Capitalism has flaws

from PolMach Forums

Pure capitalism has a fundamental failure-end, as does pure communism. With no government-induced trade regulation or tariffs, production obviously HAS to go to the cheapest labor force.......that is competition. How can American workers compete with .50/hour wages unless they accept .45/hour wages?

My buddy from childhood had this crazy notion in high school back in the '70s. He was an electronics geek and back then he had this crazy notion that one day, practically every home would have a computer......crazy, right? So he did what most everyone would agree was the right thing to do and gambled that notion and directed his education to an Electrical Engineering degree with a strong Computer Science backround. He ended up designing computer chips with a firm in Oregon. His company was all inclusive, that is, ground floor employees where the assemblers, next floor up were the software and chip programmers, above them were the designers and R&D (where my friend worked), the floor above them were the sales and finally the top floor execs. My friend pulled in about 90 grand a year to start.....the American Dream.....see a future economy, educate yourself to participate in that economy, and land a good job.

One year, all the assemblers on the first floor had their jobs shipped to Mexico, and my friend, ever confident, told me he wasn't worried.....this is capitalism, and those people didn't educate themselves like he had so those job were always at risk. A few years later, the software programers lost THEIR jobs to India, and my friend, now a little concerned, said he thought he was still safe, since programmers usually only have Associate degees and weren't as valuable as he and his Design Engineer co-workers were. In two years HIS job was sent to India, where a team of Electric Engineers, who were educated here in the states with funds provided by the Indian government (provided the graduates would return home to India to use their skills there) were ready to go to work for 20 grand a year, which is a lot in that country.

By the way, remember the lowly assemblers who lost their jobs to Mexicans? Well, my friend tells me that last year, those Mexican workers lost THEIR jobs to Guatemalans, since the Mexicans wages had risen to about $1.75/hr, and the going rate in Guatemala is .65/hr., and thanks to CAFTA there are no issues with trade now.

"Global Economy" truly is a race to the bottom.

 

free trade global economy
8,164 views 9 replies
Reply #1 from JoeUser Forums Top
"Global Economy" truly is a race to the bottom.
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If that were true, America would not have any employment. But guess what? They do.

Unskilled jobs do move, and yes now programming jobs since India (and China) have lower wages (but have you checked out who a lot of the programmers here are?).

But you have hit on the reason all jobs do not leave. The Mexicans. NOt all their jobs are leaving, but they are living a lot better now. Just as India is (which is seeing many of its former jobs going to China now). This is going to happen as the "rote" work moves to those who do not need skills, just instructions.

And the American Jobs? They come from the same place they have for the last 60+ years. Innovation and adaption. Your friend was only partially right. 30 years ago, there was no personal computer market. America Invented it. Just like TVs, Microwaves, VCRs, DVDs, etc. We create, they just imitate. Then we move on.
Reply #2 from PolMach Forums Top

Excellent post, excellent points made by both above posters.

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Reply #3 from JoeUser Forums Top

Innovation and adaption. Your friend was only partially right. 30 years ago, there was no personal computer market. America Invented it. Just like TVs, Microwaves, VCRs, DVDs, etc. We create, they just imitate. Then we move on.
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Unfortunately we've sent a large portion of the manufacturing base overseas and let our education system go to hell. So we may still design new technology but we no longer manufacture much of it here.  Our economy is in serious trouble. Spout free market all you want but when our own financial system is full of corruption, our own govt. is performing no oversight, and much of the competition is nationalized there can be no free market.  The feds are grasping at straws right now to keep the economy from going into a tailspin and my guess is that its not going to work.

Reply #4 from JoeUser Forums Top

Unfortunately we've sent a large portion of the manufacturing base overseas and let our education system go to hell. So we may still design new technology but we no longer manufacture much of it here.
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YOu dont need a country full of geniuses.  Just enough to create the jobs.  The Economy is having problems, just as it does every so often.  And every time it does it is the "worst economy in the last umpteen years".  And yet, life goes on, and except for the political rhetoric, not a lot changes.

The Education does suck, but then everything the government has a monopoly on seems to be that way.  There are laws that specifically dictate what a special needs child gets in the way of resources.  But there are no laws, and precious few resources for TAG children.  That is because government is dumbing down education to the LCD.

Reply #5 from JoeUser Forums Top

YOu dont need a country full of geniuses. Just enough to create the jobs.
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No but if your going to send the manufacturing base overseas and create new jobs that require more technical skills then you need more educated people.

The Economy is having problems, just as it does every so often.
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Unfortunately the biggest problems right now is not part of the "normal business cycle".

 

 

Reply #6 from JoeUser Forums Top

No but if your going to send the manufacturing base overseas and create new jobs that require more technical skills then you need more educated people.
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YES!

Unfortunately the biggest problems right now is not part of the "normal business cycle".
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Actually it is.  The only thing abnormal about it is the rhetoric.

Reply #7 from JoeUser Forums Top

Actually it is. The only thing abnormal about it is the rhetoric
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If u consider corruption normal.....Maybe it is since it will never go away. Unfortunatly many people dont know the difference between good and bad regulations as far as free markets are concerned. And to make matters worse some who do can be bought too easily.

Reply #8 from PolMach Forums Top

I used to recall of General Motor Companies while reading this articles, in discussing about world trade issues GM posted losses so heavy for the last quarter that they actually lost more money per minute than the average household income.  The whole thing looks like a company on the brink, desperate for government funding to keep it afloat.  Several divisions of the company have been jettisoned. One last bailout might not be enough to save general motors.