US workers blaming China for unfair labor practices is like the john blaming the hooker for looking to sexual. If Corporations had any ethics, partiotism, or humanity, it wouldn't matter what China did or didn't do -- they wouldn't be utilized.
But since it is OK (and even lauded) to chase the lowest cost buck, even if it means exploiting people and nations, the Corporations are not held accountable as they begin massive shifts of jobs out of teh country.
What would happen if Corporations insisted that *anyone* with whom they did Business *had* to adhere to some minimal set of standards? What if Government mandated that Businesses that dealt with the US had to do so?
I'd hazard that China and other nations would improve drastically. True, Corporations couldn't foist as many economic externalities off on poor people, but ... is that really such a bad thing?
Who will Stand up for Ohio by Standing up to China?
I've finished watching the twentieth, and possibly final, Democratic candidate debate. For someone like me who follows economic and jobs issues closely, the debate was both fascinating and frustrating.
First, the fascinating. Both Senator Obama and Senator Clinton said they would renegotiate the job-killing North American Free Trade Agreement (NAFTA) or exit it if our trading partners did not accept changes. That's a big development, and a welcome one, for Ohio's workers.
But one important economic issue was overlooked by the moderators and candidates alike: China. The word "China" wasn't even mentioned until three minutes before the end of the debate. No issue will have a greater impact on the future prospects of America's workers over the next couple of decades. Our grossly imbalanced trade relationship with China has cost America more than 1.8 million jobs from 2001-2006; 66,000 in Ohio alone.
Worse yet, these job losses are aided by Washington's complicity. Congress and the administration have the power to stop China's cheating and unfair trade practices, but so far, they have sat on their hands. What would a President Obama or a President Clinton do to ensure that American workers and businesses have the same opportunity to compete? Sadly, we still don't know.
No issue matters more to Ohio's economic future. China subsidizes its industries at the expense of our businesses. This is illegal under our trade laws, but no one in Washington has acted to stop it. China dumps its products into our market at below-market prices to undercut our producers. Again, it's an illegal practice, but this administration hasn't done enough to stop it. China manipulates its currency to gain a trade advantage, making its products roughly forty percent cheaper to buy in the U.S., and American products about forty percent more expensive to sell in China. This is a violation of China's trade commitments, but other than endless dialogue with China, this administration has refused to hold China accountable.
Sure, some American consumers enjoy cheap goods from China, but they come with a higher price that is not reflected on the price tag. Millions of lost jobs, dozens of recalls of unsafe and toxic consumer products and toys, a massive U.S. debt that is held by China, and diminished opportunities for good-paying jobs for our next generation.
Ohio voters deserve an answer. Which candidate will hold China accountable for its unfair trade practices and give American workers an opportunity to compete? A week before the primary, we cannot yet say.
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I work in the UK in heavy industry, by trade a machinist, but now working as a metallurgist! The devate you are having in Ohio and around the US mirrors the one here in the UK.
I would argue that as the manufactuing base of the country declines so does it's political power as conversely the service sector continues to increase and develop more influence. The cold hard fact is that, over here at least, the call to protect British manufacturing jobs has been unheeded by the majority of the UK population who have no real connection to anyone who makes something.
This in turn means, in my opinion at least, that the majority of consumers really don't think or care where something is made so long as it suits their needs at the right price! Even if one should exist as a purely British made device, not many consumers would pay a premium for such as a CD player, when just down the shopping aisle is one that is cheaper but foreign made. Of course people may talk about buying 'home goods' but what really matters is price.
That means of course either quotas or tarrifs to level the playing field to allow Western based manufacturers to compete and that means ultimately higher prices. This is seen by many (of my friends at least), who work in the white collar service sector as special treatment for industry and they have said that they won't pay higher prices simply to suit 'old inductries' and see no reason to use taxpayers cash to 'prop up failing industries'.
Most of the consumers in the UK, given recent surveys and public comment, remain solidly unconvinced by the 'strategic need for manufacturing' theory and tend to believe that in a global world it is in any case impossible to prevent jobs moving to where companies wish to put them especially given the economic power of the MNC's.
Do I think tarriffs and quotas are the way forward: yes.
