Why Does John McCain Hate the American Worker?
He says "Drill here, drill now!" to reduce the price of gas, but every time the price of oil goes up, more jobs return from China, and first to the basic heavy industries like steel. Why does he hate the rust belt states? Or, for that matter, Mexico?
All graphs from CIBC World Markets StrategEcon May 27, 2008, pdf here
Once the mills of US Steel and Bethlehem Steel employed thousands, producing the metal that was cast into the building materials and cars that were the engine of the American economy. Then they were silent, as new technology could produce new steel from scrap at a lower cost than virgin steel from ore. Soon it became cheaper to ship that scrap to China and ship it back to the US, and the North American steel industry almost shut down, and with it, many of the towns and cities that supplied the workers for it. The most productive cities in America became known as the "Rust Belt" as the economic engine of the country moved to Arizona, building houses and big box stores to sell the stuff that filled the houses.
Then, something happened. Jeff Rubin, chief economist for CIBC World Markets, writes:
"Soaring transport costs, first on importing iron to China and then exporting finished steel overseas, have already more than eroded the wage advantage and suddenly rendered Chinese-made steel uncompetitive in the US market....China's steel exports to the US are now falling by more than 20% on a year-over year basis--the worst performance in almost a decade. While many might attribute this decline to the slowdown in the US economy, it is noteworthy that US domestic steel production has risen by almost 10% during the same period."
Rubin continues: "Shipping a standard 40-foot container from Shanghai to the US Eastern seaboard now costs $ 8,000. In 2000, when oil prices were $20 per barrel, it only cost $3,000 to ship the container. But at $ 200 per barrel, it will soon cost $ 15,000 in transport costs to ship from China to the US Eastern seaboard."
For heavy things with low labor input, like steel, the response has been immediate, American steel is again competitive and is increasing production, even in the face of a recession. Heavy or bulky manufactured goods, like furniture and industrial machinery, take a little longer, but are following.
Rubin concludes "Instead of finding cheap labor half-way around the world, the key will be to find the cheapest labor force within reasonable shipping distance to your market....It seems that American importers are starting to do the math. While the pace of shipments from China to the US is slowing- mainly among freight-intensive goods, even non-energy Mexican imports to the US are still rising at a healthy annual rate of more than 7%. And interestingly, the goods that have seen the fastest growth are the ones that, on average, are more freight intensive and directly compete with China, such as furniture, iron and steel, rubber and paper products.
In a world of triple-digit oil prices, distance costs money. And while trade liberalization and technology have flattened the world, rising transport prices will once again make it rounder."
Now if you are from Arizona, your business experience, if any, is probably in real estate, and the declining value of the suburban real estate market is directly correlated to the price of gas to get there and the cost of electricity to run the AC. You want cheap energy if you live in Arizona.
But if you make steel in Pennsylvania, furniture in North Carolina, or work in the maquiladoras across the border, you may notice that jobs are coming back, that companies like IKEA are looking for factory sites, that stuff imported from China is not as cheap as it once was.
Rationally priced gas can put America back to work, but they don't see that down where the economy was built on cheap energy and real estate development rather than making things. They just say "drill here, drill now" and screw everyone else.
Read the PDF of Rubin's report from CIBC World Markets and a tip of the hat to ::Solve Climate
More on Jeff Rubin
Jeff Rubin Predicts "Mass Exodus" From Cars in US
Gas $7 Per Gallon in Four Years
The World Is No Longer Flat
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Most of the comments about this article are short sided and self centered. There is a "graeter good" at stake here. We need to return to self sufficiency. We must re-start of manufacturing on our own soil. This isn't about jobs or the price of gas. Every time a "plant" closes, we, in turn , must rely on foreign suppliers. We all can live without dollar store trinkets, toys and housewares. We acnnot exist, as a nation without steel and all that it makes. Think of all of the shortages this country experienced in WWII. When Russia invaded Georgia, I though to myself, "There is nothing we can actually "do" about it. " We no longer have the resources to self protect, on our own, much less extend ourselves in another global conflict regardless how critical it may be to our own survival as a nation. God forbid China would ever embargo us. And they know it.
Even if plants don't close, they lay off people because with better technology vastly smaller numbers of people can produce as much or more than they could in the past.
