any laws due to corruption and greasing the skids.  In India the government mainly functions on the payola principle; payoffs are what gets things done.  This situation has to change before a government can be counted on the enforce worker-rights laws.

      It is the mark of an educated mind to be able to entertain a thought without accepting it - Aristotle

      by gatorcog on Mon Apr 23, 2007 at 09:26:32 AM PDT

      [ Parent ]

      •  That sounds like how our government works too. (1+ / 0-)
        Recommended by:
        bluewolverine

        Maybe the payoffs are done a little bit more discreetly through "campaign contributions," which don't buy votes but instead allow you to have "access" to the Congressman, but the same shit happens here too.  We definitely need to do some housecleaning of our governments worldwide, but that shouldn't mean that we simply give up and submit to the notion that wages are going to fall because transnational corporations are buying up everything and purposely widening the gap between the haves and the have nots.  We should fight the bastards.  We shouldn't concede anything.

  •  Investments in small business (5+ / 0-)

    I remember hearing Governor Dean talk about the need for small business investment during the presidential primary in 2004.  It's one of those areas I hadn't really thought about that makes perfect sense once you hear it.

    Right now we put a lot of tax investment into large corporations.  They get tax breaks and all sorts of pork that help them grow.  But big corporations are also the same entities that are moving jobs overseas.

    So why don't we move all of the money we're putting into large corporations into small businesses?  Small businesses keep jobs in America and in our communities.

    Formerly of Los Angeles, now in the FL Panhandle(Lower Alabama) I blog at ThisIsWhatDemocracyLooksLike.com

    by Thom K in LA on Mon Apr 23, 2007 at 06:39:17 AM PDT

  •  Climat change and the disruptions (2+ / 0-)
    Recommended by:
    jps, a gnostic

    that will accompany it is going to put paid to all this blather about a global economy.  Everyone's livings standards are going to go down,  and many people will die.

  •  100% inspection of imports (0+ / 0-)

    One way to partially solve the problem of accountability is to insure that all products entering our country are safe.

    The need for this is more apparent than ever as we can see from the tainted food products that have been sent in from China.  If we had 100% testing of products that would force countries that trade with us to enact more stringent controls on production than they currently have.  

    Formerly of Los Angeles, now in the FL Panhandle(Lower Alabama) I blog at ThisIsWhatDemocracyLooksLike.com

    by Thom K in LA on Mon Apr 23, 2007 at 06:44:33 AM PDT

    •  This is not correct - on many levels (0+ / 0-)

      First: There is absolutely no scientific or statistical reason to do 100% inspection for the vast majority of products. Intelligently designed random sampling schemes are just as accurate (within a very small margin of error) and massively cheaper to implement. This is especially true if the goal of the inspection is deterrance rather than discovery.

      There is one exception. Very rarely, it is rational to be afraid that if even one flawed item slipped through accidentally, it would cause tremendous damage. An example might be safety equipment for a nuclear reactor or electronic components for electronic assembly. In that case, you would have to do not only 100% inspection, but you would want to automate it if you could and then do multiple passes of 100% inspection. Fortunately, situations that meet this criteria represent a tiny fraction of all inspection situations.

      Second: All of the efforts on quality management for the past 30 years have been designed to remove the need for inspection at receipt and increase the quality of the product at the source. That method has been proven over and over again to be faster, cheaper, and vastly more reliable.

      Third: There is no physical space in or near our ports to do anything like high percentage inspections. The resulting delays would cripple our ability to conduct international trade.

      Bottom line: 100% inspection is a terrible idea and would set back American quality management practices at least 50 years. This is my professional field and any other solution is a hell of a lot better than 100% inspection.

      -2.38 -4.87: Maturity - Doing what you know is right even though you were told to do it.

      by grapes on Mon Apr 23, 2007 at 09:55:03 AM PDT

      [ Parent ]

  •  Bonddad please read (2+ / 0-)

    I am aware of the fact there are people who pay attention to what I do and say, but I try to avoid customizing my behavior for them. -Ian MacKaye

    by waitingforvizzini on Mon Apr 23, 2007 at 06:46:40 AM PDT

  •  We could stop undermining 3rd world economies (5+ / 0-)

    Latin America is finally breaking free from the crippling US 'advice' and is finally experiencing real growth.

    If US foreign policy were to build up our competitors instead of trying to keep them groveling & underdeveloped, this wouldn't be as much a problem.

  •  bondad, you missed a great diary yesterday (0+ / 0-)

    http://www.dailykos.com/...

    this is a must read

  •  your guitar comment is wrong (1+ / 0-)
    Recommended by:
    Joe Bob

    all of the guitars are made in Asia, particularly China

    not quite - check out prsguitars.com.  The SE models are all well under a thousand bucks and made in the USA with mahogony and maple.  
    Asian made guitars are all shit because they are all made with crap woods.  Crap wood = crap tone.  

    Sorry to nitpick on such a minor point, but as a die-hard PRS fan...

    "I can't take his money, I can't print my own money, I have to work for money. Well, why don't I just roll over and die!" - Homer S.

    by woobie on Mon Apr 23, 2007 at 06:52:51 AM PDT

    •  PRS (0+ / 0-)

      I have a PRS CE-24. Beautiful guitar.

      Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. - Groucho Marx

      by Joe Bob on Mon Apr 23, 2007 at 08:48:44 AM PDT

      [ Parent ]

      •  nice (1+ / 0-)
        Recommended by:
        Joe Bob

        that's the same one I have.  Got it about 12 years ago when they were making everything at the "old factory".  Beautiful guitar indeed.  Only problem is when I want another guitar I know it will have to be a PRS.  McCarty, hollowbody, artist series?  So many expensive choices.

        "I can't take his money, I can't print my own money, I have to work for money. Well, why don't I just roll over and die!" - Homer S.

        by woobie on Mon Apr 23, 2007 at 01:14:51 PM PDT

        [ Parent ]

  •  Bondad, what is needed is (2+ / 0-)

    a frontier - someplace for those who want to start over.  That is what has been needed.  When you have that, we aren't faced with the restricted resources that we see today.  

    The idea that wealth is a limited resource is a mistake - its only limited IF we maintain that all resources are limited, which is only true if we limit our living on Earth.  Ive mentioned this on many responses, about colonizing space.

    I am curious as to your take on the possiblity that space colonization can deal with the issues raised by globalization.

  •  Corporate profits and the cost of globalization (5+ / 0-)

    So developing countries need infrastructure? Why should I pay for it out of my salary? Why should labor anywhere pay for it when CEOs are making 10s or 100s of millions a year and corporate profits are at record highs?

    Basically you're arguing that corporations have no responsibility for the world they live in. Their only job is to maximize profits and the hell with the rest of us.

    Corporations need to carry their fair share of the load. If they won't pay for the infrastructure, etc., themselves, then they can pay taxes. You don't have to get it all out of labor.

    Molly Ivins wanted WHO for President? But WHY?

    by Positronicus on Mon Apr 23, 2007 at 06:59:45 AM PDT

  •  There's a great companion piece on John Edwards (0+ / 0-)

    Why John Edwards is wrong on trade

    If you get a chance, see my comments where I argue points similar to bonddad's -- and in fact called for a "bonddadesque" diary on trade.

    I don't think we are completely helpless in reforming other countries, however. We have mucho purchasing power to leverage, as a government and as individuals. What consumers need is better information, and what the country needs isn't "free trade" or "fair trade" but SMART TRADE where the endgame isn't just getting corporations sources of cheap, exploited labor and unregulated production.

    But I agree with bonddad -- we lived high on the hog for a generation, but that's because the rest of the world hadn't caught up, or it's manufacturing base had been destroyed by war. Now, that base is fully rebuilt and the rest of the world is catching up.

    "With great power comes great responsibility." -- Stan Lee

    by N0MAN1968 on Mon Apr 23, 2007 at 07:01:11 AM PDT

  •  Globalization flies in the face of "buying local" (3+ / 0-)

    so with the environment going to shreds mainly due to the worldwide hyper-consumerism of the past 50 years, how do we reel globalism back in to a tolerable level before it's too late?

  •  What to do with our workers? (7+ / 0-)

    The current environment in the USA is not so complicated to describe:

    1. High paying manufacturing jobs are going away fast. You can say that manufacturing is basically dead. Look at all the products you buy for your household, and figure out where they are made. The probability is that it's not made in the USA. See our trade balance, discount energy purchases, you still see a massive deficit with not trend to reverse itself.
    1. So we have service industries that have sprung up during that transition. Look at the health care sector, and the inefficiencies it contains. That creates low pay service jobs and a health care system that the majority increasingly can't afford. Those service jobs are not a good way to move up, as lower pay and lower benefits keep the workers down.
    1. The middle class has a collective wealth that is not trivial. There is money there to be taken away. So the government promotes the destruction of the safety net so that war mongering can continue. There is no question that the so called entitlements are the target of those who want to transfer the middle class wealth to themselves. As "globalization" makes the workers' lives harder, the removal of the safety net makes them despair.
    1. The service industries can offshore the jobs too. And in some cases import workers via legal or illegal immigration. The race to the bottom has been on for many years.
    1. It's hard to figure out what work will be on demand 5 years from now. How can you encourage retraining without a focus on those jobs that will remain? The multinationals have been thinking outside the box for many years about how to export expensive labor and import cheaper. The role of technology and telecommunications has greatly increased the opportunities for this. A financial analyst can be located in India, as well as a highly trained engineer, a radiologist, or a relatively unskilled call center representative. There is no intrinsic monopoly for the USA to develop new technologies anymore. New industries could develop here in concept, but its associated goods and services, the source of continuing economic growth, doesn't have to, and most likely will not.

    It's time to avoid the conventional wisdom pushed by the big economic interests behind this state of affairs. You say develop new technologies or industries for the future, but who says the production of those can't be offshored too? Even venture capitalists nowadays make decisions on the offshoring potential of any new venture that they will fund. You say retrain, but you have no idea what to retrain for. What looks attractive yesterday, doesn't look attractive anymore. That's because the employers are always one or two steps ahead of you. And nowhere you mention how to preserve or augment the safety net that is becoming more necessary by the day. This whole subject is a political time bomb, and no one has figured out when it will explode.

  •  Globalization doesn't make sense (5+ / 0-)

    from a biological perspective. All life is local and habitat dependent. The fact that our economic system as it is currently structured behaves as if life is global doesn't make it so. People are biological and our economic activity will inevitably be predominantly local because the purpose of exchange, in the biological sense, is not accumulation but to create dynamic, diverse, living ecosystem that supports the ability of local life to thrive.

    The purpose of global capitalism is the accumulation of capital and which is driven by human competition for the privileges of rank. Multinational corporations are the primary drivers of using commodities, labor is the main topic of this diary, globally to increase wealth concentration. This is not natural, or inevitable, it is a reflection of the power apportioned to entities who are successful at concentrating capital and using concentrated capital to grow even larger, in our current system.

    We need to start questioning the current economic system. What is the purpose of economic activity? I think the purpose being accumulation and rank competition has run it's course as a useful method of organizing human economic exchange because we humans are now so much more powerful than when the system was originally conceived. The purpose of economic activity should be to support local human and natural ecosystem development and enhancement. Continued expansion of the current system is bound to fail because it is anti-biological and unrealistic now that humans have enough power to change the climate and hugely damage the life giving properties of our world.

    There are a lot of good comments, (new deal democrat, bink, alizard, and others) up stream that offer good food for thought about the holes in the argument for the inevitability of global capitalism as it relates to labor, meaning, and purpose.

    Bill McKibben has a new book out DeepEconomy, that I have not yet finished but am enjoying, which explores a re-localization of economic activity, and there are a lot of other folks out there who are questioning our current economic system and developing ideas about alternatives and modifications. Globalization dissenters are not irrational and out of touch they are ahead of the curve.

    Our economy sucks up our environment, people, and government. Redesign it at Beyond Political Center

    by Bob Guyer on Mon Apr 23, 2007 at 07:03:19 AM PDT

    •  How local is local? (0+ / 0-)

      There is one at least one part of the ecosystem that is 150 million km away, and that we can't ignore.  

      For small micro-organisms, local proabbly is measurable in centimeters, or perhaps even milimeters.  

      Frankly, given the speed of transportation, I think we need to increase our range, and start looking at off planet solutions as well as on planet solutions

  •  Bonddad misses key point (7+ / 0-)

    Literally every inexpensive product we buy in the US is now made overseas.  Home electronics, kitchen implements, furniture, tools, hell you name it and it stands a good chance of being made in another country.  And the fact that these goods are inexpensive benefits the US by giving us more choices.  In addition -- and be honest -- how many people like getting something for less money?  If you said no, chances are you're saying no simply to disagree with the point.  And that's a central point:  People like getting inexpensive stuff.  That's a central reason why Wal-Mart is now the largest US retailer by a mile.

    Bondad misses a key point here.  Of course, EVERYTHING ELSE BEING EQUAL, people prefer to get something for less money.  But free markets only function effectively when buyers have access to all relevant information.  And a major problem with the so-called 'free market' is that buyers in fact DO NOT have access to all the relevant information.  When you go out to buy a piece of furniture, there is no information about the environmental costs (both short and long-term) of its manufacture, the work conditions in the factory where it was made, etc. If givin a choice between one chair which cost $50 -- but which was clearly labeled as made from illegally-cut wood from a clear-cut rainforest in Borneo and manufactured in a factory in with a horrific history of worker deaths and injuries and where workers were paid starvation wages -- and another physically identical chair which cost $60 dollars -- but which was made from wood derived from 3rd party-certified sustainable forestry in a factory with an impeccable safety record and which paid above the locally-prevailing wage (and, for good measure, is managed by an autonomous workers' council) -- which chair would people choose?

