8 ms·

As an aside, it both saddens and surprises me that we don't hesitate twice when buying the cheap stuff (made abroad, of course) but also complain that all the j

As an aside, it both saddens and surprises me that we don't hesitate twice when buying the cheap stuff (made abroad, of course) but also complain that all the jobs have left. It's certainly not a small town, blue-collar occupation issue but it does affect them disproportionately. This recent NYTimes piece was an eye-opening read for me in that regard. [https://www.nytimes.com/2017/10/14/us/union-jobs-mexico-rexnord.html?_r=1](https://www.nytimes.com/2017/10/14/us/union-jobs-mexico-rexnord.html?_r=1) https://www.nytimes.com/2017/10/14/us/union-jobs-mexico-rexn.... Not that I didn't know this but to have it be made so vivid, it was hard to digest stuff. I'm not even sure if there's a good solution in sight. Basic income and all that is fine but people still need to be and feel productive and busy for us to stay a sane society.

rconti 9y ago
I haven't read the article, but just clicked on it -- she was featured on today's NYTimes podcast The Daily.
rainbowmverse 9y ago
It's hard to buy better stuff when you can't find work that pays enough for it. The problem is bigger than the purchasing decisions individuals make.
- blizkreeg 9y ago
  People can't buy better stuff because they don't have jobs or jobs that pay well enough. Those jobs leaving are what helps them buy the cheaper stuff. Quite the roundabout, isn't it?
  - jeirje88382hj 9y ago
    Yeah except those jobs began to leave due to the actions of government and the elite. Let's not wrap well documented history in overly reductionist loops to sound smart. This isn't a natural economic process. It's based upon decisions made by the rich to keep getting richer. The process played out a century ago when factories left urban centers for rural. Humans go in room, come out of that room talking austerity of some kind for the masses. It's not a mystery. Economics is not physics.
  - taurath 9y ago
    It’s more like a spigot that is draining into corporate coffers, and out of the communities. There’s not much money left and what does move around all doesn’t stay in or anywhere near town.
    - virmundi 9y ago
      To be fair, even local mom and pop stores still purchased the majority of the supplies they sold from out of town. Few cities could produce all of the goods, or even the majority of the goods needed on their own. So yes, DG takes some of the profits, but there are local employees making money to then spend in the local economy.
  - yahna 9y ago
    There is lots of reasons to not buy better stuff. I own mostly cheap furniture because good stuff is a very expensive commitment, for example.
- nejenendn 9y ago
  Yup, this is a problem of money draining from rural america. There are many symptoms.
paulpauper 9y ago
hmm..but stores that make 'cheap stuff' (walmart, mcdonalds, target, etc.) employ a lot of people. The jobs may not pay much but it's employment nonetheless.
- vkou 9y ago
  They don't employ as many people per dollar of goods sold as the businesses they replaced. It's why those businesses got replaced.
Teknoman117 9y ago
That was an incredibly good read, thank you.
omegaworks 9y ago
>we don't hesitate twice when buying the cheap stuff When things like gas and international trade are heavily subsidized (either directly or indirectly using preferential trade agreements) we create a world where this is the norm. When this is the local maxima of capital growth in these areas, this is where capital will invest.
adventured 9y ago
There is at least one very good solution. Significantly increasing the earned income tax credit. Warren Buffett has been pushing this for a long time as a superior alternative to increasing the minimum wage. We can push to $15 / hour equivalent without punishing businesses that can't afford the minimum wage at that level. Few people on either side are listening to him however; Democrats in Congress are mindlessly latched onto the minimum wage as the only solution, and Republicans dislike expanding such benefits in general. It can be done without changing much about how the system works and it would immediately begin boosting the standard of living for the bottom 1/2 of workers. The EITC is superior to the universal basic income, as it doesn't needlessly give money to the well-off (ie it isn't inherently regressive) and the US could actually implement a higher and broader EITC system immediately. https://www.wsj.com/articles/better-than-raising-the-minimum-wage-1432249927 https://www.wsj.com/articles/better-than-raising-the-minimum...
- Something1234 9y ago
  I think the issue with this is that the average voter won't understand what it is.
- mrob 9y ago
  There's nothing inherently regressive about a universal income. Taxing everybody the same percentage is considered regressive because of the diminishing marginal value of each dollar. Rich people are taxed a lower percentage when measured by utility. By the same argument, giving everybody the same basic income is progressive.
  - kirse 9y ago
    There's nothing inherently regressive about a universal income Except that universal incomes are basically adult allowances provided by Daddy Government. So they are regressive in the sense that they're an idealistic childhood notion that immature adults keep trying to carry forward into adulthood.
    - mrob 9y ago
Consultant32452 9y ago
