Your entire theory about cheap labor goes down the drain.
Ron Paul has railed against the WTO (World Trade Organization) who's rules we are under.
Cheap labor has nothing to do with it.
Let's give you a nice example my WTO friend,
About 3-10 years ago you could buy cheap clothing and shoes, we had competition, India, the USA, the Phillipeans, China, Macauw, etc. However in the last 3 years China has cornered the market and prices have screamed upward.
Why...because foolish people bought cheap crap from China who was dumping products into every country through unfair slave labor practices selling products below the cost to make them. They bought up clothes processing equipment from companies that went belly up, and shipped it to China. Now they own the market, the equipment and the know how and have increased prices dramatically - the competition from Mexico, India, the Phillipeans, USA etc. is gone and dead, you have no competition, you have no choice.
I have friends that used to use my business that worked making clothing for LL Bean, this was 2003. Well LL Bean starting buying Chinese, this company went to Mexico to compete and these people that made $13 an hour back in 2003 , not bad, but are now making $10 hr in 2013 working in a different industry, they can't afford to use my business, along with many others that closed around them. The company that moved to Mexico, still couldn't compete with China and their illegal tactics of dumping their products and closed.
Free trade only works if everybody is on an equal playing field without NAFTA, GATT and the WTO and other unconstitutional trade agreements. I can sell my products unrestricted anywhere, then so can you, however when you decimate an industry or a countries industrial backbone so much over time, that I'm sure China is fairly close to saying sure trade with us now that we have a monopoly on everything.
When you go to WalMart do you realize every bottle of Apple juice they stock gets shipped over thousands of miles from China - they dont sell American made apple juice even though American made apple juice is just as cheap and probably won't ever be contaminated like a Chinese brand - why so they can get rid of competition and corner markets and then raise prices. In addition, a few years back thousands of people had their pets die, because an ingredient in pet food sourced from China (because it was cheaper) killed the dogs and cats. Clothing from China has been shown to have huge amounts of formaldehyde in the products, stuff you would never get away with in the US.
The trick to keeping prices down is to have competition, it's not buying the lowest priced product.
Where I live we have from year to year the Cheapest gas in the country it's about $3.25 - $3.29 a gallon right now, I don't go to the same gas station every day, I go to different ones so they all stay in business, as a community we have learned to do that, so we keep competition around to keep prices down.
There is nothing wrong with Chinese competition or products, if they had competition. Wal Mart product line is nearly 70% Chinese made, there is no competition and as a result prices are moving higher.
When you take an industry out of the US you lose the tax base, the wage scale overall goes down, the knowledge from the industry is lost, and you lose competition, resulting in higher taxes to make up the difference, welfare increases, increased prices for the same product, less choice and higher unemployment.
All one has to look at the US since NAFTA and GATT were approved by Democrat Bill Clinton and the Republican congress to see the damage the US has sustained. While our wages have dropped like a rock, our taxes have increased, what was the industry that picked up the slack after NAFTA, it was the housing industry and it's bubble and every job associated with it, from home flippers to mortgage brokers to construction to home products manufacturers -
In the past you use to see on TV, Thousands of Chinese riding bikes because they were poor, now they are driving cars, because the roles have switched, now Americans are riding bikes because we are too poor.
During the time of the colonies, the King refused to allow manufacturing here, we sent to England raw materials that would come back as finished products that we were taxed on. Thats because manufacturing creates wealth, we are sending our wealth, that we have created here over the last 150 years, out to China at a crazy rate. The wealth you might think would come back here, but the Chinese buy nothing from us, maybe a few high end cars, maybe some illegally killed tusks from elephants or Rinos, but that's it. As much as they manufacture and as much as they have increased their standard of living by selling their crap to us, we sell them nothing in return. Oh wait, we do, they buy our scrap steel, our lumber and our minerals to build more crap to sell us. China will always have a labor advantage because even if we gave then every single job now located in the United States, they would still have 600 billion unemployed.
I'm all for letting the market place decide and free trade, but we have neither in the US Anymore and I will buy US as much as I can just to try and keep some competition out there.
Buy the way for those that want unlimited supplies of the old style incandescent light bulbs and made in USA (Texas)
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