    I think that a significant percentage of people would choose the more expensive chair, IF THEY HAD EASY ACCESS TO ALL THE RELEVANT INFORMATION.  Of course, the larger problem is that the 'free-market' does not in fact incorporate long-term social costs into the price of a product.  If the price of the first chair actually reflected the costs of  increased global warming (from the clear-cut rainforest), cleaning up the river polluted by the factory, and taking care of the workers who had lost limbs through factory accidents, then it would properly cost much more than the second chair...

    Zack

    •  Yes! And yes to Bob Guyer's comment too! (0+ / 0-)

      It is imperative that we begin to think in terms of local economies.  For one thing, energy costs will make globalization impossible in the long-run.  I sometimes drink bottled water from Fiji, and whenever I do, somewhere a little bell chimes faintly in my mind, reminding me how ridiculous it is for me to buy water imported from half way around the world.  It is not sustainable.  This kind of behavior cannot be sustained.  

      I'm sure that many people would willingly pay more for products they could be sure were produced sanely and humanely.  I know I would (and do).  People are already paying more for organically grown foods.  Same principle.  

      The "cost savings" of globalization are illusory, since huge amounts of energy are required to transport all that cheap stuff from China.  At some point, the energy and environmental costs must be factored in.  

      May all beings be free from fear.

      by shakti on Mon Apr 23, 2007 at 03:45:32 PM PDT

      [ Parent ]

  •  free trade benefits ALL! (10+ / 0-)

    i am so tired of this garbage being peddled by the economic elites who are just as fundamentalist in their thinking about globalization/free trade as the Taliban and Southern Baptists are about their religion.

    I've sat through many a grad level econ class where it is said over and over that free trade benefits us all.

    I can tell you for one CRITICAL sector, "free trade" doesn't work--in fact, it's a death sentence for countries, and that's agriculture, which is still the majority of what developing countries survive on. "free trade" doesn't work because agriculture doesn't respond to your typical "free market" scenario. all it does is produce cheap commidites to be processed by ADM, Cargill which we then dump in the Third World countries. ask the 2 million Mexican farmers who have been driven off their land due to our dumping of corn if NAFTA/Free trade has improved their standards of living. then ask our farmers here who barely can survive while rural America continues to be hollowed out if our "free trade" policies have benefiteed them either. the only solution to the agriculture crisis (which has led to more pesticides, more obesity, more fossil fuel dependency) is localized food systems and an international agreement on commodities to ensure price stability and that farmers get what they deserve in covering the costs of production. i think the china wheat gluten/pet food problem shows the danger of a globalized, centralized food supply in the hands of few multinationals. and everyday now, people are looking to alternatives to "Free market" globalizatino--by supporting farmers markets, CSAs, the "buy local" movt, "fair trade" coffee.

    the only time i ever agreed with Michael Savage on anything was when he was ranting about how come all the stuff he has to buy is made in China. why can't Americans make bicycles and guitars he asked? sure the middle class and elites like bondad can afford their $500 guitars and benefit a lot from more cheap stuff. for the hollowed-out workers and farmers in the Rust Belt now working at Wal-Mart, i doubt such benefits of "free trade" are apparent.

    to check out organizations fighting the globalization consensus in agriculture, see

    http://www.viacampesina.org/...

    www.globalfarmer.org

    these organizations want true food security and nutrition that respects their cultures, the land and the earth.

  •  Anti-Globalization pressures (4+ / 0-)

    There are some trends pushing against the trend to globalization too.

    Post-peak oil.  Globalization shot off when oil was at $10-$20 a barrel.  It still makes ecconomic sense to ship products all over the world at $60/bbl.  It might not make the same ecconomic sense at $150-$200/barrel.

    Carbon footprints:  Global warming countermeasures often speak of carbon-usage costs.  Those costs will add tot eh cost of doing business.  This will work against the globalization model of distant manufacturing centers.

    However chances are these pressures are weaker than the pro-globalization forces.  They are certainly in the short-term.  Of course the ultimate trend breakers are The Four Horsemen.  Unfortunately, they will probably ride again in a decade or three.

    "A Republic, if you can keep it". Ben Franklin 1787, regarding the new Constitution. "Challenge accepted." George W. Bush, Jan 20, 2001.

    by Quicklund on Mon Apr 23, 2007 at 07:10:15 AM PDT

  •  Bonddad, you are spot on with this one (5+ / 0-)

    and I might say, I thought about the same thing last night SilverOz Diary on Free Trade
    There seems to be an idealistic view here that we can simply change some trade deals, enact some tariffs, and we will return to that strong unionized manufacturing base we had in the 1950's.  The real issue we have here is that technology has made manufacturing in the US so efficient that we can produce more than we ever have in the past (fact), with ever decreasing numbers of people  doing it (and more and more of those people need to be engineers).  The US needs to adapt to an economy that will never again be based on manufacturing and until we  realize this, we will continue to fall behind.

  •  Generally love your analysis... (11+ / 0-)

    but I find much to disagree with here.  Seems like warmed-over Rubinomics on the whole.  

    Some issues I see.
    __________________________________________________
    Lower prices help consumers, but they also help to mask overall wage stagnation/wage regression which has generally been the norm for anyone not in the top quintile or two since the Reagan era.  So instead of having real wage increases which can be spread around all different aspects of consumer spending, we see certain products having gotten exceedingly cheap, with much of the savings having gone towards petroleum products, housing, and medical bills.
    __________________________________________________

    Globalization has been transitory in the past.  Around 1900 free trade was the worldwide norm, and by the 1920's and 1930's, heavy tariff walls were again seen as the sensible macroeconomic procedure.  Things could flip again if the majority of political and business interests thought doing so was politically expedient.  While I don't foresee this happening in the short term, within 20 years it could be a distinct possibility.
    __________________________________________________

    You openly admit we don't have "free trade" with China - we have a form of trade which is politically advantageous towards China.  China, like the Asian Tigers before them, Europe in general, and America, is following the sensible, semi-open market form of development.  Develop an export-based economy, protect domestic industry behind tariff walls until it's truly competitive on a global scale, have tight currency controls, and pour great masses of money into education and infrastructure.  That's how you develop an economy - not with a market totally unrestricted for foreign investors (see Africa, Latin America).  

    While I agree the U.S. needs to fight in bilateral trade deals for our economy, and not just our corporations, to get the best deal, I don't see how - given China is succeeding wildly with non-free trade, we need to assume that only freer trade could be the solution for us.  
    __________________________________________________

    I work as a researcher for a predominantly manufacturing labor union.  It's true that low-skill manufacturing is essentially gone from America.  We would still like to organize new manufacturing plants given our history, but I always tell folks there are only three kinds of manufacturing left in the U.S.: Goods which are so bulky (housing products, timber, food products, chemicals) that transport costs from overseas far outweigh labor savings, high-productivity/high skill manufacturers, and everything else.  The everything else will be gone in a generation (with a few exceptions like defense due to domestic content laws).  

    Where I think you're being misleading is the amount of high-skill manufacturing jobs will never replace the low-skill ones lost.  our union is full of shops making more product (and money) than ever which now employ only 100-200 - but employed thousands in 1980.    There is a strong demand now for skilled machinists, but most machine shops employ under 50 people.  Highly skilled manufacturing workers are just too productive to be even a minor engine of job growth.  If the U.S. employed all our unemployed/underemployed former manufacturing workers in such positions, it would likely exceed world demand even if the U.S. was the most cost-competitive nation.
    __________________________________________________

    The U.S. isn't just losing jobs to low-productivity, low-cost developing nations.  We're also losing jobs to developed countries like Canada, Australia, and New Zealand, though in these cases it's more often measured in jobs we miss because they are created elsewhere.  Unless/until we get spiraling health care costs under control through a health care system that strongly resembles the rest of the developed world, we will not be able to compete on the "jobs of tomorrow."  

  •  Globalization has occurred at least (0+ / 0-)

    since Marco Polo (actually even before), but modern globalization is entirely dependant on externalizing costs to societies experiencing diminished returns. When society decides to stop underwriting those costs the "cheaper" model falls apart. Also the real cost of maintaining workers cannot be a dollar comparison. If it costs a ham sandwich, a tee shirt and room to sleep in, that is the cost in either country. Whether that is $1 or $10 the money represents the same goods and services. If $1 provides middle class in China and $10 provides middle class in the U.S., it simply means that $10 is a $1(China wage) wage here. The exchange value of the two currency amounts is equal.

    "I count him braver who overcomes his desires than him who conquers his enemies; for the hardest victory is over self." --Aristotle

    by java4every1 on Mon Apr 23, 2007 at 07:20:03 AM PDT

  •  Deceasing Living Standards? (0+ / 0-)

    I am not sure that I get this.  The developed world has long had slow growth rates (less than 5% usually) while the developing world has rates like 25% of more.  Overtime this leads to parity.  I see no reason why this historical trend will not continue.  With or without tariff agreements.

  •  At first glance (1+ / 0-)
    Recommended by:
    FirstValuesThenIssues

    you seem to model 'Developing Nation's' futures after the historical growth patterns of Developed Nations. Just as wireless communications allows developing nations to leap frog the U.S. era of New Deal infrastructure economy so will the developing nations leap frog the century long labor organization struggles we've hurdled. Unfortunately the Conservative governments here of the last few decades greatly eroded American labor (skilled labor) security. It's hard to find a welder in the U.S. because they have no trade guilds providing job security. The best course of action for our own workers and those emerging in the developing world is to maintain the highest standards of job and health security here at home. Your diary suggests we carry the heavy burden and pay to play in the global market. If the developing world nations want to play with us the impetus is on them to adopt the labor structures we have already fought so hard for, and fight if necessary for the democratic instututions in their own countries that our own struggles have set the example of it's benifits, with our help, if they choose to do so.

  •  Precarity and its discontents (2+ / 0-)

    I don't know how familiar you are with the European "anti-precarity" movement, but it's a large and dynamic social movement that has sprung up in the past few years, with a very sophisticated analysis and a clear political strategy that address this issue of the worker in the advanced capitalist countries under global neoliberalism.  I wrote about this in some detail at my blog The Agitator just this week.

  •  Gawd, I agree with both you and bink. (1+ / 0-)
    Recommended by:
    lizpolaris

    You correctly assert that the numbers and the impetus are on the side of globalization.  He asserts that there are methods, given that the US is the world's largest market, to combat this trend.

    But a trend it is.

    I hate to be ambivalent, but you are both right.  VERY right!

    FAIR Trade is perhaps the answer.  But it is not an answer in isolation.  China buys our debt.  Our massive debt.  We could not operate as a country without that reciprocity.  We could not be in Iraq without that reciprocity.  We would simply be stuck in fiscal/governmental time without that reciprocity.

    We would have to start paying, short term, some 18% more in taxes, and long term, our kids would have to pay out more interest on our (as current non bill paying taxpayers) excesses.

    Yes we can buy stuff cheaper and that is good because it helps us produce.  But if everything we buy eliminates well paying jobs in the US, then we will kill this country.

    So again, and you know this, it is either a race to the bottom based on numbers, or a stand based on principals and ethics designed to raise others up, rather than bring us down.

    Buckminster Fuller proposed that wages be raised at GM in order that workers there could buy more consumer products.  This worked, and I don't know why that lesson has been forgotten in the last 60 years.  Particularly by the people that benefitted from it.

    •  It was a different time and a different place. (0+ / 0-)

      America is no longer the sole economic superpower. Our market power is still highly significant, but it is no longer dominant.

      A lot of Americans would like to believe that we are still driving the bus. Unfortunately, the reality is that America's situation is actually trending towards that of the toddler in the car seat with a toy steering wheel.

      OK, we're not there yet. And we still have a ways to go. But it is the worst kind of folly to pretend you are in control when important aspects of the control resides elsewhere.

      Just ask George Bush how that works in foreign policy.

      -2.38 -4.87: Maturity - Doing what you know is right even though you were told to do it.

      by grapes on Mon Apr 23, 2007 at 10:04:53 AM PDT

      [ Parent ]

      •  Oh, but we are the sole economic Super Market. (0+ / 0-)

        We could use this to the advantage of our people in the the that Bucky did, by leveraging our buying power.

        But we don't for some reason.  Even to the point of economic self-emolation.  I believe it's a corporate media thing, as expressed through advertising (i.e. revenues).  Buy the best deals and win.  Forget about buy the best deals and lose your job.

        It's not as simple as this, but no one, to my knowledge has tracked the dollar flow and published it.  IOW, where does the money go?  Who are the actual beneficiaries of cheap foreign products. I haven't seen it.

        I think bonddad tried here, but there is more to the analysis.  It's an analysis as broad as electric cars.  Where does the energy come from.  In this case, is it better to enable someone to play the guitar cheaply, perchance to make a record (which is non-productive, BTW, just distributive), or is it better to produce the machine that produces the cheap guitar that enables more people to buy the record.

        I've only seen opinion on this issue, not analysis.  I think Bucky got it right, even now.

        It's full of stars...

        by Terra Mystica on Tue Apr 24, 2007 at 06:09:18 PM PDT

        [ Parent ]

  •  You Don't Know Jack About Computers (7+ / 0-)

    There are no jobs of tomorrow. Every action a human being can make can be made cheaper abroad or by automation.

    There are no exceptions.

    There are no jobs of tomorrow.

    For God's sake learn how to subtract.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Mon Apr 23, 2007 at 07:54:58 AM PDT

  •  Where's BondDad and what have you done with him? (3+ / 0-)

    n/t

  •  Corruption won, not free trade (8+ / 0-)

    in it's concept, free trade is noble.  But we have neither trade nor is it free.