There's been a good solution in sight for years. Barak Obama campaigned in the primaries on a platform of renegotiating NAFTA. Then he dropped that issue during the general. Trump sang that tune all the way to the White House. Here's the long story about what's wrong with NAFTA and it's mostly about tax structure. In Mexico they have a VAT sales tax. This is a huge chunk of their federal budget. Most of the taxes are on the consumption side (point of sale), not the production side. Goods produced in Mexico but sold abroad avoid the VAT tax. However, goods produced outside Mexico but sold in Mexico get the same VAT tax as every other good sold. Now let's look at the US. We have no federal sales tax, all of our taxes are on the production side. Every good that leaves a factory has its price loaded up with basically all of our tax costs. It's the production side that's taxed, not the consumption. That means a product manufactured in the US already is loaded up with US taxes, and then gets shipped to Mexico where the VAT is added on top. Double-taxation. Goods produced in Mexico have no VAT, come to the US tariff free, and sold to US consumers where no federal tax is collected on the consumption end. No-tax. You don't need a Ph.D. in Economics to understand what the result of this will be over time. The way I see it there's two potential solutions to this. One is to renegotiate NAFTA just like we elected Obama and Trump to do. Another would be to restructure our taxes to be more like Mexico and load the taxes on consumption rather than production. This was the signature campaign idea by Herman Cain during the 2012 election with his 9-9-9 plan, though he was laughed at at the time. https://en.wikipedia.org/wiki/9%E2%80%939%E2%80%939_Plan https://en.wikipedia.org/wiki/9%E2%80%939%E2%80%939_Plan. I'm not suggesting that the 9-9-9 plan exactly is good, but only use it to point out that these solutions have been discussed in the mainstream. I remember Ross Perot's entire campaign against Bill Clinton in 1992 was about how much NAFTA would suck all our jobs to Mexico. But we elected Clinton anyways and look what happened.
- Lazare 9y ago
  That's untrue; the exchange rate adjust to completely negate the tax differences. What economists call the "terms of trade" are not impacted by sales tax. This gets brought up and debunked periodically, the first result Google returns for me is http://www.aei.org/publication/keynes-at-the-border/ http://www.aei.org/publication/keynes-at-the-border/ which looks as good as any. > You don't need a Ph.D. in Economics to understand what the result of this will be over time. True enough, but it can still be a little confusing, as you've discovered. :)
averagewall 9y ago
To what extent can you fool someone into thinking they're doing a productive job? Social welfare for unemployed factory workers feels like not being productive, but what if you raise tariffs on imports to support local industry and give them jobs. Wouldn't it still feel useless? If you know that your job only exists because other Americans are paying you to make you feel productive because they realise you'll enjoy that more than just getting the money directly, wouldn't that be a hollow satisfaction?
- virmundi 9y ago
  Wouldn't it depend on what you were doing? Pushing paper probably feels pretty shitty. Actually cleaning up a forest in California to prevent another fire probably feels pretty good. We don't make people work hard any more because that's degrading? Not really sure why that is. We had work programs for those unemployed. They paid ok. They provided real benefit for the country. For some reason we don't go back this.
  - averagewall 9y ago
    I don't mean jobs that provide real benefit. I mean making cars or consumer products in cases where the local industry is dependent on import tariffs to survive because the same thing is made cheaper overseas.
mozumder 9y ago
Outsourcing benefits the consumers by keeping prices and inflation down. This helps the poor and elderly on fixed income the most. The reason so many people want Wal Marts in their town is because elderly people demand it, and they're a strong voting bloc. And there are far more consumers than there are factory workers, so outsourcing is more of a benefit than a negative in an economy. Give manufacturing to the cheapest foreign labor. It's a good thing. This is why things like NAFTA are a net benefit to the US economy. The obvious solution for the secondary problems this creates is to increase local industries for local jobs. What can someone do here that absolutely must be done here, instead of by a person in China? Things like construction works well, where you need someone local to build something since it can't be outsourced - you need to be here. Other traditionally conservative jobs like farming and mining would also be included, but also things like teaching and retail and other service jobs. The long-term solution is higher-skill jobs, pushing the state-of-the art since US has the top universities.
- BrainInAJar 9y ago
  Freedom of capital movement without freedom of labour movement privileges the capital class over the labour class. The only equitable free trade agreements include the right to follow the jobs, such as the EU.
  - mozumder 9y ago
    The neoliberal position also includes freedom-of-labor-movement. It's why you had people like Hillary pushing for open borders in her speeches to Goldman Sachs.
    - BrainInAJar 9y ago
      The irrelevancy of the nation state is something neoliberals and socialists agree on, yes.
- 1stranger 9y ago
  These towns are too small to support the higher skill jobs with state of the art universities. They have no means of self-support.

