October 28, 2004

• With the "logic" this asshat used, she should be voting for Nader, not Bush. [Oh, and hello, I'm terrapin and I'm new at the monkey house]
• It's one thing to object to Edwards' protectionist stance as bad economics, it's quite another to lump him in with David Duke. That's just incendiary and dumb. Then again, lots of people are justifying voting for Bush with reasons that make me want to bang my head against the wall. My personal favorite: Kimberly Parmer, 33, who works as a human resources manager in western Michigan, said the emphasis on national security issues had distorted the campaign. "I don't think terrorism is as big a threat as everyone is making it out to be," Ms. Parmer said. "Yes, we have had a couple of incidents, but other countries have hundreds every year. Iraq is important, but so are things like Social Security and Medicare. Neither one has really touched on those subjects because no one is going to be happy, no matter what you do." Ms. Parmer, who said she is firmly planted in "the very low middle class," also saw the Bush tax cut as poorly timed. She normally votes for Democrats, she said, but is not sure this time. "One is too polished; the other one, I think to be honest, I don't know how he ever got to be president," Ms. Parmer said. "I am really surprised he has gotten as far as he has in life. I do think he's honest." Even so, Ms. Parmer said, she thought she might vote for Mr. Bush. "If you actually look at him, and he stands up next to Kerry, you just kind of feel sorry for him," she said. "I feel he's more of an underdog, he's had a hard go of it in the last four years."
• What is most surprising to me is that Christopher Hitchens pulled the lever for Kerry in Slate's mock election. Not sure why because his "reasoning" seems to praise Bush more than Kerry. They also should fire their Intern, David Kenner. Not for suggesting he will vote for Bush, but for because he uses words that don't mean what he thinks they mean. For example, he says:

  The simple fact is that he is the only candidate who has had the courage to envision a long-term solution to the danger of terrorism—the liberalization and democratization of the Middle East.

  I don't think El Prez wants the Iraqi people to beecome more liberal, so I assume he meant he wants them liberated. No wonder he wants Bush. Bush speaks his langauge.
• The David Duke metaphor is over the top, as ambrosia noted, but his essential argument that protectionism is an immoral appeal to our base instincts strikes me as correct. Here is the money quote: "Duke thinks it's imperative to protect white jobs from black competition. Edwards thinks it's imperative to protect American jobs from foreign competition. There's not a dime's worth of moral difference there. While Duke would discriminate on the arbitrary basis of skin color, Edwards would discriminate on the arbitrary basis of birthplace. Either way, bigotry is bigotry, and appeals to base instincts should always be repudiated." When people talk about jobs "moving" to India, or wherever, my first reaction is great, India needs jobs if it is to prosper as a democracy.
• You know, this just isn't an easy issue. Developing nations need trade (especially they need to sell value added finished products, thus creating profit for themselves), but what they get are companies from developed nations setting up manufacturing there, paying pittances (even in the local sense), and bleeding most of the profit out of the country, back to investors in the developed world. Most people in the developed world benefit from the cheap goods, but not as much as one might because they may be unemployed because of this, and there is increased downward pressure on wages (adjusted for inflation) in the developed world. Sometimes I think that protectionism should be set up differently - allow the developing world to trade freely into the developed, but only if they abide by all the safety, etc, regulations of the importing country, and pay wages, adjusted for local prices, are comparable to the minimum wage in the importing country, that is, that the workers can buy the same "basket" of goods with their wages. Maybe there should also be rules about local ownership - eg 50% of stock owned by people in the same country as the manufacturing. Companies can also be sued for labour violations under the law of the country they want to import to - failure to abide by them would result in loss of permission of trade. This wouldn't really help developed nations, but it would mean an influx of more money into developing nations, money which might be constructive in local society, rather than destructive. (Dumping of goods cheap on markets in the third world, which hurts local manufacturing, is another issue, but this comment is already too long.) What to do about lives in the developed world? Part of me wants to go all protectionist and say, dammit, we need to protect those manufacturing jobs that mean that average people can still afford to raise a family, but then I think - why are we deserving of houses, and cars, and lots of food - when the third world starves? Ecological footprint studies show that we already use way too much of the world's resources, renewable and non-renewable - our lifestyles just aren't sustainable now, let alone for the whole world. Is it fair then, for us to lead them? But how do you tell the whole developed world that really, they don't deserve to have clean clothes every day, a variety of food, more than one or two rooms to live in. Try telling some people suburban sprawl is bad and they freak out - what happens if you suggest that really, to be fair, we shouldn't be using cars at all, and even small single family homes in cities are an incrediable luxury. Is everyone here willing to live with a footprint of just 1? I thought I was pretty pared back - but it still wasn't enough.
