CDZ Is it good for America when manufacturers opt to produce their wares abroad?

[william the wie]

I don't see how anyone could say that artificially made - minimum wage jobs, stocking Chinese junk is better than us making our own.
I don't see how someone going to college has to settle on flipping burgers for 15 bucks an hour is a good thing.
I think that anyone that sees the decline fo the middle class and our jobs as a good thing, is either ignorant or selfish and refuses to see the big picture.

I don't believe anyone has argued the points you identified above. I'm certainly not. For example, in post #34, I don't argue that the decrease in the size of the middle class is a good thing. I argue that the reduction in the size of the middle class that we've observed over the past 40 years, in and of itself, is neutral thing, and I show that what is a good thing is that the observed decline is attributable to more of the formerly middle class becoming upper income than their becoming lower income. Moreover, I readily and clearly state in post #34 that were the decline in the size of the middle class accounted for by more of them becoming lower income than becoming upper income, it would indeed be a bad thing.

Not trying to bust your chops but given the innumerate and ignorant, mostly due to shrinking budgets, MSM tear and print nonsense is most of the information available. I come to this and two other message boards to get news I don't have time to screen for otherwise. The very best news service, I'm aware of, is Bloomberg Business and it is an infomercial for a $25K/year stock terminal.

To give an idea of how bad the gunk and goo problem is you can get the surgeon general's reports downloaded for free online. The 1964 report alerts you in the upper right hand corner that you should look at cigar smoking. If you pay attention to that and scroll down you will discover that morbidity and mortality for cigar smokers is 0.88 when non-smoker rates are pegged at 1. If you read the text you will find that means cigar smokers live 1/.88 time as long as non-smokers or 14% longer. The 1997 report that "celebrated" a 50% reduction is a horror story of increased mortality v. expected results. Who puts out reports on that?

We are a very poorly informed society.

 

[jasonnfree]

Anybody see prices crash after an industry moves from this high wage country to a sweatshop country? I haven't. Profits just go up for the corporations. Notice the Transpacific Partnership isn't allowed to be brought up in the debates? Twenty years ago, Nafta was a big issue in the debates and it just barely passed . The ruling class, establishment, or whoever really controls politicians, decided that since Nafta, which was a close call, trade deals will not be publicized or debated anymore.

 

[320 Years of History]

I don't see how anyone could say that artificially made - minimum wage jobs, stocking Chinese junk is better than us making our own.
I don't see how someone going to college has to settle on flipping burgers for 15 bucks an hour is a good thing.
I think that anyone that sees the decline fo the middle class and our jobs as a good thing, is either ignorant or selfish and refuses to see the big picture.

I don't believe anyone has argued the points you identified above. I'm certainly not. For example, in post #34, I don't argue that the decrease in the size of the middle class is a good thing. I argue that the reduction in the size of the middle class that we've observed over the past 40 years, in and of itself, is neutral thing, and I show that what is a good thing is that the observed decline is attributable to more of the formerly middle class becoming upper income than their becoming lower income. Moreover, I readily and clearly state in post #34 that were the decline in the size of the middle class accounted for by more of them becoming lower income than becoming upper income, it would indeed be a bad thing.

Not trying to bust your chops but given the innumerate and ignorant, mostly due to shrinking budgets, MSM tear and print nonsense is most of the information available. I come to this and two other message boards to get news I don't have time to screen for otherwise. The very best news service, I'm aware of, is Bloomberg Business and it is an infomercial for a $25K/year stock terminal.

To give an idea of how bad the gunk and goo problem is you can get the surgeon general's reports downloaded for free online. The 1964 report alerts you in the upper right hand corner that you should look at cigar smoking. If you pay attention to that and scroll down you will discover that morbidity and mortality for cigar smokers is 0.88 when non-smoker rates are pegged at 1. If you read the text you will find that means cigar smokers live 1/.88 time as long as non-smokers or 14% longer. The 1997 report that "celebrated" a 50% reduction is a horror story of increased mortality v. expected results. Who puts out reports on that?