rconti 9y ago

I haven't read the article, but just clicked on it -- she was featured on today's NYTimes podcast The Daily.

rainbowmverse 9y ago

It's hard to buy better stuff when you can't find work that pays enough for it. The problem is bigger than the purchasing decisions individuals make.

blizkreeg 9y ago
People can't buy better stuff because they don't have jobs or jobs that pay well enough. Those jobs leaving are what helps them buy the cheaper stuff. Quite the roundabout, isn't it?
- jeirje88382hj 9y ago
  Yeah except those jobs began to leave due to the actions of government and the elite. Let's not wrap well documented history in overly reductionist loops to sound smart. This isn't a natural economic process. It's based upon decisions made by the rich to keep getting richer. The process played out a century ago when factories left urban centers for rural. Humans go in room, come out of that room talking austerity of some kind for the masses. It's not a mystery. Economics is not physics.
- taurath 9y ago
  It’s more like a spigot that is draining into corporate coffers, and out of the communities. There’s not much money left and what does move around all doesn’t stay in or anywhere near town.
  - virmundi 9y ago
    To be fair, even local mom and pop stores still purchased the majority of the supplies they sold from out of town. Few cities could produce all of the goods, or even the majority of the goods needed on their own. So yes, DG takes some of the profits, but there are local employees making money to then spend in the local economy.
- yahna 9y ago
  There is lots of reasons to not buy better stuff. I own mostly cheap furniture because good stuff is a very expensive commitment, for example.
nejenendn 9y ago
Yup, this is a problem of money draining from rural america. There are many symptoms.

paulpauper 9y ago

hmm..but stores that make 'cheap stuff' (walmart, mcdonalds, target, etc.) employ a lot of people. The jobs may not pay much but it's employment nonetheless.

vkou 9y ago
They don't employ as many people per dollar of goods sold as the businesses they replaced. It's why those businesses got replaced.

Teknoman117 9y ago

That was an incredibly good read, thank you.

omegaworks 9y ago

>we don't hesitate twice when buying the cheap stuff When things like gas and international trade are heavily subsidized (either directly or indirectly using preferential trade agreements) we create a world where this is the norm. When this is the local maxima of capital growth in these areas, this is where capital will invest.

adventured 9y ago

There is at least one very good solution. Significantly increasing the earned income tax credit. Warren Buffett has been pushing this for a long time as a superior alternative to increasing the minimum wage. We can push to $15 / hour equivalent without punishing businesses that can't afford the minimum wage at that level. Few people on either side are listening to him however; Democrats in Congress are mindlessly latched onto the minimum wage as the only solution, and Republicans dislike expanding such benefits in general. It can be done without changing much about how the system works and it would immediately begin boosting the standard of living for the bottom 1/2 of workers. The EITC is superior to the universal basic income, as it doesn't needlessly give money to the well-off (ie it isn't inherently regressive) and the US could actually implement a higher and broader EITC system immediately. https://www.wsj.com/articles/better-than-raising-the-minimum-wage-1432249927 https://www.wsj.com/articles/better-than-raising-the-minimum...

Something1234 9y ago
I think the issue with this is that the average voter won't understand what it is.
mrob 9y ago
There's nothing inherently regressive about a universal income. Taxing everybody the same percentage is considered regressive because of the diminishing marginal value of each dollar. Rich people are taxed a lower percentage when measured by utility. By the same argument, giving everybody the same basic income is progressive.
- kirse 9y ago
  There's nothing inherently regressive about a universal income Except that universal incomes are basically adult allowances provided by Daddy Government. So they are regressive in the sense that they're an idealistic childhood notion that immature adults keep trying to carry forward into adulthood.
  - mrob 9y ago

