How the 'Losers' in America’s Trade Policies Got Left Behind

[THE Bigzoman]

I don't really see the problem with this, accidental aid it's still aid and I don't think people will disagree on this. After all in many places in the world its better to have job over no job. But that's not what I take issue with, what I'm more interested in is if people value possible long term gains over short term losses.

No. People are too dumb and myopic for that.

[Auxora]

The driver for trade deals and globalization isn't political, it's economic. Economics are driven by the stock market, which is all based around growth. Otherwise, there's no reason for the stock market to exist - stockholders could have zero risk instead by putting their money in savings accounts.

And that's the problem, markets in the US got saturated to the point that growth slowed. So the obvious result was to look for growth elsewhere, both in cheaper labor and in new markets to sell to. Any way you cut it, US workers were going to get the short end of the stick since it was never really about helping them (at least directly). The only benefit to US workers was in the increased profits to the corporations they work for, and maybe indirectly to their 401k's.

Isolationism isn't really the answer either though, since what initiated the trade deals was slow growth in the US. So for US workers it's kind of pick your poison, open trade and lose jobs and income to other countries, or protectionism and the companies they work for do poorly because of low growth and may end up laying off people.

The only way to avoid either negative (no growth from protectionism, or loss of jobs in globalization) is to have growth in the US so either isn't necessary. But that's not an easy problem. Take any industry, say automotive. In the US, in general the number of cars people on average in the US have isn't going to change. So investors in Ford aren't going to see a lot of future growth. People aren't going to suddenly all start owning 2 cars each. So when they invest in Ford they are looking at what they sell in emerging markets...China, Brazil, India, etc. That's the kind of thing that would potentially double the number of cars Ford sells, not everyone in the US suddenly doubling the number of cars they buy. About the only way to go protectionist but with growth, would be to invent big new industries in the US with growth potential. But that would need to be a big new development like cars/planes/the internet/computers/televisions, etc. that creates a whole new growth genre with hundreds of millions of new customers. Going protectionist without growth would just send stock prices spiraling and putting companies out of business.

[May90]

Why not? If the working class is not seeing the benefits of free trade, why should they be sacrificed for it? Heck Autor sugests that effects of trade with China might have caused permanet damage to the welfare of workers,

Because, I think, it is two different matters that should be addressed separately: how to get benefits, and how to distribute them. In international trade, the goal should be to get the highest net gain; in internal economy, it should be to distribute that net gain among people the best way possible. The fact that the benefits aren't distributed properly isn't an argument against free trade, it is an argument for changing the system of distribution of goods.

Is it possible to comepete against near slave like conditions of working? Furthermore how long will it be until this long term benefits will materialize, because we are 16 years in and the recovery for the working class is yet to occur.
The amount of jobs gain from an increase in import industries does not offset the amount of jobs lost due to free trade with China. Besides no one is arguing we should return to protectionism in which we put tariffs to prevent trade, the claim being made is that if we should further trade liberalization. Giving past experiences I think we should not or at least not until we are capable of correctly assesing the gains from trade.

I'm not a Keynesian but god damn he was right about this attitude: In the long run we all die.

Like in case of anti-monopoly laws, if the companies end up competing against someone utilizing slave labor, or using strong foreign government support to boost their performance, then they should get help from the government, which should strive to level the playing field. But I don't think any restrictions on international trade should be put by the government, aside from some laws similar to internal anti-monopoly laws.

I don't know how long it would take for long-term effects to kick in. But in the end, long-term planning is exactly what drives the progress. Maybe, if people don't want to invest too much in the future, the process of trade liberalization can be slow and gradual - which is as it is currently happening, from what I can see.

Once again no one is arguing for protectionism, the argument that is being made is if we should continue signing more FTAs. As Krugman put it, there are no significant downsides of not signing free trade agreements and claims of inevitability are wrong. So the case for more FTAs is weak at best.

