Dean Baker: Rigged – How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer
▻http://www.nakedcapitalism.com/2016/10/dean-baker-rigged-how-globalization-and-the-rules-of-the-modern-eco
Gains from trade work the same with doctors and lawyers as they do with textiles and steel. Our consumers would save hundreds of billions a year if we could hire professionals from developing countries and pay them salaries that are substantially less than what we pay our professionals now. The reason we import manufactured goods and not doctors is that we have designed the rules of trade that way. We deliberately write trade pacts to make it as easy as possible for U.S. companies to set up manufacturing operations abroad and ship the products back to the United States, but we have done little or nothing to remove the obstacles that professionals from other countries face in trying to work in the United States. The reason is simple: doctors and lawyers have more political power than autoworkers.[4]
In short, there is no truth to the story that the job loss and wage stagnation faced by manufacturing workers in the United States and other wealthy countries was a necessary price for reducing poverty in the developing world.[5] This is a fiction that is used to justify the upward redistribution of income in rich countries. After all, it is pretty selfish for rich country autoworkers and textile workers to begrudge hungry people in Africa and Asia and the means to secure food, clothing, and shelter.
The other aspect of this story that deserves mention is the nature of the jobs to which our supposedly selfish workers feel entitled. The manufacturing jobs that are being lost to the developing world pay in the range of $15 to $30 an hour, with the vast majority closer to the bottom figure than the top. The average hourly wage for production and nonsupervisory workers in manufacturing in 2015 was just under $20 an hour, or about $40,000 a year. While a person earning $40,000 is doing much better than a subsistence farmer in Sub-Saharan Africa, it is difficult to see this worker as especially privileged.
By contrast, many of the people remarking on the narrow-mindedness and sense of entitlement of manufacturing workers earn comfortable six-figure salaries. Senior writers and editors at network news shows or at the New York Times and Washington Post feel entitled to their pay because they feel they have the education and skills to be successful in a rapidly changing global economy.
