This is not to say that trade is never mutually beneficial: trade and capital flows have been an economic reality for over 3,000 years, dating back to the very lively trade of the Bronze Age. What does need to be challenged is the largely unexamined notion that the critical interests of political entities (nation-states) and societies are magically served by private capital maximizing returns via borderless global markets.[1]And via slave labor wages overseas and other governments' disregard of environmental protections (thereby enabling lower cost foreign production).
This reminds me of something that Fran Porretto recently quoted from Thomas Jefferson:
Liberty is unobstructed action according to our will; but rightful liberty is unobstructed action according to our will, within the limits drawn around us by the equal rights of others.This singleminded pursuit of lower production cost illustrates Jefferson's "liberty." Our corporations scrambled to relocate tens of thousands of American factories to China utterly without regard to the effect this would have on the economic fortunes of their fellow citizens at home.
Adam Smith thought that the "invisible hand" would necessarily benefit the larger whole even though the individual would vigorously only seek to promote his own interests. Little did Smith foresee that his and all other Western lands would come to be ruled by traitors who drooled at the prospect of
- (1) operating in foreign lands to the primary benefit of foreigners and
- (2) importing parasitic, hostile, inassimilable foreigners to the home country by the millions.
Salus populi to our elites is as abhorrent a concept as swearing to protect and defend the Constitution.
Notes
[1] "We Can Only Choose One: Our National Economy Or Globalization." By Charles Hugh Smith, ZeroHedge, 11/26/19.
Incorporating this into my next QUICK HITS where I added this lengthy commentary:
ReplyDeleteBack in my Macroeconomics class for my MBA, the professor spoke of a “pinprick” of pain locally compared to the lowered prices having benefits nationwide. There are three problems with that:
First, many areas have only one or two “big” employers. When a plant closes, it depresses an entire region – the money-multiplier effect works both ways.
Second, if it’s ONE pinprick, it’s bearable. What happens when it’s a never-ending swarm of pinpricks? Even a big, strong man – if staked out unclothed overnight in the deep woods – can be drained to death by mosquitoes.
Third, while the working class suffers, the C-suite gets bonuses. Thus, offshoring represents – functionally – a transfer of wealth (from the lost wages AMERICANS receive) to those at the top who are already making far more than those on the line who lost their jobs. Thus there is the very real conclusion that the rich are getting richer off the backs of the poor. Where do you think the whole “99%” movement came from (at least in part; I know it was significant astroturf at the source)?
Side note: I have absolute respect for profit and the free market. But the free market absent a sense of patriotism and ethics becomes pirate capitalism – devoid of a sense of restraint.
A place I used to work had all their production in China. But wages in the Shenzhen / Guangdong area of China were getting to be too high, per the Director of Operations, hence their push to 1) relocate production to the interior of China, and 2) redesign the units for more automation to reduce the number of people required. When I inquired why America couldn’t be a viable location with sufficient automation, he went on a rant about how it might increase production costs even so. Concern for jobs in America, or keeping the money in America, was not even in consideration.
I continually make the point when I haunt the comment sections of the various sites I read is that capitalism was never intended to operate free of any restraint. Central to capitalism are law courts that enforce contracts, punish fraud, and preside over effective anti-trust enforcement actions. Unemployment insurance and workers' compensation are salutary parts of the capitalist order, especially as modern industrial economies have an impersonality that's hard to deal with and have firms that disproportionate bargaining and staying power in the face of worker unhappiness.
ReplyDeleteOrdered liberty should be our watchword.
However, with offshoring there was a complete abdication of responsibility to make the kids play nice together. In the blink of an eye there were 25,000+ factories in China with massive job loss and transformation of the American economy. No one seemed to be alarmed by this, not even the unions IIRC. Thus your Director of Operations had carte blanche to chase every cost savings utterly without having to consider other serious costs.
I fear that even governments cannot stand up to the focused economic power of the mega corporations. They will pursue their narrow interests and the universal franchise will ensure that the FSA is taken care of in the bargain as they can deliver the swing vote reliably.
The US started out good but literally outgrew the original, workable concept.