The world isn't as flat as Friedman thinks.

[Whoha]

Originally posted by lord of the mark


except that plenty of economic activity, including a fair amount of manufacturing, takes place in the US (and Europe, and Japan) as it is, and lowering the cost of labor in the US would impact this at the margin.

such wages are already falling.

Originally posted by lord of the mark


We're better off cause we no longer have the danger and the dirt, and at our income levels thats a good tradeoff. If its NOT a good tradeoff, than the we may have the wrong enviro regs.

they're not likely to be consuming the products of this factory, they'll be producing and then selling that back to us.

[lord of the mark]

Originally posted by Az

Basically what Im suggesting is that health, clean environment, etc are goods whose demand is driven by income.

what I am suggesting that this is an evil attitude.

It may be realistic. If half my kids are gonna die cause my city doenst have a sanitation system, and the hospital doesnt have antibiotics, and there simply isnt enough food, do I really care that the local factory is gonna make everyone die from lung cancer when theyre 60?

Now IF you could give me the sanitation system, AND the antibiotics, AND the food, without me having to accept the dirty factory, that would be great. But its NOT happening, and the folks who want to put limits on the local factory pollution arent doing anything that will effectively solve those other problems in the LDC's. So maybe THEY are the ones who are thinking evilly. And as you see above, some of them are mainly concerned about the loss of employment in developed countries.

[BlackCat]

Originally posted by Az

Basically what Im suggesting is that health, clean environment, etc are goods whose demand is driven by income.

what I am suggesting that this is an evil attitude.

Could be, but what is your alternative ?

[lord of the mark]

Originally posted by Whoha

they're not likely to be consuming the products of this factory, they'll be producing and then selling that back to us.

Yup. And those societies will import goods (esp capital goods) from the 1st world, which is what will make possible the sanitations systems, improved health care, etc.

[Whoha]

Originally posted by lord of the mark


Yup. And those societies will import goods (esp capital goods) from the 1st world, which is what will make possible the sanitations systems, improved health care, etc.

you're not creating something from nothing with this exchange, they can't buy more then the workers who were originally employed, and will likely buy much less.

[lord of the mark]

Originally posted by Whoha


you're not creating something from nothing with this exchange, they can't buy more then the workers who were originally employed, and will likely buy much less.

You assume the workers in the 1st world country are going to stay unemployed indefinitely. Why should they? They will take jobs in other industries, in which their country retains a comparative advantage.

Whther those will be lower wage jobs or higher, will heavily driven but whether their country invests in education, training, infrastructure, etc. But thats a different question from the desirability of trade.

[Whoha]

They aren't getting wage parity, and it isn't too likely that they would since a job that would have competed for their employment is no longer doing so.

The ultimate payoff from this proposed exchange would be that we kick start their failed economy, that it begins producing wealth on its own, and they trade with us in good faith is it not? I do not believe that any one of those things will happen.

[lord of the mark]

Originally posted by Whoha
They aren't getting wage parity, and it isn't too likely that they would since a job that would have competed for their employment is no longer doing so.

The ultimate payoff from this proposed exchange would be that we kick start their failed economy, that it begins producing wealth on its own, and they trade with us in good faith is it not? I do not believe that any one of those things will happen.

The american workers in this instance may not be better off as individuals (though the net social benefits in the US will depend on how valuable those enviro and safety regs actually are). But it is quite possible, even likely, you are, net net, creating gain through this transaction - what you called "getting something from nothing"

[Az]

Now IF you could give me the sanitation system, AND the antibiotics, AND the food, without me having to accept the dirty factory, that would be great. But its NOT happening, and the folks who want to put limits on the local factory pollution arent doing anything that will effectively solve those other problems in the LDC's. So maybe THEY are the ones who are thinking evilly. And as you see above, some of them are mainly concerned about the loss of employment in developed countries

Thing is, we aren't really seeing the sanitation systems and the medicine with the pollution, as well. It's not a package deal - more like "take this, hope for something to trickle down later"

Could be, but what is your alternative ?

A less evil one, obviously.

An approach that ensures minimum standards of living for the workers of 3rd world countries, obviously.

Currently, the situation is such that large manufacturers are getting the overwhelming lion's share of the profitablity of the shift of manufacturing - because they obviously can, due to the vastly weak position of labor in bargaining against them, in terms of both supply and demand and cartelization. Manufacturers are profiting as much as possible - because they can. However, the type of manufacturing that shifts to LDCs will enjoy a very serious increase in profitability even with higher labor costs and stiffer regulations.