There are significant downsides though, one of which, for example, is decrease in the volume of trade. Companies don't want to trade in case they have to pay outrageous taxes off sales/purchases, or in case they can't trade some goods they have, etc. The best way to promote trade between two countries is to remove all restrictions, which is exactly what FTAs aim to do.

Of course there are upsides too, such as the benefit-to-volume-of-trade ratio increasing in case of rejecting FTAs. Which one has a bigger impact? I guess it depends on the individual case.

[NED funded]

Because, I think, it is two different matters that should be addressed separately: how to get benefits, and how to distribute them. In international trade, the goal should be to get the highest net gain; in internal economy, it should be to distribute that net gain among people the best way possible. The fact that the benefits aren't distributed properly isn't an argument against free trade, it is an argument for changing the system of distribution of goods.

That would be the ideal, however that doesn't happen and in the political ambien we currently have I don't think it will be the case. Furthermore gains from hyperglobalisation and from which only a small part can be attributed to policy is around 5% of world GDP, with once again massive distributional effects. Take for example a look at this elephant:



This is what happens in developed countries, which suggests that decline in the middle class due to globalization affect all developed economies regardless of policy.

Like in case of anti-monopoly laws, if the companies end up competing against someone utilizing slave labor, or using strong foreign government support to boost their performance, then they should get help from the government, which should strive to level the playing field. But I don't think any restrictions on international trade should be put by the government, aside from some laws similar to internal anti-monopoly laws.

Why not? We know of the consequences of shocks, like the one described by Autor. It doens't have to be permanent, just temporary until things look to stabilise

I don't know how long it would take for long-term effects to kick in. But in the end, long-term planning is exactly what drives the progress. Maybe, if people don't want to invest too much in the future, the process of trade liberalization can be slow and gradual - which is as it is currently happening, from what I can see.

- This is what I take issue with. You don't know, so for the displaced worker they might as well be rotting their entire life.
- Except trade agreements necessarily creates shocks such the one seen China, the magnitude of that shock is another thing. Trade liberalization can occur naturally without FTAs (or not) at a manageable rate, which will give us enought time to plan ahead.

So I'll repeat what Keynes said, from while I disagree with him a lot he nailed this one: In the long run we all die.

There are significant downsides though, one of which, for example, is decrease in the volume of trade. Companies don't want to trade in case they have to pay outrageous taxes off sales/purchases, or in case they can't trade some goods they have, etc. The best way to promote trade between two countries is to remove all restrictions, which is exactly what FTAs aim to do.

FTA actually set restrictions on trade and implement basic standards the one you mentioned earlier, but the negative effects of it loss of jobs still persists. Take for example the TPP. A goverment report concluded that this will be the effects:

• U.S. annual real income would increase by 0.23% in 15 years relative to the baseline projections
• Real GDP would be $42.7 billion or 0.15% higher
• Employment would be 0.07% higher
• US exports would increase 1% and imports would increase 1.1%
• "TPP would generally establish trade-related disciplines that strengthen and harmonize regulations, increase certainty, and decrease trade costs for firms that trade and invest in the TPP region"

We can dismiss most of this gains, because US workers would see almost zero of this gains.

Is it fair to sacrifice the welfare of thousands for gains of 0.15%.

[May90]

That would be the ideal, however that doesn't happen and in the political ambien we currently have I don't think it will be the case. Furthermore gains from hyperglobalisation and from which only a small part can be attributed to policy is around 5% of world GDP, with once again massive distributional effects. Take for example a look at this elephant:

[IMG]http://www.pewresearch.org/files/2014/01/FT_COTW124.png[IMG]

This is what happens in developed countries, which suggests that decline in the middle class due to globalization affect all developed economies regardless of policy.

To be fair, this elephant shows the global picture, not the picture for developed countries. If we look at how the income has changed in the same period in developed countries, we will see a different picture. For example, for the US:



While, indeed, it can be seen that the rich have benefited the most from globalization, there are more factors than just globalization that affected the growth of inequality; in fact, I would argue that globalization itself had nothing to do with it, it is the internal system of wealth distribution that is at fault.