    My company has factories in China, it knows the costs of shipment, lag time, quality crisis if shipped units have defects, etc.  It's about the labor savings at all levels, from worker to supervisory and the benefit costs, as well as the vast overhead savings, through lower rents, factory capital costs, insurance, etc  Vastly lower operating costs are being exploited at the moment but this occuring because trade deals couched in free trade terms are allowing these deals to occur who advantage only the bottom lines of international corporations.  The Chinese workers, supervisors, nor American supervisor's benefit from these cost savings.  These agreements are used as tools to hide the vast profits squeezed from the explotation of labor into a smaller and smaller number of INDIVIDUALS.  Which can be obviously seen in the form of $100's of million dollar compensation packages to the CEO's of these corporations.

  •  Sorry, bonddad (8+ / 0-)

    You could not possibly be more wrong. bink's diary in response is a good starting point for why you're wrong, and I hope that over the next few days we can continue to work out the details of why your view is so very wrong.

    I'll just offer this, for now: the idea that cheaper goods help the US economy is disproved by Wal-Mart. Wal-Mart hurts the US economy by creating market conditions that push the offshoring of manufacturing jobs. If those jobs had stayed here, if we had tax policy that prevented accumulation of wealth at the top, we would not have trouble affording a US-made guitar.

    I'm not part of a redneck agenda - Green Day

    by eugene on Mon Apr 23, 2007 at 08:08:32 AM PDT

    •  Right (3+ / 0-)
      Recommended by:
      eugene, theran, drsmith131

      The Wal-Mart problem is not about free markets, it's about distorted markets.

      When people from Bentonville order their suppliers to set up offshore factories to save $0.03 per item, that's a distortion. When Wal-Mart sets up their own Chinese factories, using financial leverage that would not otherwise exist, that's a distortion.

      And, we don't really have to care if foreign governments want to, or are currently capable of enforcing health, safety and labor standards. We don't even have to care if Wal-Mart actively promotes slave labor. We can do it for them in the form of fines on their imports.

      The thing is, we don't care if foreign companies and multinationals like Wal-Mart get ahead by competing on a level playing field, but we do care if our own laws help them cheat.

  •  sorry, I'm All retrained out (6+ / 0-)

    5 fields in 20 something years...can't afford it anyway.

    of shoes and ships and sealing wax, of cabbages and kings.

    by farmerchuck on Mon Apr 23, 2007 at 08:09:17 AM PDT

  •  retraining the workers (4+ / 0-)
    Recommended by:
    rick, vivacia, mollyd, bluewolverine

    How about some demand for accountability on the part of the plutocrats?  You seem to have been suckered into buying the myth of free labor markets.  The past 20 years has seen all sorts of "retraining" workers.  Indeed, the typical American worker today is more skilled and more qualified than ever before in history.

    And yet wages are stagnant.

    Maybe we shouldn't blame the workers.

    What "retraining" means is "stop whining that you lost your $15/hour job and take this $8/hour job instead and, if you work hard, after five years it'll be $11.50/hour".

    Everybody has to suck up, grin and bear it, put the nose to the grindstone, etc., except CEO salaries, the stock market, and corporate profits go up, up, up.

    "Patriotism is supporting your country all the time, and your government when it deserves it."--Mark Twain

    by RickD on Mon Apr 23, 2007 at 08:12:25 AM PDT

  •  Globalization can be very good (1+ / 0-)
    Recommended by:
    berith

    China's economy has brought more poor Chinese people out of poverty than anything in history including the industrial revolution.

    If the Republicans promise to stop telling lies about us, maybe we'll stop telling the truth about them..

    by Romaniac on Mon Apr 23, 2007 at 08:12:47 AM PDT

  •  I agree with most of that (1+ / 0-)
    Recommended by:
    FirstValuesThenIssues

    But lets just say that all those people preaching about the necessity, the inevitibility of parity in a Global Marketplace, none of them ever seem to say one thing about parity in the American Marketplace.

    If the gap between the rich and poor is bad globally, then why doesn't anyone do anything about that gap locally?  

    If you think the entire Globe should all be in the same general economic bracket, that that's where things will gravitate, fine.  But this is not what's happening in America.

    It's the people who have been given the means to profit from other people's pain in this regard.

    There are things that can be done about this.  And the candidate that best articulates these things while still pointing out many of the things you point out above, will, I hope, get the nomination.

    More time is being spent trying to create agreement in the Dem Party than is being spent trying to exploit disagreement in the Republican Party.

    by Edgar08 on Mon Apr 23, 2007 at 08:14:26 AM PDT

  •  Sounds like Tom Friedman here today. (7+ / 0-)

    Trade can be managed, and while the point on spreading affluence worldwide (and the effects on affluence in the West relative to the rest of the world) is well taken, that's no reason to not insist on protections for the least of our brothers in the painful transition.

    There are alternatives. Aside for managed, fair trade, there are further ways to cushion the blow, which involve a lot more socialism, a lot more progressive taxation and a lot less leaving the poor out to dry even further.

    Your alternative, alas, is in my humble opinion simply leaving those vulnerable to the wolves. A neo-liberal alternative, in other words.

    No thanks, man. If that's the Democratic party program, eg the Thomas Friedman program, I ain't buying.

    Freedom is merely privilege extended unless enjoyed by one and all -9.50, -5.74

    by redstar on Mon Apr 23, 2007 at 08:15:36 AM PDT

    •  Yes, "free" trade has ALWAYS been.. (2+ / 0-)
      Recommended by:
      rick, redstar

      managed. It depends on how it's managed and who it's managed for! Free trade as Bonddad accepts in his assumptions is a myth.

    •  To say globalization is inevitable ... (1+ / 0-)
      Recommended by:
      IndySteve

      is not to say that neoliberal governance of the global economy is inevitable. But global corporations and global investors are only going to be fully governable by global scale governance. There are limits to what one country, even a very large and rich country, can impose unilaterally before we create incentives for global investors to bypass us, including those who are currently living in the U.S. Yes, there are steps we can take towards redistributing income and risk in our society before we reach that point, because we have tilted so far in the laissez faire direction during the present administration, and we should take these steps. Universal health care that is not linked to employment, better unemployment and retraining benefits, a higher minimum wage and expanded earned income tax credit, greater subsidies for higher education and affordable housing, and a more progressive income tax are all called for. But real socialism would lead to massive capital flight, and decapitalizing our country is not going to help our living standards.

      Internatinally, let's work to add protections for working conditions and the environment in our trade deals. Let's work to enforce international IP protection and regulations against state industry and currency subsidies. But other nations' interests diverge from ours with respect to their wages, and there is nothing we can do to change that or to persuade them to sacrifice their interests to prop up U.S. wages. That's the inconvenient truth in bonddad's diary. Until our living standards are closer to those of other nations, the scope for international cooperation in global governance is limited.

      "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

      by berith on Mon Apr 23, 2007 at 10:42:13 AM PDT

      [ Parent ]

  •  "...foreign made goods are cheaper and better" (6+ / 0-)

    I'll give you cheaper, but better?

    Do you think of Quality when you see "made in China"?   Do you think that anything you buy at Walmart will last more than a few years.

    The sad reality is that with outsourcing our manufacturing, many appliances and products that were once repairable are now 'throw aways'.  And this isn't because the cost of repair is so high, it's usually driven by the lack of replacement parts, or the complete lack of supportability.  

    These products are not designed with 'life cycle' in mind...  only the cost of manufacture.  As long as it lasts just long enough for their to be a new model on the market when it breaks,  and as long as the warrenty process is so cumbersome that it's just easier for a consumer to buy a new one, 'mission accomplished'.  

    'Cheaper' does not mean 'better'.

  •  More Competitive With Slave Labor? No Thanks. (3+ / 0-)

    I'd rather starve.

    "They are trying to steal our minds." - Buddhist monk upon arriving in Times Square and seeing all the billboards

    by Near Vanna on Mon Apr 23, 2007 at 08:24:18 AM PDT

  •  Some random thoughts (4+ / 0-)

    I think there will be a backlash against excess in our economy. I'm already seeing that with Edwards. $400 haircuts, 25,000 sq. ft house. Would this have been an issue 10 years ago? I suggest that in the near future, the rich will have to build enclaves if they want to separate and protect their lifestyles, because the rest of us won't be living that way. This is not a put down of Edwards. I'm leaning toward supporting him.

    I'm seeing the change in my own behavior. I have a 1400 sq. ft. house, a fifteen-year-old car that I'm holding on to just a little longer before I buy a hybrid. I look for quality in what I buy. I can adjust my standard of living very comfortably. I even find myself wondering what exactly we were striving for all those years.

    What I want from the gov't is a safety network. Healthcare, social security, poverty initiatives that help lift people up, clean air, regulatory oversight of our resources and food. I do see a contraction coming. Will our gov't start addressing the real needs of the people and forget empire building? The old model won't work in the new century.  For our future leaders to pretend that it will is dishonest. I will be listening.

  •  what? (4+ / 0-)

    they can stop it, give me a break.  At least you're acknowledging the problem here but trade, economic US policy can stop this race to the bottom through a series of policy changes.  

    As far as retraining goes what a crock of shit bonddad.  The truth is as long as corporations are allowed to labor arbitrage the globe it won't matter what kind of skills and we see that now...
    people with MS degrees, PHDs have been displaced as Blinder finally wrote about and the training does not matter.

    http://www.noslaves.com http://forum.noslaves.com

    by BobOak on Mon Apr 23, 2007 at 08:35:07 AM PDT

  •  Whoa, what assumptions have you been swallowing? (6+ / 0-)

    BondDad must have had a bad day when he wrote that earlier diary. He has swallowed the neo-liberal Koolaid.

    I am an economist, have taught economics for twenty years, and can tell you that the "free" market was never free. No history of industrial capitalism shows that nations grew in wealth under a "free trade" regime. They all used non-free trade institutions, tariffs, even slavery to gain.

    So the "we all benefit from unfettered free trade" is an ideological rant with no basis in empirical reality. Institutionalist economics is worth looking into which realistically posits that institutions such as labor unions, consumer groups, governmental agencies and NGO's are all an important part of progressive economic development. The "market" is just one of those important institutions.

    •  Nigeria is wealthy (3+ / 0-)

      With tons and tons of oil.  Due to corruption, none of the average Nigerian citizens have seen any benefit from it and live in poverty.

      Do we need to wait for every other country to have a true democracy for us to all be on a level playing field?  Because it sure won't happen when there's slave labor and corruption around the world that depresses labor and working conditions.  

      We'll be waiting for a long time for the free market God to adress that.

      Pass the Employee Free Choice Act!

      by PaulVA on Mon Apr 23, 2007 at 08:42:55 AM PDT

      [ Parent ]

  •  Cheaper shit is still SHIT. Two words... (8+ / 0-)

    global warming. Your acceptance of neo-liberal ideology ignores the fact that orthodox economic theory (which you espouse here without critical analysis) views the environment and the human impact on it as an externality.

    Time to assess ALL economic and environmental costs in the price of goods and services.

  •  last centuries solutions (1+ / 0-)
    Recommended by:
    opinionated

    you should read The Medium is the Massage, last centuries book, but clearly ahead of its time.

    roles not goals, automation will replace most jobs.

    the implications of this are profound

    on the matter of globalization one needs to  focus on autonomy. Autonomy in the area of foreign relations implies that a country has a right to self determination. or as McLuhan says there is room in the world for countries such as Cuba, which chooses not to be part of the American corporate, tourist economy.

    leaders like Bush have used globalization like Commander Perry, who opened Japan to trade through force. the repercusions of that policy in this modern world are damaging to the extreme, when Bush says he wants Democracy in Iraq, he wants to open the country to the global corporate piracy.

    we need to respect other countries need for autonomy, one, and realize that we need a great deal of autonomy in America.

    "Everything is chrome in the future..." Sponge Bob Square Pants

    by agent double o soul on Mon Apr 23, 2007 at 08:46:23 AM PDT

  •  France (for example) (2+ / 0-)
    Recommended by:
    berith, Commodify Your Dissent

    The standard complaint of Europeans about Americans is that all we care about is money, and I for one am not prepared to say they're wrong. And you, bonddad, have (if I may say so) fallen into the same trap as classical economists, who assume that materialism is the only thing that motivates people.

    Not that you'd find much evidence to the contrary around here. But behavioral economists, having disproven the "rational man" hypothesis, have lately turned their attention to the question of whether money can indeed buy happiness, and the answer is (beyond a certain minimum standard of living) "no." But we Americans are so conditioned by our materialistic, marketing-dominated culture to believe the opposite that we find it nearly impossible to wrap our minds around the idea that paying an extra $5 over Wal-Mart's price for a coffee maker at our local hardware store might, in the last analysis, actually increase our life satisfaction, for a whole bunch of reasons. So might paying more for a US-made guitar, even if we had to save our pennies a while longer to afford it.

    News is what they don't want you to know. Everything else is publicity. --Bill Moyers

    by RobLewis on Mon Apr 23, 2007 at 08:51:40 AM PDT

  •  Not an economist (2+ / 0-)
    Recommended by:
    berith, 4Freedom

    but I really appreciate the comments and the diary. This is opening up a dialog that is desperately needed.
    I will say that it is my belief and observation that the working class tends as a whole to engage in behavior that would not seem to be in it's best interests.
    Another thing to consider, is what is "lower standard of living"? Because really, we overconsume in the US. We don't need most of the things we go into debt to have. We don't need huge houses, we don't need huge personal vehicles, we don't need to redecorate every 5 years. I grew up in a time when it was considered absolutely normal to share a bedroom with same sex siblings, one car households were the norm (even in two-career families!), eating out was a very rare treat, etc. But looking back, my quality of life was so much better than today. Food was safer, and healthier, because we hadn't grown dependent on processing and fast food yet. Being in debt was considered a very bad thing, so even though the "keeping up with the Joneses" mentality was still around, it was tempered by prudence.
    If you ask me, our "standard" now is more about consumerism and less about anything really healthful or productive. Probably the biggest thing we could accomplish to keep our standard of living would be single-payer healthcare.  

