8:50 haha, wow. How pertinent that vaccine comment remains. This video was published several years before 2020's Covid. It's nice to see that some people had this foresight.
10:15 I get the general point but it's not the best example today. The chips may be individually "cheap" but as many nations have come to realize this year the extremely specialized fabrication technology is not something that can be quickly replaced or upgraded. We can live without potato chips, and anyone can start making potato chips without much infrastructure. Not so for computer chips.
I see two separate issues here. This first is what happens when the Chinese start consuming more. The second is what happens when the Chinese labor becomes more skilled on average. Strictly speaking their demand is already equal to their supply, because they get American dollars in exchange for the goods. The dollars they buy for their goods are in essence future goods for them, even if they now use those dollars for savings, which allows the US government to obtain loans. When the Chinese decide they want to consume more in the present, they quantity supplied of loanable funds decreases and the US government would be forced to limit deficit spending, which would overall not hurt the American economy. The second issue is what happens if the quantity supplied of unskilled labor decreases. If this happens because the Chinese get rich in a world of trade, Americans would be themselves much richer due to the accumulated mutual benefits of trade. This means Americans would not need to buy low quality products only because they are, well, affordable.
By Ricardian Model, then exporting dollar is cheaper than other goods. Beside, most of the world debt are in dollar, one way countries got dollar by trading. Is it?
Still not convinced it's not a global race to the bottom. How can you say that Wal-Mart has done good for the US? Yes it may be the world's largest firm, but how is that wealth distributed? Can you talk about that aspect of free trade?
For the general argument why international trade is a good idea than see "Tariffs and Protectionism". From a global point of view restrictions on trade are wasteful simply because substitute more costly means of production for the less costly. We can measure the "good" Wal-Mart does in the US just like we do we any other firm, by looking at the prices of sold goods. That value is distributed to the buyers according to how much they buy. Because Wal-Mart products tend be cheap, it seems that low income buyer enjoy that value the most. Free trade tends to destroy some jobs but create others because the new imports must be paid with new exports. The video mentions that in the US, it is mostly low-skill jobs in the US that are being destroyed while relatively higher skill jobs are being created. This is acceptable to the extent education works to reconvert labor and also to the extent to which the benefits from the newly created jobs spill over the particular people forced to reconvert.
Wal-mart keeps their prices low in part because they pass their labor costs onto the state. Most of their employees are on public assistance. They even tell their employees how to sign up for food stamps and other forms of welfare when they are hired. Police in various jurisdictions are now complaining about the company doing the same with their security costs. The stores tend to be hotbeds of crime and Wal-mart refuses to pay for adequate security. Thus, you guessed it. taxpayer supported police and sheriffs departments are forced to deal with the theft, assaults, and drug dealing that go on at these places. Recently, a meth lab was busted operating underneath a Wal-mart.
Acceptable? Do you really believe two thirds of the American workforce is going to be converted into software engineers bio-chemists. Furthermore, from the standpoint of the U.S. and other developed nations, one of the biggest flaws in free trader's reasoning is the presupposition that Indians, Mexicans, and Chinese are somehow unable to perform high skilled jobs and that this work will inevitably go to western nations.
How about conducting an analysis using revenue neutral tariffs? That's the only correct approach under macro ceteris paribus. If you're not doing that, you're not doing it right.
Just about trade not reducing jobs because foreigners want goods in return for our exports, what if you're running a trade deficit? Won't jobs be reduced in that case? Also, even if there isn't a trade deficit, what's to say the new exporting industries don't require less labour and thus provide less jobs than the import-competing industry that's suffering from international competition? I don't see why the fact that foreigners buying our exports necessarily means that there will not be a net jobs loss.
Are low-skilled American workers prevented from working by Minimum Wage and all the other government rules which makes the cost of their labor unprofitable? Wouldn't it be better to abolish those impositions instead of relying on the government controlled and government run "Education" system...?
Mujangga Nobody is forcing anyone to work in low paying jobs (at least in the US). Those who work in low paying labor usually have no educational background, and that cannot be blamed onto anybody but the uneducated people in those positions. Adding on, jobs are nearly endless, and promotions will be granted to those who gain favor with the boss. How? They work hard! Take Steve Jobs for example. He was a very poor man who was fired from his own company. Yet he rose to the top and made his company more profitable than before. Why? He worked really hard for it!
Mujangga No one in the US wants to work below the poverty line. Lowering or abolishing the minimal wage is simply moronic unless you want the system to be like the Nordic Model. The low skill workers are going to lose jobs to those fortunate enough the have received a decent education. Manufacturing jobs are going to be replaced by highly skilled people that can work more efficiently with new technology and from automation (i.e. robots). It's best to provide them with a good education to allow them to adapt to the changing economy and get higher-paying jobs.
