Re: More on Outsourcing and Offshoring

["Schulte-baeuminghaus" <schulte.baeuminghaus@xxxxxxxxx>]

Gary,

There will have to be some retreat from the damaging policies of recent
decades.
Just how great that retreat will have to be from, for example, WTO, is
difficult to say; but we might hope that it will be somewhere between a sort
of Hawley-Smoot solution and what we had under GATT in, let's say, the
1960s.
Some countries will suffer more than others.
The problem is not so much differences in labour costs - which tend to be a
relatively small part of the costs of current high-technology manufacturing
of almost any kind - as in capital costs.
Singapore, for example, is a high labour cost country now - as indeed Taiwan
and South Korea tend to be too.
They could suffer badly and find it difficult to make effective adjustments
when the crunch comes with the US and others trying - note, trying - to
regain some of the huge territory they've lost to the surplus countries in
the last two to three decades.
China is likely to find adjustment easier and indeed seems already to be
taking measures to maintain growth and keep employment growing when the
crunch comes.
We're likely to see some dramatic changes in economic "power" in the next
few years, some of which will unwind what happened after 1970 or 1980 and
some of which will confirm the shifts in power which have already taken
place.
With the new shifts and confirmation of some old shifts in economic power,
we're likely to see - indeed, we will certainly see - some big shifts in
political and strategic power too.
On the face of it, the United States is not likely to be one of the prime
beneficiaries, however much it reverts to highly protectionist and even
isolationist policies.



James Cumes
http://VictoryOverWant.org
http://crystaldreamspub.com/bios/authors/A-E/cumes_j.htm

----- Original Message -----
From: "Gary Santos" <evs@xxxxxxxxxxxx>
To: <pkt@xxxxxxxxxxxxxxxx>
Sent: Monday, July 28, 2003 9:00 AM
Subject: Re: More on Outsourcing and Offshoring


> Mason,
>
> The same Chinese (and Taiwanese) garlic hit the Philippines and what
> formerly cost P90 per kilo is now sold at P30 per kilo. Garlic farmers
have
> suffered obviously. Globalization and comparative advantage necessarily
> meant deflation as "economies adjust".
>
> I am sure neoliberal economists would still defend the idea and we will
have
> the likes of John Williamson say that "they" never said trade
liberalization
> should take place in some shock treatment type of implementation. Well,
> that's correct, I think. They never said so. But, neither did they open
> their mouths when the shock treatment was implemented.
>
> I ask the same questions you do and I wonder if we should go back to
> "looking inward" developing domestic industry with tariff protection,
> quantitative restrictions, some deficit spending and moderate inflation. I
> just told someone in TNF that the US can always turn its back on
> liberalization, raise tariffs and thereby get US manufacturing going
again.
> I think the Philippines should also. I dread though what will happen to
the
> likes of Singapore and Hongkong/China whose economies are extremely
> dependent on trade.
>
> And, that's what PKT is all about, right? To save the world from itself.
> Anyone here read "The March of Folly" by Tuchman?
>
> Gary Santos
>
>
>
> ----- Original Message -----
> From: "Mason Clark" <masonc@xxxxxxxxxxxxx>
> To: <pkt@xxxxxxxxxxxxxxxx>
> Sent: Monday, July 28, 2003 5:50 AM
> Subject: Re: More on Outsourcing and Offshoring
>
>
> >  It effectively makes for a borderless labor market in a global
experiment
> > with the idea of "comparative advantage".
>
> At what point will economists face up to "averaging down"?  And must
> the Law of Comparative Advantage rule? -- that most sacrosanct of all
> economics (I've been forcefully told by economists)
>
> > Countries like the Philippines, India and China will be
> > able to create jobs that otherwise would not be created.
>
> Without the importation of jobs and export of goods -- isn't it just
> possible
> that developing countries could, should, and would create jobs producing
for
> their own consumption, including production goods?
>
> Is it an accepted, irrefutable fact that development depends on
> mercantilism, i.e. exporting to earn foreign money?
>
> Admission of bias: I live in the former apricot center of the world and am
> eating Turkish apricots. The nearby garlic center of the U.S. is beginning
> to cease farming and instead import garlic from China.
>
>            Mason C
>
>
>
>
>
>
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>