Would the general public support this idea and be willing to pay higher prices: no.
Maybe if there weren't plenty of people in Ohio who are themselves eager to buy Oxo corn-cob holders and other such "necessities" of life, not to mention lead-based toys, then China wouldn't be reaping the rewards it has. The next time the good folks of Ohio feel a bitch coming on about the economy, maybe they should start by looking in their own kitchens and garages. Most of the plastic novelties that crowd the shelves in Bed Bath & Beyond aren't worth the space that they will eventually take up in the landfills. It isn't policy that's hurting Americans--it's a sick addiction to consumerism. And as for the toys, I've seen the Amish-produced toys, wrapped in brown paper, that are made right in the USA, in our own communities. But if parents would rather litter their living room floors with a sea of plastic junk from China, then don't blame it on policy makers.
What!? You mean we citizen/consumers should (or need) to do something more than vote for one person every four years? What are you, some kind of pinko terrorist?
Look, i need those everyday low prices at WalMart. I really don't care if my neighbor loses his job because of it; that's not my problem...at least not until his house goes into foreclosure and the vacant house next door to me starts dragging property values down. But that's something for the politicians to fix...i need to watch my TV shows on the big, shiny new plasma i bought with my credit card.
You probably think i don't need an F-350 to make my 45 mile, one way, commute to work every day either. Well, i've got news for you...at least four times a year i put some stuff in the bed of that truck. Don't tell me it isn't patriotic either: i've got a yellow ribbon magnet AND an American flag sticker. I support our troops who have to go overseas to get us more oil...why can't you?
And who am i supposed to believe, you or the President. He told us all to go out and shop after 9/11; if we stop shopping then the terrorist will win. But you're probably one of those "blame America first" liberals, aren't you? Next you'll start telling me about insulation and turning down the thermostat...or buying one of those CFL lightbulbs.
(In case that wasn't over the top enough to be obvious, it was sarcasm; excellent post!)
Sorry to post this again. A co-worker told me ten years ago that we will kick China's ass. Look where we are now. China owns our collective asses. LOL.
Ditto, Good article.
Which candidate would be more beholding to the American 'people'?
China aside for a moment, when we caste our votes they should be casted with future interests in mind. We should be voting for a leader, not a certain skin tone... That said, Sen. Obama is no 'legal fiction' and not in conflict with corporate interests.
I am certain Sen. Obama, himself, is surprised and honored with the support shown by American voters and individual sponsors. His campaign strategy, itself, offers new insight into and gives him real pause to consider Public Campaign Funding options and/or the possibilities of public support brought about by the internet (an instance of change).
Tariffs may help workers; but, until voters recognize 'multinationals' have conflicting interests, a vote for candidates backed by corporate-lobbyists (given the games they compel politicians to play) only advances 'fictional' interests, not the American worker.
Oh! China and its impact on the American economy and worker is no 'fiction', either. The problem is that as Americans we keep fighting ourselves because we're color struck.
The government won't stand up to the guys that are financing our economy. If the Chinese stopping giving us loans our economy would probably collapse.
Bravo, Paul!
Your question is the type of journalism I like to see. I don't need endless rehashing of who's done what to whom, I'd rather see a public push for answers to unconsidered questions.
It doesn't matter who "my" candidate is. I am willing to listen to each of their responses. Do we want a positive campaign? Great. Do we want more content and less style? Ok, let's ask for it. Ohio is the perfect setting to ask this question, and it certainly speaks to an issue that the future president will face. Let's get some "I think we can engage China by . . . " statements going here. Positive and substantive. Come on, people.
We need to quit supporting CHINA with our desire for the cheapest possible consumer goods. The Gov't hasn't been run for the common good in quite some time, it's all about the money, and we have been sold out by our elected officials. I think NAFTA was a good idea, take some of that CHINA work and bring it back to North America, if we can't make it here make it in Mexico, it would eliminate our illegal problem overnight.
The reason the North could defeat the South in the American Civil War was because the North had a virtual monopoly of manufacturing.
The reason the United States of America could take on and defeat Germany and Japan in WWII was that our nation had a vast manufacturing base that could be quickly tooled to supply what was needed to win a global war.