Simply put, you could place enviromental and safety regulations in 3rd world countries, and raise the worker's wages, while still keeping the shift in place of manufacturing worthwhile - and letting most of the jobs settle in the 3rd world. Yes, profitablity will be compromised - but in all of those labor intensive industries, the margins between costs of manufacturing and wholesale prices are still immense - and besides, I am not really grasping my chest in pain for the profit margins of these companies...

[Ramo]

I'm generally for free trade. In an aggregate, long term sense, free trade generally makes people wealthier. Obviously, there may be local (either temporally or spatially) concerns that would mitigate this tendency, but reducing trade barriers typically is a good thing.

In particular, farm subsidies may be the single ****tiest thing that we do to the rest of the world.

But I don't mind using threats of trade restrictions to secure labor and political rights.

I would like to see an extremely agressive use of the Alien Tort Claims Act to secure these rights, or similar legislation in that spirit. There was an interesting case on a suit against Unocal who was building a pipeline in Burma with forced labor in the courts. Obviously the Bush Admin. has been fighting on Unocal's side, arguing for immunity.

[BlackCat]

Originally posted by Az

Could be, but what is your alternative ?

A less evil one, obviously.

An approach that ensures minimum standards of living for the workers of 3rd world countries, obviously.

Currently, the situation is such that large manufacturers are getting the overwhelming lion's share of the profitablity of the shift of manufacturing - because they obviously can, due to the vastly weak position of labor in bargaining against them, in terms of both supply and demand and cartelization. Manufacturers are profiting as much as possible - because they can. However, the type of manufacturing that shifts to LDCs will enjoy a very serious increase in profitability even with higher labor costs and stiffer regulations.

Simply put, you could place enviromental and safety regulations in 3rd world countries, and raise the worker's wages, while still keeping the shift in place of manufacturing worthwhile - and letting most of the jobs settle in the 3rd world. Yes, profitablity will be compromised - but in all of those labor intensive industries, the margins between costs of manufacturing and wholesale prices are still immense - and besides, I am not really grasping my chest in pain for the profit margins of these companies...

At first glance it of course is less evil, but I think it has some flaws.

First, you seems to think that labours in TWC's doesn't get the same wages as in FWC because of lousy union help, evil caiptalism etc - that is not true - the wages is low because that is the actual level.

Secondly, if you take FWC regulations and demand that they regidily shall be obeyed in a TWC, then two things happen - first, no companies moves their production to them, and secondly, the local production system will grind to a halt.

It's actually pretty complicated to move production to cheaper countries and often it's not worth it. Those profit margins that you fabulates about are very rare, but of course there is a gain - otherwise they wouldn't do it.

Besides that, it's not always possible to move production to the cheapest place. Sometimes logistics prevents it, sometimes the country simply isn't ready to handle it.

Lastly, it isn't like moving production to TWC's is reinventing the early days of industrialisation - there are lots of knowledge about handling dangerous stuff (though, I must admit that the Indian government have something to catch up) etc.

[VetLegion]

Images speak better than words. Here's why the world is flatter than Oerdin thinks

Everyone interested should see the animation:

http://hdr.undp.org/docs/statistics/data/flash/2005/2005.html

Here are screenshots I've taken for the lazy ones:

[chequita guevara]

Originally posted by Kuciwalker
Friedman is an idiot.

"The next six months are crucial for Iraq" said every six months since the invasion.

[Dinner]

The basic point of my idea was that poor countries would still retain relative advantages in costs over rich countries but, like a government setting a minimum wage, everyone below that mark will be better off. We'd be setting a minimum level of social acceptable policy and those nations which didn't follow it would find themselves locked out of the global economy. No democracy then no trade, no environmental protectin then no trade, etc... We'd be offering them the carrot of trade to increase their wealth and the stick of total isolation for the wealth which trade creates if they don't enforce the minimum standards.

As for enforcement that is a simple issue. Every trade group has an enforcement body where people or governments can take complaints. The courts in the enforcement body then decide if the complaint has merit or not. It's a system which seems to be working.

[chequita guevara]

They need to develop their own internal markets before they can join the world market. No country has ever free traded its way to development.