• Sorry - I should be more clear about the issue of the developing world trading into the developed. I certainly think that first world standards should be imposed on all companies owned and operated in the first world, who manufacture overseas, or who distribute to their profit the goods from overseas. Should actually locally held countries be held to the same requirements? I'm not sure. Thinking about disparity in the third world, I'm thinking yes, or else profit would just accumulate with the very richest, and not benefit the people at all. Truth is, I couldn't give a flying fuck how well a "nation" does economically - I just want the majority (aka more than 50%) of its people to be better off.
• Edwards would discriminate on the arbitrary basis of birthplace. That is absolutely moronic. Should Edwards run for VP of Estonia? Why discriminate Edwards would discriminate on the arbitrary basis of birthplace? ps hey Terrapin- I'm a Terp too ('97).
• oops a little cut and paste SNAFU there- should read: "That is absolutely moronic. Should Edwards run for VP of Estonia? Why discriminate on the arbitrary basis of birthplace?"
• (Oh, and don't get me started on what a messed up thing the idea of GDP per capita (measured in US dollars) is for measuring the "wealth" and well-being of people in a given country. Aside from the problems of the international money market, even in third grade, we all learned about skewing the average.)
• Personally I have some misgivings about Edwards' protectionism, as I believe that everyone benefits when goods, people, and ideas are allowed to move freely. But that's not stopping me from voting for Kerry. For the author of this piece to say that because of protectionism, he was going to vote against Kerry isn't very consistent, either- Bush has a lousy record on this issue. Steel tariffs, agricultural subsidies, etc. As my cousin the economist has noted, Bush is the worst sort of Republican when it comes to trade. I agree with jb that it is hard to figure out where to start. I would suggest gradually doing away with agricultural subsidies in the developed world- that would allow farmers in developing countries a chance to compete on a more level playing field.
• While Duke would discriminate on the arbitrary basis of skin color, Edwards would discriminate on the arbitrary basis of birthplace. Um, shouldn't politicians be doing this? The state is there to take care of its own people; that's why people organize into larger collective groups in the first place. Political Philosophy 101. I'm thrilled that India has a democracy but there's little reason for my tax dollars to pay for it, when there are so many pressing needs here at home. Maybe when most Americans have jobs and healthcare and we have a president that doesn't send poor people off to fight a half-trillion dollar war, maybe then we be even more generous than we are now. Until then, how about we clean up shop here at home? Otherwise we won't have a state that can so willingly throw tax benefits at corporations to help them move overseas.
• Letting workers in other countries compete for american jobs is one thing. Giving the companies who hire them tax incentives for doing so is another issue entirely. It's the tax incentives that make it more than an issue of national preference. This person is just another republican troll screeching his stupid opinion on the internet. *YAWN* Freepers bore me.
• what a fucktard...
• ambrosia is right - agriculture is definitely the first place to start, as it is so important to the economies of the devloping world. Subsidies hurt them very badly. As can food aid in kind, actually. I would never have known this, but I met an Ethopian academic who studied agriculture, and he was telling me about how all the aid in kind makes it very difficult for their farmers to sell the grain at prices they need to survive (and thus not need aid themselves). The poorest there do need foreign aid, but it would work all the much better if that aid came in the form of cash used to buy local grain and redistribute to those in need. But apparently many countries (the US?) have policies against cash aid; they would rather redistribute their own excess products..
• (second dot a typo)
• If the Indians were getting the same pay as Americans, maybe Edwards would be the racist. But since the Indians are getting a small fraction of the pay Americans recieve, it's the corporations who are racist.
• Asshat in ivory tower has an opinion, casts vote for Bush... nothing new here.

• But since the Indians are getting a small fraction of the pay Americans recieve, it's the corporations who are racist.

  How so? Isn't paying Americans more to do a job Indians are willing to do for less actually the mark of self-sabotaging prejudice? Besides, trade doesn't really work that way - businesses aren't charities, and the low wages of Indian workers reflects their relatively low productivity by comparison with American workers.
• I wonder what the author's position on American vs. foreign lives is. Should every murdered person treated the same as a murdered American person with respect to our foreign policy and military action?
