N2EY wrote:
In article , Mike Coslo
writes:


The reality of things economic is that, like it or not, we are in a global
economy and that isn't going to change.


That's true to a point. But we don't have to simply accept everything
that comes down the pike as inevitable.

It will probably stabilize when one of the programmers from India
writes a good program to replace CEO's! ;^)


'zactly.


The drastic reduction in costs
of shipping (both importing and exporting goods) as well as
similar reductions for communications makes it cheaper to manufacture
and even provide certain service functions off-shore. That isn't
going to change in the short run.

Only if it doesn't affect buyer behavior. If buyers protest with their
dollars, things will change.

In the long run, those currently
cheap off shore labor markets will self adjust upwards.

Maybe. And if so, might they not find themselves in the same boat?

Correct! I have alway though that the best argument for what is going
on is the elevation of a population's living standard. A country has a
low standard of living, and the workforce is available for next to
nothing, wage wise. So like Pizza take-out's in a college town, everyone
ant their brother migrate there for the cheap labor. AS the standard of
living goes up, the cheap labor starts to demand more in salary and/or
benefits. This works for a while, but eventually another poor country
looks attractive to employers. So they move on to the next poor country.


The trick is to do that without creating more poor countries.


At the present time, I doubt that is a concern.

And the fundamental question is: Why are countries poor in the first place, and
how do countries get rich and stay rich without exploiting other countries?

Examples are what has happened to Japan. Korea is the present hot
spot,

but is slowing. China is ascendant now, but the inevitible will happen
there. Mexico is now experiencing import concerns too.


Remember NAFTA and the "giant sucking sound"? Where's Ross now?

Ahh, there was some comic relief!


What happens when the cycle is complete, and the last third world
nation is brought up to modern standards will be the interesting thing.

First you have to understand why it hasn't happened yet.

There are plenty of countries yet to bring up.

In the short
run, US labor has their head in the sand if they think there's something
either party (Dems or Reps) can really do to stem the shift of
manufacturing jobs overseas. The same thing is going on in Europe.

OTOH, unemployed workers can't buy the goods anyway. So what good are
lower prices?

You see, the big trick is to have all this happen without ourselves
turning into a third world country. See below.

And that trick is?

As I see it, one of the first things to do is to stabilize the stock
market. Right now it is so short term, that it will do damage to the
companies involved, and to workers. The pressure to increase profits on
the short time scales now involved makes longterm actions difficult if
not impossible.

I don't subscribe to the Japanese lifetime employment thing, but at the
base of it, there is a valid idea. Humans desire a little stability.
Remove that stability, and a whole host of problems erupt. Employer
loyalty goes away, and when that happens, things suffer. If I know my
employer will just as soon get rid of me for .001 percent rise in their
stock, I'm not going to be willing to stay in all night to make sure the
project goes out the door on time.

Note the present legislative efforts to shift workers from overtime
eligible to salaried. From the supershort term view, this makes perfect
sense. Reduction of the employees salary by mandatory unpaid overtime.
This will make for a quick jump in profits. From a longer term
perspective, it makes for a "what do we do next quarter to increase
profits" issue, it makes the job less desireable, because now the
employees are taking a wage cut, and they have it reinforced that their
empoloyer would like nothing better than to get rid of them.

In the long run, employees must be constantly reevaluating their
job skills and looking at the prospect of how vulnerable their job
may be as to their job being farmed out to off shore labor.

That's true up to a point. But how often is it reasonable to expect a
person to retrain? And what happens to "the wealth of nations" in the
meantime?

I don't know of any country that grew prosperous on a service economy
alone.

Countries that are service based economies are the *servants* of other
countries.

We can "reality" each other all day long, but if economies chase the
almighty profit without any moral guidance - that is if they are not in
business for the sole purpose of making a buck, then disaster is the result.


Actually I think it's simpler than that. They have to consider both the
short-term buck and the long-term buck.

Henry Ford was criticized by other industrialists because he paid workers the
princely sum of $5 per day. His response was that it did not make sense to him
to have people building a product they could not afford to buy. He traded off
the short-term buck of higher wages for the long-term buck of a bigger market.
I don't think he did this out of any love for the workers or the country, but
rather because he saw a bigger picture.

73 de Jim, N2EY

- Mike KB3EIA -