I'm glad you mentioned this. Some people have lost their jobs to workers overseas. People can't always be "retrained" and so for these people, since they are now unemployed they are not able to buy more.
In addition, lack of employment correlates (and presumably causes) and increase in crime, in drug use, in depression. These are all externalities that are borne not only by the former worker and their families but by taxpayers and society at large. Someone has to pay for the increased crime and protection, someone has to pay for the additional health care costs, and so on.
These negative externalities of exporting jobs to China, to Mexico, and soon possibly to other Asian nations through TPP are never part of the economic equation.
In order to address a problem, it must be fully analyzed. In this case, there is much finger pointing at the victims of a broken system.
So, when a company exports a worker's job overseas, who is supposed to pay the additional healthcare costs cost by the unemployment? Should us the taxpayers or should those that caused the problem in the first place? Someone has to pay and we shouldn't just let events decide but rather make a conscious choice.
Personally I think it's entirely fair if someone in another country is allowed to compete on the world market and provide a service for cheaper. It makes economical sense for them as they'll improve their living standards by quite a lot. So you could say that I have compassion for everyone else in the world who isn't born a US citizen and needs to scrape by from much diminished opportunities to begin with.
The offshoring country indeed loses jobs and the jobless need to handle this situation. Some will end up drugged out in the street. I'd argue that these drugged off people aren't that much the fault of corporate leaders who cut costs by offshoring. I'd say the drugged off people are jointly responsible for their fate, along with governmental policies that offer no social net while also not wanting to take any action to prevent spiraling delinquency.
If you look around the world, not every person who loses their job ends up drugged off and homeless. In many places, people are quite poor and don't end up this way. Most people lose their jobs and turn around and figure something out. And then some people can't deal with the hit and don't have what it takes to handle and end up drugged out in the streets. There's some self responsibility going on here that allows this to go down this path. And there's some social policy at play too. In another country, you could only fall so far down before something makes it harder for you to go further down. Either there's strong social nets, or there's just strong anti-drugs laws, or all kinds of debatable policies.. but many of these policies help prevent people getting so low that they can't come back up.
Why is the poor trade worker in VN, living in a metal shed, able to handle abject poverty with dignity, and then get an offshored job and thrive... but the US worker loses their job, has 10x better economical opportunities than the VN worker but ends up drugged out in the street. This isn't a real argument as there are people heading down a self-destructive path everywhere in the world. But I can't help but think that a lot of self-pity has to do with one's own perceived expectations for higher standards and inability to accept loss.
Ultimately, I can't help but think it's an infantilizing argument to say that the hard working factory workers who become junkies, are junkies because someone offshored their job. Because this supposes that they had no agency into doing anything about it, they were doomed to become junkies. This also supposes that a variety of things could have easily knocked them off the good path. That they were fragile and had no recourse or control over their destiny. If it wasn't a CEO offshoring their job, it would have been some other hurdle. And I don't buy this, I don't think the average hard working factory worker is such a fragile person, whose entirely at the mercy and requires the protection of a patronizing CEO.
I understand that we should consider the human cost in this sense, but if you're going to appeal to the empathy I have for the people who lose jobs, you can't ignore the people which benefit from the "industries being sent overseas" by receiving those jobs. Of course I'm sad when I see a homeless person in the US, and yes some of them are homeless because their jobs "moved overseas", but those jobs might have helped a few really poor Chinese farmers attain a higher standard of living as factory workers. How do we account for that?
Your Cost of Living argument is lame; the term has a definition which you have overloaded to mean something completely different.
Yes, there are people who will lose jobs for all sorts of reasons, including competitive advantage of different regions (eg China and Mexico have labor that is far cheaper than Americans are willing to work for) or the euphemistic “creative destruction”.
I don’t feel sorry for horse buggy whip salespeople who had to search for a different purpose in life. They already won a lottery by being born in the USA in the most affluent time in history. The economy doesn’t owe anyone anything.
The only thing I wished we as a country had done during multinational trade pacts was not to put the onus on individual employees for proving jobs lost to offshoring; there was moral hazard and the evidence to prove causation was hidden from those who needed the evidence. Other than that, these trade pacts simply accelerated the changes that were going to happen anyway. It’s better not to live in a one-industry town where the winds of change can decimate the Un-diversified local economy.
The consequence of not shipping jobs to southeast Asia is that folks there will be vastly poorer than unemployed Europeans. That isn't theoretical, its simply a fact.
Why does a non-contractual relationship change things? Are you applying the Copenhagen theory of ethics or something?
There is a general lack of empathy for these workers and even for those who get laid off due to globalization and now under a opioid/meth epidemic.
Free market proponents always talk about 'retraining' and other up in the air initiatives but there is no follow up or details about how these will actually work in the real world with some base accountability, processes and studies about how well they worked in the past. And yet all these trade deals without exception have claw backs and multiple processes protecting their investments and profits. In this case all the details are covered carefully and it is not left 'up in the air'.
There are no easy answers here as opinions will shift depending on which side of the equation you or someone you care about finds themselves in. This is really about the kind of society and community you want to build and how you see yourself as a country.
Sure people do make the connection. But no amount of lower costs across the board will help a newly unemployed person. For that person, the costs and benefits just don't match up.
Structural unemployment is an inevitable result of globalization, we need ways to mitigate this. Trade from the POV of rich countries is often a redistribution from the poor (uncompetitive labor) to the wealthy (multinational corporations), justified by the "gains from trade". We must be willing to aggressively redistribute these resulting gains back to the disenfranchised or see populist backlash.
