3 ms·

The problem is that they (US corporations and local elites in the developing countries) haven't built a global labor market. Rather they built very large pipeli

The problem is that they (US corporations and local elites in the developing countries) haven't built a global labor market. Rather they built very large pipelines into the US labor market. This means that workers in a country such as China work 14 - 16 hours a day, eat in the company dining hall, and sleep in the company dorm. But they get paid a tiny amount, while US corporations and local elites who control the pipeline capture most of the profit. Because of this, workers in developing countries act like a full worker (or 1.5 - 2x a full worker) but they don't act like a consumer. So you get 3-4 billion workers competing for jobs in an economy of 320 million people.

Asbostos 11y ago
That Chinese worker may be worse off than the US worker he replaced, but he's better off than whatever else he would have done instead. That's why it's a win for the Chinese worker. It's also a win for the consumer who gets a cheaper phone and a win for the US company which reduces costs. The only loser seems to be the US worker, but is that really such a bad thing? Isn't this a force for equality? The poor getting richer and the (relatively) rich getting poorer? I won't disagree that a privileged minority is making huge profits from this, but it's not a zero sum game so it isn't necessarily bad that that's happening. I'd like to know if there's any other reason to restrict the international labor market beyond US workers being seen as more deserving than foreigners.
- throwaway12309 11y ago
  Well, there is the fact that is US (and other) corporations that sell products in the US market, but are able to skirt US rules by offloading those costs to other countries without contributing much to the US wellbeing. It is not about being more deserving, is about taking advantage of 'loopholes' in the whole process. For example, in Europe, it is quite common for employers pay on top of the salary 20-40% extra in taxes and social security for a local employee. Even if they pay the same salary to an offshore person, and skirt those 20-40% of taxes, the company wins, the offshore person may win, but the company that uses the country it is doing business in isn't paying it's fair share. Think of this differently. Imagine a company that offshores all costs (employees, manufacturing, etc) and just has a director/owner in the US. They also use creative accounting so their tax rate is very low. Lets ignore the costs of using the infrastructure as well. Now, this seems like an amazing deal for the owner + their non-us suppliers right? IS it fair for the citizens? What would the owner ask the gov. to do if the citizens then just decided to rob the owner blind? Or destroy the cargo ships as soon as they entered the US? Would he just say "well, tough luck" or they would fight tooth and nail to get the gov/police involved? I'm fairly liberal, but more and more believe there has to be a balance of responsibilities between corporations and the citizens, because if not, there will be a point where something will change, and most likely by force (check European countries history in the last decade for example)
  - maxerickson 11y ago
    The taxes attached to a local salary are hopefully paying for services that an offshore worker is not consuming. Which is to say, determining what is fair is not a simple thing.
- severus_bro 11y ago
  The Chinese worker loses because instead of participating in a functioning labor market (like the ones in US, most of Latin America, East/West Europe, etc) his only choice is slave-like factories. The US worker loses because he loses his job. "The consumer" is the same as the US worker, so under this scheme everyone loses, except a small cartel of US corporations and local elites in some developing countries. The point is not to restrict the international labor market, but to free it from this artificial pipeline that is only possible because US corporations work together with local elites in countries like China to suppress their local labor markets.
  - Asbostos 11y ago
    The Chinese worker can't participate in the US market because as you said, it's too small even if he was allowed in. So that's not an alternative that might have happened. He couldn't do it in China because either because the value of the RMB was too low for him to buy a nice imported car and phone. Factory workers now can afford iphones of course, but only because of the exports they're producing. With the US worker and consumer being the same person - I'm not so sure, we're mainly talking about manufacturing, where most people don't work - The rest of the consumers would otherwise be subsidizing the overpaid US worker. Is it right that all consumers (people) in America pay a bit extra in charity to a minority of people who somehow aren't being as productive as they could? What kind of solution do you propose? More freedom of the labor markets, or less, or something else?
    - deleted 11y ago
      [deleted]
    - Asbostos 11y ago
      severus_bro. I'm still not sure what you're suggesting. Is it that the Chinese government is allowing its people to be treated badly by employers? That may be true, but could they actually do much better? Improved working conditions mean reduced competitiveness and more unemployment. Anyway, "I don't want to repeat myself" tends to be a sign that somebody has come to the end of their chain of reasoning. So there's probably nothing further for us to discuss. I hoped you might be someone who could explain a valid reason behind this popular idea. More than "Be like the better ones."