Why not? We know of the consequences of shocks, like the one described by Autor. It doens't have to be permanent, just temporary until things look to stabilise

Even temporary restrictions can have devastating effects on long-term trade, such as break in trust from potential foreign traders.

- This is what I take issue with. You don't know, so for the displaced worker they might as well be rotting their entire life.
- Except trade agreements necessarily creates shocks such the one seen China, the magnitude of that shock is another thing. Trade liberalization can occur naturally without FTAs (or not) at a manageable rate, which will give us enought time to plan ahead.

I think both natural and manual liberalization is needed. Same way, you are right, a worker might not be happy knowing that benefits of the current policies will only be reaped in dozens years, while currently they are harming their live; a hybrid approach is needed, gradual liberalization, but also not forgetting about the current situation.

FTA actually set restrictions on trade and implement basic standards the one you mentioned earlier, but the negative effects of it loss of jobs still persists. Take for example the TPP. A goverment report concluded that this will be the effects:

• U.S. annual real income would increase by 0.23% in 15 years relative to the baseline projections
• Real GDP would be $42.7 billion or 0.15% higher
• Employment would be 0.07% higher
• US exports would increase 1% and imports would increase 1.1%
• "TPP would generally establish trade-related disciplines that strengthen and harmonize regulations, increase certainty, and decrease trade costs for firms that trade and invest in the TPP region"

We can dismiss most of this gains, because US workers would see almost zero of this gains.

Is it fair to sacrifice the welfare of thousands for gains of 0.15%.

This just goes back to income distribution. We see that top percent, or however much, gets the vast majority of benefits. We don't want it to be that way. So the solution is to increase taxes, and use this extra governmental income to invest into lower classes. Not just give them the money for free, but to create jobs for them, more accessible education, healthcare, etc. Economy is all about investment into the future, and when the money is just sitting in people's pockets or goes into buying unnecessary luxuries, economical opportunities are being lost.

[Theodarzna]

See, this is what bugs me about the whole topic.

We're all encouraged to embrace globalization for all these various reasons. We're told that it's better for the economy, better for the nation. We're told to not be "isolationist" or "nationalist". Yet for some reason the assumption for the average worker is always that they just need to "buck up" and "compete" or else just lose everything. To do the impossible task of "improving themselves" in order to "compete" with someone overseas that's basically willing to be nearly-free slave labor.

Meanwhile, just a couple handful of people are raking in ever increasing piles of cash.

Ultimately, I feel like the entire society of the US is just untenable in the face of globalization. There's just too many cheap workers all over the world and only (by comparison) a handful of us. The goal will never be to move all the other nations up to our economic level (we're not even willing to fight to improve our own status, after all!) and so the inevitable is that we'll just move down to theirs. Not a complete crash, since they'll move up a little bit as we're falling, but it certainly won't be a pretty situation for most of us.

And all the while we refuse to fight against it because of this incredibly twisted form of "work ethic" that we have in the US, combined with a large chunk of the voting base that still thinks trickle-down and similar polices are the way to go.

Globalization is a deliberate scam in this sense. The wealthy elite were never going to go for it if they had to redistribute the wealth back into their homelands respectively. This is why its so strange that so many theoretical progressives are twisting themselves into knots to defend Free Trade policies and deals, purely because they know that is Clinton's sincere policy.

There are too many cheap workers, and even if the logic of "This is a long term project," holds out and eventually you have global wealth equalization, we are talking 100+ years until that happens. America won't endure 100+ years of this, the country will topple.

[Alydael]

Krugman on trade:
[/URL]


So what do you think MMO-C do you think trade liberalization (Globalisation) is an endeavor worth pursuing for?

EDIT: Forgot to add, its worth mentioning that while US workers suffer the consequences of trade, developing nations benefit a lot, while the win/win scenario many economists preach only occurs in the long term.

