Re: Political Roundtable Cosmic String of Cataclysm - Part V
Posted: Tue Nov 27, 2012 11:32 pm
Induveca wrote:barelyawake wrote:Walmart not allowing unions has absolutely nothing to do with competing on a global market, and absolutely everything about how much the top gets paid. Your argument is a red herring used to shield guys who want ten helicopters (instead of eight). If more companies like Walmart paid their workers a livable wage and provided healthcare, the economy would recover much faster. But, honestly I've written huge posts about this, and I'm sick of the argument. Moving on...
It's not a red herring, not at all. It's reality, and one the American public needs to come to grips with quickly. US rate of production, for products which aspire to compete with foreign products, does not justify current US salaries, nor standard of living.
Here is the current situation (more or less) of US manufactured goods vs comparable Chinese goods
Cost of Production/Manufacturing/Wage of Widget in China = .80
Cost of Production/Manufacturing/Wage of Widget in America = 2.50
Currently, you're applying your argument to Wal-Mart, the largest importer of Chinese goods. Surely, they can withstand a reduction in their profit margin. I don't disagree at all. By all means, have the Fed investigate Wal-Mart and pass some legislation requiring brick and mortar companies importing x% of their goods from China to provide certain benefits to its workers. We agree completely.
However, the laws being bantered around do not in any shape or form apply only to such situations. These same laws will be applied to all companies, including the American based manufacturers who aspire to sell to the Wal-Marts of the world, but can't do so as they are already priced out of most markets. The same "liveable wage" and "healthcare" would put already reeling US based manufacturers out of business. Also, this approach, even if implemented correctly would only ensure the US is able to compete nationally, not internationally. In other words, China still dominates the rest of the world. I know for sure in the Dominican Republic, all hardware parts, pipes, and consumer products are 95% chinese. 20 years ago, they were 95% American.
New Equation with "better wages" and "healthcare" for companies not named WalMart.
Cost of Production/Manufacturing/Wage of Widget in China = .80
Cost of Production/Manufacturing/Wage of Widget in America = 3.50
How does this not worsen the core competitive issue? Wal-Mart sells huge amounts of Chinese goods because they are vastly cheaper, and allow them to operate their huge spiderweb of stores. I think you're aiming your blowhorn at the wrong issue, the issue isn't WalMart per se, it's the lack of competitively priced goods being manufactured inside the US.
The obvious "solution" would be to add a 150% import tax on imported Chinese goods to support the higher wage/healthcare/make the playing field more even. However that would result in a trade war, with Vietnamese/Indian/other SE Asian companies then undercutting China/US.
At the end of the day, what you're truly arguing for is isolationism. But hard to pay high wages when you have no one to sell your goods to.......oh, so let's just make a stop-gap and tax the rich. Because there is no real solution but a major correction of the US economy, and a new reality for the middle-class standard of living.
End of the day, the US is in for a major wake up call until the common American once again embraces blue-collar labor.
And this is what happens as you transition to a world economy. There will be adjustments as the equation tries to find a balance. I couldn't agree more that to many Americans expect to have to many things. Things they don't need to be happy. They would be happier focusing on their families and friends and living in a tighter community. But people where sold a message that everyone can have it all. There is a adjustment that will need to happen. To me, its all a part of the process we are going through as we have adjusted from single income homes where people were just happy to have a healthy family and one car to what people expect now. What in it for me. I want it all. I got get mine and have more then you. Its the message of the me generation.
But to that, it would help if the government would get back to doing the things it used to do that helped build that manufacturing economy. ie. invest in infrastructure and growing industries like oil and coal used to be. The government played in building that previous model. Now they are trying to do it again with green energy but the people that won the last round of this game don't won't to let go of the profit centers that got developed. The country needs to move forward and reinvent/invest. The last round of the game it over. Gotta rest and start a new round.
We can do it again. People just have to understand the partnership we have with the people, the peoples government and private industry. Its need to get back to be a healthier relationship and more in balance with mutual respect for all three pieces and their roles.