----- Original Message -----
From: "John D. Giorgis" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Sent: Friday, January 26, 2001 6:50 AM
Subject: Re: Villain of the Week: Bolder Technology Corp
> At 06:33 PM 1/26/01 +1100, Autarch wrote:
> >While I can't provide facts and figures or even a concrete
> >example, I understand that most manufacturing workers in develo[ing
nations
> >live considerably below independently determined "poverty lines".
>
> I strongly suspect you understand wrong. Workers in even the worst
> manufacturing environments in the developing world, are usually earning
> more than the $1 a day of the unemployed or workers in subsistence
> agriculture.
>
> >>Besides, you are improperly valuing the Nike sneaker as the sum of its
> >>manufactured parts, without considering the value of Michael Jordan's
> >>endorsement - which accounts for almost all of the value of the sneaker
to
> >>the consumer.
> >
> >What? There is no profit involved for Nike Co.?
>
> I did not say this. Rather, you were arguing that a fair value of the
> Nike sneaker would be the sum of its parts. This suggests that Nike is
> making an exorbitant profit. I am pointing out that you neglect the
> value to the sneaker of Michael Jordan's endorsement, which is very
> significant - and thus produces a much less exorbitant profit.
>
>
> >>> Jobs are not moved to lower wage conditions out
> >>>of any sort of altruism - greed is the common reason.
> >>
> >>Who said anything about altruism? I was talking about the invisible
hand.
> >
> >Laissez Faire? I was of the opinion that that idea had been thrown on the
> >scrap heap with many other monetarist principles.
>
> Think again.
>
> >>Let me but it a different way - I am not saying that the way the company
> >>arrived at its decision was altruistic. I am saying that the altruistic
> >>decision and the company's decisions are identical.
> >
> >Let us take your argument to it's end. Would it not lead to all companies
> >taking their manufacturing base to the developing world? After all, it is
> >cheaper, and it provides great benefit to the originating nation. What
> >would be the effects of such a situation?
>
> An excellent question! (I asked Jeroen the same thing.)
>
> The answer of course is that the reason workers in developing countries
> earn such low wages is that they are much less productive and reliable
than
> the highly skilled, highly educated, professional work forces of developed
> countries. Workers from developing countries veyr often can't compete
> with these workers.
> There are other reasons as well, for instance, the high costs of moving,
> higher transportation costs, les reliable governments, etc.
>
> Neglecting that for a moment, though, if companies were acting
> altruistically and moving as many jobs as economically possible to the
> developing world - what would happen is that demand for workers in
> developing countries would rise, producing a concomitant rise in wages.
> Eventually, the wages of the developed world would decrease as well, as
the
> supply of jobs in developed countries fell. In the end, wages would
reach
> an equilibrium level worldwide, with all workers earning a wage roughly
> equal to what they produce.
>
> >>>So, unless you have a college education you don't deserve a living
wage?
> >>>This is a rather extreme position to take.
> >>
> >>What's a living wage? There are a great many people in this world
> >>*living* on just dollars a day. The minium wages of the developed world
> >>are almost exorbitant by comparison.
> >
> >So unless you have an education, you should be reduced to a subsistence
> >situation? I can't accept that either.
>
> The minimum wage is much more than a subsistence situation in this
conutry.
>
> >>My position is that your wage should be determined in part by your
> >>contribution to society. The value you bring to the market should be
the
> >>value you bring home from your market. If you are unskilled, then you
are
> >>likely not producing much value, and should expect your work to be
valued
> >>as such - minimum wage.
> >
> >Who declares what is valuable - and what level of recompsense you should
> >receive?
>
> The free market. You sell the products of your labors on the free market
> for as much as you possibly can.
>
> > A number of individuals who earn truly exorbitant wages provide
> >very little to society. Frequently these are the same class of
individuals
> >who determine what the "working class" (used with caution) should
receive.
> >Do you accept that the work a divorce lawyer or tax accountant does is
more
> >valuable then a farmer?
>
> Yes. Quite frankly, the world has too many farmers. In the US our
> government supports many inefficient farmers through transfer payments.
In
> the developing world, there is a sever shortage of modern agricultural
> techniques.
>
> Being a divorce lawyer or a tax accountant, however, requires a very high
> level of training and skill - to become one, a worker must invest
> significantly in education, and that market must reward that. Moreover,
> the work is very difficult, and not terribly rewarding. Thus, these
> workers are in short supply (as opposed to farmers, which we have an
excess
> of.) Thus, divorce lawyers and tax accountants should be paid high wages
> to attract more people to these professions. Farmers, on the other hand,
> should be paid low wages, to encourage people to leave these professions.
>
Economists should work for free.
<G>
xponent
rob
