Letters to the Editor
-
Manufacturing was NOT bound to decline.
We are using all that stuff. More of it per capita than any place else in the whole world. Why shouldn't we be making it here?
The problem is that we've got all kinds of regulations for product safety and efficacy for manufactured and agricultural goods and practically none for the financial sector.
It's like if you could make an automobile out of the very cheapest materials, with no safety equipment and a dangerous engine design and then not have to worry about what happens when people drive it. Or even if it'll sell after the first few fatal crashes because the government will just bail you out when your product fails.
Manufacturing is declining because the system has been rigged to make it more lucrative to be a stock analysit or financial planner than an engineer or scientist. It isn't as if the course work is easier for a degree in economics than for one in a scientific or engineering discipline. So why should the idiot redistributing money be making more than the genius creating wealth?
We need to get back to a tax structure that sets an effective limit on executive renumeration and that puts a heavier tax burden on dividends and capital gains than it does on wages.
To quote Ronald Reagan: "The system should reward those who work for their money instead of those whose money works for them." OK, he didn't mean it. But he still said it and it sounded good at the time.
-
ANYONE...
who recalled the junk bond fiasco, savings and loan joke of the 80's, and the cannabalism of American manufacturing jobs and assets in the 80's COULD NOT swerously believe in a Wall Street or the tooth fairy anymore.
I don't know half as much as Phillips, and lot of other people too. But I do know one thing: Wall Street has never been my friend - or a friend of the middle class. If George W. Bush, and the rest of his eog-maniacal nut cases, got their way, Social Security would have been privatized now - and gone!
And, along with pointing out how we got here, who do we hold responsible for the demise of our country's strength, power, and integrity?
-
By the by
The modern steel mill operates with fewer than 10% of the headcount as in the heyday of American steel. You can have ALL those jobs back in the US tomorrow and it wouldn't make a bit of difference.
-
@ Electro Robot
Wrong. If the manufacturing were still here, then the jobs lost at the steel mills due to modernization would be elsewhere doing something else. Like making solar panels, perhaps?
-
THAT was the longest Andrew...ever.
And terrific...not that , in this day of the ephemera and the quickie,
I'm a fan of long posts.
But's`o nice to be regaled by good sense both all at onct
by Mr Phillips AND HTWW.
so, thnx... then.
-
Equity vs efficiency, evil economists, etc.
What amazes me is that anyone is still allowed to speak in positive tones about the "free market" without being tarred and feathered.
We have a world economy that is growing more "efficient" by the day through free trade and technology. Economists point out how free trade makes everyone the system better off (i.e. more wealthy). However, the missing link is that that wealth is nowhere near evenly distributed among the population; it is concentrated at the top, namely, those people whose income does not come primarily from wages. This is how companies are able to pay executives hundred-million-dollar bonuses but (for example) the police in Northern Michigan are driving old cars and many families use the emergency room as primary health care.
Meanwhile, we have a federal reserve bank one of the main purposes of which is to control inflation. How does it do this? One of the main ways it tries to do this is to assume that inflation comes from upward pressure on wages due to labor shortages arising in turn from "excessive" growth in the economy. As firms make money, they want to expand, to expand, they hire more workers. More demand for workers will eventually push up against whatever practical limit there is on the number of people in the workforce, and at some point workers will be able to successfully demand higher wage costs. Higher wage costs will make companies increase prices, and there you have classic wage-pressure inflation. But what you really have is a system that is designed to permanently keep the demand for labor lower than that the point at which workers are able to demand a bigger share of the economic pie--in other words, there must always be a labor reserve (i.e., the unemployed) to keep workers in line lest labor's bargaining power push us into an inflationary spiral. The Fed does this by raising interest rates (and thereby, theoretically, slowing economic growth) any time it fears that economic growth will give labor the upper hand in negotiations over wages. However, I question whether the US will ever see real wage-pressure inflation again in our lifetimes because US firms now draw from a global labor pool and there is plenty of untapped labor out there.
Add to this cheap credit due to low rates, plus a constant, pervasive barrage of advertising intended to make us feel less than human if we do not have the latest I-phone or SUV, and you get a lot of people in debt and a global economy that is more or less dependent on that debt to prime the pump of consumption.
Further add to the mix the fact that we have free capital but not free labor—-in other words, capital is free to find the cheapest production environment (a major component of which is cheap labor) anywhere across the globe, but labor is constrained by, among other things, national boundaries and language.
How anyone can talk about the virtues of the “free market” in light of this is a mystery to me, except it’s not really a mystery because I know that it is just an ideological cover for greed and rapaciousness.
-
Really Bryan?
How about car companies - 9% of the total cost of making a car is labor. Where did all those jobs go?