Cameron is exactly right. The whole part about the unequal playing field is exactly right. That's why NAFTA, CAFTA, and trade policies where tariffs on imports don't exist are malevolent for the American economy. They allow companies to make more money by employing people in other countries.
It's also the problem with Mexican immigration. I've heard the President say "Mexicans are taking jobs that Americans don't want." This is true only because the employers are unwilling to pay the amount of money to get American workers. If the Mexicans in America weren't there, employers would be forced to raise wages in order to get employees. "Essentially, it's not a level global playing field and adjusting up the price in one place will not always have the overall long term desired effect of increasing the standard of living." The long term effect is to move the jobs to the place where it's most cost-effective. Think about our own profession - companies like Microsoft, Dell, HP are moving support tech jobs to India because it's far less costly to pay those people, and it more than offsets the cost of moving offshore. Personally, I think there should be a tariff on goods/information (like software) moving over the internet in/out of the country. Tariffs protect the US citizen from losing jobs to overseas workers. If we could get those back (repeal the said trade agreements), minimum wages would again be a force, because as Cameron said, it's a microeconomic feature. Matthew Small -----Original Message----- From: Cameron Childress [mailto:[EMAIL PROTECTED] Sent: Tuesday, September 27, 2005 3:33 PM To: CF-Community Subject: Re: also circulating the email lists....re katrina On 9/27/05, Dana <[EMAIL PROTECTED]> wrote: > Gruss, Keynes has been around for almost a hundred years now. I can't argue > economics with someone who isn't familiar with the prevalent model. I've been watching a little of this thread with interest, trying hard not to be dragged into a conversation I don't have time to actually participate in, but here goes... Keynesian economics are mostly macroeconomics - big decisions, small nudges, tinkering with the economy on a grand scale to effect a certain outcome. It tends to have the effect of causing big government, and big government spending. Keynesian economics are the backbone of the Bush's tax refund a few years ago. The Multiplier effect is axactly what Bush was talking about when he said he wanted to increase spending by giving people more money. Just about everyone on this list was against that - rabidly. You can't turn around and use the same arguement for govenment meddling in spending on the wage level. In principle I agree with a living wage, I think people should be able to make a living. Here's where Keynesian economics falls on it's face when it comes to wage law in a local economy - we live in a global economy (macro) and wage rules are only effective on a local level (micro). Essentially, it's not a level global playing field and adjusting up the price in one place will not always have the overall long term desired effect of increasing the standard of living. In the micro, a forced increase in wage will always force the employer to make a decision of: 1) Paying/eating the increase 2) Paying zero dollars (doing the job him/herself or shutting down) 3) Paying someone else somewhere else. The multiplier only goes into effect if option one is chosen all of the time. If there is an option to move the buiness to another plae or country for the same wage or less, then it will move - plain and simple. With a forced wage increase in the short term, everyone might get paid a little more for a few months or a few years, but in the long run, those companies will make the decisions that they have to make. MacDonalds and Walmart have to have employees on the ground, but that manufacturing plant downt he street can move to Mexico Whoops, now in the long run we've chased away more jobs and all that's left are jobs at MacDonalds and Burger King. The next rung in the ladder of income (the manufacturing plant) has moved away, so everyone who was hopig to use that to take a step up is screwed. Now we have a low income class working flipping burgers, and an executive class, but no blue collar class. Oops... Now here comes the replies - there goes my day - Bring It! -Cameron ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Find out how CFTicket can increase your company's customer support efficiency by 100% http://www.houseoffusion.com/banners/view.cfm?bannerid=49 Message: http://www.houseoffusion.com/lists.cfm/link=i:5:175294 Archives: http://www.houseoffusion.com/cf_lists/threads.cfm/5 Subscription: http://www.houseoffusion.com/lists.cfm/link=s:5 Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=11502.10531.5 Donations & Support: http://www.houseoffusion.com/tiny.cfm/54