  •  I call BS on #2 (2+ / 0-)

    Let's see... Pull someone out of a rice patty in some third work country to work in a manufacturing plant.

    But, a US worker needs more training.

    I think that is bullshit. The major difference is the amount of money the third world worker is getting paid compared to the US worker.

    As far as pain along the way goes. It seems to me that some people can afford to be philosophical about these things while the rest of us take it up the ass!

  •  Bonddad, your posts are usually good... (4+ / 0-)

    but a little economics is dangerous. You have apparently accepted the type of economics taught in Econ classes. There is a rich literature out there that questions the assumptions of neo-liberal (or neo-classical) economic theory and provides compelling answers to the problems you pose here.

    Continue to educate yourself rather than repeat ideological economic dogma.

    •  IndySteve, your responses are usually good (2+ / 0-)

      but you have fallen into the trap of living in an ivory tower rather than the real world.  I would suggest you get out into the real world more to see how it works.

      "You think you can intimidate me? Screw you. Choose your Weapon." Eliot Spitzer

      by bonddad on Mon Apr 23, 2007 at 09:12:05 AM PDT

      [ Parent ]

      •  My point is your diary is based upon... (4+ / 0-)

        ivory tower dogma about free trade. Please broaden your reading and study, and question your (hidden) assumptions. I think it is a good diary, though, because it challenges people here to defend and deepen their understanding of economic forces.

        I am simply trying to point out how much you seem to have accepted neo-liberal (neo-classical) theory yourself. The "real world" through empirical study simply doesn't support the pure theory.

        Even Adam Smith wrote a companion book, "The theory of moral sentiments" that noone ever reads, which makes the point that self-interest is NOT the only motivating force underlying human behavior.

        Yet your diary is purely one of accepting the view of the self-interested, rational, maximizing machine that economists have mistakenly used as the basis of orthodox theory and policy.

        •  adf (1+ / 0-)
          Recommended by:
          Lashe

          I have read a ton of stuff on this.  But none of it adequately responds to the central point I made.

          So long as it's cheaper over there, we'll buy it from over there.  It's that simple.  To argue otherwise is to completely overlook a basic aspect of human nature.

          "You think you can intimidate me? Screw you. Choose your Weapon." Eliot Spitzer

          by bonddad on Mon Apr 23, 2007 at 09:20:53 AM PDT

          [ Parent ]

          •  I agree that as long as people don't... (2+ / 0-)
            Recommended by:
            vivacia, bluewolverine

            see the connections between doing that and environmental destruction, erosion of their standards of living, erosion of labor rights here and abroad, you are right. That is why education, advocacy and activism is SO IMPORTANT. And the momentum is on our side. Why do you want to disempower people?

            People are more than maximizing machines. And PLEASE use your considerable analytical skills to show how we CAN manage globalization AWAY from planetary destruction!

            I choose to work on how to use economics to empower people to work for a progressive future. The market and individual self-interest is just one institution and value in our society. There are many others that are essential to our survival!

          •  This is a reflection of human morals, not nature (1+ / 0-)
            Recommended by:
            Commodify Your Dissent

            Americans could pay more for higher labor and environmental standards in imports if that was what they valued most. The example of fair trade coffee suggests that a small minority of people in this country actually will, the majority won't. (Even this example overstates the moral position of Americans as a population, because it's much easier to make a symbolic purchase of ethically-premium coffee than to accept the materially poorer lifestyle that would result from making all of one's purchases this way).

            As long as we are talking political economy here, the politicians have to work with the electorate they have, not the electorate they wish they had. So long as the majority of Americans continue to understand their well-being primarily in economic terms, there are real limits to what even the most courageous politicians can implement and hope to be elected.

            "What is government itself, but the greatest of all reflections on human nature?" - J. Madison

            by berith on Mon Apr 23, 2007 at 11:10:28 AM PDT

            [ Parent ]

  •  "So long as foreign made goods are cheaper... (6+ / 0-)

    ...and better, we're going to import them.  There's no way to stop that from happening."

    like hell there's no way to stop that from happening.

    so when we mark up chinese imports to put them on a level playing field with domestic and imported products that aren't produced with exploited labor then all of the sudden people will start buying their doggie toys on the black market, right?

    "First, high-unemployment indicates that 10 cents/day may be too high to begin with."

    oh, then why have a minimum wage in this country either for that matter? just let the market decide - the market is always right - it's like the very handwriting of god.

    "Issues of wage parity and working conditions are simply a low priority in this type of political environment."

    no doubt. and they will continue to be as long as large import markets like the US follow your spineless approach and reward the governments of developing nations for bleeding their workers.

    "The point here is that we are arguing about developed world problems and solutions when the other countries have developing world problems and solutions."

    wage parity and working conditions are a not "developed world problem." they are universal problems. your words read a lot like racism.

    taken as a whole, your diary reflects a mindset totally alien to the values and traditions of the progressive movement. it might as well have come from the WSJ or a DLC white paper.

    AP: John McCain Defends Bush's Iraq Strategy

    by jethropalerobber on Mon Apr 23, 2007 at 08:58:17 AM PDT

  •  Here's the problem... (1+ / 0-)
    Recommended by:
    IndySteve

    Globalization is only possible with large sources of ever expanding energy.  Without the energy supplies to transport goods globally, you won't have a global economy anymore.  Considering the anecdotal evidence that suggests we may have already hit peak oil, the continued growth of a "global" economy is an exercise in impossibility.  Until we figure out a way to replace fossil fuels, the economic system we presently have is doomed to collapse.  And no amount of neo-liberal hand clapping will change that.

    •  Good, and global production on the scale... (1+ / 0-)
      Recommended by:
      jps

      we see it today only occurred because of vastly declining transportation costs which DID NOT reflect the true economic and environmental cost of transporting goods and services.

      The market encourages throwing as many of those costs onto third parties or the environment. Global climate change is the result. Contrary to Bonddad's conclusions, our only option is to utilize labor, consumer and investor power to use government to correct the FAILURES of the market and so-called free trade.

      The kind of powerlessness that Bonddad promotes is a death sentence for our planet.

  •  Anyone Read "The Sovereign Individual"? (0+ / 0-)

    The future is not going to be industrial and its not going to be set by policy.  

    Some of the book dips pretty damn deep into the Libertarian school of thought and will cause many people here to reject it out of habit.  But be careful... just because some people like to bash Clinton does not make them innacurate economists.  

    Sift through the bat-shit crazy parts and really think about the things they say about the future.

    There is some very interesting material there.

    Thinking men can not be ruled. --Ayn Rand

    by Wisper on Mon Apr 23, 2007 at 09:15:43 AM PDT

  •  This, I don't know about (1+ / 0-)
    Recommended by:
    SecondComing

    So long as foreign made goods are cheaper and better, we're going to import them. There's no way to stop that from happening. Any measures we take to stop it will prove temporary and fleeting.

    There are measures we might take, and there are measure that might happen whether we want them to or not. Chief among these is the availability of oil as a transportation fuel. Globalization only works as it does as long as transporting goods across the globe is only a small portion of the cost of doing business.

    One only has to take a brief look around to see that the measures being taken to get us beyond the need for oil are half-hearted at best. The result is that much higher, and much more unstable, prices for fuel are all but inevitable. Without a secure and affordable fuel supply, the whole global sourcing 'just in time' method of manufacturing goes out the window. The natural result is production will become more diffuse and it will occur closer to the point of actual consumption.

    Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. - Groucho Marx

    by Joe Bob on Mon Apr 23, 2007 at 09:20:07 AM PDT

  •  It's the wealth distribution inequality! (3+ / 0-)
    Recommended by:
    jps, opinionated, bluewolverine

    Like many here, I usually agree with Bonddad's assessment of an economic situation, but not this time, and for a couple of very simple reasons.

    1 - There will be no 'equalization' of living standards over the next 50-100 years because of the fact that the Earth cannot sustain the levels of pollution and resource extraction required to raise the standard of living of the five billion people not currently enjoying the lifestyle of the other one billion (that's us).

    2- The other reason Bonddad is completely wrong about this is that the aggregate wealth of the US is currently increasing at a rapid rate with no sign of slowing down. Yes, that's correct. The GDP of the US has increased  dramatically since the middle 1990s, much of it at the expense of third-world countries. The flow of econimic wealth is TOWARDS the US, not AWAY! The reason it does not seem that way to most of us is that the increase in the GDP has gone, almost exclusively, to corporations and the wealthy. In other words, the US is much richer as a whole, but most of that wealth went to a very few elites. IT'S THE WEALTH DISTRIBUTION INEQUALITY, STUPID!

    Sorry, Bonddad, but you are not seeing the forest for the trees on this one.

    -6.38/-3.79::'A man is incapable of comprehending any argument that interferes with his revenues.' Descartes

    by skrymir on Mon Apr 23, 2007 at 09:20:23 AM PDT

    •  Well if you take the economic (0+ / 0-)

      convergence theory then technology, as it becomes available, will help the developing countries compete and they will prosper. Meanwhile, the part I don't like about the theory is the fact that it leaves out the fact that as a result of competition people are displaced. As a result, the billion or so (minus the top who generate income from investment) who have been reliant on work for income are going to (and I believe this is happening presently) be SOL. Their standard of living is going to decrease. I'm not sure the theory isn't right and I'm certainly not happy that our leaders weren't preparing the American people adequately for job displacement.

      •  Wealth distribution inequality can be fixed. (2+ / 0-)
        Recommended by:
        jps, opinionated

        The overpopulation problem will not be cured by technology because that improved technology simply represents a more efficient means of extracting resources from the earth to supply the needs of the five billion now barely existing. This conflicts with the fact that the earth's resources are finite. The earth can barely sustain the current population level at a poverty level.

        The degree of income and wealth inequality in the US can be corrected by a change in policy, especially tax policy. It is a fact that tax rates of 70% on income and 50% on capital gains were in place from 1945-1980, a time when the middle class prospered. It is a matter of having the political will to implement domestic policies that tend to equalize wealth and income.

        Surrendering to GOP economic talking points is not clear thinking, it is stupidity.

        -6.38/-3.79::'A man is incapable of comprehending any argument that interferes with his revenues.' Descartes

        by skrymir on Mon Apr 23, 2007 at 09:56:26 AM PDT

        [ Parent ]

        •  In the US (0+ / 0-)

          Here's the problem as I see it. We don't exist in a vacumm and I sincerely believe that even if we wished it we can not stop globalization at this point(the horse is out of the barn so to speak). Since we can't stop it the best thing we can do is regulate it carefully to ensure that it is fair. It also would help if we weren't so reliant on other countries for our resources. I still think one of the most myopic things we did was put out of our minds the oil crisis in the 70's. At that point, we should have been looking at alternatives for transportation that weren't so reliant on a resource that is largely found in an area of the world that is not crazy for us.

          •  My point is that globalization is not (3+ / 0-)
            Recommended by:
            jps, opinionated, bluewolverine

            'hurting' the US, as a whole. In fact, the US is benefiting from it, squeezing the poor nations of the world to increase the flow of wealth into the US. So Bonddad is wrong about globalization hurting the US. I, too, believe  that globalization is inevitable, but where I differ from Bonddad is in believing that this is, inevitably, going to cause a 50-100 year decline in living standards. Why should living standards decline when the overall wealth of the country is increasing? The problem is one of wealth and income distribution, which can be corrected through the political process as long as the GOP isn't successful in having their self-serving economic propaganda regarded as true by the citizenry. Bonddad does a great disservice by buying into these talking points distributed by the wealthy and powerful elite. He has jumped the shark on this topic.

            -6.38/-3.79::'A man is incapable of comprehending any argument that interferes with his revenues.' Descartes

            by skrymir on Mon Apr 23, 2007 at 10:55:01 AM PDT

            [ Parent ]

            •  I feel the opposite (0+ / 0-)

              I realize that some of the jobs lost are due to technological advances but I also know that corporate America has jumped on the idea of using other countries citizens for cheap wages and then lining their pockets with the profits. As a result we have Americans that have become displaced as jobs have been sent overseas or H 1 B visas are requested to keep wages stagnant(and not keeping up with inflation).

  •  People DON'T like cheap stuff (3+ / 0-)
    Recommended by:
    vivacia, bluewolverine, pkbarbiedoll

    ..when they believe value is attached to something more expensive.

    Why in the hell do we pay more for a large latte than we pay for an entire meal elsewhere?

    Why are people willing to pay $100 for their hairdo when you can go to the local beauty college for a third of that?

    Why do people pay 100 bucks to go to the theater?

    Why do people tithe a thousand bucks a month to their megachurch?

    It about learning to value American labor like we value other things. It's not impossible. It requires a shift in thinking.

    How we know Daffy Duck is Republican: "It's mine, understand? Mine, all mine! Get back down there! Down down down! Go go go! Mine mine mine! Mwahahaha!" --BIPM

    by rhetoricus on Mon Apr 23, 2007 at 09:22:17 AM PDT

    •  Your point doesn't quite hold up - the things you (0+ / 0-)

      mentioned are all "experiences" rather than things.

      People will pay $100 for a hairdo at a nice salon because it is a pleasant experience - more so than going to the beauty college.  Same for going to the theater, church etc.

      My experience of a new blender is the same whether it was made here or in China, so unless I'm unusually politically/ideologically committed, I'm probably going to go with the cheaper product.

