The Off-Shored Economy

[New Dawn]

Another informative article by Paul Craig Roberts: http://www.counterpunch.org/roberts03172010.html

[AdHocSolver]

1. A few snippets from "The Off-Shored Economy".

Some key points from the article:

(snip)

In the 20th century, Detroit, Michigan, symbolized American industrial might. Today it symbolizes the offshored economy.

Detroit’s population has declined by half. A quarter of the city--35 square miles--is desolate with only a few houses still standing on largely abandoned streets. If the local government can get the money from Washington, urban planners are going to shrink the city and establish rural areas or green zones where neighborhoods used to be.

President Obama and economists provide platitudes about recovery. But how does an economy recover when its economic leaders have spent more than a decade moving high productivity, high value-added middle class jobs offshore along with the Gross Domestic Product associated with them?

Some very discouraging reports have been issued this month from the Bureau of Labor Statistics. There have been record declines in both jobs and hours worked. At the end of last year, the U.S. economy had fewer jobs than at the end of 1997, 12 years ago. Hours worked at the end of last year were less than at the end of 1995, 14 years ago.


(snip)

Economists and policymakers tend to blame auto management and unions for Detroit’s fall. However, American manufacturing has declined across the board. Evergreen Solar recently announced that it is shifting its production of solar fabrication and assembly from Massachusetts to China.

A U.S. Department of Commerce study of the precision machine tool industry has found that the U.S. comes in last.The U.S. industry has a shrinking market share and the smallest increase in export value. The Commerce Department surveyed American end-users of precision machine tools and found that imports accounted for 70 percent of purchases. Some U.S. distributors of precision machine tools do not even carry U.S. brands.


(snip)

Moreover, after the derivative fraud perpetrated on the world’s banks by the U.S. investment banks, there is no prospect of any country trusting American financial leadership.

The American economic and political leadership has used its power to serve its own interests at the expense of the American people and their economic prospects. By enriching themselves in the short-run, they have driven the U.S. economy into the ground. The U.S. is on a path to becoming a Third World economy.

**********



The WTO, the IMF, NAFTA, Most Favored Nation trading status for low-wage countries, the World Bank, and all the corporate written cartel trade agreements that make it profitable to offshore jobs must go. Americans have to wake up from their mesmerized stupor and stop buying imported goods made using low-wage labor. Americans must demand that retailers stock American-made goods or you will take your business elsewhere. This is especially important for the everyday goods people buy such as clothes, shoes, toys, food, office supplies, electronics, kitchen utensils, tools, appliances, hardware, and all the other products that used to be American made, and provided jobs for Americans.

Telling American workers to retrain for "green" jobs is also a sham as the example of the solar panel company that is offshoring its jobs to China demonstrates.

Your government isn't going to help you. You will get the corporate elite's attention when you stop buying their imported junk.

[raccoon]

3. This needs to be shouted from the rooftops:

"Your government isn't going to help you. You will get the corporate elite's attention when you stop buying their imported junk."

[dmallind]

2. He seems to go all over the place with few real comparable data

It's easy to pick an example or two, but where is the comparison of US investment in offshore production to foreign investment in US production (the former is indeed greater, but it's probably closer than many think)? Why is it bad if our banking industry is less concentrated than in Europe? Where are the employment figures for other sectors and industries? Why did he compare employment in a deep recession to boom year employment rolls to draw systemic conclusions?

[AdHocSolver]

4. You can look at barometric pressure, frontal systems, cloud formations, dew point or...

...you can look outside and see that it is raining.

[fasttense]

5. Some of the data points he mentions are very important all by themselves.

"At the end of last year, the U.S. economy had fewer jobs than at the end of 1997, 12 years ago. Hours worked at the end of last year were less than at the end of 1995, 14 years ago."

Fewer jobs and fewer hours than 12 to 14 years ago is NOT a minor statistic that can be dismissed as cherry picking.

It means that despite a huge population, which has recently grown to over 300 million people, we are employing fewer and fewer of those people. The less people employed means less people paying taxes, less people being able to afford junk from foreign markets, a smaller middle class, a growing under class and a ballooning budget deficits.

This is a path to economic destruction no matter how you manipulate the data points.