The world economy now operates on a ships vs serfs economic model.
The U.S. Economy is based on ships delivering parts and widgets to our shores. China is serf-based, but it is failing from the other side of the pond.
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The Chinese announcement of the “Clean Plate Club” should be the key to our entire foreign policy. Unfortunately, the ‘crats have little insight into the situation and so we will muddle along as usual. This program underlines the frailty of our dependence on China as a labor source.
The Chinese are desperate to remove attention from their failing governmental/economic model. As mentioned before, it is a quite dangerous circumstance because a politician will do anything to avoid the chop. Basing decisions on governmental statistics is subsumed with reasons for misrepresentation. There is no reason to believe any governmental statistic, and certainly not a Chinese one.
The United Nations Conference on Trade and Development reports that one-third of all global trade passes through the South China Sea. China’s per capita income has grown from about $500 in 1970 to about $12k today. Trade with the U.S. is critical for China financially, while their dependence on our food crops is growing daily.
China has weakened considerably in the past few weeks as natural disasters have struck again. The long trail for just-in-time parts for the assembly line has been shown to be a weak reed upon which to base our economy. The thought of buying a quality product once instead of replacing junk annually is again moving to the fore. It requires a bit of research to ferret out the facts, but we have an opportunity to revamp our international trade posture and strengthen the country immeasurably.
Serfs toiling illegally for food factories in the U.S. are an embarrassment brought to us by our political trash. “Land of the exploited, home of the brave” instead of “Land of the free and home of the brave.” The illegal labor is significant in our economy. The large lobbyist group in D.C. is in total support. Any heavy labor industry in the U.S. attracts illegal aliens and provides campaign contributions for the needy political class. If there was really a wish to control this migration, all that would be necessary would be to put the management/ownership in jail for hiring illegals. It would take 24 hours to eliminate the problem.
Is the U.S. competitive labor wise internationally? Only in automated industries. What can be done to ameliorate the problem? Nothing. This is the standard economist’s answer since the end of the autoworkers’ battles of the 80s and 90s. Shipping jobs overseas is a program that has reduced U.S. middle class income since 1980. The problem that arises is that those jobs which are shipped overseas also eliminate a possible consumer here. Domestic market share has been forgotten.
Unfortunately, the Master Bureaucrat Administrator (MBA) has no other peer acceptable program to accelerate profits other than to cut costs. This myopic approach has shown its weaknesses over the last 18 months. A solution to middle class financial stress and U.S. resumption of ultimate economic strength would be a simple but extensive tariff system. Today the system is an incredible maze of regulations purchased in D.C. by each industry or country individually. This situation is totally corrupt and inefficient.
There is nothing that is manufactured in the world that could not be done well here. The old Craftsman brand of tools was a perfect example of excellent quality for a fair price. LL Bean still makes boots and other items in Maine. Great quality and price, and no slave labor. BMW and Mercedes ship luxury cars all over the world from the U.S. and make a nice profit. Tire companies from around the world have factories that ship from the U.S. to everywhere.
Why do we not service our own market, which is the largest in the world, with our own homegrown technology and manufacturing? The tariffs levied by the E.U., Japan and China on our goods put us at a great disadvantage. Tariff reciprocity would shake things up quite nicely. Why have our citizens been required to rebuild Europe, Japan, Korea, and China with our sweat and struggle only to be spat at in return?
The elimination of illegal labor and the addition of tariffs would definitely raise prices. But the wages could be raised for U.S. citizens as well. That means a larger citizen market for the products would be available, thus more profits. The other ignored benefit is that the welfare and tax rolls could be reduced significantly, providing another extension of the citizen customer’s disposable income through tax relief.
Our foreign policy has been based on continuing and expanding our economic dominance around the world for 100 years. Our consumer still (barely) rules. Our foreign and trade policies must be addressed to ensure a better lifestyle for our fellows and descendants. It will be difficult as the Congress is paid by individual companies and countries instead of by citizens, but it can be accomplished. Independence from the international outhouse would be a phenomenal accomplishment for our freedoms.
Madame Defarge is a regular contributor to The Blue State Conservative and a patriotic American offering opinions on issues of the day while working in the biodiesel refinery and clean water industries, internationally focusing on technologies that make cents.