PKT message, Re: Outsourcing a plus for the US economy.?

Paul Davidson and I might agree that politicians in the West already know that free trade will impoverish workers whose jobs are outsourced ? unless other decent jobs or self-employment (or related income maintenance during training) are available ? before unemployment insurance and savings are exhausted.

The politicians know it and they know that incumbents will lose office ?unless free trade in practice includes remedies for its current agonizing effect.

So why are millions of families tortured while our politicians fritter away precious time instead of solving the problem?

They are tortured because government and big business have not yet devised a scheme to pay higher wages (in order to keep our domestic manufacturing and high-tech services base profitable) that does not adversely effect the corporate bottom line.

(Federal subsidies could do this without raising taxes. Whatever inflation might follow would be far easier to accommodate than the inevitable inflation that will hit if we ever can manufacture nothing.)

One of these days the national security angle will be recognized and certain jobs will be protected.

Later, the social tranquility angle will be recognized and enough jobs will be protected to allow comparative advantage to determine only where super luxury items are produced, and none other.

Meanwhile, we economists at PKT should hang our heads in shame for not offering the politicians timely warning to make the changes now that will be inevitable later.

We are afraid to openly embrace national defense and security as a current reason to reclaim steel, ships, machine tools, etc., as industries we must protect from low wages or any other threat.

And we are reluctant to insist that comparative advantage be restricted to pearls and diamond jewelry ? and not allowed to make us dependent on foreign sources to stock the shelves of ordinary stores.

William Clinton and George Bush have this in common: they fiddled while we burned our industrial might. They should be hung out to dry and we should tell them so.

John Gelles