• But since the Indians are getting a small fraction of the pay Americans recieve, it's the corporations who are racist. How so? Are you serious? Paying blacks less for same amount of work = racism Paying women less for same amount of work = racism But paying Indians less for same amount of work = free trade?
• I'm going to sidestep the topic and run around screaming over the part ambrosia posted. Even so, Ms. Parmer said, she thought she might vote for Mr. Bush. "If you actually look at him, and he stands up next to Kerry, you just kind of feel sorry for him," she said. "I feel he's more of an underdog, he's had a hard go of it in the last four years." New campaign ads: big watery puppy-dog eyes and faint whimpering noises! With a flag. Obviously.
• Mr K, I think it should be "paying Indians who are living in another country less for the same amount of work = free trade". I don't quite agree with it, but I don't think it's racist either. They're in another country, they pay different kinds of taxes, and they have different costs of living. What's a living wage in their money wouldn't feed a flea in ours, so we can't go comparing our salaries with theirs either.
• They could be living on the moon, it still wouldn't change the pertinent facts: The do they same job, but are paid much less solely on nationality. Most often when you see wage quotes, they've been adjusted for costs of living and the other factors. Note how they'll say the "equivalent" of $X wage. If you are willing to pay $X to a person for Y amount of work, then it shouldn't matter whether they live in the US, India, or on Mars, so long as you are getting what you paid for.
• Paying workers in foreign countries a wage they are willingly agreeing to work for is not taking advantage of them, and it's definitely not racist. On a larger scale, global outsourcing does affect American jobs and wages, but if it causes an average 2% decrease in American standard of living, and a 20% increase in the average standard of living in a developing country (all figures made up), is it worth it? Some people (like Edwards) just see the negative local effect, and ignore the global benefit. I think that's shortsighted, and maybe a little bit racist.
• I think it is "fair" to pay people less, because money is just a fiction; currencies go up and down in value on mere speculation, and prices are completely different. What really matters is how much food, housing, clothing, etc that money will buy in local prices (which are much lower). It saves the company money (and thus gives an incentive to go to manufacture in poor countries), but doesn't allow them to use the desperation of the local people to pay starvation wages. To make up some completely random numbers, it's the difference between paying someone $2 a day, and $0.20 a day, where $2 a day supports a family, and pays for the kids to go to school, etc. Of course, better yet to pay $5 a day,* like Ford did, and make sure your workers not only have enough money to stay healthy, but even to purchase the product you are making. Suddenly you have increased your market, and like Ford, you will become rich, even as you make your workers richer. (*I think this was actually the amount Ford started paying his factory workers, but it's been a few years.) rocket88 makes a good point, but I think that the current business practice is hurting first world standards, and helping third world only somewhat, but not to the degree that they could be - instead, they push Real Wages (wages in relation to local prices) well below what would be acceptable in the first world, because they can, and simply accumulate more profit. Any pretense that there is no coercion in the relationship between employer and employee is utterly naive (don't you know anyone who has taken a job, ANY JOB, out of desparation? I do - most of my family) -- only minimum wage laws keep western wages up. Furthermore, employers work in concert (not a conspiracy, but certainly not working against each other) to keep wages very low when the labour pool is large - and we are looking at a global labour poor of almost 6 billion. Also, the issue isn't just wages, but working conditions, which are often much worse than would be even legal in the first world, or would exist in traditional occupations in the third world. I wonder whether living standards (taken holistically as wages, access to food and clean water, living and working conditions, health, etc) do improve with the movement of global capitalistic manufacturing into the third world - though the cash wages may be higher, and the GDP (see my above remarks on the uselessness of the that), the actually conditions can be much worse. A peasant farmer may have little or no measurable income, if they do not engage in cash markets, but a very good lifestyle if they have enough land and resources. To what extent is it worth it to a third world nation to increase its GDP, if it means ruining its peoples' living standard?
• This is quite a silly argument but just for fun, imagine people in India had white skin. then would you call it "racist?" If anything, it is "nationalist" because the pay is based on their country of origin. An Indian who emigrates to the US will get paid the same as any white Amerrican employee of the same company. Of course the companies argue that the Indians are getting paid as much or more then they would in whatever other work they could find in India. Whether this is true, and whether this is ethical, is the real isse.