The greatest threat to our national security is not a bunch of self-righteous terrorists, but the loss of this nation's ability to make things. With our nuts and bolts industries gone, the nation is in the same position as our southern states were long ago.
It is no wonder our leaders just smile when China poisons our children and pets.
Think this not so. See what the current or next President does when China finally seizes Taiwan.
Well said. Once we became a "services" nation vs. a "goods" nation, we were done...
The ills destroying manufacturing:
> Labor - wages in factories are too high due to unions
> Health care - killing payroll of companies
> Pensions/retirement - killing payroll of companies
> Cost of Goods - inputs to products are too expensive because we have to import everything
> Output - lack of pride in work turns out crappy end product consumers don't want
> Taxes - higher taxes make companies cut corners, mostly the wrong corners
> CEO compensation - it is ridiculously inflated and a drain on companies
> Fuel costs - contributes to rising cost of goods sold
I would love to be able to buy an American made product, but it is next to impossible to find one these days!!
Curse you, yellow peril! How dare you subsidize your industries when America d ... oh, wait ...
Golly, a long time ago I used to live in Ohio and never knew they made 'cheap crap' but lost all those good jobs to China. Who knew?
Maybe there should be less emphasis on bashing foreigners and more in asking hard questions here at home. Like, Mistuh Paulson, what do you really mean about a strong dollar (or what are you smoking?) Or, how long can an individual -- or a country -- continue to spend money that doesn't exist?
It is time for Tariffs ... No serious economist will tell you that these trade deficits are either sustainable or reversible.
We have a choice:
- Tariffs that will protect American jobs, pay down the debt and protect the dollar.
- Or ... Doing nothing that will lose American jobs, increase the trade deficit , trash the dollar and eventually the entire economy.
The authors plan for more entitlements is unsustainable. America needs to put people to work, at real jobs , not retrain them for jobs that will be outsourced ... The only antidote to currency manipulation, product dumping and hidden trade barriers are tariffs , plain and simple.
Let's rephrase that question; Which candidate will commit to find a win/win solution? Which candidate will commit to telling the American people the truth, asking them to sacrifice, and formulating a viable plan to compete with China?
This is about substantive change in Washington. Get real. We subsidize China today. It's not about "cheap". It's about doing something about politics as usual. Widgets can be made anywhere.
We need to ask ourselves now how we can get tough with China. After all, they have most of our dollars!
Scott,
Thanks for redirecting focus and pointing to what is one of the most significant challenges facing America and all North Americans, since it directly affects the personal pocket books, today and tomorrow....
Level 1: - http://pacificgatepost.blogspot.com/2008/02/americas-china-quandary.html
and
Level 2: - http://pacificgatepost.blogspot.com/2008/02/america-for-sale.html
Let's set some Rules, then get on with rebuilding the damage.
As you may or may not know, China is an ancient, vast, and vastly complicated civilization. It is only in the past several decades that she has willingly ( that is, not forced to, by Western gunships, as in the past ) opened up to the rest of the world. This is causing problems unheard of in former times, both within and outside of China.
As with every great power, the leaders of China will do whatever they believe will make them stronger.
The thrust of your post is absurd. It is part of the seemingly endless belief that the U.S.A. can, and indeed has every right to, control the world. That day has long gone. The ones profitting by any so-called unequal trade policies reside in both counries.
Ohio must look to Washington and other Western centers of power for justice. And China will take care of itself.
The clintons took illegal donations from the Communist Chinese Military in exchange for granting China Most Favored Nation status. So I don't see hillary, the NAFTA queen, as the person to stand up to China.
Not only China.
But most major trading partners in the US.
I lived abroad for a long time.
The US has one of the most open markets in the world.
The rest of the world closes itself off the US goods and services through tariff and non-tariff barriers.
The US has an anti-corruption law, where US companies can't bribe foreign officials.
Guess what? Most foreign 1st world countries bribe officials in places like China, Thailand, and other 3rd world countries in order to do business. American companies can't even sell abroad unless they have a "foreign partner." Foreign partner means bribing somebody to allow access to the market.
The Chinese have access to Africa and Latin American markets because they bribe. And they are bribing with US dolllars. You know, those dollars that we pay them to buy their cheap crap.