Asbostos 11y ago

That Chinese worker may be worse off than the US worker he replaced, but he's better off than whatever else he would have done instead. That's why it's a win for the Chinese worker. It's also a win for the consumer who gets a cheaper phone and a win for the US company which reduces costs. The only loser seems to be the US worker, but is that really such a bad thing? Isn't this a force for equality? The poor getting richer and the (relatively) rich getting poorer? I won't disagree that a privileged minority is making huge profits from this, but it's not a zero sum game so it isn't necessarily bad that that's happening. I'd like to know if there's any other reason to restrict the international labor market beyond US workers being seen as more deserving than foreigners.

throwaway12309 11y ago
Well, there is the fact that is US (and other) corporations that sell products in the US market, but are able to skirt US rules by offloading those costs to other countries without contributing much to the US wellbeing. It is not about being more deserving, is about taking advantage of 'loopholes' in the whole process. For example, in Europe, it is quite common for employers pay on top of the salary 20-40% extra in taxes and social security for a local employee. Even if they pay the same salary to an offshore person, and skirt those 20-40% of taxes, the company wins, the offshore person may win, but the company that uses the country it is doing business in isn't paying it's fair share. Think of this differently. Imagine a company that offshores all costs (employees, manufacturing, etc) and just has a director/owner in the US. They also use creative accounting so their tax rate is very low. Lets ignore the costs of using the infrastructure as well. Now, this seems like an amazing deal for the owner + their non-us suppliers right? IS it fair for the citizens? What would the owner ask the gov. to do if the citizens then just decided to rob the owner blind? Or destroy the cargo ships as soon as they entered the US? Would he just say "well, tough luck" or they would fight tooth and nail to get the gov/police involved? I'm fairly liberal, but more and more believe there has to be a balance of responsibilities between corporations and the citizens, because if not, there will be a point where something will change, and most likely by force (check European countries history in the last decade for example)
- maxerickson 11y ago
  The taxes attached to a local salary are hopefully paying for services that an offshore worker is not consuming. Which is to say, determining what is fair is not a simple thing.
severus_bro 11y ago
The Chinese worker loses because instead of participating in a functioning labor market (like the ones in US, most of Latin America, East/West Europe, etc) his only choice is slave-like factories. The US worker loses because he loses his job. "The consumer" is the same as the US worker, so under this scheme everyone loses, except a small cartel of US corporations and local elites in some developing countries. The point is not to restrict the international labor market, but to free it from this artificial pipeline that is only possible because US corporations work together with local elites in countries like China to suppress their local labor markets.
- Asbostos 11y ago
  The Chinese worker can't participate in the US market because as you said, it's too small even if he was allowed in. So that's not an alternative that might have happened. He couldn't do it in China because either because the value of the RMB was too low for him to buy a nice imported car and phone. Factory workers now can afford iphones of course, but only because of the exports they're producing. With the US worker and consumer being the same person - I'm not so sure, we're mainly talking about manufacturing, where most people don't work - The rest of the consumers would otherwise be subsidizing the overpaid US worker. Is it right that all consumers (people) in America pay a bit extra in charity to a minority of people who somehow aren't being as productive as they could? What kind of solution do you propose? More freedom of the labor markets, or less, or something else?
  - deleted 11y ago
    [deleted]
  - Asbostos 11y ago
    severus_bro. I'm still not sure what you're suggesting. Is it that the Chinese government is allowing its people to be treated badly by employers? That may be true, but could they actually do much better? Improved working conditions mean reduced competitiveness and more unemployment. Anyway, "I don't want to repeat myself" tends to be a sign that somebody has come to the end of their chain of reasoning. So there's probably nothing further for us to discuss. I hoped you might be someone who could explain a valid reason behind this popular idea. More than "Be like the better ones."