Our politicians blame our corporations. But our corporations did not approve NAFTA or our membership in the WTO. Our corporations did not allow China to join the WTO and they did not open our markets to slave wage countries (including China).
I spent over 30 years working with small businesses in a variety of industries. When I started, most of them were manufacturers. By the time I retired, almost all of those who were still in business had become importers. But most of them had gone out of business because they could not produce goods here and compete with foreign manufactures whose labor costs were 80% to 95% lower than theirs.
When it costs a domestic manufacturer more to make a product than an importer is selling the same product for, the domestic company cannot continue to manufacture its products here. That guarantees bankruptcy, and many of our companies that could not or would not adapt to the change in the rules of “competition” did go bankrupt.
Our corporations may not be perfect, but they did not create or promote the idea that “free” trade was and is “good for everybody,” and they did not hang their workers out to dry as they rushed to buy goods from foreign suppliers.
Look in your closets, your kitchens, your bedrooms and your cars. Look for country of origin labels or stickers. You will see who else is responsible for “exporting" our jobs.
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The primary things that drive jobs out of the country are unions and taxes.
Currently US taxes on business are the second highest in the industrialized world. If Obama takes office he will make them the highest in the industrialized world.
Maybe if we cut business taxes and unfair labor laws that give unions unfair advantages - we would have more jobs.
It used to be "Hecho en Mexico." Then, "Made in Japan." Then, "Made in [various Asian countries]." Now it seems predominantly "Made in China." You're letting corporations off the hook way too easily. How many companies have left this country and established their home offices in countries that offer a tax break or other incentive? How many American companies have their banking done exclusively in foreign countries (the Cayman Islands come to mind) to avoid American taxation? How many American corporations have received corporate welfare for "speculative ventures" only to accrue enormous profits that NEVER get shared with the most crucial share holders: The American Taxpayer. You're right to infer that companies will always be looking for the cheapest labor - this is the original Ponzi scheme where there will always be someone more desperate that is willing to take a low wage. Right now, China is riding this wave, but eventually, they will also build their middle-class who will eventually balk at getting $1 per day for making crappy products. So who will be next to exploit? China is doing their version of this in Africa. What can curb this trend toward unrestrained capitalism is a return to community resources rather than relying solely upon imports. The global economy engine is a finite path: the logical conclusion is a global wage, at which point all economies become stagnant - stable, but stagnant.
Until then, the chasm between the very poor and the very rich will continue to deepen and widen.
I'm glad to see that you understand the situation, most don't. Most will say the government has full control over sending our jobs overseas, or that corporations willingly do this to screw Americans. At least you understand the economics behind it.
Free trade isn't great for everybody, but a great majority of economists point out that the benefits outweigh the detriments. You understand that companies in America cannot compete with foreign manufacturers that have drastically reduced labor costs. We do have to compete with that, one way or another, if we expect to stay ahead, or at least afloat.
What's interesting to note is that despite the number of manufacturing jobs declining, total manufacturing output is increasing. Most manufacturing operations are becoming so automated to the point where actual workers aren't needed in the US.
Please provide a link where Gordon Brown or new Labour have encouraged British firms to dump their workforce and export jobs to China. It is a combination of manufacturing and consumers that have done that and they have been doing it for the last 50 years. Manufactures failed to produce goods that consumers want - take the motor industry for example - cars where being produced that manufactures wanted to make not what consumers wanted to buy, end result UK car manufacturing goes into decline and we all drive foreign cars. Incidentally something similar is happening in the US - where the big 3 continue to bring to the market big gas guzzlers that do 16mph and the American consumer is buying small japanese cars that do 50mph. Consumers have demanded lower prices for goods and services, this has forced companies to look at their manufacturing or service costs meaning that they have had to look overseas for cheap labour. The consumer whilst complaining does nothing. How many people still use British Gas and British Telecom who have Indian call centres when there is an alternative which supports UK call centres. All it takes is a phone call or internet click to change suppliers but whilst many complain few do anything about it. If enough people left these companies and told them it was because they where supporting UK jobs do you think it would take long for UK call centres to reappear? If UK consumers insist on buying British and UK manufacturing listens to what its customers want and produce the goods and services then jobs will return to the UK manufacturing and service sectors.
First we have to remember the morals of a corporation is to profit and shareholder satisfaction, they are not people and do not have feelings. Back in the 1980`s Reagan changed the rules by lifting tariffs and Clinton signed the Republicans NAFTA, WTO bill. Clinton was a real conservative economically speaking. So what do we do now? Change the rules, The owner of Nike stated that he is only doing what the rules allow him to do. We can`t just tell people to stop buying, but what we can do is say, that is OK if you want to make stuff over seas but if you want to sell that crap to the number one consumers in the world then it will cost them to the point that they will have to have plants here to.
U.S. minimum wage laws and unions have cost us jobs. Of course, manufacturers want the lowest possible product cost so they use the cheapest labor possible, and if it's under a non-collective-bargaining environment that will be even more cost-effective for them. If they produce things more cheaply they can offer more attractive (lower) prices to buyers.
US automakers are drowning in paying the cost of retiree pensions and benefits.
Maybe free trade is good for everyone in the long run, but Americans are feeling a lot of pain in the short run (and let's face it - we ALL live in the short run). In the mean time consumers are buying based on lowest price more than ever before. It's a vicious circle.
While it's true that the corporations aren't to blame for exporting our jobs (hey, the Indians, Taiwanese, etc. work cheaper and better), your blame on free trade is misplaced. We cannot have an insular economy. We need imports. We need markets to which to export. Instead things like the minimum wage and the sucky work ethic of three generations of Americans raised under a nanny state.
Why should I spend $5 on a crappy American made widget when I can get a slightly less crappy Taiwanese widget for $2?
That is true, however tax hikes for companies that move their jobs overseas may help stop the flow of jobs out of this country. If the businesses can make more money here by not outsourcing jobs then they will more than likely keep jobs here. McCain wants to keep NAFTA in place and is not willing to increase taxes on businesses to ship jobs overseas. In short, he has no plan to stop the flow of jobs out of this country. At least Obama has a plan to tax businesses that outsource jobs so they are less likely to outsource. He has talked about trying to renegotiate NAFTA but that is a lofty goal that will be very tough to achieve when other countries are doing well thanks to NAFTA.
Most everyone is to blame here. It comes down to simple supply and demand. The other countries give us products at a low price and we buy them. The government is responsible to a point, but the real truth is if we Americans would stop buying foreign we wouldn't have companies leaving the US.
I think it is also the demand of the consumer. Consumers no longer care much about where the product comes from, just as long as the product is of reasonable quality. Would I rather buy a shirt in Pennsylvania which costs much cheaper to purchase than my home state New York by $10? Heck yes.