I am afraid that the "self-sufficiency" hypothesis has its demise built into it. The fewer people are needed in a country to produce goods, the more worldwide customers it takes to make operations economically viable.
Your just looking at this from the "supply side" perspective. Those laid off workers were your customers, but not anymore! That's one of the reasons our economy is in the crapper.
This is the part of killing the golden goose that these supply side guys just refuse to get. I've come to the conclusion that these low level ne0con enablers have just drunk the koolaid and are working against their own self interest, only they don't know it yet.
The guys at the top, however, are all about Relative Wealth. That many of the world's most powerful and wealthy families could ride out another Depression and emerge stronger and richer, just like they did from the last one. That, relatively speaking, once the masses have been crushed into poverty, the Elites will all be like Royalty of yore--Vastly wealthy compared to the serfs over whom they will rule. So it isn't about the bottom number. It's how that number stacks up against everyone else.
We will still need to eat, have water, homes, heating, the essentials, and we will be made to pay for them.
So every driver in the US should pay $2.00 a gallon more so a few union workers can make over $100,000 a year? Working mothers making $8.00 an hour should have to choose between gasoline and food so a steelworker can make $50.00 an hour with benefits? And McCain is antiunion because he wants to lower gas prices to help all 300,000,000 Americans instead of keeping gas prices high so 10,000 union members can get their jobs back?
If your working mother was unionized she would be making a living wage and be able to pay for food and gasoline and have decent benefits. Low wages as you can see it do not guarantee low gasoline prices. They only enrich the already rich like McCains.
Competitive wages insure the survival of the company. Excessively high wages take money from the companies that could be used to modernize and keep the company viable. That benefits all the stockholders and every pension fund that invests in the company. Excessive wages don't help the workers when the company has to close plants to stay in business.
You are missing the point entirely!
I do drive on occasion myself. Let me admit that when I do I hipermile! I pull away gently from the stop bar when the light goes green, accerate to the speed limit, and coast to the next red light. I save maybe 10% of the fuel I'd otherwise use . I don't see any working mothers driving as if they are concerned about how much fuel they use or how much it costs. They fly by me as if I'm standing still, even when I'm driving at the speed limit.
Maybe those poor working mothers can get a good paying job in one of those steel mills that are starting up.
What percentage of Steel Workers Union people make over 100K a year?
Very few union members earn that muck. Most are either laid off or retired because the steel companies went bankrupt trying to pay union wages, union benefits, and union retirement funds.
High wages don't do anyone any good if the company goes bankrupt paying them.
Nevermind that "drill here, drill now" will do nothing to lower gas prices in the forseeable future. We have to break this addiction to fossil fuels, and we should have been working on alternative fuel sources since Carter turned the thermostat in the whitehouse down and put on a sweater.
So if we can survive the hurricane force winds there may be a silver lining to those high oil prices.
"Why Does John McCain Hate the Amerian Worker?" It comes to him naturally, he is a republican.
Why not manufacture oil here in the US?
Why is it okay to purchase this product from countries without enviromental or worker safety programs?
The short answer to your question:
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
yea the greedy union workers...just look at the auto and airline industries, union labor is breaking their backs because they want to stand in an air conditioned assembly line making 35.00 dollars an hour with full benes to put steering wheels on. greedy bastards. down with the corrupt greedy unions.
Also, the USA uses 25% of the world's oil, but only holds 3% of the world's oil reserves. So even if we drilled like crazy, we'd still have to import over 80% of what we consume. We have no options, and will not have them until we develop alternative, sustainable energy sources. As long as our economy runs on oil, we will be owned by foreign countries.
We are not drilling like crazy right now and yet we don't import the numbers you mention.
Oil is not being "manufactured". It is a natural resource that is being exploited. Once it is gone, it is gone forever. And sadly, the US has burnt through most of its conventional oil reserves about thirty odd years ago.
Replace the word manufacture with process, drill, refine or what ever word you want.
Why not bring that "action" back to the US where it can be done responsibly to the environment and its workers?
Oil companies already have many untapped oil leases. Why do they need more? Even if they got more leases the pay off is way down they road. So why is Mccain pushing this idea? A gimmick for the people who don't care to read up on this, and want to be spoonfed. Wake up America.