Further, Japan, China, Russia and India basically steal US goods through reverse engineering, repackaging, and remarketing.
Do you know our embassy officials do? Nothing. They are too busy attending cocktail parties and acting like big shots.
I know. I have been to many US chamber of commerce meetings abroad.
The US government does nothing to protect US interests while going out of its way to make sure foreign companies in the US get national treatment.
The Democratic candidates are idiots who have no clue. All this talk about labor and environmental standards is rubbish. Most factories I have seen are not sweat shops. They are more modern and advanced than many of our factories.
If the US wants to make an impact on unequal treatment, it needs to withdraw from free trade agreements and the WTO and start massively raising tariffs.
Exactly , I couldn't have put it better.
We need tariffs and we need them now. The choice is very simple, pay more for American products now and retain our jobs or export our jobs and our dollars and pay even more for products later with no American jobs, a broken economy and a worthless dollar.
Indeed, CNN reports an Air Force 40 billion dollar contract to Grumman/EADS, EADS is a Airbus division, This contract is expected to climb over time to 100 billion.Wanna bet this is a Bush-to-Europe bribe for support in Iraq, Afghanistan, and Iran?
This sounds suspiciously like the Lou Dobbs Approach to Politics: Just Blame the Foreign Country of Your Choice. China subsidizes some of its industries? Well, who do you think subsidizes Boeing, Lockheed Martin and dozens of others? The U.S. taxpayers, that's who. And when it comes to currency manipulation, no one can hold a candle to Uncle Sam, who rules the planet by fiat through the International Monetary Fund and other global agencies.
I'm not a big fan of China, but this Beijing-bashing is getting ridiculous. Take Darfur (please). If China didn't buy that oil, other countries would step forward to snap it up. And yet we expect China to wave its magic chopsticks and suddenly halt the centuries-old genocide that goes on in Darfur. Give me a break. We buy most of Venezuela's oil; are we to blame for political and racial strife within that country?
If we don't want to do business with China, all we have to do is order our industries to pull out of there -- and pay the resulting higher prices for products in our stores. Who's willing to put their money where their mouth is? . . . That's what I thought.
Why was China allowed to take jobs from Americans? It is simple. Americans have endorsed the use of slave labor and no environmental controls so long as they can have a whole lot of cheap shirts. If Americans would live with less and defend the globe from their own greed then American jobs would be in America where the standards for environmental protection and minimum protection of workers is the law. WalMart sells goods from China and then has more people who need to shop at WalMart. It is the same thing with taxes. It is unChristian to have almost fifty million people without health insurance but it seems that the wealthiest country in the world finds that ok. Ditto good schools.
In spite of all the obfuscation, Senator Clinton was touting NAFTA while her husband was kowtowing to Globalism. Senator Obama was actively trying to rebuild communities devastated by job loss caused by this ill-advised destruction of the dollar. We played right into their hands and GWB only made it worse. I would hope that everyone has become more aware of how America is mortgaging her long term future for short-term profits. Without a middle class we can rapidly become a more feudal and more futile way of life.
Everytime anyone says they will "solve" the trade problems by demanding labor and environment standards, I just choke. This isn't the real concern, so why pretend it is? An unemployed American isn't going to be okay about the fact that their job is being done in Thailand just because the workers in Thailand are treated well, and the business doesn't dump poison into the ground. It's fairly irrelevant.
The fact is that some groups, including unions, decided they couldn't attack the jobs leaving solely based on protectionist grounds, so they came up with these other bizarre objections based on environment and labor standards.
I think the correct way to approach the problem is the direct way. We object to jobs leaving the U.S. Any business that takes jobs to another country should have its corporate charter yanked, and the ability to import and sell eliminated. Or, of course, tax all such businesses based on the assumed difference in pay between what they would have paid if they left the job here compared to what they're paying in China. Use that money to build new businesses and employ Americans.
If we really want to get tough, why not say that homeland security depends at least in part on Americans having jobs. Why not declare all trade secrets and patents to be national property, and make it illegal for anyone to take those out of the country. No, the giant drug companies do not need to take their patents to India and use slave labor to manufacture drugs. They can manufacture them right here in the U.S. After all, American consumers pay more and probably use more of the drugs, so keep the jobs here.