      •  Ideological commitment (1+ / 0-)
        Recommended by:
        bluewolverine

        ..really is the issue, and that in itself would have to be the "experience." Many people can't tell the taste of organic food from inorganic, but they'll pay more for organic. Many people can't tell the difference between a "real" Prada purse or Gucci (sp?) dress and their knockoffs, but they'll pay more for the "real" things because they imagine they hold more value.

        Remember "buy American," that Cold War adage that chided people to buy products made in America because it supported our economy? Funny that it was the right-wing position--and it did work with many people.. my grandparents wouldn't buy ANYTHING foreign, out of a sense of patiotism.

        It really is about individual and collective priorities.

        How we know Daffy Duck is Republican: "It's mine, understand? Mine, all mine! Get back down there! Down down down! Go go go! Mine mine mine! Mwahahaha!" --BIPM

        by rhetoricus on Mon Apr 23, 2007 at 11:17:12 AM PDT

        [ Parent ]

        •  You have a point, although I'm not sure that it (1+ / 0-)
          Recommended by:
          rhetoricus

          would ever be possible to get enough people to buy into  a "buy American" mentality to make a significant difference.

          I also don't think the matter is that simple.  I'm no fan of Wal-Mart for example, but one has to wonder what the source of their success was - I don't think they went to all the areas they opened stores in and held guns to people's heads and made them shop there.  Presumably, the people that shop there feel they are better off by doing so, because of their access to a wider range of goods at lower process.  One could argue that in the long run they're not, but I wonder what they would say about it.

          On the other hand, I do think we are seeing an increase  in interest in supporting local economies, at least in some areas such as the production of food.  I live in Portland, OR and there are a lot of farmer's markets here, and grocery stores and restaurants that focus on doing business with local suppliers. I am very much in favor of that, mostly from an environmental perspective but I also like the idea of strengthening the regional economy.

          I'm jumping around all over the place here, but my point, I suppose, is that this is a complex issue.  Another example - I used to work for Levi Strauss which used to pride itself on manufacturing its products in the US, and continued to do so long after other apparel companies moved the majority of their manufacturing overseas.  Partially as a result of that, their costs were higher than other companies, and they declined considerably and have had to lay many people off in the past 5-10 years, myself included.  They've now stopped manufacturing in the US anyway - so one could argue that if they had done so sooner, fewer people overall would have lost jobs.

          •  I totally understand (0+ / 0-)

            About the outsourcing dilemma for companies. It really has to be a government move in the form of tariffs, or a consumer-driven move that eschews the foreign for the more-local as in the examples you stated. I understand that the entire burden for the change can'e be placed on the businesses--that's insane. And really, as long as there is so much "free trade," the cycle may be doomed to repeat itself.

            How we know Daffy Duck is Republican: "It's mine, understand? Mine, all mine! Get back down there! Down down down! Go go go! Mine mine mine! Mwahahaha!" --BIPM

            by rhetoricus on Tue Apr 24, 2007 at 11:45:54 AM PDT

            [ Parent ]

  •  You may be over-stating your case (3+ / 0-)
    Recommended by:
    johnny rotten, berith, DBunn

    Yes, supply/demand equilibration would tend to bring our standard of living downward. However, it's not as bad as you say, for several reasons:

    1. If incomes start to even out, prices should also even out.
    1. We will be forced to be more efficient, in terms of energy consumption and productivity, and many other ways. This is not a bad thing and does not necessarily harm our standard of living. (So long as you measure standard of living in ways other than energy consumption.) It does create a market for new goods and services that we can serve.
    1. We still have competitive advantages, in the value of the services our workers offer, that attract higher wages. Our investment in education, for example, still has a payoff.
    1. The world economy is not a zero sum game.

    Having said that, it's not automatic that we can maintain our standard of living. Government policy makes a big difference:

    1. Our culture of bold innovation is eroding into fearfulness and risk aversion. Leaders from all sectors in and out of government, including religion, have been a part of this problem and need to become part of the solution. We Kossacks can help by becoming these leaders.
    1. We've got to be willing to invest heavily in basic research and technology, to a much greater extent than the private sector would be willing, thus requiring government investment.
    1. You listed a few industries that deserve investment, but I would argue that every industry, including manufacturing, is fair game for American innovation.
    1. Ultimately, our competitive advantages in the world come from our cultural love of creativity, and the strength of our institutions. So as national policy we have to strengthen those.
    1. Over time it will matter less to us whether America maintains the highest standard of living in the world. It will matter more that our local communities maintain a high standard of living, and that our families do. And for politically active liberals like us, the standard of living in Darfur will start to matter just as much as the standard of living in Louisiana.

    I also disagree with you that trade policy will be ineffective in raising living standards around the world. Sure, there are limits on what we can extract from other countries in terms of speed of their progress. But that shouldn't stop us from trying, it just means we have to take it incrementally and monitor it closely as developing countries develop.

    •  And furthermore... (3+ / 0-)
      Recommended by:
      raines, DBunn, Commodify Your Dissent

      Let me elaborate on that last point. The whole notion of "standard of living" is a moving target. Your average American couldn't care less how economists measure standard of living. What matters is whether we can obtain the goods and services we want, and whether we can attain a state of happiness with our lives. All of that is a cultural invention, especially now that most of us in the developed world aren't lacking for life's essentials.

      What's more, certain important improvements of what we might value in our standard of living, are attainable right now and aren't a function of wealth. Universal health care comes to mind as one of those. Economists might consider universal health coverage a wash in terms of the economy, but a lot of us would see it as a huge step forward.

      There's a corrolary to the notion that a lot of goods made overseas are becoming much cheaper: it's that a lot of those goods are becoming less valuable to us: because they are badly made, because they don't give us much enjoyment, and because we only have a limited amount of time to devote to our toys.

      •  Excellent point pdt (1+ / 0-)
        Recommended by:
        pdt

        ... about universal health care being more valuable in use terms than it is in money terms. Indeed, switching to single payer might actually reduce GDP, as all those wasted dollars in our current fake-out system are counted as economic production.

        Couple other points I would add...

        After a certain level of economic security has been attained, there is little or no correlation between increased "standard of living" and increased satisfaction in life, where standard of living is equated to rate of material consumption.

        There are two kinds of wealth to be considered. Absolute wealth  measures first whether you have enough of the necessities to survive, and then how much extra stuff you have after that. Relative wealth is concerned with how much you have compared to other people.

        The economist Herman Daly has observed that there is no limit to the amount of absolute wealth that a person or nation can have (except for the capacity of the natural world to supply and support same), but that after survival needs are met there is less and less increase in satisfaction as more and more wealth is piled on. The US in the last half of the 20th century is proof of that. So why do we continue to pursue wealth beyond survival need?

        The answer is that we are pursuing relative wealth, an activity also known as keeping up with the Joneses. Individuals may be more or less successful at this game, and some may gain satisfaction by passing others, who in turn lose an equal amount of satisfaction by being passed. Pursuit of relative wealth IS a zero-sum game. It is impossible for a nation to increase the internal average relative wealth of its citizenry. At the national level it is a classic treadmill situation, with everyone running as hard as possible while as a nation we get nowhere.

  •  I think the key point (2+ / 0-)
    Recommended by:
    berith, FirstValuesThenIssues

    to the diary that I agree with is that trade needs to be bilateral. It is absolutely wrong for us to open up trade with a country and that country to place restrictions on what we bring in but expect us to allow them unfettered access to our market. The standards on certain products should be discussed before these agreements so that things like automakers know what they are up against it bothers me alot that Korea has only allowed something like 4500 US cars in their country because they have a dual standard while we have allowed thousands here and have a single standard for foreign and domestic. If other nations are going to be protectionist it does us no good to open up our trade.

  •  Stop buying new... (5+ / 0-)
    Recommended by:
    tmo, IndySteve, theran, raines, 4Freedom

    ...there's enough in freecycle communities and in thrift shops to supply most everyone's needs for more goods. Buy food locally at farmer's markets or directly from community farms. Think about how each purchase will or will not enhance your life.

  •  you're wrong here... (2+ / 0-)
    Recommended by:
    jps, FirstValuesThenIssues

    ...just like you were wrong that oil market manipulation doesn't happen (and i've got a bridge in brooklyn to sell you)...

  •  Bonddad, a kink in your solution (4+ / 0-)

    The industry of tomorrow may be developed here, but as soon as it is figured out, it will be sent overseas, the way everything else was sent out.

  •  Monitoring vs. sovereignty (0+ / 0-)

    We may argue for a third-party to monitor the countries labor resources - something like the US or another multi-lateral organization.  This runs into problems dealing with the country's sovereignty, making it difficult to achieve.

    But if monitoring is organization-by-organization, producer by producer, done by independent monitoring organizations, as well as in-house agents, how does that threaten sovereignty?

  •  Enough for everyone's needs (1+ / 0-)
    Recommended by:
    opinionated

    Gandhi said that there was enough for everyone's needs, but not enough for everyone's greed.

    If we are going to have a lower standard of living, which I can live with--hey! I already have a much lower standard of living than I had before--I do want to get the bare minimum:

    • Housing in a safe neighborhood.
    • Secure medical insurance
    • secure income in case of disability or old age
    • long unemployment benefits
    • food and services
    • access to education

    You know,  those things found in the declaration of human rights.

  •  Globalization is an irreversible process (1+ / 0-)
    Recommended by:
    johnny rotten

    It's the first thing you learn in any International Political Economy class. Look at the nations that opt-out of globalization: Zimbabwe, North Korea, Burma. These aren't states I want my country associated with.

    In all honesty it's amazing that we debate this over and over. Globalization can be made more fair but in the end you cannot roll back liberalization, socially, economically or politically - it's impossible.

    •  Noone with any depth is saying we... (1+ / 0-)
      Recommended by:
      Commodify Your Dissent

      can or should completely reverse globalization. But buying local when possible, recycling, conserving, and managing global trade is ALL necessary.

      •  I agree (0+ / 0-)

        Who wouldn't? But without a global government I just cannot say how trans-global trade can be "managed."

        •  Trade is and has always been managed.... (2+ / 0-)

          in some form or another. In the past, it was managed by the imperial colonial powers. Now we've turned it into management by international institutions primarily controlled by the imperial powers! We need to change the rules of trade and manage it fairly for people.

          That can only be done if we don't succumb to Bonddad's powerlessness. I hope he comes around to understand that we need to build realistic hope, not diatribes of hopelessness.

          •  We ARE an imperial power (0+ / 0-)

            and the world's largest trader - I'm not interested in doing anything that is going to sabatoge my country in the interests of helping people in other nations. There is a better way than this zero-sum game you're mentioning. And I appreciate Bonddad's diary because a plethora of views is healthy for this site.

  •  Never going to happen? (2+ / 0-)

    Dang.  That's just quitter talk.  I still vote despite the poor results to date.

    I think some minimal impact can be expected from our gov't in enforcing labor and human rights...let alone our intellectual property

    Capitalism must be fettered.  We can't have countries duplicating our intellectual property, just as we can't have countries duplicating our currency.

    We need to start enforcing labor law here in the U.S. before we expect the third world to come on board.  That's why the Employee Free Choice Act must be passed, even if it means gutting the mandatory card check elections.  Companies must respect the law, and currently our labor laws are so weak that violating them is a cost of doing business.  That has to stop in the U.S. and it has to stop overseas.

    Please read my series on Labor, the GOP's #1 fear. Organized, we shall overcome!

    by try democracy on Mon Apr 23, 2007 at 10:31:28 AM PDT

  •  new jobs (2+ / 0-)

    Three of my favorites are stem cell research, alternate energy and nano-technology.

    All are subject to outsourcing, including the intellectual heavy lifting.

    Biotechnology as a whole is not a high-volume employer, and stem cell bio is a small part of it. Molecular and cell biology research by big pharma is increasingly robotized. Stem cell therapies are likely to be quite expensive and have a customer base rather smaller than that for cell phones, lawn furniture, DVDs, little black dresses, ballpoint pens, vitamins, bananas, automobiles, steel, etc.

    Mother Nature bats last.

    by pigpaste on Mon Apr 23, 2007 at 10:54:35 AM PDT

  •  Defeatist, not realist (2+ / 0-)
    Recommended by:
    berith, Commodify Your Dissent

    While this analysis is solid, the conclusion that we should simply give up is more dangerous than the author realizes. Worker protections and such? They aren't a far cry from human rights issues, and sometimes they are one and the same. The idea that we should simply give up on that throws the entire international human rights regime into jeopardy.

    National sovereignty is not a defense. If you violate human rights, you should be dealt with:

    Reprimands
    Threats
    Sanctions
    Loss of your UN seat
    Invasion by a "Human Rights" force - the HRC should have its own army.

    in that order.

    The idea that national sovereignty should continue to allow countries to act with impunity is an idea that needs to die. No country should be immune.

    Palpably Extant: the death of the 4th estate.

    by spencerh on Mon Apr 23, 2007 at 10:55:59 AM PDT

  •  It must be more than "bilateral". Certain (2+ / 0-)

    activities, industries must have tariff like protections to insure they stay within the United States and have protections for them.  It is for our own safety, security and stability as a society.

    You cannot have "parity" when the living standards of differing societies are so far apart.  All you will have, without appropriate protections, is a degradation of the more developed society, starting with labor, as the first sacrifice for the gods of capital!!

    How can the US compete with China, with such a lower cost of living; no workplace regulations; rampant counterfeiting, even to food products (e.g. pet food ingredient doctoring); and no environmental regulations, so they can throw their costs to the environment?!

    You CAN NOT!!!  When you have differing societies and laws and political systems trading you must be aware of these to set the appropriate tariffs to balance the question and to provide the incentive for the less developed society to bring up their standards of living.  Anything else is just $$$ for the Pimps of capital with us as their bitches!

