- Among the serious consequences of offshoring are the
dismantling of the ladders of upward mobility that made the US an "opportunity
society," an extraordinary worsening of the income distribution, and
large trade and federal budget deficits that cannot be closed by normal
means. These deficits now threaten the US dollar's role as world reserve currency.
- I was not alone in making these warnings. Dr. Herman
Daly, a former World Bank economist and professor at the University of
Maryland, Dr. Charles McMillion, a Washington, DC, economic consultant,
and Dr. Ralph Gomory, a distinguished mathematician and the world's best
trade theorist, understand that it is strictly impossible for an economy
to be moved offshore and for the country with the offshored economy to
remain prosperous.
-
- Even before this handful of economists capable of independent
thought saw the ruinous implications of offshoring, two billionaires first
recognized the danger and issued warnings, to no avail. One of the billionaires
was Roger Milliken, the late South Carolina textile magnate, who spent
his time on Capitol Hill, not on yachts with Playboy centerfolds, trying
to make our representatives aware that we were losing our economy. The
other billionaire was the late Sir James Goldsmith, who made his fortune
by correcting the mistakes of America's incompetent corporate CEOs by taking
over their companies and putting them to better use. Sir James spent his
last years warning of the perils both of globalism and of merging the sovereignties
of European countries and the UK into the EU.
-
- Sir James book, The Trap, was published as long
ago as 1993. His book, The Response, in which he replied to the "free
trade" ideologues in the financial press and academia who denigrated
his warning, was published in 1995. [For readers who wish to hear a speech
given by Sir James to the US Senate in 1994 warning of the perils of globalism,<http://www.youtube.com/watch?v=maouTP8vTO0>watch
it on YouTube. Also <http://www.youtube.com/watch?v=4PQrz8F0dBI&feature=related>here.]
- Sir James called it correct, as did Roger Milliken.
They predicted that the working and middle classes in the US and Europe
would be ruined by the greed of Wall Street and corporations,
who would boost corporate earnings by replacing their domestic work forces
with foreign labor, which could be paid a fraction of labor's productivity
as a result of the foreign country's low living standard and large excess
supply of labor. Anytime there is an excess supply of labor, or the ability
of corporations to pay labor less than its productivity, the corporations
bank the difference, share prices rise, andWall Street and
shareholders are happy.
-
- All of this was over the heads of "free trade"
ideologues, who threw accusations such as "protectionist" at
Sir James, Roger Milliken, Herman Daly, Ralph Gomory, Charles McMillion,
and myself. These "free trade" ideologues are economically incompetent.
They do not know that the justification for free trade is based
on the principle of comparative advantage, which means that a country specializes
in those economic activities in which it performs best and trades for
those goods that other countries do best. Instead, the ideologues think
that free trade means the freedom of capital to seek absolute
advantage abroad in lowest factor cost. In other words, the free
tradeincompetents have never read David Ricardo, who formalized the case
for free trade.
-
- Other economists, especially those high profile ones
in high profile academic institutions, were <http://www.informationclearinghouse.info/article28189.htm>bought
and paid for. In exchange for grants from offshoring corporations
these hirelings invented "the New Economy," in which everyone
would prosper as a result of getting rid of "dirty fingernail jobs."
The New Economy wouldn't make anything, but it would lead the world in
innovation and in financing what others did make. The "new economists"
were not sufficiently bright to realize that if a country didn't make anything,
it couldn't innovate.
- Let's go now to Michael Spence and Sandile Hlatshwayo,
who have provided an honest report for which we should give thanks. Professor
Spence could have made many millions using the prestige of his Nobel Prize
to lie for the Establishment, but he chose to tell the truth.
-
- Here is what Spence and Hlatshwayo report:
- This paper examines the evolving structure of the American
economy, specifically, the trends in employment, value added, and
value added per employee from 1990 to 2008. These trends are closely connected
with complementary trends in the size and structure of the global economy,
particularly in the major emerging economies. Employing historical time
series data from the Bureau of Labor Statistics and the Bureau of Economic
Analysis, U.S. industries are separated into internationally tradable and
non-tradable components, allowing for employmentand value-added trends
at both the industry and the aggregate level to be examined. Value added
grew across the economy, but almost all of the incremental employment increase
of 27.3 million jobs was on the non-tradable side. On the non-tradable
side, government and health care are the largest employers and provided
the largest increments (an additional 10.4 million jobs) over the past
two decades. There are obvious questions about whether those
trends can continue; without fast job creation in the non-tradable sector,
the United States would already have faced a major employment challenge.
