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unlawflcombatnt Donating Member (1000+ posts) Send PM | Profile | Ignore Thu May-19-05 01:00 PM
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CAFTA, Slave Labor, & Outsourcing
CAFTA is the latest anti-worker, pro-slavery, "free" trade bills being considered in Congress. l urge everyone to write Congress and tell them to vote against CAFTA. This is another bill designed exclusively to facilitate outsourcing of American jobs. The bill is much worse than any of the previous "free" trade bills. The flaws are even more obvious. It is a dishonest attempt by the Bush administration to portray an outourcing bill as an attempt at "opening up markets." Central American workers are so poor they will NEVER create a market for American goods. Impoverished Central American workers, however, will provide an excellent source of cheap semi-slave labor. This new source of slave-labor will be in direct competition with American labor. The only way American workers will be able to compete is to accept the same slave-labor conditions as their Central American counterparts.

CAFTA is nothing but an extension of the disastrous NAFTA scam. American workers will lose jobs, wages will decline, and 0 new jobs will be created. CAFTA's advocates are 100% aware of this. They are simply lying when they talk about "opening up markets to American goods." In reality, what they really want is to "open up" the American labor market to competition with foreign slave-labor. Don't let Benedict Arnold corporations extend their economic treason any further. I urge you to continue supporting Economic Patriotism, and vote against this new outsourcing extension.

George Bush, and his fellow "economic terrorists," continue to espouse outsourcing as being "good for America." It is not. And they know it. It helps a selected few at the expense of the many. This bill is a typical product of today's inhuman corporate greed, and its influence on the legislative process. And outsourcing is the epitome of this corporate greed.

Again, outsourcing is done exclusively so American corporations can use cheap foreign labor. The underlying motivation behind ALL free trade agreements is to enable American corporations to use the unskilled, impoverished, semi-slave labor of other countries. There has never been any real concern about "opening up markets." That is more than just a mistaken concept. It is an outright lie from Bush and the economists that espouse "opening up markets." The minuscule income of these 3rd world countries makes it impossible for them to buy American products. Bush knows this. Mankiw knows this. Snow knows this. The man on the moon knows this. Markets are created by aggregate consumer income, not people. Countries with little aggregate consumer income have minuscule-sized markets. Exporting countries that pay their 11-year old slave laborers $2/day will never, ever buy US products. Those wages don't provide enough consumer income to do so.

Chinese and Indian industries would collapse if they had to depend on their own populations to purchase the bulk of goods and services they produce. Wages and consumer income are too low for them to survive on domestic sales. They depend on the American consumer market, which is created by American wages (and borrowing).

When American industry outsources jobs, it outsources consumer income as well. This is the same income that purchases their products. Loss of jobs also places downward pressure on employed workers' wages. If labor demand decreases, so do wages. If this trend continues, Americans will be unable to purchase 80% of its own goods, as it currently does. Demand for goods, and the labor to produce them, will decrease further. This will further reduce consumer income and buying power. This is a self-perpetuating cycle, which will result in a continued decrease in DEMAND for American production.

The price reduction on foreign-produced goods does not make up for the income lost. It is simply illogical to think so. If it did compensate, there would be no benefit to outsourcing. Wal-Mart statistics, provided by Wal-Mart, provide some insight. A Wal-Mart spokesperson recently stated that consumers save $600/year purchasing goods from Wal-Mart. He also admitted, however, that Wal-Mart wages were $2/hour lower than those of the average retail sales worker. Here's the math: $2/hr x 40hr/week x 52weeks = $4160 per year less income for a Wal-Mart employee. However, the $4160 is only a small part of the labor income actually lost, because it is confined to retail sales employees only. Nearly 100% of the labor income from production workers is lost, since Wal-Mart buys most of its products from production facilities ouside the U.S. The loss of income by American production workers is even greater. Does $600/year in consumer savings make up for income lost by retail employees and production workers? Of course not. Aggregate consumer income decreases FAR more than prices decrease. The price savings are MUCH less than the amount of labor income lost. The only income increase is in CEO salaries and corporate profits. And that increase is entirely at the expense of the American worker. Increased corporate profits are EXCLUSIVELY from reduction in labor costs. In other words, this profit comes directly out of the pockets of American workers.

American workers are the most highly educated, highly skilled, productive workers on the planet. They produce more goods per hour than any of the workers they are losing their jobs to. But they are not as productive measured in goods per dollar. American workers lack the "skills" to survive on $2/day. We need to begin retraining them to acquire this skill. Our educational system has completely failed us here. And the ability to survive on $2/day is THE most essential job skill in today's market. We definiely need to increase federal funding to teach this "skill."

In reality, the "re-training" mantra is just a copout. The solution to outsourcing is not increased worker training. Nor is it increased funding to job-displacement programs. It is not extension of unemployment benefits. The solution to the outsourcing problem is to stop outsourcing. Period. Repeal ALL "free" trade agreements. We have absolutely no need for any "free" trade agreements. We already had free trade before any of these agreements were ever created. NAFTA, FTAA, CAFTA and the others have only one real goal -- to reduce the labor costs by using the slave labor of impoverished countries. This makes American workers compete with the exploited labor of poor countries. American workers then become no more than slaves themselves. Is this the job retraining Bush has in mind?

Economists speak of "comparative advantage" with outsourcing. This outdated concept is nothing but economic fantasy. It's what Right-Wing, "alternate reality" economists hide behind when defending outsourcing. They should lose their economic degrees for even mentioning this in public. It's a long, twisted, completely non-applicable concoction, which is designed to disguise the real reasons for outsourcing. Mankiw and Snow know better than to hide behind the "comparative advantage" fairy tale. Bush may be too stupid to be held completely accountable for his policies. But Mankiw and Snow are nothing but taxpayer-paid liars. The Bush/Mankiw/Snow/Greenspan "economic axis-of-evil" may destroy our economy.


EconomicPopulistCommentary /

America needs a return to Demand-Side economic policies. Consumer spending and demand drive our economy. Investment "permits" growth, but only DEMAND will cause such growth. Production is limited by Aggregate demand for that production.

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Runcible Spoon Donating Member (1000+ posts) Send PM | Profile | Ignore Thu May-19-05 01:07 PM
Response to Original message
1. great post..I wonder how Chavez will react....
Edited on Thu May-19-05 01:14 PM by FarceOfNature
I see you're not "new" to DU but welcome anyway and I hope to see more of your posts!

On edit: I find it extremely frustrating when I am called a radical or worse within my own political sphere for protesting G8 summits and the like. I and a few others think that the only effective way to stop global hegemony is for all countries to STOP IMMEDIATELY paying their World Bank and IMF loans. Bring those motherfuckers down and we may have to adjust our consuming behavior (ie, less cheap crap to buy) but at least these countries could nationalize their assets and get on thei feet.
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TayTay Donating Member (1000+ posts) Send PM | Profile | Ignore Thu May-19-05 01:20 PM
Response to Original message
2. I heard that the Admin needs 20 Dems to pass this
Edited on Thu May-19-05 01:20 PM by TayTay
And they have 6. I don't know which six these are. (Does anyone?)

I heard Kerry say he isn't inclined to vote for it. (During the confirmation hearings on Rob Portman as USTR.) Anybody know where other Dems sit on this? :shrug:
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Runcible Spoon Donating Member (1000+ posts) Send PM | Profile | Ignore Thu May-19-05 02:08 PM
Response to Reply #2
3. dunno but would like that information so here is a KICK
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