On 26 Feb 2004 15:29:27 -0800, (Jonathan Cook)
wrote:

(George Adams) wrote in message ...

I agree. The horse is out of the barn, and we can't, (and maybe shouldn't),
stop it, but we do need some way to buy time and develop a strategy for the

Outsourcing is inherently an unsustainable mechanism. It only
benefits those who use it first. A good question to ask oneself
when deciding whether to do something or not is "what would
happen if everyone did it?".

[snip]

Jon.

Is it all bad? Well maybe yes, maybe no. The decline in trade
unionism is also mirroring a decline in well-paying blue collar
manufacturing jobs and seeing them replaced by non-union McJobs.
Employment standards are eroding in parallel with union decline as
these standards were dependent on the political clout of the unions to
to maintain them. In manufacturing it appears we are in a race to the
bottom. The Walmartification of both our economies is well under way.

But is that always true? Is this something unique? Well, no it
isn't. Ever since the Industrial Revolution started in England,
social institutions have never kept pace with technological
advancement. Structural unemployment is an artifact of this reality.
Capital is extrermely mobile, production is very mobile, but labour is
not. Capital changes very rapidly, production capability changes
rapidly, but labour does not. Since those first few factories started
up in England, labour has never kept pace with technology.

When NAFTA was signed into law, Ross Perot predicted there would be a
huge sucking sound made by all of the jobs flowing south across the
border. He was right. Canada and especially Ontario, was shoved into
the throes of a vicious recession as huge numbers of manufacturing
jobs flowed out of high standards, high wage Ontario, into the low
standards, low wage states of the US. The manufacturing sector of
Ontario was gutted. Ontario was a miserable place to be in the early
1990s for our earning power fell steadily behind that of the US. At
the beginning of the decade, I might have had the earning power of my
equivalent in the US but by the end of the decade, it was around 60%
to 70% of that level. Had we enjoyed a free trade agreement in
labour, we would not have had this earning loss for our skilled
workers could have followed their jobs to the US. Those companies
that remained would have had to compete with US salaries to retain
those workers and our salaries would have kept up. But NAFTA did not
include a free trade in labour and the remnents of Ontario's
manufacturing sector started to enjoy the benefits of a captive,
passive, and insecure labour force.

Was it the end of the world? No. Modern economies are very resilient
and Ontario turned around so much so that, by the end of the decade,
it was roaring along, outpacing the US. We still have plenty of
problems, largely caused by declining tax revenue (as a percentage of
GDP), due in large part by our inability to make corporations pay
their fair share and have them stay in Canada. In teh 1960's, the
income tax take was split roughly 50-50 between personal and corporate
sources. Today, the corporate share is only about 7%. The tax burden
falls disproportionately on the middle class to support both the poor
and the corporate welfare bums. Consequently, much of our public
infrastructure is eroding. But, we're doing OK. We do have a growing
disparity in wages as the working poor contiue to decline, but a new
entrepreneur class, high tech industries, and other growth sectors are
leading to a resurgence in earning power.

So, the current trend in the US will balance out. The
Walmartification of the US economy will hurt, especially considering
the cost of the war and the fiscal ineptitude of the current
administration, yet it will turn around. I do know that protectionism
would be just about the worst thing you could do. Whatever job losses
you stem in those under-competitive, declining sectors, they will be
more than offset by job losses in other sectors in the economy,
directly caused by protectionism. Protectionism helps the declining
sectors of your economy and punishes the performing sectors. I always
laugh when I hear the righties wail about the need for protectionism
because it's such a lefty thing to do.

RDL's comments in a previous thread are symptomatic of the arrogant
blindness that prevents many Americans from understanding just how
dependent the maintenance of their well being depends on other
nations. Protectionism in the US has always been bolstered by the
notion that America can go it alone. America never has been able to
go it alone and it can't especially now. It's a nice little fantasy
but it has never been true. Hell, American males even need a foreign
contry to help them with their hard-ons. The next you take the little
blue pill to get a stiffy, remember to hum a few bars of, "Rule
Britannia" in gratitude.

Globalization is probably the grandest expermiment in human history.
So please do remember to fasten your seat belts as the ride will be a
little rough. Oh, and please do remember that the global trade rules
driving Globalization are maintained by the WTO and supported by other
international organizations such as the World Bank and the IMF, and
international trade agreements like NAFTA. Institutions and agrements
that were developed in American, by America, for the benefit of
America. This game is being played out according to your rules so it
still works out in your favour more often than not.

So, remember the little blue pill, the next to time you get the urge
to vote the protectionist line and do both your lady and your country
a favour.

(BTW,. if you're having trouble squaring this post with my last one, I
figure it's pointless to swim against the tide -- also a decent
metaphor for protectionism and globalization.)

Peter

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