• but if it causes an average 2% decrease in American standard of living, and a 20% increase in the average standard of living in a developing country (all figures made up), is it worth it? Sure, but that's a cozy way of putting it: if that 2% decrease involves, for workers, a 5% chance that a given worker will see a 100% decrease in their standard of living, that's a much harder thing to ask of somebody. I don't think you could get a majority of actual Naderites Communists to willingly sacrifice themselves for an incremental increase of wealth in another country. I agree there's racism in the anti-outsourcing movement, but like they say it's not that simple.
• India needs jobs if it is to prosper as a democracy That's nice, but sorry, I'd rather keep the jobs here in the States, if possible. A government is for protecting the governed first, and everyone else a distant second.
• We are all of one world. (just keep the fuck away from my job)
• I'm no economist (I did take ECON 101 as an elective, tho) but here's how outsourcing *can* (if implemented correctly) benefit the local economy. If a growing company (say fledgling IBM) decides to move it's low-skilled manufacturing jobs offshore to the far east, it benefits by having lower costs, which allow it to sell its products at a lower price. Thus, the company gains market share, grows even more, gains some economies of scale from the incresed volumes, and grows even further...into a multinational behemoth. Now the original move displaced some American manufacturing jobs, but it helped the company grow to massive proportions, and as a result it now employs thousands of Americans in sales, marketing, management, and administration at it's American headquarters and sales offices. The net benefit to American jobs is huge, both in number and quality of jobs. It also provides much needed employment and job skills in a developing nation. Economics is not a zero-sum game. Just because something is good for a multinational corporation, doesn't mean it's bad for you or me.
• Can someone name one company that has lowered their prices after outsourcing? That money goes straight into their pockets.
• Economics is a zero sum game - someone just needs to tell the economists. I know what you mean about expanding a business rocket88, but our world is finite, and that makes production and consumption (the heart of economics) finite.
• but our world is finite, and that makes production and consumption (the heart of economics) finite. Some assets are renewable. Others, such as education, create a multiplier effect and proliferate on themselves. Others, such as hydrogen, exist in abundance. Still others wait to be capitalised on by mechanisms yet to be invented. Let's nuance our thinking a little, shall we?
• I'm fine with outsourcing, but the "racist" comparisons used in the article is completely bogus.

  Duke thinks it's imperative to protect white jobs from black competition. Edwards thinks it's imperative to protect American jobs from foreign competition. There's not a dime's worth of moral difference there. While Duke would discriminate on the arbitrary basis of skin color, Edwards would discriminate on the arbitrary basis of birthplace. Either way, bigotry is bigotry, and appeals to base instincts should always be repudiated.

  Bull. When a black Amercian takes ("") a job from a white American, he pays the same income tax and has the same money left to spend/save (mostly) in America. The contribution to American society remains the same, so there's no justifiable reason to discriminate. When a foreign worker takes ("") an American job, the American sociecty loses the income tax revenue, the consumer spending and household saving. From the American government's POV, there are damn good reaons to discriminate. The American government (and everyone else) discriminates against foreign voters. As a Canadian, I can't vote in American elections no matter how much they affect my welfare. It's the way it should be.
• Can someone name one company that has lowered their prices after outsourcing? That money goes straight into their pockets. Ever hear of competition? Companies lower costs and prices all the time to gain market share. our world is finite, and that makes production and consumption (the heart of economics) finite I'm not sure what you mean by this. Companies and economies continually grow. Production grows through innovation and consumption grows through emerging markets and expanding economies. We're far from the finite limitations of the planet.
• Can someone name one company that has lowered their prices after outsourcing? That money goes straight into their pockets. Man, I hate to say this, but Wal-Mart. Or, more specifically, Levi's.
• ...Levi's.
• Two more thoughts: I've come around to the notion that outsourcing would, eventually, be a tide that raises all boats and such a world economy would enrichen everyone... but the question is, what do we do until then. That isn't to be glossed over; "until then" can mean quite a long time. But if oil production hits a plateau and prices skyrocket, outsourcing is going to stop almost cold and we'll have a whole different mess of problems.
• Smo, I thought you might've had me for sec, but those prices are dropping they are offering a cheaper quality product, the "Signature" series. A price drop from a quality drop isn't the same as a price drop from outsourcing. Were talking about them producing "the same amount of work for less pay," not workers producing "less work total for less pay total" (yes, quality falls under amount of work accomplished).
