On the Outsourcing of Jobs - Political Discussion

Home | Community | Message Board

You are not signed in.
New Account

Forum Index Search Posts Trusted Vendors Highlights Galleries FAQ User List Chat Store Random Growery

This site includes paid links. Please support our sponsors.

Welcome to the Shroomery Message Board! You are experiencing a small sample of what the site has to offer. Please or register to post messages and view our exclusive members-only content. You'll gain access to additional forums, file attachments, board customizations, encrypted private messages, and much more!

Shop:

Buy Bali Kratom Powder

Red Vein Kratom

Golden Teacher Liquid Culture For Sale

All-In-One Bags That Don't Suck

Unfolding Nature: Being in the Implicate Order

Jump to first unread post

Pages: 1 | 2 | 3 | Next > [ show all ]

Ancalagon
AgnosticLibertarian

Registered: 07/30/02
Posts: 1,364
Last seen: 15 years, 2 months

On the Outsourcing of Jobs

#3099724 - 09/06/04 03:55 PM (19 years, 7 months ago)

Jobs Come and Go

In 1970, the telecommunications industry employed 421,000 switchboard operators. In the same year, Americans made 9.8 billion long distance calls. Today, the telecommunications industry employs only 78,000 operators. That's a tremendous 80 percent job loss.

What should Congress have done to save those jobs? Congress could have taken a page from India's history. In 1924, Mahatma Gandhi attacked machinery, saying it "helps a few to ride on the backs of millions" and warned, "The machine should not tend to make atrophied the limbs of man." With that kind of support, Indian textile workers were able to politically block the introduction of labor-saving textile machines. As a result, in 1970 India's textile industry had the level of productivity of ours in the 1920s.

Michael Cox, chief economist at the Federal Reserve Bank of Dallas, and author Richard Alms told the rest of the telecommunications story in a New York Times article, "The Great Job Machine." Spectacular technological advances made it possible for the telecommunications industry to cut its manpower needs down to 78,000 to handle not the annual 9.8 billion long distance calls in 1970, but today's over 98 billion calls.

One forgotten beneficiary in today's job loss demagoguery is the consumer. Long distance calls are a tiny fraction of their cost in 1970. Just since 1984, long distance costs have fallen by 60 percent. Using 1970s technology, to make today's 98 billion calls would require 4.2 million operators. That's 3 percent of our labor force. Moreover, a long distance call would cost 40 times more than it does today.

Finding cheaper ways to produce goods and services frees up labor to produce other things. If productivity gains aren't made, where in the world would we find workers to produce all those goods that weren't even around in the 1970s?

It's my guess that the average anti-free-trade person wouldn't protest, much less argue that Congress should have done something about the job loss in the telecommunications industry. He'd reveal himself an idiot. But there's no significant economic difference between an industry using technology to reduce production costs and using cheaper labor to do the same. In either case, there's no question that the worker who finds himself out of a job because of the use of technology or cheaper labor might encounter hardships. The political difference is that it's easier to organize resentment against India and China than against technology.

Both Republican and Democratic interventionists like to focus on job losses as they call for trade restrictions, but let us look at what was happening in the 1990s. Cox and Alm report that recent Bureau of Labor Statistics show an annual job loss from a low of 27 million in 1993 to a high of 35.4 million in 2001. In 2000, when unemployment reached its lowest level, 33 million jobs were lost. That's the loss side. However, annual jobs created ranged from 29.6 million in 1993 to a high of 35.6 million in 1999.

These are signs of a healthy economy, where businesses start up, fail, downsize and upsize, and workers are fired and workers are hired all in the process of adapting to changing technological, economic and global conditions. Societies become richer when this process is allowed to occur. Indeed, because our nation has a history of allowing this process to occur goes a long way toward explaining why we are richer than the rest of the world.

Those Americans calling for government restrictions that would deny companies and ultimately consumers to benefit from cheaper methods of production are asking us to accept lower wealth in order to protect special interests. Of course, they don't cloak their agenda that way. It's always "national security," "level playing fields" and "protecting jobs". Don't fall for it -- we'll all become losers.

--------------------
?When Alexander the Great visted the philosopher Diogenes and asked whether he could do anything for him, Diogenes is said to have replied: 'Yes, stand a little less between me and the sun.' It is what every citizen is entitled to ask of his government.?
-Henry Hazlitt in 'Economics in One Lesson'

Extras:

Similar Threads	Poster	Views	Replies	Last post
"Bush: Outsourcing Jobs Since 2000" bumper sticker	starptv23	1,783	17	03/14/05 11:35 PM by JesusChrist
outsourced jobs, a crime against humanity	afoaf	362	0	10/06/04 06:26 PM by afoaf
Job Outsourcing ( 1 2 3 all )	silversoul7	3,627	46	08/20/04 09:50 PM by Evolving
Bush outsourced	Alex213	388	3	09/16/05 05:47 PM by Los_Pepes
dear right wingers ( 1 2 all )	KingOftheThing	2,788	23	08/03/05 05:50 PM by z@z.com
Jobs??? ( 1 2 all )	lonestar2004	1,915	28	12/06/04 08:46 PM by Baby_Hitler
Union wages and outsourcing	JesusChrist	840	8	03/17/05 10:03 AM by afoaf
US technology. Where would we be without it?	carbonhoots	702	7	03/06/05 06:36 PM by Psychoactive1984