If we honestly care about the poor, we will support free international trade. Because of comparative advantage, even the poorest have something to offer and all to gain! Well said.
These guys knock protectionist polices regarding wool as useless and silly. However, wool is a strategic product. The reason the Germans weren't prepared for the Russian winter in WWII was that they knew if they made huge purchases of wool on the international market it would tip the Soviets off as to the coming invasion. These clowns like most conservative economists are overly glib in their analysis. They continually contradict themselves by asserting that arguments against free-trade are good in theory but don't work in practice whilst make pronouncements in favor of neo-liberal economic practices as if they had the predictive power of the natural sciences.
To my knowledge there is no good data suggesting that the savings from cheap imported goods exceeds the income lost through trade related job loss. For some reason, economists-especially those from the right-seem to think that making assertions is the same as having hard numbers. To date, economics is a weak science. Think of all the sharp economic thinkers who predicted the crash of 2008.
This 'professor' is an ideologue. No one is arguing against technology advancing. That is a strawman argument, sir. But the mass emigration of manufacturing jobs from America to China and Mexico have nothing to do with technological advances. We still manufacture all those goods in the same way - we just cannot produce them anymore because China pays sweatshop workers pennies on the dollar of what we pay our employees. When you have as many regulations as we do, you cannot compete. Tariffs even the playing ground for us. And yes there is a shift to high skilled service jobs in this country, but some people are too low IQ, uneducated, and unsophisticated to get any of those jobs. So we need tariffs to keep their low skilled jobs right here in America. We need to look out for our own people. Every country that has ever become rich has done so with protectionism, and its periods of using the most protectionism have coincided with its periods of the fastest growth. We need to use protectionism to stop losing money and start gaining wealth and prosperity for ourselves as a country once again (just like WE did in OUR period of our fastest GDP growth in history as well).
You make a valid point, but your argument still seems to be clinging to the notion that our domestic low skilled workforce is dependent on the manufacturing sector. The way I see it, if the overseas manufacturing market really has input requirements that are so much lower than ours, it just makes economic sense for manufacturing to be done elsewhere. In the meantime, there is NO way that ALL the low-skilled jobs will leave the country, and there will still be plenty of jobs remaining for our domestic low-skilled workforce, in industries other than manufacturing. The other sad part of your argument is that you seem content to accept this idea that large portion of our population is just too stupid, lazy or incompetent to produce at a high level. Maybe its idealistic, but I believe that there are huge improvements we can still make to our education system and that's enough evidence for me to see that we're not allowing people to produce to their potential. Instead of pigeonholing people into categories of "low IQ" or "unsophisticated" we could provide greater access to opportunities and see what else people might enjoy or be good at.
There are consequences of outsourcing and automation, that's valid. But technology and outsourcing are functionally the same. Lets say one day a genius creates a factory that can turn corn into cars! Some factory jobs are lost, but still it's amazing innovation which improves the economy. But one day a journalist sneaks into the factory to see how the genius does it. Low and behold he just illegally imports tariff free cars from japan by selling them US corn. He's exposed and made a pariah. But really, if the factory did actually somehow turn corns into cars for real, it's the exact same as having tariff free trade with Japan.
@@AJ-wp3pw not only that, but it also, AS WELL as emotional intelligence, means that many people are and will not ever be fulfilled doing high-level jobs. It doesn't matter even if they can learn or can't, it is just that they prefer to do other things that make more sense to them, and is more in line with who they are and how they want to live their life!
Imagine thinking that every person has the same IQ and capability to learn and understand everything on such a high level as much of higher-level jobs/careers need to. Yea, just fix the education, then everyone can be a programmer and scientist! Sorry to break it for you, but even an average IQ is not high enough for those people to thrive in those kinds of careers, to be good at them, and to feel fulfilled especially. So yea, the arguments you are making are false from the very start. Try better. And understand better.
If we honestly care about the poor, we will support free international trade. Because of comparative advantage, even the poorest have something to offer and all to gain! Well said.
9:05 like wow, that escalated quickly! But the goat looks soooo cuddly
8:50 haha, wow. How pertinent that vaccine comment remains. This video was published several years before 2020's Covid. It's nice to see that some people had this foresight.
10:15 I get the general point but it's not the best example today. The chips may be individually "cheap" but as many nations have come to realize this year the extremely specialized fabrication technology is not something that can be quickly replaced or upgraded.