We are a very poorly informed society.

Pink:
NP...FWIW, my "chops" weren't going to feel burst from anything you wrote in post #41. LOL

Purple:
Question: what does "MSM" mean?

As for what constitutes "most of the information available," I suppose I may agree the "MSM tear and print nonsense" (once you tell me what "MSM" means) do indeed comprise most of what's available.

Red:
I truly don't know for that specific topic. I'm reasonably certain someone had something to say about it, but I cannot tell you who.

Blue:
Good and objective info is readily available; it's just that one must look for it. If one is going to consume only information that falls into one's lap, well, odds are it won't be the highest quality info that can be had. Similarly, if one willingly seeks only information that supports or compliments what one is predisposed toward believing, one will surely find plenty of it, but again, rarely will it be of high quality, and, quite frankly, it won't need to be given that it's intended to pander to one's existing inclination or lack of deeper awareness.

The other thing about high quality information is that it cannot be guaranteed to be distilled exactly and specifically to answer the question(s) one has at the moment. Instead, one may have to read (consume) information from one or more sources and "put it all together" in a coherent way to arrive at the answer one seeks. The information itself is often free, but culling it and analyzing it isn't; one must "pay" with one's time and cognitive energy.

That said, there is an excellent Internet tool/source for really first rate information, and it's the one I use quite often: Google Scholar. Believe it or not, it's rare that I don't find that several legit researchers haven't written a peer reviewed paper on whatever topic interests me at that moment. It's an excellent resource, but the content there isn't written for sixth graders...On the upside, reading a paper's abstract, discussion (if there is any, but researchers whose word didn't lead to a conclusion will have a discussion section instead of a conclusion section) and/or conclusion(s) is often all one really needs to read. Give it a try.

For example, using Google Scholar I entered "minimum wage" and got a list of results, the first one of which that had an accessible PDF document available for free was this one: "The Effect of the Minimum Wage on Employment and Unemployment." Reading the abstract and conclusions, it's clear that Dr. Brown et al don't address specifically the matter of the impact of increases in the minimum wage, it's an excellent paper to read to get a broad based understanding of the economics of the minimum wage.

The paper is dated 1982, which gives one some idea of about how new the minimum wage debate is. Moreover, anyone who has taken (and scored well in) an intermediate micro and macro economics course won't likely find much they haven't already learned, assuming they took the class in the past decade or so. For folks who haven't taken any economics, it's an excellent paper that does a really good job of presenting key economics principles that pertain to the discussion of the minimum wage.. Using the information in the paper, a reasonably astute person should be able to make sense of most minimum wage discussions provided they can find some data showing what's currently going on in the marketplace.

Is that as "on a silver plate" as is what one will get from, say, CNN, Fox or PBS Newshour? No, not at all. However, after reading that paper, one will have enough "scoop" on the matter of the minimum wage to know when what one hears from "pick a source" sounds "fishy," and since it does, one will either ask for evidence of what the writer/speaker said or go on one's own hunt for information that clearly refutes or supports what the author said/wrote. At that point, it really doesn't matter what pans out:

• The author provides additional credible support for their positions/assertions and that support makes sense given your reasonably well informed understanding (from having read the paper or taken a full on intermediate macro econ course) and you know it, so you change your viewpoint.
• The author replies with some B.S. or not B.S. necessarily, but weak, reply and you know it's weak, so you discount or dismiss what the author said. From them you either try to enlighten them, or faced with their intransigence, just say "f*ck it" and let them wallow in their ignorance.
• You do your own research and discover the author of the assertion was right or wrong, and change or stand on your position.

The nice thing is that if/when you opt to be dismissive of the author, you know you have nothing at risk because your awareness of the matter comes from objective and credible content and consideration on your part, and not because "this or that" popular press person, or candidate who wants something from you, is your source. That feeling is incredibly empowering, but it's, as I wrote above, not free, but it's also not terribly expensive.