    The meek shall inherit the earth.... six feet under!! Liberals and progressives, stop being meek!

    by FightTheFuture on Mon Apr 23, 2007 at 11:00:34 AM PDT

  •  What's this WE crap? (2+ / 0-)
    Recommended by:
    Irfo, berith

    I honestly can't be bothered to read these comments because just the tone of 'We are going to have to lower OUR standards of living' pisses me off.

    I am born in UK, live in US, have worked in India, Africa, Central & South America, Asia, Australia and much more so what is this WE and who are WE?

    If you are living in a Cairo souk, a Calcutta slum, a Brazilian favela, and Indian rural village, a teeming Nigerian city such as Lagos and on and on and on, I assure you that the view from the We looks a hell of a lot different than it does  from the point of view of even the poorest American.

    Levelling the playing fields may by definition lower one end but also lifts the other.

    Get over it.

    •  its doesn't lift shit (2+ / 0-)
      Recommended by:
      opinionated, pkbarbiedoll

      it doesn't lift shit. NAFTA has not lifted mexico's standard of living at all. Globilization is just american firms being allowed to EXPLOIT the less fortunate of the world.

      Generals gathered in their masses Just like witches at black masses.. Evil minds that plot destruction Sorcerers of deaths construction..........

      by pissedpatriot on Mon Apr 23, 2007 at 11:28:03 AM PDT

      [ Parent ]

      •  that is an extraordinarily myopic view (0+ / 0-)

        of the globe!  if you are making $2:00 a day I can assure you 25 cents extra raises your families standard of living.

        Mexico is not the only nation and NAFTA not the only example. Neither are American corporations holding the monopoly on exploiting the less fortunate.  Unless you can show me that you are willing to stand bent double for 1o hours a day in the blazing sun picking strawberries in California fields so you can buy your berries at Safeway for $2:00 a punnet, these hi-falutin notions have no equal foundation.

        I expect many an Indian and Chinese software engineer would also like to develop and sell his software in order to escape the ratrace. Are they any less worthy of such lofty ambitions? Where would you retire to?  Mexico, and exploit the poor by hiring gardeners and maids at prices you can't afford in America.  Some equality, pissedpatriot.

        •  okay cool - give your house away. do it. NOW. (2+ / 0-)

          Come on give your car to a poor Mexican illegal immigrant, he has less than you.  You must give it to him, damnit.  Give your house away.  Find a homeless woman and give her $1000 cash.  

          Put your money where your mouth is or stfu ok?  Stop demanding I roll over lube up at the whim of global corporations.  Fuck them.  Fuck their ideas.  

          •  how do you know i have not done exactly that? (0+ / 0-)

            does 2 out of 3 count? Still got my house which i share with several 'poor immigrants', and those who have less resources than I do. What a piss poor argument. Hasta Luego.

            •  No. You are not entitled (0+ / 0-)

              Many people in the world sleep in filth and cold and rain.  What makes you think you deserve a home?  How dare you elevate yourself above the poor.

              So go to your shiny  American bank and ask for your house deed from the vault, and sign it over or stfu about American entitlement.  

        •  equality (0+ / 0-)

          WTF are you talking about? equality? I am all for equality, the fight is NOT among the workers of the world, it should be between the workers and the slave wage owners of the world.  Workers racing to the bottom is not a winning solution FOR ANYONE, it is just the rich exploiting worker versus worker, while thye fdo virtually nothing and make 10,000 times that amount as the average worker.

          I want India workers to have a good life, BUT I AM not going to sacrifice my way of life for them.

          Generals gathered in their masses Just like witches at black masses.. Evil minds that plot destruction Sorcerers of deaths construction..........

          by pissedpatriot on Mon Apr 23, 2007 at 04:01:07 PM PDT

          [ Parent ]

  •  with you from the start (0+ / 0-)

    of your diary:

    Here's the point of all this: all of the guitars are made in Asia, particularly China.  I've played a few of these items and can tell you there are some really fine inexpensive guitars in the lot

    because my hubby just discovered the same thing in the case of mandolins. Managed to buy an inexpensive-but not cheap mando imported from Asia, then scouted out all the local instrument stores and found many that cost ten times as much that actually had the very same hardware, and (we think) the same make. The only difference was the brand.

    ps. hubby owns a small machine shop, and has been decrying America's lack of manufacturing and quality engineering for decades.

  •  Late to the game, but here is a flaw (1+ / 0-)
    Recommended by:
    FirstValuesThenIssues

    in your argument, in my opinion.
    Let me say to start with that I think your diary is largely realistic. However, in terms of labor conditions, I wonder if you are in error when you say that the governments in the 3rd world don't have the power to enforce labor regulations.
    Well, maybe they don't have to! Is it possible that strong enough unions can effect changes in working conditions---changes that are appropriate for the level of the particular country?
    Maybe laws which protect unions would be enough to get the ball rolling... also make this part of trade agreements. What do you think?

  •  GUITARS!! (0+ / 0-)

    I just felt like saying guitars....carry on...

    •  UNEMPLOYMENT (0+ / 0-)

      Debt, layoffs, offshoring, soup kitchens, poverty for millions, no health coverage, no retirement, despair, turmoil, war, disease, profit for corporations.  

    •  Guitars (0+ / 0-)

      There was a great discussion last night on the issue John Edwards views on trade.  Some sap said, why not buy a cheaper Chinese guitar...I have one and I saved so much money, and it sounds just as good...

      This was enough to tell me what an idiot he is.  He might as well shop for everything at Walmart.  One, you must not have an ear for sound.  2.  How long do you think that Chinese guitar will last?   About 3 years, before it starts succumbing to the environment.  3.  You would not recognize Beethoven over Milli Vanilli or a Stratavarious over Peking trash.

      There was an interesting article in the local Nashville press recently about Chinese counterfeiting of Gibson guitars.  

      Did you know that the mere possesion of a fake Gibson guitar is enough to make you a criminal...so you better be careful.

      It is like saying the houses that we build today are better than the ones we built in 1920...let alone 1850.

  •  Amazing (4+ / 0-)

    Bonddad publishes a diary with some harsh realities that people don't want to hear, and all of a sudden it's "dumb."  I've never seen one person call any of his diaries dumb, but when it's time to face the cold hard facts, people reject them and say "we can do it!  Screw the realities!  And anyone who writes about them is DUMB!"

    This is one of the problems with the progressive movement: people who know little about the policies they're trying to change, and who refuse to tailor their efforts to the realities on the ground.  Half of our ideas don't go anywhere because we refuse to start at the ground level, changing things by increments.  We want drastic change, and we want it immediately.  That's a noble way of thinking, but all it leads to is an incredible amount of energy expended on unrealistic progress.

    Thanks bonddad for taking the heat in order to present some facts that aren't exactly popular.

    Facts aren't supposed to be popular or unpopular.  That's why they're called facts.  Face 'em!

    What's so funny 'bout peace love and understanding? ~ Nick Lowe (thanks Alyosha!)

    by timberhoood on Mon Apr 23, 2007 at 11:11:22 AM PDT

    •  There seems to be (0+ / 0-)

      a presumption among many Kossacks that we could achieve economic paradise except for the greed corporations and elites that have manipulated our economic and trade policies.  A corrolary belief is that macroeconomic trends are largely controllable through the right set of policies.  I think these beliefs reflect a naive and conspiratorial worldview.

      I don't agree with everything Bonddad says, but I think his perspective is more realistic than the majority of commenters on this thread.  Macroeconomic trends and global trade are not controllable by the U.S.; like every other country in the world, we must react to these trends as best we can.

      Ever get the feeling you've been cheated?

      by johnny rotten on Mon Apr 23, 2007 at 02:55:48 PM PDT

      [ Parent ]

    •  That's a mighty high horse, pardner! (0+ / 0-)

      Do you imagine all of us here are in their Mom's basement in their PJs? Is that because you are? Why do you come here, then?

      This is an excellent discussion with a lot of good points, so don't bring your crap to the table.

  •  we are fucked, well actually (0+ / 0-)

    well actually the next and the next and the next generations of americans are fucked.

    I work in software development, I am hoping to sell my next program for enough to allow me to retire and forget this whole rat race.  You want to know why my program is in such high demand?  Because it eliminates jobs, it pays for itself by eliminating jobs humans are now doing.  THIS IS WHAT SELLS.

    Make software that eliminates jobs and THUS PEOPLE on the companies healthcare rolls and you have a winner.  THIS IS what is happening in the real world.  

    If I were to create software which required an increase in jobs? I wouldn't be able to give it away.

    Also , one of my family members is in manufacturing, they sent  their last bid out to 14 US firms and one chinese.  trying to be good citizens, First off only 5 american fims even bothered to return a bid, ( i guess they are too rich to make more money, lazy fucks more like it) and the 5 that came back, only one came back in a timely manner ( within a week).  The chinese firm came back with a bid in LESS THAN 24 hours, and their price was HALF of the lowest american firm. AMericans can all get phds in every field, it doesn't matter, you can't compete with that.  The quality of the product from china was incredible too when it arrived.

    America,  you jumped the shark.  

    Generals gathered in their masses Just like witches at black masses.. Evil minds that plot destruction Sorcerers of deaths construction..........

    by pissedpatriot on Mon Apr 23, 2007 at 11:22:02 AM PDT

    •  I would hope so (0+ / 0-)

      Because it eliminates jobs, it pays for itself by eliminating jobs humans are now doing.  THIS IS WHAT SELLS.

      That's called efficiency.  Less employees means less overhead and more profit.  You don't think China is trying to reduce the amount of manufacturing jobs it needs to make those products?

      A program that increases jobs is inefficient and useless.  They could perform their business better without it.

      Thinking men can not be ruled. --Ayn Rand

      by Wisper on Mon Apr 23, 2007 at 01:14:18 PM PDT

      [ Parent ]

  •  More proof we need pirates! (1+ / 0-)
    Recommended by:
    plymouth

    Ok, while the links between a decrease in the number of pirates and the increase of global warming is tenuous at best.  The link between global trade and pirates is directly related.

    More pirates would mean higher shipping costs (protection/insurance/mafia payments, pick a flavor).  On top of which it would also slow trade due to increased security needs.  Making the most perishable goods nearly impossible to ship.

    On the local side it would mean local companies would have to manufacture anything not worth or too risky for pirates to get a hold of.

    Yeah, this is all snark.  I really do wonder why some countries haven't thought of the financial benefits of harboring pirates or forming their own fleets.  And not just third world countries either.  Exxon could steal a few of their own ships and make a fortune between the cost increases and the insurance payouts.  Or even snag some other companies ship, then sell the oil at an increased price because the whole market would jump.  And it's not like it would even be hard for them.  They know how to shut off the transponders, they know when enough cloud cover is coming.  It'd be just another ship that disappeared in a storm.

  •  Globaliation is a failed concept (4+ / 0-)
    Myth #1: Globalization is inevitable so we may as well adapt.

    Nothing could be further from the truth. Globalization was an idea schemed by extremely powerful men who had a vision of an empire of global capitalism. See Quigley for details. These men set about implementing their vision over many decades. We are now seeing the fruits of their labors.

    What was the catalyst for this new globalist agenda? After all, Britain was globalizing their empire centuries ago. The new drive was triggered by the introduction of a new form of energy: oil.

    Why globalization will fail.

    The entire scheme of a globalized economy depends on  cheap oil. It also depends on the massive use of oil to transport widgets made in Indonesia to London and Paris not having any significant externalities.

    As we should be aware, neither of the preconditions are sustainable. The externalities of oil production and consumption are fastly approaching catastrophic.

    When pet food recalls raised the issue of regulatory oversight on imported goods, many saw this as a soft target iin the globalization argument. But a far softer target has been overlooked - why the hell do we need to ship wheat gluten from China in the first place.

    All you opponents of globalization need merely wait. In our lifetimes, we will see the differential of the benefits to corporate capitalism of cheap labor and the costs of transporting goods around the planet closed and eventually reversed.

    And you disciples of dead economists, who could never have imagined their scant little theories would be used to justify an empire of loosley strung corporate power the world has never seen, please wake the fuck up (bonddad).

    The "free trade" that you are touting has nothing to do with Ricardo. This is something entirely  different with conditions and consequences far removed from anything economic theory has prepared you for.

    The real world rules of the game, with transnational corporations whose revenues exceed that of most countries, and who can redefine the regulatory playing field of their host nations with ease, eat economists like oysters.

    The complexity of corporate ownership, in holding company structure, the injection of mass corruption in host state bureaucracy, and the prohibition of real numbers from researchers all make the costs benefit assessments you attempt here a fools errand.

    Globalization is a fialed concept. Democracy is the solution.

    •  That is so 20th Century (0+ / 0-)

      The entire scheme of a globalized economy depends on  cheap oil. It also depends on the massive use of oil to transport widgets made in Indonesia to London and Paris not having any significant externalities.

      Widgets?  Hardly.  Globalization is about technology.  Its the fact that I can route help desk calls from America to India at light speed and pay people over there a fraction of what it would cost to run a call center here.

      Globalization is about virtualization.  Its about pulling enough high-speed bandwidth to a tiny island in the Mediterranean and run a bond-trading floor in Malta at the same speed that GoldmanSachs is trading on Wall Street.  Only their paying American salaries and American taxes and American costs for things like real estate and insurance and utilities, and I'm sitting in Malta 100% tax free paying people $4 an hour.

      Globalization is about money.  And how all I needed to do was shift my assets to Euros in January 2002 and get that money (and all the transactional revenue that goes with it) the hell away from the failing United States of America and I would already have realized a 52% profit because the US Dollar is being run into the ground.

      And everytime someone sets in the US and decides what we really need is another law, or regulation or tariff or any kind of barricade to do business in America, that's one more reason for everyone else to go elsewhere.

