re: National Socio-Economic Security Need for Encryption Technology
Duncan Frissell wrote: The first axiom of economics is "Wants are unlimited." I'm glad that they're "shipping all those jobs overseas." The more people we have working the more goodies are produced. If the labor of US workers is freed up, then they can go about producing something else valuable that they didn't have time to produce before because those "third worlders" weren't doing their fair share back when they were trapped in feudalism or fabian socialism. You can't get more stuff (wealth) unless everyone is out there working to capacity (consistent with their desired work/leisure tradeoff). I agree that 'shipping all those jobs overseas' will not cause the US workers to lose jobs. There is other work they can do. But there is another axiom of economics which the nationalist/socialist can use for his case against the free movement of capital. This axiom states that the wages of workers depend on the amount of capital invested. The more capital invested, the higher the wages are. If American companies are moving capital to Third World countries because of the low wages in these countries, then the workers in the Third World will of course be better off. But in the US, the amount of capital will be lowered. So the American workers will be able to get other jobs, but these jobs will pay less, because of the diminished amount of capital in the US. Of course there are advantages also for the US (shareholders will get higher returns, trade will increase), but how can you proof that these advantages will offset the disadvantage of the lowered amount of capital in the US? Anyone? Bart Croughs
Bart Croughs writes:
But there is another axiom of economics which the nationalist/socialist can use for his case against the free movement of capital. This axiom states that the wages of workers depend on the amount of capital invested. The more capital invested, the higher the wages are.
This must be some new axiom of economics that I had not heard of.
If American companies are moving capital to Third World countries because of the low wages in these countries, then the workers in the Third World will of course be better off. But in the US, the amount of capital will be lowered.
????
So the American workers will be able to get other jobs, but these jobs will pay less, because of the diminished amount of capital in the US.
This is truly one of the oddest economic theses I've seen in years. It seems like an odd offshoot of mercantilism at the very best... Perry
I realized that I'd simply dismissed Bart without explaining why his contention is so silly. "Perry E. Metzger" writes:
Bart Croughs writes:
But there is another axiom of economics which the nationalist/socialist can use for his case against the free movement of capital. This axiom states that the wages of workers depend on the amount of capital invested. The more capital invested, the higher the wages are.
This must be some new axiom of economics that I had not heard of.
I failed to note obvious counterexamples. Well known authors get giant advances for books written with manual typewriters. Minimum wage workers routinely operate expensive equipment. Workers doing the same job in different places using identical equipment that cost identical sums earn different salaries. Clearly, wages are defined by supply and demand -- not by "capital investment". Perry
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ SANDY SANDFORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C'punks, On Sun, 11 Aug 1996, Bart Croughs wrote:
If American companies are moving capital to Third World countries because of the low wages in these countries, then the workers in the Third World will of course be better off. But in the US, the amount of capital will be lowered. So the American workers will be able to get other jobs, but these jobs will pay less, because of the diminished amount of capital in the US.
The fallacy in this argument is the assumption that because some American capital moves overseas, there will be less capital available in the US for investment/wages. It doesn't contemplate infusion of foreign capital investments in American industries that have a competitive advantage over their foreign competition. S a n d y ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
participants (3)
-
Bart Croughs -
Perry E. Metzger -
Sandy Sandfort