 

[william the wie]

Quite true. However last I heard increasing returns such as in ICs and LEDs had not been taken into economic theory. Nobel laureates were still trying to explain the discrete math of capital markets in terms of the continuous functions of CAPM. And the collapse of China with massive but illegal capital flight was being explained away.

 

[Supposn]

Time an time again, I encounter folks who assert that manufacturing jobs being "shipped" abroad is bad for the U.S., at least to the extent that the manufacturers are American companies. I would rather that American manufacturers produce their goods domestically, but I don't really have a problem with them opting instead to do so abroad. What do you think?

I think the headcount per million dollars manufactured keeps on dropping. So, anyone who thinks insourcing will produce net jobs is not thinking.

Enterprises usually require some production support from other enterprises. Computer graphic designer’s working from their own homes require some tools, equipment and supplies. They may require Pizza delivery because their task deadline will not permit them to shop and cook. Some of the goods and service products they purchase to support their production may be produced in the USA and almost all of those goods and products to support their graphic design enterprise required some USA supporting labor. Even if all of the graphic designer’s equipment, supplies and materials were all imported, they required USA distribution and sales.

William the Wie, if and when that one-worker graphic design enterprise’s task was outsourced beyond USA’s borders, USA lost more than the job of one worker. USA’s gross domestic product, (i.e. our GDP) was reduced to reflect all of the other USA goods and service production that supported that single-worker enterprise.


USA’s loss of manufacturing is not inconsequential regardless of automation. If a USA factory required no direct labor to produce their output, that factory would still require USA’s public infrastructure, some USA produced goods and it would certainly require USA service products.


USA’s chronic annual trade deficits are always a drag upon our GDP and numbers of jobs. Anything that drags upon a nations numbers of jobs must to some extent drag upon our wages purchasing powers.


I’m among the proponents of the trade proposal described by Wikipedia’s “Import Certificates”.


Respectfully, Supposn

 

[OldLady]

Time an time again, I encounter folks who assert that manufacturing jobs being "shipped" abroad is bad for the U.S., at least to the extent that the manufacturers are American companies. I would rather that American manufacturers produce their goods domestically, but I don't really have a problem with them opting instead to do so abroad. What do you think?

I have a problem with American manufacturers producing their goods overseas. I understand why they do, but it has crippled the economy for the working middle class. The New York Times article you linked uses an income range between $35,000 and $100,000. What happens when a plant/business closes is the workers get lower paying jobs that used to be the niche of less qualified or skilled workers. Going from an income of $75,000 a year to $40,000 a year is quite a jolt and it is that kind of "movement" within the middle class that your stats don't take into account. It is real. It may not affect you, personally, and that's great, but it has had a ripple effect in the economy that is NOT being exaggerated or just a lot of whining by losers.

 

[320 Years of History]

Time an time again, I encounter folks who assert that manufacturing jobs being "shipped" abroad is bad for the U.S., at least to the extent that the manufacturers are American companies. I would rather that American manufacturers produce their goods domestically, but I don't really have a problem with them opting instead to do so abroad. What do you think?

I have a problem with American manufacturers producing their goods overseas. I understand why they do, but it has crippled the economy for the working middle class. The New York Times article you linked uses an income range between $35,000 and $100,000. What happens when a plant/business closes is the workers get lower paying jobs that used to be the niche of less qualified or skilled workers. Going from an income of $75,000 a year to $40,000 a year is quite a jolt and it is that kind of "movement" within the middle class that your stats don't take into account. It is real. It may not affect you, personally, and that's great, but it has had a ripple effect in the economy that is NOT being exaggerated or just a lot of whining by losers.

Yes, America's middle class has been disappearing....into higher income groups - AEI

• "2/3 of the [middle-class] losses were because they moved to ‘rich.'” That is, of the 11 percentage point loss in the share of middle-class households between 1971 and 2015, 7 percentage points represent the middle-class households who moved up to one of the two highest-income groups, which represents 7/11, or 64% of the shrinkage of middle-class households.
  