      "Why can't General Motors just make their cars in Ohio?"  Look around people... its 2007.  

      Thinking men can not be ruled. --Ayn Rand

      by Wisper on Mon Apr 23, 2007 at 01:22:11 PM PDT

      [ Parent ]

  •  What does a daily salary really mean? (3+ / 0-)
    Recommended by:
    sagesource, vivacia, BlueTide

    The average daily salary is 10 cents in US dollars.

    I get a little tired of hearing about 3rd world countries in these terms because that number doesn't really give me a sense of what it's like to live there. That 10 cents means they take their local currency, convert it to US dollars (at a really shitt enchange rate) and then come to the US and try to spend it on US goods here. That's not how these people live. For them that 10 cents buys a lot more. My question is - how much more? Can they buy a day's worth of food for that amount? Only one meal's worth? I know they can buy more than a gumball, which is about that it would buy here. But I don't know HOW MUCH more. Until I know that this number is totally meaningless.

    conscietious objector in the battle of the sexes

    by plymouth on Mon Apr 23, 2007 at 12:20:20 PM PDT

    •  The concept of purchasing power parity (0+ / 0-)

      deals with exactly this problem.  It compares the price some basket of goods costs in different countries then corrects for this.
      Another way of dealing with this is through The Big Mac Index.  You can find it on the Economists website.  You can see how much a single commodity (The Big Mac sandwich which is served in over 200 countries) costs.  The cheapest is in China (about $1) and the most expensive is Iceland (close to $7).
      These aren't perfect tools but the address the problem you mention.

      The Truth is such that it cannot be seen and not be believed. Wm. Blake

      by John L on Mon Apr 23, 2007 at 01:39:41 PM PDT

      [ Parent ]

  •  Free Trade: Another framing problem (0+ / 0-)

    Conservatives have convinced most people that free trade is free and fair trade is not. They have also convinced the people that Globalization means free trade and isolation means fair trade.

    Free trade is not free. What conservative economists advocate requires just as many rules and regulations as what more liberal economists advocate. Moreover, free trade doesn't mean that there is going to be more trade than with fair trade. Fair trade means that we consider the social costs of doing international business and that the price of products produced around the world reflect these social costs. For example, I don't think its too demanding that we take into account the cost of global warming.

    That being said, what's wrong with a more equal world wide income distribution? We argue that there should be a more equal distribution within the United States, so why be against a more equal income distribution within the world?

    •  Nothing.. in Fairy Tale Land (0+ / 0-)

      That being said, what's wrong with a more equal world wide income distribution?

      Because there will always be places in the world that will not go along with "income distribution" and those places will attract the international investors.  Do you have any idea how much "transactional money" floods the US Economy because of all of markets?  Wall Street is only ONE EXchange.  Most of the worlds money flows through the United States because we want it to, because we make it easy to do so, and because we get a small percentage of it as it does so.

      Keep talking up protectionist things like tariffs and money distribution and you wonder why we're already seeing more and more IPOs launching in London or Hong Kong.

      If America is no longer an attractive trading platform ALL OF THAT MONEY and I mean ALL OF IT will quickly go elsewhere.

      Thinking men can not be ruled. --Ayn Rand

      by Wisper on Mon Apr 23, 2007 at 01:09:56 PM PDT

      [ Parent ]

      •  Fewer IPOs getting done in the US? (0+ / 0-)

        The only loss would be to the bonus pools for bankers at Goldman Sachs, Morgan Stanley, UBS, Credit Suisse, Citigroup and Merrill Lynch.

        •  Are you kidding me? (0+ / 0-)

          and 401(k) holders, and stock traders, and pension funds, and insurance companies and employees of these companies, and the service companies that rely on these companies for business, and the public programs that are funded by the taxes these highly profitable companies pay. Do you know how much revenue is generated by a major IPO?

          Did we not just see a round of layoffs at Morgan Stanley?  Thousands of people out of a job.  Hundreds of companies that sell things from office supplies to computers to Morgan Stanley are losing accounts or seeing the revenue from these accounts shrink.

          Millions less in taxes paid to the US Treasury and the State of New York because Morgan Stanley is losing money.

          And how many of those people (I dont mean senior level bond traders but clerks and secretaries and helpdesk techs and marketing interns and mail room guys) end up on unemployment or without insurance or getting their house foreclosed or cancels their plans to buy a new car, or has to stop making depoits to their kids college fund or anything else that drains the economy?

          Don't be so near-sighted to think that this only effects some uppity millionaire and therefore you could care less.  

          Thinking men can not be ruled. --Ayn Rand

          by Wisper on Mon Apr 23, 2007 at 01:30:05 PM PDT

          [ Parent ]

          •  Hmm, the round of layoffs was at Citigroup not (0+ / 0-)

            Morgan. Citigroup is bloated bank, with expense growth outpacing revenues in recent years, but the firm is still profitable, particularly its investment banking business. In any case, low level back office support personnel is already being outsourced to India.

            JP Morgan has set up an equity research department in its office in Mumbai.

            In any case, globalization is the reason why overseas firms choose to list in London or Hong Kong, or even exclusively in their own markets. Capital has become global and liquid.

            Don't pine for Morgan Stanley, Goldman and their other brethren. They have global brands and robust profits from their global activities.

            •  If you think US doesn't need International $ (0+ / 0-)

              You are mistaken.

              People can rail away at these rich people making money off other people's money all they want but if that money picks up and heads for London, Tokyo, Hong Kong, Dubai, Singapore and Brussels, every American Citizen will feel the pain.

              You want to talk about fair taxes or trade policies that's one thing.  You want to talk about trade barriers and protectionism thinking that the US is strong enough to force the world to work in whatever way we decide... that's another.

              In the years following WWII that was probably true.  Today is a whole different matter.  We would be destroyed.  Our economy would collapse.  Our currency would plummet.  Inflation would take off.  Everyone who had money would get it the hell out of the country and all the international business would turn to Europe, China, Japan and India.

              Thinking men can not be ruled. --Ayn Rand

              by Wisper on Mon Apr 23, 2007 at 02:02:05 PM PDT

              [ Parent ]

              •  That's going to happen anyway (0+ / 0-)

                as soon as China builds a stable and strong middle class, we're history.  

                The best we can hope for is to prepare for that inevitability but relocating manufacturing jobs here, refamiliarize ourselves with farming and hope for the best.

      •  I think you misunderstood the phrase (0+ / 0-)

        But maybe I misunderstood your comment. My argument was that I don't like the argument that we should be against globalization because the third world will gain income and we will not. I'm trying to make the argument that we should not be selfish.

        •  But your suggestion (0+ / 0-)

          is that we introduce some artificial market force that would effect price and operating costs out of some sort of sense of "fairness".

          I have to assume that this would mean that the products would be more expensive.  An extra cost built into each unit to cover things like environmental impact or to help pay for universal health care for the people that worked to create it.

          This market vector would not be reflected in products made elsewhere and will result in you deliberately pricing yourself out of the market.

          We're already out of the manufacturing market.  Adding these kinds of things to the products are services we still produce (professional services, intellectual property, etc) will only hurt our standing in those markets.

          Thinking men can not be ruled. --Ayn Rand

          by Wisper on Mon Apr 23, 2007 at 02:07:14 PM PDT

          [ Parent ]

          •  We already have trade agreements (1+ / 0-)
            Recommended by:
            opinionated

            My other point was that conservative think tanks has been successful in convincing people that "Free Trade" agreements mean that there are no more tarrifs and regulations between the countries involved. That is not true. The so called "Free Market" involves government intervention. For example, patents is a law that excludes competitors from the market that involves a patented product. The reason why we think of Republicans are for more freedom and Democrats for more regulation is due to the superiority of Republicans to frame the debate.

            Countries have been able to get together and make trade agreements out. They can make trade agreements that will ensure that the environment will be protected. I'm not suggesting that countries act unilaterally. The best way to get fair trade is through coordination among the nations. That way there won't be a "race to the bottom."

  •  Globalization (0+ / 0-)

    How can U.S. companies compete when the CEO and the top five people in the typical U.S. company take 10% of the profits right off the top?

    How can we compete with the rest of the world when we operate at a 10% disadvantage?

  •  "pain... for all involved" (3+ / 0-)

    There will be a fair amount of pain along the way for all involved

    Except for the multinational corporations who will be laughing all the way to the bank. But I guess it's out of the question to try to minimize the pain for the rest of us by limiting the winfall for the hyper-rich. That seems to be an unstated premise of your diary. As technology and productivity advance, why can't everyone benefit? Why are we doomed to inevitable poverty as material wealth increases?

    miasmo.com If you're not a liberal, you're a dick.

    by miasmo on Mon Apr 23, 2007 at 12:32:31 PM PDT

  •  Revolution (1+ / 0-)
    Recommended by:
    Cassiodorus

    is the answer when the wealthy have gone too far.

    It is time for working class Americans to admit that they are working class, and to stop pretending that they are "this close" to breaking through to being rich.

    Remember, folks, most big corporations are simply proxies for the wealthy that are immune to class criticism.

    This is CLASS WAR, and the other side is winning.

    by Mr X on Mon Apr 23, 2007 at 12:49:56 PM PDT

  •  bondad you are not the decider (1+ / 0-)
    Recommended by:
    pkbarbiedoll

    there are many things wrong with globalization, free trade, whatever you want to call it. For one thing, it accelerates global warming. Why? Because when a widget gets made in China, the factory over there is not making any attempt to conserve energy. Then the widget has to be shipped overseas, more waste. Not to mention the social issues of US jacking up the oppressive Chinese Govt. It is more efficient and responsible to manufacture products in the general area in which they will be consumed. So, bondad, you are saying that the next 50 to 100 years will be ruled by policy that does not support the environment. What's up with that???

  •  Perhaps something will change your basic premise (0+ / 0-)

    By that I mean if it became too costly or too dangerous to ship materials, parts, product or  people then globalization would be less attractive even to the point of being abandoned.  

    Bird flu or a war that targeted shipping vehicles (ships and planes) could lead to a voluntary retraction in globalization.

    A huge increase in the cost of oil, a definite possibility, could put a serious damper on globalization as it is practiced today.

  •  Americans are not entitled to a special place in (1+ / 0-)
    Recommended by:
    johnny rotten

    in the world that is sheltered from the ravages of global economic change.  This sparks heated emotion, and I guess I know why.  Actually, no I don't.

    People need to stop being fearful and get busy.  We all need to recognize change, to accept it, and to always be preparing for it.

    •  Sure, neither is anyone else (1+ / 0-)
      Recommended by:
      opinionated

      If we are expected to fend for ourselves, why the HELL should we create regulations which encourage the destruction of our middle class and way of life? Using your own logic these other countries should rise up and overturn crooked/totalitarian governments and demand (and achieve) change on their own dime.  Not mine.  

  •  Globalization is infinitely better (0+ / 0-)

    at helping poor people around the world do better.  They don't have to kiss your behind like they do for foreign aid either.
    Rampant capitalism has a million faults - most basically, do we really need all this stuff - but it does give people more options.

    The Truth is such that it cannot be seen and not be believed. Wm. Blake

    by John L on Mon Apr 23, 2007 at 01:47:29 PM PDT

  •  I don't agree... (1+ / 0-)
    Recommended by:
    pkbarbiedoll

    I usually can agree with your logic, but not this time.

  •  Globalization will continue without the US (2+ / 0-)
    Recommended by:
    vivacia, pkbarbiedoll

    If we are headed in the direction you say we are headed then the US is doomed! I'm not saying you are wrong. I'm just saying.

    The US will import cheap stuff as long as it can afford to import cheap stuff. With a declining standard of living how do we sustain that level of consumption? I say we don't. Why? For the same reasons that you document in most of your diaries - A declining US currency, government and trade deficits, lack of personal savings, increased energy costs.

    Lets face it. The world doesn't, or soon won't, need the US anymore. Our nation has been having a fire sale since the 1970's (more like a going out of business sale). The petrol-dollar is being traded for the petrol-euro.

    I see one of two things happening between now and 100 years from now if things don't change. Either we have a rebellion (armed or otherwise) or we have an exodus. I'm betting on a little of both.

  •  bonddad (0+ / 0-)

    You say that there's nothing we can do about this.

    But that does not seem accurate, to me.

    Establish a minimum standard in law for the treatment of labor in countries trading with the US.  That can cover wages (vis-a-vis living standards, etc., in those nations) and other things.

    Those nations that fail to meet the requirements in law face tariffs on the grounds that definitionally, those nations are deemed to be dumping.

    "I desire what is good. Therefore, everyone who does not agree with me is a traitor." King George III

    by ogre on Mon Apr 23, 2007 at 02:29:37 PM PDT

    •  asdf (0+ / 0-)

      Let's reverse the situation.

      Suppose a country we trade with told the US to implement laws that say women must be paid 50% of men's salary.  Would we stand for that?  No.  It's the same way they won't stand for us telling them how to run their country.

      Other countries have their own perspective.  While we can disagree with it, we can't force our standards on other countries.

      In addition, read the example I provide. We're approaching the problem from the perspective of a developed country.  They are approaching the problem from the perspective of a developing country.  Simply put, their problems and priorities are different than ours.

      "You think you can intimidate me? Screw you. Choose your Weapon." Eliot Spitzer

      by bonddad on Mon Apr 23, 2007 at 03:44:23 PM PDT

      [ Parent ]

  •  Okay I know I"m late to this... (3+ / 0-)
    Recommended by:
    vivacia, pkbarbiedoll, Kujo AAR

    ...and likely few people will read it but I have to make a distinction.