• Fair enough. But it's very difficult to point to a company that has outsourced labor and then find the price reduction that should follow. Not necessarily because it doesn't happen, but because the economics of product prices are more complex than that. If a company doesn't outsource, prices might go up, and if they do choose to outsource, they might go up anyway, just not as much. I still think Wal-Mart is a good example of a company that has driven down prices all over the place, in all kinds of markets, forcing companies to outsource labor, and not always at the cost of quality products. Even if Levi's isn't the ideal example you were looking for, I'd say Wal-Mart in general is, much as I hate the place.
• Some assets are renewable. Others, such as education, create a multiplier effect and proliferate on themselves. Others, such as hydrogen, exist in abundance. Still others wait to be capitalised on by mechanisms yet to be invented. Let's nuance our thinking a little, shall we? Wolof - I have done a lot of thinking about this, albeit not from the standpoint of someone educated in economics (detriment or asset? I don't know). Some assets, notably labour, are renewable. Agricultural production appears to be, though someone did point out to me the other day that really we don't know where it is going - it's been a 14000 year experiment that may go seriously kaka very soon. It's already seriously messed up in many places - they are burning through the topsoil of the Great Plains in the U.S.. where it takes 1000 years to form one inch. My own thesis is on an area of England where 12-20 feet of extremely rich peat have been lost in just 200-300 years - a farmer there was telling me that in some places it's gone entirely, leaving a blue-black clay that's very unproductive. Now, it may seem strange that I am concentrating on physical assets. But that's because that's what I believe ultimately matters. Labour can add value, education can help increase short term production (although often at the expense of long-term sustainability) - but neither of these can do anything if you haven't the fertile land to grow food - and we are nothing without food. All this talk of money or value or non-physical sources is a fiction - an agreed upon social fiction that helps us exchange products and labour, which we need to keep our society going, but a fiction none the less. It's all predicated still on basic production of STUFF - we could never support our tertiary heavy Western world without still having strong primary and secondary sectors, and importing goods from elsewhere (often at unfairly low prices - but that's another issue). I just read an economics paper the other day about how the Industrial Revolution increased per capita production for the first time in human history, making everyone in countries like England richer. Of course, that idea made no acknowledgement of how that increase in production was a) not as high as they think, as they ignore slave labour and deteriorating living conditions in the colonial possessions which supported that growing economy, and b) was predicated on the use of non-renewable sources of energy and nurtrients, including coal and guano-mining. The production of stuff is not infinitely sustainable. We keep our farming going with chemical fertilisers - we are running out of guano, and any other replacement must be produced somehow. We're burning through not just fossile fuel deposits, but also soil. I understand less about how water works, but I am aware that in many places the water tables, built up over centuries, are being destroyed. This is what I meant by it really being a zero sum situation. We can play the game of added value and imaginary production (such as creative production) - it's wonderful that we have the labour surplus to have that. But ultimately what really matters is what we have to eat, where we can live, what keeps us clothed and warm - and all of these things are finite.
• I am also very skeptical of the "science will save us" argument. I grew up watching Star Trek, and I want to be optimist, but I've also seen that so often the "saving" is just a matter of solving old problems by causing new. Sure, there is lots of hydrogen, now - there was tons of water, and not much CO2 in our atmosphere a few centuries back. Maybe it isn't a problem, if the universes supply of hydrogen is really so huge, but really we can't just look for another solution from science. We also need to look within ourselves, and ask ourselves what will become of us, what do we want? Do we want to burn hot and quickly? Live life to the fullest, but have no future? Maybe Asimov was right - we must get off this planet if we are to survive, since stopping growth just doesn't seem to be possible for human societies. Unfortunately, he wasn't right about nearby, easily colonizable worlds.
• Smo - I think there are two levels of objection to practices like Wal-mart's. One is the loss of local employment, obviously. But beyond that, you can still object on the grounds that it isn't just a loss of American employment for overseas, but a loss of what I would term fair or moral employment (enough to feed a family, for instance) for unfair (where not only the price in dollars, but the Real Wage is considerably lower). This isn't a problem in skilled professions, such as programming, but it is in manufacturing. Some of the lower costs are certainly passed on to the North American consumers, but most of the profit accrues with the owners. It's also short sighted - manufacturers and retailers should aim to be sure their employees can afford their products, just to make sure they have a customer base.
• I don't necessarily disagree with where you're going, but Walmart's margins are still very low -- about 3.5%. The reason Walmart makes so much money has everything to do with volume, not profit margins.
• Can someone name one company that has lowered their prices after outsourcing? That money goes straight into their pockets. how about Applied Materials. or *gasp* Honda.