• "Stated differently, the share of American households earning $100,000 or more per year (in 2014 dollars) increased more than three-fold from 8.1% in 1967 to 24.7% in 2014."

Yes, of course, some of the middle class have seen their fortunes decline, but when 2/3rd of the middle class have seen them increase to the point they are no longer "middle middle" class and become upper middle or higher, one cannot credibly assert that the overall trends and economic decisions/factors that have led to that occurring have a net negative effect.

So what about the other 1/3rd? The thing to do is identify why they failed to make the same shift and do what one can to help them do so. The thing not to do is try to say that because 1/3rd didn't "make it," the programs and policies that saw 2/3rds to "make it" are a failure, disaster, etc.

 

[Spare_change]

Time an time again, I encounter folks who assert that manufacturing jobs being "shipped" abroad is bad for the U.S., at least to the extent that the manufacturers are American companies. I would rather that American manufacturers produce their goods domestically, but I don't really have a problem with them opting instead to do so abroad. What do you think?

I have a problem with American manufacturers producing their goods overseas. I understand why they do, but it has crippled the economy for the working middle class. The New York Times article you linked uses an income range between $35,000 and $100,000. What happens when a plant/business closes is the workers get lower paying jobs that used to be the niche of less qualified or skilled workers. Going from an income of $75,000 a year to $40,000 a year is quite a jolt and it is that kind of "movement" within the middle class that your stats don't take into account. It is real. It may not affect you, personally, and that's great, but it has had a ripple effect in the economy that is NOT being exaggerated or just a lot of whining by losers.

While this myth is common, and certainly cultivated by the liberal politicians, it simply isn't based in fact. As our society becomes more tech oriented, there are, of course, unskilled workers who get left behind. "Artisan buggy whip makers" find their talents no longer in need, and , thus, their income level suffers. Unquestionably, workforce needs have changed, and some haven't been able to keep up (or choose not to).

However, as reported in The Washington Post, Is the middle class moving up?.

It turns out that the middle class isn’t stagnant after all.

You know the conventional wisdom. The richest 1 percent of Americans have siphoned off all the income gains of recent decades. Everyone else is treading water. The claim has been repeated so often that it’s taken on the aura of truth. The reality is different: Living standards for most income groups have improved, especially for the upper middle class, which has more than doubled in size.

We know this from a new study by economist Stephen Rose of the Urban Institute, a think tank. Rose subdivided the population into five economic classes. The poor and the near-poor had annual incomes from $0 to $29,999; the lower middle class, from $30,000 to $49,999; the middle class, from $50,000 to $99,999; the upper middle class, from $100,000 to $349,999; and the rich, $350,000 and up. He then examined how each group had fared between 1979 and 2014.

Here’s what he found. There was a gradual and broad-based shift of Americans from poorer to richer status. Productivity gains have translated into higher living standards more than is generally believed.

The most spectacular change involved the explosion of the upper middle class (incomes from $100,000 to $349,999). It grew from 12.9 percent of Americans in 1979 to 29.4 percent in 2014 — from 1 in 8 U.S. households to more than 1 in 4. The rich ($350,000 in income or more) went from 0.1 percent of households to 1.8 percent in 2014. If these two groups are combined, nearly one-third of Americans have incomes exceeding $100,000. (Note: All these thresholds apply to three-person households; income levels are adjusted for differences in household size.)


Meanwhile, the poorer segments of the population declined. The poor and near-poor (less than $29,999 of income) dropped from 24.3 percent of the population in 1979 to 19.8 percent in 2014. The lower middle class ($30,000 to $49,999) fell from 23.9 percent to 17.1 percent, and the middle class ($50,000 to $99,999) decreased from 38.8 percent to 32 percent.

All in all, it’s an important story. “The growth in the rich and upper middle class and the declining proportion of the population in the middle and lower classes indicate widespread economic growth between 1979 and 2014,” writes Rose.