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The good old days

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skepcindy

The good old days

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I've been reading a lot about economics lately. (Deep Economics by McKibben, Accidental Economist by Paul Krugman, the Wal Mart Effect by Fishman). I've also been following the news about Zimbabwe and reading about what happened in South Africa.

So a couple of thoughts: I'm pretty convinced that jobs going overseas is in general a good thing, and as an exception doesn't work. By that I don't mean that it's the best thing for Americans. I think that's a mixed bag. We lose manufacturing jobs, and get cheaper goods. But if things go like they're supposed to, whole nations can rise out of poverty. And in a global economy, I don't think anything other than draconian avoidance of free trade can keep American wages from being threatened until the rest of the world comes up a bit. While reading, I was thinking what are the ways we know that a nation can switch over from being primarily subsistance farmers to having specialized labor, universal education, and free time. The obvious answer is self-industrialization, where you discover your own coal supplies and build some factories. The more recent approach is you have a whole bunch of subsistance farmers and a relatively stable government, and foreign countries come build factories or buy your food, hopefully doubling and tripling wages. Paul Krugman makes a good point about why we feel guilty about paying people low wages in third world countries despite the fact that the standard of living goes way up, and people that get these jobs are pretty thrilled about it. He says that before, they're living in abject poverty, but we have no relationship with them so we don't have to care. Afterwards, when we're profiting from the fact that they'll work for so little, suddenly we feel guilty. He argues that passing laws on our side to raise the wages will tend to reduce the number of jobs companies create in other countries, concentrating the wealth into a few good jobs when we'd rather spread it out to help their economy.

Another thing that I'm being steadily convinced of is that nothing is going to bring all the small farmers back. There's a lot of people that really want this to happen, and they write a lot of books about it. To put this in perspective, let me point out that I live in California, I don't have a drivers license, and I walk to farmers' markets to get the vast majority of our groceries. We see the inside of a Safeway every few weeks to grab some milk and granola bars. But from the reading I've been doing, I'd have to argue that the majority of the quality food culture is not made up of potential competitors to large-scale farming and grocery stores. In the same way that Audis and Jaguars are not going to drive Honda out of business. If you walk into a Whole Foods, your senses are assaulted with affluence. All the fine wines, and chocolates, and cheeses, and the finest looking shiny happy produce you've ever seen. And when you leave, you get to feel good about helping the or whatever. The point is, Whole Foods might motivate Safeway to put in a fluffy Organic section, but Whole Foods will not put Safeway out of business, because we don't all have the money to shop at Whole Foods.

There are a few things that I think do have the potential to take down large scale farming and outsourcing of manufacturing. The very biggest is oil, which will drive up the costs of imports relentlessly, and make it much more cost effective to buy local food. This might be the greatest thing to ever happen to small farmers with less of an oil footprint. The second is the non-affluent farmers market. The kind where you buy five apples for a dollar, and hand the dollar to the farmer's kid who's running the stand. These are both fun and cheap, and pretty darn profitable. And I could actually picture a culture where all had townsquares that we visited once a week for a mini-party and shopping trip.

Back to the jobs going overseas statement. I really feel like it's not the best idea to pine for the good old days of manufacturing jobs and small farmers. Things change. Raising the standards of living in third world countries is awesome. Robots should do repetitive tasks 24/7 instead of humans. All of these things free up resources, and if we're unhappy about where those free resources are going, we should try to change that. We should try and figure out where people are going to be working as the world improves over time. Green collar jobs are an excellent idea. It's going to take a lot of labor to move us over from oil and coal to solar, wind, and nuclear. Also, dealing with the population density requires a lot of construction, and public transportation. And if we have more hobbies, are more concerned with our health, and like eating more interesting food, that can all create jobs that are more interesting than moving a part on a factory line and hitting a button a million times.
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