    I was under the impression that the wonders of globalizaiton can only really be realized when the big bad industrial nations can lift up the lowly developing nations, thereby developing a consumer market for more goods.

    However that doesn't seem to be how globalization is working.  Industrial nations, in their "race to the bottom" are not paying developing nations enough to raise the standard of living (the possible exception being china but that's more a matter of sheer volume than anything else).  And rather than invest in a single location for development, corporations are flitting around the world like hummingbirds chasing the cheapest labor for any given moment.  What little is being given to a nation's economy is being taken away and given to some other country.

    This will not fufill the promise of globalization.  This is why we need "fair trade" and not "free trade".

  •  Huh? (3+ / 0-)

    In other words, we are entering a period of decreased living standards that could last 50-100 years during which the developed world's standard of living decreases while the developing world's standard of living increases.

    I disagree.  Everyone's standard of living will decrease as the ecosystems collapse and as abrupt climate change worsens.  This perspective is notoriously lacking on an analysis of the "human-nature metabolism" which has gone so awry with neoliberalism.

    While we can rail about the effects of free trade all of us benefit from free trade.

     

    Tell it to the 40% of humanity that still lives on less than $2/day.

    Here's my latest example.  A long time ago in a galaxy far, far away (actually a city named Austin, Texas) I was a professional guitarist (What else are you supposed to do with a political science/economics/music major?).  Anyway, I still keep my hand in the game and read Guitar Player Magaine every month.  This month they review budget guitars -- guitars under $500 or so.  Here's the point of all this: all of the guitars are made in Asia, particularly China.  I've played a few of these items and can tell you there are some really fine inexpensive guitars in the lot (particularly the Hamer XT series).  It's a damn fine guitar for the money.  In fact it's a damn fine guitar compared to some guitars under $1000.

    Are cheap guitars made with cheap labor supposed to make up for more expensive rent on a dying planet?  I'm tired of being a consumer -- I want a meaningful life to live.

    1.) We need to become more competitive in the "jobs of tomorrow" -- economic areas that will provide goods and services the world wants tomorrow.

    2.) The US workforce needs massive retraining/education.

    India can provide cheap, well-educated workers far more effectively than the US can, and the US isn't going to rush into any losing race to catch up by cheapening its doctors, lawyers, or scientists any time soon.  Meanwhile the US still rides high on dollar hegemony, a subject I've challenged you to discuss without avail.  The current mentality is: we don't need to make anything -- we make the US Dollars.

    When we make deals with other countries, we must insure there are policies in place that benefit US exports.

    As the fossil-fuel energy runs out and as replacements prove to be relatively expensive in terms of energy return on energy investment (EROEI),  industry will have to localize, not globalize.  "Globalization" is a matter of relatively cheap oil, which won't last forever.

    "This is an impressive crowd, the have and the have mores. Some people call you the elite, I call you my base." - George W. Bush

    by Cassiodorus on Mon Apr 23, 2007 at 02:42:24 PM PDT

  •  Labor unions? can't our international (1+ / 0-)
    Recommended by:
    opinionated

    Brotherhoods insist on organizing in the developing countries?  Or at least send out organizers to find out what the conditions are really like.
    and also, retraining.  Every time I try to find more about retraining it seems as though the jobs people are expected to retrain for have disappeared.

    WE must hang together or we will all hang separately. B.Franklin

    by ruthhmiller on Mon Apr 23, 2007 at 02:56:07 PM PDT

  •  Outsourcing (0+ / 0-)

    Let's 'outsource' the "Global War on Terror".

    http://www.gocomics.com/...

    Republicans were for `partisan fishing expeditions', before they were against them.

    by William Domingo on Mon Apr 23, 2007 at 03:17:54 PM PDT

  •  There is no point of return, no reversal (3+ / 0-)

    and your solutions points are terribly misleading:

    1. "We need to become more competitive in the "jobs of tomorrow" -- the job/industries you offer are NARROW and highly specialized -- they do not have the scale lift all-the-boats you claim is needed to turn the imbalance around
    1. "The US workforce needs massive retraining/education."  How do you propose this will happen?  Retrain older workers for...what new jobs? Rewrite our elementary, secondary, college curriculum, process and infrastructure for....what?  Where?  How?
    1. "Trade deals must be bilateral."  Why? We are consumption based economy; the developing countries are supply based.  Are we not consuming what we demand they supply? And trade is only part of the overall economic relationship here.  What about the flows of funds and capital?  Maybe, just maybe, the trade deals are unfair because they have an unfair advantage in ownership of our debt paper -- govt, mortgage, commercial and currency?

    Globalization is at a point of no return; we can't turn back the clock.  The smarter "haves" will figure out how to take advantage of this, while the "what me worry?" have-nots will continue to marginalize.  The gap will grow larger than what it is now.

    Whenever you find yourself on the side of the majority, it is time to pause and reflect -- Mark Twain.

    by dcrolg on Mon Apr 23, 2007 at 03:21:59 PM PDT

  •  Losers not compensated (0+ / 0-)

    if I remember my trade theory, it is that trade increases the size of the pie and that the losers can be compensated and the nation still comes out ahead.  The losers have not been compensated, and that was an implicit promise of the politicians selling free trade.

  •  Ex-Pats and such (0+ / 0-)

    Dear Bonddad,

    Do you not think, that if the trade laws did become equitable for labor and the environment, And if that was enforced by the laws of the USA, that we could not immediately impact the status of workers everywhere?  Whatever happened to the fight against communism that so many of your economic co-whores espoused?  Is it because Capitalism, with or without Totalitarianism, is OK with US?  If that is the case, then maybe we should try Socialism or Communism again, because the countries that practise this, seem to be the ones on the upswing these days.

    20 years ago, we were with Yeltsin and Tienamin.  Now, they are positioned for the future, much better than us financially...and the Bush Dogs have guaranteed that we will have to fight for every last drop of oil with our blood.  The Capital account balance of the US with our trading partners, where it is negative, is not as dire as you say; simply because these economies would nearly, if not actually collapse, if we were to impose our collective will.  Our current acount may be negative, but if we want to preserve our substanial wealth and economic potential, we must change the status quo.

    If the USA wew to impose what you say are self-defeating and draconian trrade laws, then...How many expats would come forward and move their operations overseas.  and how do you think OUR companies would do, if we were to force them overseas?

    1.  No one would want to live there, forever.
    1.  The company, if it did switch like Halibuton/Treasonhurtin, would not be a US comany anymore.
    1.  The company would die

    Otherwise, I think your blogs are great.

  •  Now you're confusing me with your update (1+ / 0-)
    Recommended by:
    Commodify Your Dissent

    The emphasis in your first paragraph is:

    In other words, we are entering a period of decreased living standards that could last 50-100 years during which the developed world's standard of living decreases while the developing world's standard of living increases. Until we reach a point of near parity there is little we can do on the policy front to prevent it from happening.

    But your final paragraph says:

    The central point is this: So long as the US likes cheap "stuff" globalization will continue.  In addition, other countries have clearly benefited from these policies.  China is a classic example, but there are numerous others.  The Asian economies have done very well for themselves because of US consumption.  So long as we consume at current levels, expect this trend to continue.  If you want to stop globalization, then you need to figure out how to get the US consumer to stop buying.

    Your final paragraph is a statement that can be backed up with an economic argument. It sounds like a few people disagree but I would agree with it. But in the context of the rest of the article, that last paragraph in the update looks like a bait-and-switch.

    Your first paragraph, which originally appeared to be the central point of the article, is a completely different statement. It's a political statement and any economic argument you might make to support it, would be speculative (about future government policies and cultural changes) and would have to be evaluated through a political lens. There's nothing wrong with that, that's what we're here for, but a lot of people disagree with that first paragraph, myself included, and there are a lot of good counter-arguments here.

    There's also a subtext that runs through the whole piece, that a reduction in "standard of living" (however you define it) of the nation as a whole is a bad thing. That's like saying that the economic growth we've seen in the nation as a whole in the past few years is a good thing. A majority of Americans might disagree since they haven't benefited from that growth. Once you get into policy, you can't really evaluate the situation without considering equity, and what power the losers might have in order to try to make the situation more to their liking over a long period of time.

  •  Don't know if anyone has raised this (0+ / 0-)

    But considering the accuracy (specifically, lack thereof) of Bonddad's prognostications of immament recession back in 2004, I'm not too worried by what he says here. Some of it is true--people love cheap stuff, espcially when they're getting paid crap wages--but the idea that the race to the bottom is inevitable and there is nothing we can do except all become nanotech engineers...no. We will never need that many nanotech engineers or alternative-energy researchers--we need to fund alternative energy research and development, but there is a point beyond which adding more researchers does not hasten results, especially if said researchers aren't particularly good at what they do and are only in it because it's a trendy job.

    And demanding regulation based on fundamental human rights--no child labor, no slave labor, no obviously hazardous working conditions--that's how the US and Europe got to be what they are now. It may not happen to tomorrow, but there is absolutely no excuse for giving in to "free trade" on that.

    "All governments lie, but disaster lies in wait for countries whose officials smoke the same hashish they give out." --I.F. Stone

    by Alice in Florida on Mon Apr 23, 2007 at 04:33:44 PM PDT

    •  No longer an advantage in Stem Cells or Nano (1+ / 0-)
      Recommended by:
      bluewolverine

      Half of the researchers, even in the USA, are from Asia in these fields.  Our advantage is almost nil.  It seems the greedy speculators in our good ole USA, do all of the talking and little action.  Have you ever heard of corporate espionage?  Do you realize that most foreign scientist in the USA are "double dipping" ?  They are selling our future potential BondDad, not only our current account deficit.

  •  Free Markets (0+ / 0-)

    There is one area where, even if they did not exist, they cannot be allowed to exist.

    Food security cannot be allowed to reside in the hands of other people.

    Importing optional foods, luxury foods etc, fine, they can obey the laws of economics and as the cost of production and transport rise we will eithger "afford" them by cutting other expenses, or the market for those products will vanish.

    But any nation that places its staple food production in the hands of other countries is stupid. The European CAP and US restrictions on imprts of Austyralian foods are pains in the ass, but they retain local productive capacity and skills and the social, economic and just plain survival value of that is almost never factored in; although it should be.

    Nations that elect to starve their people into learning to live differently either collapse, like Somalia, or become fascist dictatorships like North Korea.

    There is no way that is a rational decision.

    The Number of the Beast 72-25

    by Deep Dark on Mon Apr 23, 2007 at 04:50:15 PM PDT

  •  As an example: Boeing. (0+ / 0-)

    If we prevented Boeing from building a factory in China, then we could probably get 50-100 more years of market dominance simply based upn brand name and actual quality.

  •  globalization in Iraq (0+ / 0-)

    construction companies in Iraq used 3rd world slave labor for most of the projects there. In those cases taxpayer money enriched the bottom lines of these companies while hurting the overall US mission. The Marshall plan that rebuilt Europe invested money directly into the affected countries. This created jobs and allowed local businesses to grow. If germany and Japan had no security and 40 % unemployment, it's likely we would be fighting insurgencys "over there". Iraq's globalized and privatized rebuilding has benefited noone.

    Patriotism consists not in waving the flag, but in striving that our country shall be righteous as well as strong. ~James Bryce

    by california keefer on Mon Apr 23, 2007 at 05:46:27 PM PDT

  •  What about Perma-lancers like myself? (0+ / 0-)

    The fact of the matter is that you can get all the education money can buy - that does not guarantee you a job in corporatist America. The trend for Corps for the past 25 years at least has been to replace as many employees with contractors, downsize and otherwise liquidate any and all pension obligations, benifits and employees in general (rewards for service ,dedication, professionalism or loyalty).

    Why hire (invest) in an employee that is on your balence sheet, when you can contract (lease) one for cheap?

    When it comes time for massive downsizing and transferral of jobs to 3rd world tax havens there will be no headlines of massive layoffs, because firing contractors does not impact the balance sheet at all since they are not assets or employees technically.

    HB1 Visas (importing highly the skilled from the globe) kill American wages by legislative fiat. That is scantly reported, or acknowledged by the Institutional View that just urges people to spend their own money getting degrees that will never be honored by American Employers.

    American Corporations will either offshore jobs/factories or import workforces rather than hire one American Citizen.

    Furthermore Govt. and corporations consider Americans too smart already, because they know they are worth far more money than they are being paid. Every American that goes to college and grad school is a potential political liability for corporations.

    The more educated you are the more you will notice the highly technical accounting, trade, economic and political structures and and machinations that exist only to benefit Corporatists and their lackey servants in Government.

    So there isn't going to be any concerted effort by corporations to train Americans who will only turn around and demand their stinking rights to elect their own govt without corporate interference and sedition.

    As it stands right now American Corporations are poised to leave enmass and reincorporate elsewhere while the getting is good and their are no laws preventing them from a massive exodus from American soil, taxation, or control. Next stop - Dubai.

    I believe year after year 90% recent graduating JD's - can't find work in the field of law. A JD in international contract law with a cpa however will garnish you a million dollar starting salary working for a Transnational setting up a plantation - I mean, 'subsidiary' in the 3rd world.

    The future of the American Economy is no American Economy if the current globalization and liberalization of tarrifs and trade policy suceeds.

    There is only relative success in an economy that can drown labor at any given moment by opening the boarders for corporations.

    I respect your institutional view as a good starting point for analysis. But right now our institutions are controlled by corporatists, who aren't going to come clean  about their intentions to jettison America like an expendable used up carcass when the ship starts sinking.

    The economy will crash and corporations will leave as soon as the institutions think a non-corporatist will be elected President. I don't think they are all that worried by Clinton.

    Remember those in prison as though you were there with them. -8.88,-9.69

    by Kujo AAR on Mon Apr 23, 2007 at 07:16:19 PM PDT

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