They want more leases, so they can continue to tie up those resources, and thus continue to control the price on the market.
Yes! Let's bring back sweatshops, 16 hour days and 10 year olds working at a man's job.
The Republicans and the corporate oligarchy hate ALL workers below the C-level but Americans are hard to realize that.
When you took out the loans for your undergrad and MBA - $100K+, did you ever imagine Globalization would make it so it could take you 70 years to pay them off if you have a family to support?
How do you know that all Republicans and corporate oligarchy hate ALL sub-C-level workers? Have you polled them? Do you know them all?
It's contradictory to say this. If they are hated, then why were they hired in the first place?
Oh, so they can be exploited by C-level Republican Oligarchy.
Well, if they are being hated and by extension exploited, you would agree that those sub-C-level are either Democrats or non-Republicans. Are all C-level executives Republicans?
Pretty transparent, if not pathetic, joebiz. But typical for a Republican.
Your questions aren't even worth answers, to a thinking, informed person. But since there are so many out there that aren't, here are your answers.
But first let's look at that word "hate." I don't myself think business owners actively hate their workers (at least not until they cause "trouble" by asking for a living wage). I rather think they simply don't care about them personally at all, but think of them as a simple resource, to be acquired and maintained as cheaply as possible.
As to why sub-C workers are hired, if they are (not-loved), look at the pre-Civil War South. Did plantation owners keep slaves because they loved black people, or because they wanted cheap labor? Ergo Sum.
As to your imaginary division of workers into Dems and Reps, It's actually rather accurate, if the Dems in the C-Suites are DINO's.
So you are saying you can't hire a person you hate? Where is the contradiction? If you were hiring people and simultaneously resenting having to pay them (which takes money out of your personal pocket), it stands to reason you may resent them at minimum.
In showing your consternation with something that Chavez08 clearly expressed as an opinion, you fell into the same logical trap yourself. You criticize him/her for putting words into mouths and then attempt to sylogistically do it yourself.
tsk, tsk....
So maybe an extension of the consume-local-produce campaign will eventually be a consume-locally-manufactured campaign? It even makes sense.
On the other hand, McSame's campaign to drill offshore will actually be counterproductive, and result in higher prices by taking needed investment away from renewables. So, Mac's policy position may in the end result in more jobs coming back home, by causing a hike in oil prices. I'm pretty sure a man who doesn't even know how many mcmansions he owns doesn't feel too much compassion for other people, but, the law of unintended consequences may result in Mac's policies working out for us. (I don't really believe that, but it's kinda amusing to think of someone like McCain accidentally doing something that helps the American economy.)
Investment in drilling offshore will not deter investment in "renewables." There has been significant investment over the last years in both and there will continue to be large amounts of investment in both unless oil prices completely collapse.
Yes that is the ticket !
Oil at $200 a barrel and Americans living hand to mouth after paying their engery bills.
Yeah those are the jobs we want. The ones that allow us to just barely stay alove and work another day.
That's the plan! - To sustain slaves long enough to create new slaves. That's the intent behind the anti-abortion crusade, these un-born children are just what the establishment is looking for to maintain the MIC, PIC and the global trade empires. This is pure Capitalism, the way the "natural order" intended - 98% slaves and 2% kings.
This is the future for most of Americas' children under Capitalism - either to be slaves sustaining the empire or soldiers expanding the empire. Forget about homes, vacations, dignity, retiring..... When you are no longer healthy enough to be productive, the corporate establishment will help make sure you die quickly and quietly to not be a drag on their well-oiled machine (Universal Healthcare and Social Security spoils it for them)
"On the boats and on the planes...."
And, no offense Chavez, but luring poor and uneducated illegals into the country (from anywhere!) but especially the Catholic countries with their culture of huge families, is a part of that program! We are not offering them streets of gold or a melting pot. We are offering them chains, body ruining work, and self esteem destroying class warfare that is intended to last for Generations. I know Black people whose families have 300 years of history in American and Still aren't accepted as full citizens. This must stop! We must break the chains. The Corporatocracy of America must be torn down.