I think the answer is to incentivize people to get back into those skills. Likewise, the corporations need incentive to keep those jobs here. We, as a nation, can't do this if everything like those jobs gets sent over seas.
Jobs move overseas because employers don't want to pay us if they can find a pool of people that do not expect rights or market compensation for their labor.
It's like applauding McDonald's for replacing its minimum wage workers with indentured servants. They're ignoring basic human expectations about compensation so they can save money.
Now we don't have jobs, but the servants get to live in America! It should be celebrated.
If those people were to receive the same basic rights or fair market compensation for their labor, it would be a positive.
Huh? How many southeast Asians were denied for decades employment at a company in small town USA?
Regarding social responsibility, this is simply my opinion, but companies that wish to employ the full legal and financial protection of the United States and operate within its infrastructure bear some social and moral responsibility to contribute back into the system. Offshoring the bulk of a company's workforce or moving profits overseas to evade taxes and other things of this nature should disqualify any company from receiving the protections and benefits provided by the US, full stop.
Why should the overseas workers capture that gain? Seems like a tax which can be used to train US citizens for these extremely in demand jobs would be a better use of that money than sending it overseas.
There are Federal programs to retrain and financially assist those who have be displaced by offshoring.[1]
The problem is that these programs are notoriously underfunded (the financial assistance barely helps. It's like 10k a year if you're very lucky), have their resources misallocated, and do just enough to say that they're doing "something". Their funding is also often lumped in with other welfare "handouts". So when people vote against funding "handouts", they vote against helping people who need it most.
I think this gets at the root of the dichotomy: it shouldn't be about making the lives of either Mexican workers or American workers better. If the system properly redistributed the profits from moving the factory abroad to, say, education and retraining and job placement programs to the American workers, then we wouldn't be having this debate in the first place.
Right. The American worker lost his job because he was undercut by people who'll do the job for a third-world salary in third-world conditions. The solution is to let the American migrate to the third world so he can join the fun. How could we have been so blind?
I've heard many folks complain about TPP on the premise that it will destroy and/or degrade American jobs. I believe there is lots of truth to that--people in other countries are usually willing to work for less than Americans.
Even so, TPP will help job-hungry people in other countries (at least slightly) by dumping more jobs into their job markets. So, if we're going to help Americans by ditching TPP, we're going to do so at the expense of people in other countries.
Is that the right trade? Helping Americans by hurting others? Maybe it is.
Or maybe I'm missing something... Thanks for your thoughts!
Good points. Getting metrics that cover underemployed and apathy would be difficult.
Where I was going was that it appears looking backwards to want to bring jobs back that were outsourced for mostly cheaper labor. If US companies could do those things here profitably, they would.
The people weren't offered a choice, "you can have inexpensive goods and go on unemployment, OR you an keep your jobs but with a 10% markup on electronics" (btw there was massive collusion by Samsung and Sony with subsequent settlement for price fixing in flat-panel TVs).
Moving jobs overseas is evading the "free market" by literally moving the labor market somewhere else. The corporation captures the benefit, the old workers are unemployed, the new workers do not benefit from the social benefits of the nation to which the corporation pays it taxes, and the shareholders get an extra $1.00EPS on their dividend sheet (that they pay very litle tax on because their rates are lower than wage tax). It's an all-around scam.
People who are against outsourcing of jobs because it hurts workers have what appears to me to be a small view of the set of humanity that matters. I don't see any particular reason why workers in the US are more entitled to good jobs than workers in other countries. There is no force more powerful for improving the quality of life and well-being of _billions_ of people than economic development, of which foreign investment is one of the best sources.
I want to see a world where there aren't poor countries and rich countries, but rather a global economy where someone born in (e.g.) Africa has opportunity and education similar to someone born in the US. Once this is accomplished (and the challenges in front of us for doing so are enormous!), outsourced jobs won't be a problem.
Rather than being opposed to trade and globalization (which are, frankly, unstoppable) we should be focused on mitigating losses for those affected. Erecting barriers to trade will only make US industry uncompetitive, our economy smaller, and those same workers, ultimately, worse off.
You're asking an implicitly deontological question with an explicitly consequentialist answer. This kind of "outsourcing economy" has been tried, and we have observed mostly negative effects. It deskills the country which pays for the goods, creates trade imbalances that help to break down what's left of our international system, impoverishes the people who are disemployed, and exploits the people who are newly employed.
Worse, the gains-from-trade that economists say ought to occur are allocated entirely to the owners of firms and equities, rather than being redistributed to the former workers to help smooth out economic transitions.
>This weird entitlement around jobs in America is strange to me.
That's because America's not willing to spend any resources on retraining workers or redistributing wealth away from the owning class, so "jobs" are the one thing people absolutely need to stay alive.
In addition, lack of employment correlates (and presumably causes) and increase in crime, in drug use, in depression. These are all externalities that are borne not only by the former worker and their families but by taxpayers and society at large. Someone has to pay for the increased crime and protection, someone has to pay for the additional health care costs, and so on.
These negative externalities of exporting jobs to China, to Mexico, and soon possibly to other Asian nations through TPP are never part of the economic equation.
In order to address a problem, it must be fully analyzed. In this case, there is much finger pointing at the victims of a broken system.
So, when a company exports a worker's job overseas, who is supposed to pay the additional healthcare costs cost by the unemployment? Should us the taxpayers or should those that caused the problem in the first place? Someone has to pay and we shouldn't just let events decide but rather make a conscious choice.
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