NP - The Myth of a Jobless Recovery

[alice wellintown]

The arguments here ignore the point of view of the people who gain jobs.

These arguments pretend to care about the foreign workers, a type of
white man's burden orientalism that claims to protect the workers in
the emerging economies from exploitation, even as it ignores the point
of view of these workers, and the basic economics that improve the
lives of these workers.

The true objective of such arguments is to protect jobs, to keep them
from being outsourced or offshored,  and not protect workers.

There is a strong correlaton between productivity and wages. US and
European workers get paid higher wages mostly because they are more
productive than emerging economy workers, workers in nations like
China and India.

Why are US and European workers so much more productive? Well, mostly
because of technology. But also because of what economists call
intensity. The US, for example, has its intensity in a highly skilled
and educated workforce. Combine this educated workforce with
technology, including robots an automation, and you have super
productive workers who earn high wages.

China and India have intensity in labor itself. That is, they have
huge labor forces. These workers are not productive, for they are not
highly educated nor are they highly skilled,  and therefore they do
not earn high wages.

In the US and in Euorope a bi-monoploy exists in the production of
comercial aircraft. We have Boeing and they have Airbus. Why is this?
Well, it's the same reason whjy China and India make clothes and all
the other consumer junk people fill therir houses with: they have not
the investment spending, the R&D, the education, the
infrastructure....they are emerging economies, decades behind the US
and Europe. But the low wages in the emerging economies give those
economies an advantage, cheap wages. Why take it from them? They will
not emerge if you do. They will sink into oblivion and weakness. They
have a comparative advantage, cheap labor, and an intensity in labor.
They have to use it to their advantage. Why stop them from doing so?

Such arguments are kettles calling the pot greedy. Stop the greedy
business plutocrats from exploiting cheap labor so we can keep high
paying jobs where we have no production advantage. This makes no
sense. Moreover, it will sink workers in both the developed and
developing economies into poverty.

The Pauper and Sweatshop Fallacies find alliance with protectionists,
isolationists, and loons.

Trade raises wages for all involved and allows nations to produce more
and consume more of everything, thus raising everyone's standard of
living. Comparative Advantage is produced through differences in
development, by natural endowment, and by technology and
capital--human, financial, and physical. The US has invested in
education and technology and now has that advantage, in addition to
other endowments. That is chooses to use these to improve the lives of
its citizens is natural and ethical and moral. Other nations must use
what they have and, trade. That other nations choose to trade cheap
labor for US technology is expected and natural and good.

Arguments against this are utopian and ignorant.