We need a direct approach to this problem. Our government and both parties favor allowing corporations to use slave labor and maximum the profits to the CEOs. The CEOs pay enormous bribes to the politicians. We need to punish the businesses that take jobs out of the U.S., and get rid of the politicians that support them.
That includes agricultural and food stuff. It is so bizarre that we import more and more of our produce from Mexico, a third world country which lacks clean water, and pours poison all over produce then ships it up here and sells it to Americans. And now we're importing poisoned food from China. We need to limit any food imports and bring food production back into this country. To protect our health, if for no other reason. When Mexico gets basic sanitation standards, decent living and healthcare in place for their people, and cleans up their water and sewage, then we should consider importing produce, but not until then.
I really appreciated your post, even if I disagree somewhat. While it may be true that labor and environmental objections were a red herring, they now form the only unobjectionable (read unblatantly protectionist) means of attacking the problem. It's too late to turn the clock back on free trade. As a Canadian, I was fervently against it in the early 90's and still don't think that Canada took the right route. We lost a ton of manufacturing jobs to be replaced with the $10 an hour " service industry " substitutes and I know the same happened to our friends south of the border. The three economies are now so intrinsically intertwined that it would do more harm than good to unravel them. That being said, there is something we can collectively do about China and other developing economies. We need to demand that they stop fiddling with their currency; to demand that they enforce strict labour standards; and we need to give up the pretence of policies such as Kyoto, (the U.S, excepted since you never signed on to it) in favour of a system where all countries have to abide by similarly strict emission controls. To argue that it is unfair for the Chinese et al. to have to play by the same environmental standards as us given that the western world has already experienced its economic development does not fly. Nobody knew what the environmental results of our development would be until the late 50's, so we cannot be blamed for having done nothing about it earlier.
In short, Fair Trade is the modern answer. If the Chinese are made to experience the same costs of production that we do in North America, then the jobs will start flowing back to the U.S. midwest and central Canada since our workforce will once again become comparatively competitive. The fact that no politician on either side of the Canada/US border (with the exception of Canada's socialist NDP) will even entertain putting these issues to the Chinese tells you a lot about how much power and influence conglomerates like Wal Mart actually wield.
You argue your position passionately. You're on to something there, but perhaps there are simpler ways of achieving the goal of fairness in trade and loss of jobs without regulatory measures that are overly complicated to establish criteria for, or heavy handed in their application.
Our premise is that competition among corporations is always good and must be encouraged, but gaining competitive advantage through unfair means is not. Why not consider measures like taxing all corporations at a fairly low base rate (say 25% for the sake of argument), and then compound that tax rate when a company's market share crosses a certain threshold (say 33%, on the premise that you need 3 or more players to discourage oligopoly)? I can see this being particularly effective in erasing media consolidation -- don't let the door hit you on the way out, Murdoch!
These are just off-the-cuff thoughts, not seriously researched proposals...however, I am certain we can achieve enormous effect on rogue behavior through little tweaks that actually simplify rather than complicate the tax code, reward the creation of good American jobs and punish cynical wage arbitration and tax-shelter maneuvers. Case in point -- Halliburton moving its headquarters from Houston to Dubai to pay less taxes and dodge American laws and regulatory oversight while continuing to receive massive no-bid contracts from friends in the White House.
I'd like to follow up your argument on the folly of importing food and agricultural products willy nilly from any cesspool of a producing nation: contrast that blase unconcern (in the name of free trade) to the dangers of what we and our children put into our bodies in great quantities every day with the ENORMOUS solicitude for our well-being the FDA develops over the near-zero risks of importing drugs from Canada (when free trade suddenly goes clean out the window).
Good article.
But what do you expect when one of the candidates worked on the board of Wal Mart who are among the real beneficiaries of China's boom ?
Attacking NAFTA rather than China is like bailing a leaky boat with a thimble. The sad truth is that the U.S. is in debt so deep to the Chinese that no one wants to rock the boat, and no candidate has the intestinal fortitude to challenge that status quo (it's a change you shouldn't believe in !).
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Posted February 29, 2008 | 02:54 PM (EST)