We can live without potato chips, and anyone can start making potato chips without much infrastructure. Not so for computer chips.
I see two separate issues here. This first is what happens when the Chinese start consuming more. The second is what happens when the Chinese labor becomes more skilled on average. Strictly speaking their demand is already equal to their supply, because they get American dollars in exchange for the goods. The dollars they buy for their goods are in essence future goods for them, even if they now use those dollars for savings, which allows the US government to obtain loans. When the Chinese decide they want to consume more in the present, they quantity supplied of loanable funds decreases and the US government would be forced to limit deficit spending, which would overall not hurt the American economy. The second issue is what happens if the quantity supplied of unskilled labor decreases. If this happens because the Chinese get rich in a world of trade, Americans would be themselves much richer due to the accumulated mutual benefits of trade. This means Americans would not need to buy low quality products only because they are, well, affordable.
By Ricardian Model, then exporting dollar is cheaper than other goods. Beside, most of the world debt are in dollar, one way countries got dollar by trading. Is it?
Interesting to argue chips are pointless to produce domestically in the light of COVID and the chip shortage. Now, it’s a national security issue.
Still not convinced it's not a global race to the bottom. How can you say that Wal-Mart has done good for the US? Yes it may be the world's largest firm, but how is that wealth distributed? Can you talk about that aspect of free trade?
For the general argument why international trade is a good idea than see "Tariffs and Protectionism". From a global point of view restrictions on trade are wasteful simply because substitute more costly means of production for the less costly.
We can measure the "good" Wal-Mart does in the US just like we do we any other firm, by looking at the prices of sold goods. That value is distributed to the buyers according to how much they buy. Because Wal-Mart products tend be cheap, it seems that low income buyer enjoy that value the most.
Free trade tends to destroy some jobs but create others because the new imports must be paid with new exports. The video mentions that in the US, it is mostly low-skill jobs in the US that are being destroyed while relatively higher skill jobs are being created. This is acceptable to the extent education works to reconvert labor and also to the extent to which the benefits from the newly created jobs spill over the particular people forced to reconvert.
Wal-mart keeps their prices low in part because they pass their labor costs onto the state. Most of their employees are on public assistance. They even tell their employees how to sign up for food stamps and other forms of welfare when they are hired. Police in various jurisdictions are now complaining about the company doing the same with their security costs. The stores tend to be hotbeds of crime and Wal-mart refuses to pay for adequate security. Thus, you guessed it. taxpayer supported police and sheriffs departments are forced to deal with the theft, assaults, and drug dealing that go on at these places. Recently, a meth lab was busted operating underneath a Wal-mart.
Acceptable? Do you really believe two thirds of the American workforce is going to be converted into software engineers bio-chemists. Furthermore, from the standpoint of the U.S. and other developed nations, one of the biggest flaws in free trader's reasoning is the presupposition that Indians, Mexicans, and Chinese are somehow unable to perform high skilled jobs and that this work will inevitably go to western nations.
Walmart pays taxes that pays for benefits for low wage workers just like any other business.
There are certainly a lot of Software enginners and Bio-chemists from China India and Mexico.
How about conducting an analysis using revenue neutral tariffs? That's the only correct approach under macro ceteris paribus. If you're not doing that, you're not doing it right.
Just about trade not reducing jobs because foreigners want goods in return for our exports, what if you're running a trade deficit? Won't jobs be reduced in that case?
Also, even if there isn't a trade deficit, what's to say the new exporting industries don't require less labour and thus provide less jobs than the import-competing industry that's suffering from international competition? I don't see why the fact that foreigners buying our exports necessarily means that there will not be a net jobs loss.
Are low-skilled American workers prevented from working by Minimum Wage and all the other government rules which makes the cost of their labor unprofitable? Wouldn't it be better to abolish those impositions instead of relying on the government controlled and government run "Education" system...?
Mujangga Nobody is forcing anyone to work in low paying jobs (at least in the US). Those who work in low paying labor usually have no educational background, and that cannot be blamed onto anybody but the uneducated people in those positions. Adding on, jobs are nearly endless, and promotions will be granted to those who gain favor with the boss. How? They work hard! Take Steve Jobs for example. He was a very poor man who was fired from his own company. Yet he rose to the top and made his company more profitable than before. Why? He worked really hard for it!
Mujangga No one in the US wants to work below the poverty line. Lowering or abolishing the minimal wage is simply moronic unless you want the system to be like the Nordic Model. The low skill workers are going to lose jobs to those fortunate enough the have received a decent education. Manufacturing jobs are going to be replaced by highly skilled people that can work more efficiently with new technology and from automation (i.e. robots). It's best to provide them with a good education to allow them to adapt to the changing economy and get higher-paying jobs.