Consultant32452 9y ago

There's been a good solution in sight for years. Barak Obama campaigned in the primaries on a platform of renegotiating NAFTA. Then he dropped that issue during the general. Trump sang that tune all the way to the White House. Here's the long story about what's wrong with NAFTA and it's mostly about tax structure. In Mexico they have a VAT sales tax. This is a huge chunk of their federal budget. Most of the taxes are on the consumption side (point of sale), not the production side. Goods produced in Mexico but sold abroad avoid the VAT tax. However, goods produced outside Mexico but sold in Mexico get the same VAT tax as every other good sold. Now let's look at the US. We have no federal sales tax, all of our taxes are on the production side. Every good that leaves a factory has its price loaded up with basically all of our tax costs. It's the production side that's taxed, not the consumption. That means a product manufactured in the US already is loaded up with US taxes, and then gets shipped to Mexico where the VAT is added on top. Double-taxation. Goods produced in Mexico have no VAT, come to the US tariff free, and sold to US consumers where no federal tax is collected on the consumption end. No-tax. You don't need a Ph.D. in Economics to understand what the result of this will be over time. The way I see it there's two potential solutions to this. One is to renegotiate NAFTA just like we elected Obama and Trump to do. Another would be to restructure our taxes to be more like Mexico and load the taxes on consumption rather than production. This was the signature campaign idea by Herman Cain during the 2012 election with his 9-9-9 plan, though he was laughed at at the time. https://en.wikipedia.org/wiki/9%E2%80%939%E2%80%939_Plan https://en.wikipedia.org/wiki/9%E2%80%939%E2%80%939_Plan. I'm not suggesting that the 9-9-9 plan exactly is good, but only use it to point out that these solutions have been discussed in the mainstream. I remember Ross Perot's entire campaign against Bill Clinton in 1992 was about how much NAFTA would suck all our jobs to Mexico. But we elected Clinton anyways and look what happened.

Lazare 9y ago
That's untrue; the exchange rate adjust to completely negate the tax differences. What economists call the "terms of trade" are not impacted by sales tax. This gets brought up and debunked periodically, the first result Google returns for me is http://www.aei.org/publication/keynes-at-the-border/ http://www.aei.org/publication/keynes-at-the-border/ which looks as good as any. > You don't need a Ph.D. in Economics to understand what the result of this will be over time. True enough, but it can still be a little confusing, as you've discovered. :)

averagewall 9y ago

To what extent can you fool someone into thinking they're doing a productive job? Social welfare for unemployed factory workers feels like not being productive, but what if you raise tariffs on imports to support local industry and give them jobs. Wouldn't it still feel useless? If you know that your job only exists because other Americans are paying you to make you feel productive because they realise you'll enjoy that more than just getting the money directly, wouldn't that be a hollow satisfaction?

virmundi 9y ago
Wouldn't it depend on what you were doing? Pushing paper probably feels pretty shitty. Actually cleaning up a forest in California to prevent another fire probably feels pretty good. We don't make people work hard any more because that's degrading? Not really sure why that is. We had work programs for those unemployed. They paid ok. They provided real benefit for the country. For some reason we don't go back this.
- averagewall 9y ago
  I don't mean jobs that provide real benefit. I mean making cars or consumer products in cases where the local industry is dependent on import tariffs to survive because the same thing is made cheaper overseas.

mozumder 9y ago

Outsourcing benefits the consumers by keeping prices and inflation down. This helps the poor and elderly on fixed income the most. The reason so many people want Wal Marts in their town is because elderly people demand it, and they're a strong voting bloc. And there are far more consumers than there are factory workers, so outsourcing is more of a benefit than a negative in an economy. Give manufacturing to the cheapest foreign labor. It's a good thing. This is why things like NAFTA are a net benefit to the US economy. The obvious solution for the secondary problems this creates is to increase local industries for local jobs. What can someone do here that absolutely must be done here, instead of by a person in China? Things like construction works well, where you need someone local to build something since it can't be outsourced - you need to be here. Other traditionally conservative jobs like farming and mining would also be included, but also things like teaching and retail and other service jobs. The long-term solution is higher-skill jobs, pushing the state-of-the art since US has the top universities.

BrainInAJar 9y ago
Freedom of capital movement without freedom of labour movement privileges the capital class over the labour class. The only equitable free trade agreements include the right to follow the jobs, such as the EU.
- mozumder 9y ago
  The neoliberal position also includes freedom-of-labor-movement. It's why you had people like Hillary pushing for open borders in her speeches to Goldman Sachs.
  - BrainInAJar 9y ago
    The irrelevancy of the nation state is something neoliberals and socialists agree on, yes.
1stranger 9y ago
These towns are too small to support the higher skill jobs with state of the art universities. They have no means of self-support.