-
- The trends in value added per employee are consistent
with the adverse movements in the distribution of U.S. income over the
past twenty years, particularly the subdued income growth in the middle
of the income range. The tradable side of the economy is shifting up the
value-added chain with lower and middle components of these chains moving
abroad, especially to the rapidly growing emerging markets. The latter
themselves are moving rapidly up the value-added chains, and higher-paying
jobs may therefore leave the United States, following the migration pattern
of lower-paying ones. The evolution of the U.S. economy supports the notion
of there being a long-term structural challenge with respect to the quantity
and quality of employment opportunities in the United States.
A related set of challenges concerns the income distribution; almost all
incremental employmenthas occurred in the non-tradable sector, which
has experienced much slower growth in value added per employee. Because
that number is highly correlated with income, it goes a long way to explain
the stagnation of wages across large segments of the workforce.
-
- What is Spence telling us? Spence is careful not to
say that globalism is the intentional result of enhancing capital's profits
at the expense of labor's wages, but he does acknowledge that that is its
effect and that globalism or jobs offshoring has the costs that Daly, Gomory,
McMillion, Milliken, Goldsmith, and I have pointed out. Spence uses the
same data that we have provided that proves that during the era of globalism
the US economy has created new jobs only in non-tradable services that
cannot be offshored or be produced in locations distant from their market.
For example, the services of barbers, waitresses, bartenders, and
hospital workers, unlike those of software engineers, cannot be exported.
They can only be sold locally in the location where they are provided.
-
-
-
- Open Letter To Paul Craig Roberts On "Offshoring
Destroys American Economy"
-
- Br. Nathanael Kapner
-
- 6-2-11
-
-
- Hello Dr Paul Craig Roberts!
-
- I just read your latest article on Nobel Prize winner
Michael Spence regarding "Offshoring Has Destroyed The Economy"
@ http://www.foreignpolicyjournal.com/2011/06/01/
- a-nobel-economist-says-globalism-is-costly-for-americans/
-
- I read Spence's report and watched a Video on him last
week and although I was quite impressed, (the establishment Council of
Foreign Relations featuring it notwithstanding), the analysis doesn't have
a chance of any life whatsoever.
-
- Capitol Hill is strangled and owned by Jewish money,
(I grew up as a Jew in an upper-middle class "Lobby-Intensive"
synagogue), and KNOW that Jewish-Money/Jewish Wall Street RULES America.
-
- Our jobs are gone by way of JEWISH FINANCE CAPITAL, insured
by Zionist shills on Capitol Hill and the White House, and NOT coming back.
-
- The shame of it all is that due to the Jewish-destruction
of the White Middle Class vis a vis our White Collar jobs being outsourced
to India at 1/5th of the wages paid them in America, money has been concentrated
into the hands of a few - A tightly organized racial group known as World
Wide Jewry.
-
- This is scary and MUST be understood by all honest economists
like you.
-
- We MUST identify the culprits or we get nowhere in our
fight to save America and its economy.
-
- My hunch is that as Americans find themselves poverty
stricken and in a declared state of Martial Law which the next president,
the Jewish-controlled "schwartza" Obama, will declare - a North
American Union will be promoted and proposed by Zionist shills on Capitol
Hill and pushed by the Jewish-owned Main Stream Media and their bought-and-paid-for
"economists of academia."
-
- Then a Jewish-elite, not unlike the case of the EU in
Brussels, will be installed that has NO CHECKS, NO ACCOUNTABILITY, in order
to further International Jewry's plan for "Global Governance"
as Strauss-Kahn "spilled the beans" in front of Bernanke who
had daggers in his eyes for DSK.
-
- Please See My Latest Vid for the visuals of Bernanke
vis a vis DSK: "The Strange Case Of Dominique Strauss Kahn" @ http://www.youtube.com/watch?v=1eReJXjYQPA
-
- I also feature you in this Video.
-
- Regards,
-
- Brother Nathanael Kapner
- Publisher Real Zionist News @
- http://www.realzionistnews.com/
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