The recession technically ends when we have a quarterly increase in GDP - which means nothing to the average citizen, particularly those who are looking for work. It really ends when there are good jobs for people who want to work. While there is general agreement on this, we often disagree on cause. I take issue with columnist Thomas Friedman and his corporate CEO pals (Wis. State Journal, Oct. 24) as they blame the public school system, and a "decline of the American worker's global competitiveness" for those lost jobs.
Friedman ought to be talking less with his CEO pals and more with loyal, competent middle-aged factory workers whose jobs have been shipped abroad. If these workers are so "uncompetitive," how come when a factory moves abroad they are asked, er, required, to train their replacements in Mexico or China before getting the final ax?
No, the primary problem is not alleged "uncompetetiveness" of American workers, or schoolteachers, or administrators. The problem is American trade policy that allows - even encourages - corporate America to produce in Mexico and abroad, thereby forcing American labor to compete with what practically amounts to slave labor, all under the guise of "cost-cutting and efficiency."
As an economist I can make the case for comparative advantage and international trade. Surely, some items always will be produced abroad. And, no, we don't want unnecessarily high protective tariffs and trade wars.
But international trade pacts should be constructed and designed to bring foreign wages up, rather than American wages down. This requires the right of foreign labor to organize and demand higher wages and better working conditions. While that is easier said than done, serious effort has not been made. Foreign producers and American companies producing abroad keep foreign wages low because they can. The result is jobs flowing abroad and stagnant or declining American wages.
Our government, including both Republican and Democratic administrations, likes to lecture other countries on human rights. A more productive avenue would be to push for worker rights. Higher foreign wages and reduced disparity between American and foreign wages not only would reduce incentive for corporate America to ship jobs abroad, but would provide a high-powered international stimulus. Foreign workers would be able to buy more of their own goods as well as more of ours.
Think of it in another way. We are constantly reminded that consumer spending is about 70 percent of the American economy. But if the majority of increased spending is for goods produced in China, it's no wonder that American jobs are the last to recover as we come out of recession. And sadly, some of those jobs are gone forever.
In previous columns, I have argued that we need government spending on construction projects that provide jobs here - jobs that can't be shipped abroad. That's still the case, but it's only a temporary measure until the private sector gets cranked up. But that is going to be a long pull if we keep shipping good middle class jobs to Mexico and abroad. We are indeed tied to the worldwide economy. The real potential stimulus is that which would result from higher wages in places like Mexico, China and India.
If Friedman is so concerned about the "lack of competitiveness" of American labor, he might look toward costs of health care borne by employers. A system of universal health insurance, divorced from our employer-based system, would eliminate a major barrier to employers hiring new workers. Critics say it can't be done. So how come every other so-called advanced economy can? If we "can't do it," it's only because of the overwhelming political power of existing vested interests and the nasty politics of constructive change. But that's another story.
So, let's concentrate on the real barrier to economic recovery - the loss of good middle class jobs to foreign countries. And let's look to real solutions, not scapegoats. Sure, public schools always need to change and improve. And individuals have a responsibility to upgrade their skills. I'll give Friedman that. But it is neither his alleged failure of our schools nor deficient skills of our factory workers that cause jobs to be shipped abroad. The major cause is the disparity of wages here and abroad.
Addressing this problem will be tough, given the political power of corporate America. It's far easier for Friedman and American CEOs to blame public schools and displaced American workers for jobs shipped abroad than for corporate America to do what's right - and for our trade negotiators to insist on protection of American and foreign labor.
So let's focus on the real cause of American unemployment. And above all, let's stop blaming the victims.
- Monroe resident John Waelti is former Professor of Applied Economics, University of Minnesota; and Professor Emeritus, New Mexico State University. He can be reached at jwaelti@tds.net.
Friedman ought to be talking less with his CEO pals and more with loyal, competent middle-aged factory workers whose jobs have been shipped abroad. If these workers are so "uncompetitive," how come when a factory moves abroad they are asked, er, required, to train their replacements in Mexico or China before getting the final ax?
No, the primary problem is not alleged "uncompetetiveness" of American workers, or schoolteachers, or administrators. The problem is American trade policy that allows - even encourages - corporate America to produce in Mexico and abroad, thereby forcing American labor to compete with what practically amounts to slave labor, all under the guise of "cost-cutting and efficiency."
As an economist I can make the case for comparative advantage and international trade. Surely, some items always will be produced abroad. And, no, we don't want unnecessarily high protective tariffs and trade wars.
But international trade pacts should be constructed and designed to bring foreign wages up, rather than American wages down. This requires the right of foreign labor to organize and demand higher wages and better working conditions. While that is easier said than done, serious effort has not been made. Foreign producers and American companies producing abroad keep foreign wages low because they can. The result is jobs flowing abroad and stagnant or declining American wages.
Our government, including both Republican and Democratic administrations, likes to lecture other countries on human rights. A more productive avenue would be to push for worker rights. Higher foreign wages and reduced disparity between American and foreign wages not only would reduce incentive for corporate America to ship jobs abroad, but would provide a high-powered international stimulus. Foreign workers would be able to buy more of their own goods as well as more of ours.
Think of it in another way. We are constantly reminded that consumer spending is about 70 percent of the American economy. But if the majority of increased spending is for goods produced in China, it's no wonder that American jobs are the last to recover as we come out of recession. And sadly, some of those jobs are gone forever.
In previous columns, I have argued that we need government spending on construction projects that provide jobs here - jobs that can't be shipped abroad. That's still the case, but it's only a temporary measure until the private sector gets cranked up. But that is going to be a long pull if we keep shipping good middle class jobs to Mexico and abroad. We are indeed tied to the worldwide economy. The real potential stimulus is that which would result from higher wages in places like Mexico, China and India.
If Friedman is so concerned about the "lack of competitiveness" of American labor, he might look toward costs of health care borne by employers. A system of universal health insurance, divorced from our employer-based system, would eliminate a major barrier to employers hiring new workers. Critics say it can't be done. So how come every other so-called advanced economy can? If we "can't do it," it's only because of the overwhelming political power of existing vested interests and the nasty politics of constructive change. But that's another story.
So, let's concentrate on the real barrier to economic recovery - the loss of good middle class jobs to foreign countries. And let's look to real solutions, not scapegoats. Sure, public schools always need to change and improve. And individuals have a responsibility to upgrade their skills. I'll give Friedman that. But it is neither his alleged failure of our schools nor deficient skills of our factory workers that cause jobs to be shipped abroad. The major cause is the disparity of wages here and abroad.
Addressing this problem will be tough, given the political power of corporate America. It's far easier for Friedman and American CEOs to blame public schools and displaced American workers for jobs shipped abroad than for corporate America to do what's right - and for our trade negotiators to insist on protection of American and foreign labor.
So let's focus on the real cause of American unemployment. And above all, let's stop blaming the victims.
- Monroe resident John Waelti is former Professor of Applied Economics, University of Minnesota; and Professor Emeritus, New Mexico State University. He can be reached at jwaelti@tds.net.
