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Monday, March 07, 2016

Ramblings on politics, the economy and the futility of seeking simple solutions

I'm thinking that NAFTA and other trade agreements probably did have something to do with manufacturing job losses in this country. But there were probably a lot of other factors, including financial market collapses, the oil crisis in the 1970s, that made smaller, fuel-efficient cars more attractive and provided an opportunity for Japanese auto makers to compete with US manufacturers and entrench themselves in the United States. There have been advances in robotic technology  that will have an impact on manufacturing now and in the future as more manufacturers shift to robotics.

 Even before the loss of a lot of those jobs in the auto industry, companies were being pressured by retailers like K-Mart, Target, WalMart, etc to keep prices low or lose business, and shareholders were demanding more profits, so American manufacturers looked overseas, mostly to Asia, where wages and production costs were cheaper. I'm pretty sure NAFTA didn't have a lot to do with the fact that years ago, it seemed every time I called a customer service number I ended up talking to somebody in India. And it wasn't just companies--according to a  report by CBS aired in 2003, at least 18 states were outsourcing welfare benefits calls to Indian operators because it saved money. That same report estimated that "in just the last three years, as many as 400,000 jobs have gone to places like China, Russia, and India." People just love to save money. 

We expect to pay low prices- without thinking of the consequences of those low prices. We have lost a lot of manufacturing plants; it's hard to find products made in the USA; But it can be done, there are still companies producing quality products in this country. You'll probably pay a little more for them than for the cheaply made products on sale in WalMart but if we're really concerned about the loss of  jobs and  manufacturing here,  we out to put our money where our mouth is and at least make an effort to "Buy American." Now that wages are rising in China and other countries, more manufacturers are beginning to bring production back home and customer service calls are increasingly being answered by people in the US. But we will probably never return to the heyday of American production that existed post- WWII. 

The global economy is complicated, but it seems, in addition to low prices we also want simple answers, and it's so much easier to blame something like NAFTA or GATT or the TPP for all our woes than it is to try to view them as part of a much larger picture, to figure out all the different aspects that have contributed to the problem and try to find a solution based on the reality of the situation. And it probably won't be quick or simple, no matter how much we'd like it to be.

1 comment:

Rick Watson said...

There are no easy horses. But we want INSTANT solutions to complex problems.
Aren't you glad global warming is "just a hoax."