Maybe if, as a country, we learned how to conserve energy rather than waste it, then we wouldn't have an energy crisis. But, unfortunately, because most Americans can only see six inches in front of their face, we need to drive up the cost of energy in order to motivate people to conserve.
And, maybe, if the wealth disparity between the lower/middle class and the upper class wasn't so astronomical, the rising cost of energy wouldn't hurt so bad. But, heaven forbid rich people have to give up one cent to the country which enabled their lifestyle...
There isn't much choice here. Oil will be $200/barrel, if you like it or not. And the jobs the article is talking about will never materialize. A modern steel mill needs no more than a handful of people to do the same thing that kept a whole town employed 50 years ago.
I was stuck behind someone with the bumper sticker that said "DRILL HERE, DRILL NOW, PAY LESS" on their Tahoe today and I wanted to seriously rear end them..Repeatedly.
Don't resort to violence. This is exactly what they want. The older I get the more I understand the wisdom of Gandhi. Passive resistance on a global scale might just bring this Matrix tumbling down. On the other hand wide-spread violence will give the Power-Elite a plausible excuse to further extend their fascist grip on the planet. Conspiracy Theory? Perhaps.
I believe that as much as they want violence, nobody wants to die.
I argue that if they are looking for violence they should be willing to follow through on that path to its natural conclusion.
Who wants?????
Cool! Bring the "matrix" down. Then you can sit under a bridge and celebrate with a roasted rat for dinner.
Glad you did not do that beanchihuahua, it might of scratched the paint on your hummer.
Our reliance on Chinese (and others) imports is fueled on our rampant consumerism. Look at what our parents had, and look at what most people think they should have. I know people eyeball deep in debt, they are broke, but they have a big flat screen tv and a new car or two in their trophy-home. Jeans cost no more today than they did when I was in college (1977-1982). How do we get the consumer to choose quality over price, local over imported.
I'd have to disagree. Our "consumerism" is fueled by envy and class distinctions that result from the "me too" generations who had TVs as babysitters.
nonsense. Consumerism is nothing new. Consumerism is the backbone of capitalism and what this country was founded on.
What do you think happened to all those native Americans who 'owned' this land to begin with? What happened to Mexico's rights in California? How and why do you think Hawaii became part of the United States?
Who invented the credit card, after all - a uniquely American experience.
Consumption and expansion is the American way and at the heart of all empire building. And it's hard not to notice that we are an empire (two foreign wars, 750 permanent bases around the globe) and an empire now in decline (trillions of dollars in deficits and a falling dollar).
But it wasn't the 'me generation' or anything that happened in the '60s that made us consumers - consumerism is as American as apple pie and been around a lot longer than McDonalds.
The jeans teenagers are buying now days are much more expensive than what they were buying in the early 80s/late 70s. Most Diesel or True Religion jeans are $200 a pair, some $275. Sometimes I wonder where kids get all this money to buy these jeans, but they got it! Lower income folks can still buy $15 at Walmart.
While this post is technically true, and I am definitely a supporter of the worker and homegrown industry, it's also a rather hypocritical argument if we on the left are going to continue to condemn high gas prices. We have to choose one or the other, or we risk being intellectually dishonest. Now if gas prices were high because of taxes (which were then pumped back into the environment), rather than price gouging, speculation and war, then this argument would be flawless.
Excellent point.
But nothing is pure and until we have a coherent alternative energy strategy to wean us from our dependence on oil, foreign and domestic, it would be suicidal for any candidate to concede that high gas prices are good for America even if such prices result in more manufacturing jobs.
So, the schizophrenic idea of hating high gas prices and embracing homegrown industry is not intellectually dishonest, it is just politically realistic.
We need a coherent energy policy which is going to take years and years to actualize even when that concept is accepted.
Except, of course, that this post is not even technically true. China is not exporting their steel to us because they need all of it for themselves. And more. It's simply supply and demand. Again.
Good point, but what happens when we find alternative energy sources?
Find?
You mean "invent".
Invent?
You mean *use*!
We already have alternative energy sources such as wind and solar power.
We just need to start *using* them!
You imply that McCain is actually thinking about conditions, ie real estate in Arizona. He's just reading Karl Rove's cue cards, silly.
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