If we honestly care about the poor, we will support free international trade. Because of comparative advantage, even the poorest have something to offer and all to gain! Well said.
lol. but is that what happens in real life or do the rich countries keep all the gains from trade themselves? isn't that why the Doha round failed?
child labor has to do with income inequality and systemic problems. blaming globalization is a fallacy
These guys knock protectionist polices regarding wool as useless and silly. However, wool is a strategic product. The reason the Germans weren't prepared for the Russian winter in WWII was that they knew if they made huge purchases of wool on the international market it would tip the Soviets off as to the coming invasion. These clowns like most conservative economists are overly glib in their analysis. They continually contradict themselves by asserting that arguments against free-trade are good in theory but don't work in practice whilst make pronouncements in favor of neo-liberal economic practices as if they had the predictive power of the natural sciences.
To my knowledge there is no good data suggesting that the savings from cheap imported goods exceeds the income lost through trade related job loss. For some reason, economists-especially those from the right-seem to think that making assertions is the same as having hard numbers. To date, economics is a weak science. Think of all the sharp economic thinkers who predicted the crash of 2008.
This 'professor' is an ideologue. No one is arguing against technology advancing. That is a strawman argument, sir. But the mass emigration of manufacturing jobs from America to China and Mexico have nothing to do with technological advances. We still manufacture all those goods in the same way - we just cannot produce them anymore because China pays sweatshop workers pennies on the dollar of what we pay our employees. When you have as many regulations as we do, you cannot compete. Tariffs even the playing ground for us. And yes there is a shift to high skilled service jobs in this country, but some people are too low IQ, uneducated, and unsophisticated to get any of those jobs. So we need tariffs to keep their low skilled jobs right here in America. We need to look out for our own people. Every country that has ever become rich has done so with protectionism, and its periods of using the most protectionism have coincided with its periods of the fastest growth. We need to use protectionism to stop losing money and start gaining wealth and prosperity for ourselves as a country once again (just like WE did in OUR period of our fastest GDP growth in history as well).
You make a valid point, but your argument still seems to be clinging to the notion that our domestic low skilled workforce is dependent on the manufacturing sector. The way I see it, if the overseas manufacturing market really has input requirements that are so much lower than ours, it just makes economic sense for manufacturing to be done elsewhere. In the meantime, there is NO way that ALL the low-skilled jobs will leave the country, and there will still be plenty of jobs remaining for our domestic low-skilled workforce, in industries other than manufacturing.
The other sad part of your argument is that you seem content to accept this idea that large portion of our population is just too stupid, lazy or incompetent to produce at a high level. Maybe its idealistic, but I believe that there are huge improvements we can still make to our education system and that's enough evidence for me to see that we're not allowing people to produce to their potential. Instead of pigeonholing people into categories of "low IQ" or "unsophisticated" we could provide greater access to opportunities and see what else people might enjoy or be good at.
@@youngkristoff You and I both know that iq is 80% genetic and can't just be raised thru education. Stop with the leftist bs.
There are consequences of outsourcing and automation, that's valid. But technology and outsourcing are functionally the same. Lets say one day a genius creates a factory that can turn corn into cars! Some factory jobs are lost, but still it's amazing innovation which improves the economy.
But one day a journalist sneaks into the factory to see how the genius does it. Low and behold he just illegally imports tariff free cars from japan by selling them US corn. He's exposed and made a pariah. But really, if the factory did actually somehow turn corns into cars for real, it's the exact same as having tariff free trade with Japan.
@@AJ-wp3pw not only that, but it also, AS WELL as emotional intelligence, means that many people are and will not ever be fulfilled doing high-level jobs. It doesn't matter even if they can learn or can't, it is just that they prefer to do other things that make more sense to them, and is more in line with who they are and how they want to live their life!
Why are you racist against goats?
Almost feel sorry for economists who believe their science has much in the way of predictive power. They need to leave that for the natural sciences.
Imagine thinking that every person has the same IQ and capability to learn and understand everything on such a high level as much of higher-level jobs/careers need to.
Yea, just fix the education, then everyone can be a programmer and scientist!
Sorry to break it for you, but even an average IQ is not high enough for those people to thrive in those kinds of careers, to be good at them, and to feel fulfilled especially.
So yea, the arguments you are making are false from the very start. Try better. And understand better.
If we honestly care about the poor, we will support free international trade. Because of comparative advantage, even the poorest have something to offer and all to gain! Well said.