Glad to see another article from you. I work in the auto industry so I have witnessed first-hand the offshoring of U.S. jobs. At this point, people just need to accept that the factory jobs that have been lost are not coming back. Trade barriers will do nothing to stop the automation of factories.
Most of the parts my company makes overseas have been turned into commodities. The jobs making these parts only exist because the labor is cheap. If we try to bring these jobs back to the U.S., they will just become automated.
The complicated parts and all of the engineering is still in the U.S. That is where the U.S. needs to be focused-new developments and not trying to roll back the clock to 1960. Putting resources into electric motors and batteries, self driving cars and lightweight materials will be much more beneficial. I'm sure other industries are much the same in this regard. We need to invest in innovation and educating skilled workers, not trade restrictions. Great post. I find it funny that almost all economists are in agreement about free trade, but everyone seems to ignore them.
Always great hearing your feedback, thanks! This was spot on:
"If we try to bring these jobs back to the U.S., they will just become automated."
Also great point that so much of the higher value production is still done in the U.S., like the engineering and design work. You're right in that so much of this anti-trade movement has the flavor of trying to bring society back to the "good ole days" of the 60s.
If products were priced in people/hours then your premise would be true.
Having an american machine a part @$50/hour is, in this paper's terms, less productive than a chinese use a file to make a part for $3/day. So, the american costs $50 and the chinese costs $9. So, the chinese is clearly better? But, if you compare 1 hour with 36 hours?
And lets compare toasters. The $19.95 wallymart special cost about $2 to make. That $100 fancy toaster cost about $3 to make. How do you apply more for less to that? Especially since, in the store, product design is everything, and product durability is nothing.
The biggest stumbling block to this thesis is that everyone has to be assumed to doing something that pays. In that case, the cheaper the better. But homeless people cannot buy televisions, even though they are the cheapest per size they have ever been.
An artist will spend as much time as needed to create their piece. And often the value of the piece will have no bearing on the input of time or resources.
eh, the benefits of trade don't rely on labor hour pricing; i've actually never heard of that before. It's all about relative advantage, labor cost differentials being one such advantage, but there are plenty other factors in production...some real, others artificial like taxes and regulations.
Also, the concept of a social welfare safety net is separable from any trade argument. Trade makes societies wealthier, period. Not everyone within society benefits, though, as trade adds competition which of course means some people in some businesses get out competed. Whether that competition comes from your neighbor or someone living across national borders is irrelevant to the process.
There have always been arguments against competition; that was the entire justification for the destructive guild systems in feudal Europe.
It would be better for society to refrain from forcefully limiting competition and simply providing some safety net after the fact to those that lose out, rather than forcing most of society to lose out by stifling the entire process.
Glad to see another article from you. I work in the auto industry so I have witnessed first-hand the offshoring of U.S. jobs. At this point, people just need to accept that the factory jobs that have been lost are not coming back. Trade barriers will do nothing to stop the automation of factories.
Most of the parts my company makes overseas have been turned into commodities. The jobs making these parts only exist because the labor is cheap. If we try to bring these jobs back to the U.S., they will just become automated.
The complicated parts and all of the engineering is still in the U.S. That is where the U.S. needs to be focused-new developments and not trying to roll back the clock to 1960. Putting resources into electric motors and batteries, self driving cars and lightweight materials will be much more beneficial. I'm sure other industries are much the same in this regard. We need to invest in innovation and educating skilled workers, not trade restrictions. Great post. I find it funny that almost all economists are in agreement about free trade, but everyone seems to ignore them.
Always great hearing your feedback, thanks! This was spot on:
"If we try to bring these jobs back to the U.S., they will just become automated."
Also great point that so much of the higher value production is still done in the U.S., like the engineering and design work. You're right in that so much of this anti-trade movement has the flavor of trying to bring society back to the "good ole days" of the 60s.
If products were priced in people/hours then your premise would be true.
Having an american machine a part @$50/hour is, in this paper's terms, less productive than a chinese use a file to make a part for $3/day. So, the american costs $50 and the chinese costs $9. So, the chinese is clearly better? But, if you compare 1 hour with 36 hours?
And lets compare toasters. The $19.95 wallymart special cost about $2 to make. That $100 fancy toaster cost about $3 to make. How do you apply more for less to that? Especially since, in the store, product design is everything, and product durability is nothing.
The biggest stumbling block to this thesis is that everyone has to be assumed to doing something that pays. In that case, the cheaper the better. But homeless people cannot buy televisions, even though they are the cheapest per size they have ever been.
An artist will spend as much time as needed to create their piece. And often the value of the piece will have no bearing on the input of time or resources.
eh, the benefits of trade don't rely on labor hour pricing; i've actually never heard of that before. It's all about relative advantage, labor cost differentials being one such advantage, but there are plenty other factors in production...some real, others artificial like taxes and regulations.
Also, the concept of a social welfare safety net is separable from any trade argument. Trade makes societies wealthier, period. Not everyone within society benefits, though, as trade adds competition which of course means some people in some businesses get out competed. Whether that competition comes from your neighbor or someone living across national borders is irrelevant to the process.
There have always been arguments against competition; that was the entire justification for the destructive guild systems in feudal Europe.
It would be better for society to refrain from forcefully limiting competition and simply providing some safety net after the fact to those that lose out, rather than forcing most of society to lose out by stifling the entire process.
thanks