"US workers suffer the consequences of trade, developing nations benefit a lot" which is exactly why I am against globalization and these trade deals. You have no right to forcibly make American workers take a hit to the detrement of their families just to benefit workers in another nation. Our government should not be involved with that, our government should protect the american workers.

For god's sake! We have enough charity forced on us by the government.

They take our money as taxes and use it for social programs (which I am not against but is basically a charity). They also take our tax dollars and send it overseas as "aid packages." The government also use our military (paid for by your taxes) to help impovershed nations recover from disasters (which is essentially a charity).

I am all for charity, but I notice (for our government) it is awfully easy for them to be charitable with our money. Then they tell us there is not enough money for things we need so they raise taxes and cut our military..... Most of our country is in debt (student loans, etc), we need our jobs and money.

Charity should be a choice. Not a situation where the government takes your money (under threat of jail time) and then uses it for charity.

[Deleted]

Globalization is a deliberate scam in this sense. The wealthy elite were never going to go for it if they had to redistribute the wealth back into their homelands respectively. This is why its so strange that so many theoretical progressives are twisting themselves into knots to defend Free Trade policies and deals, purely because they know that is Clinton's sincere policy.

There are too many cheap workers, and even if the logic of "This is a long term project," holds out and eventually you have global wealth equalization, we are talking 100+ years until that happens. America won't endure 100+ years of this, the country will topple.

Globalization in the current form won't last due to automation. Several western brands are already coming back from the places they delocalized to, just this time they produce their stuff with robots.

[Theodarzna]

Globalization in the current form won't last due to automation. Several western brands are already coming back from the places they delocalized to, just this time they produce their stuff with robots.

Perhaps, but then what global instability will that cause?

Or, to the Rhetorical side, how will the champions of Globalization defend it when its now longer throwing bread crumbs and the poor blighted "PoC," around the world?

- - - Updated - - -

"US workers suffer the consequences of trade, developing nations benefit a lot" which is exactly why I am against globalization and these trade deals. You have no right to forcibly make American workers take a hit to the detrement of their families just to benefit workers in another nation. Our government should not be involved with that, our government should protect the american workers.

[...]

I think that a Charity should be a charity freely given. What we have here is akin to the following....

The richest person in town decides to help a very poor town nearby, he then robs and loots from every home in his own town, keeps half the proceeds and gives the other half to the very poor town and expects his own town to both endure this theft but also pat him on the back for it.

or to use a different Moral example: Say you are a doctor, you have 5 patients who need organ transplants and a drifter is in the waiting room. Do you kill the drifter, harvest his organs to save others? Once more the others will pay you handsomely for their lives. But you are still murdering someone and harvesting them, ULTIMATELY for your own personal profit.

My problem with the Globalization Acolytes is that their justification is ultimately a kind of pro-Vampirism. More over it solves nothing because as China is learning, those multinationals have no loyalty, they are now heading for Vietnam and Cambodia and Thailand. So it seems more like a great wealth harvest for some.

[Shadowferal]

Globalization in the current form won't last due to automation. Several western brands are already coming back from the places they delocalized to, just this time they produce their stuff with robots.

If China were to replace their workforce with robots/automation then what will happen to their population if no one is working anymore?
And what happens to the products made when no one can afford them but the few wealthy?

[Theodarzna]

If China were to replace their workforce with robots/automation then what will happen to their population if no one is working anymore?
And what happens to the products made when no one can afford them but the few wealthy?

Maybe the class war Marx predicted was merely delayed?

[Deleted]

Maybe the class war Marx predicted was merely delayed?

Nah. Basic income is the answer. But it requires a big change in how society is organized, and, more importantly, it is incompatible with immigration and globalization.

[Theodarzna]

Nah. Basic income is the answer. But it requires a big change in how society is organized, and, more importantly, it is incompatible with immigration and globalization.

basic income isn't going to happen. At the end of the day it would defeat the objectives of the elite classes IMHO.

[ImpTaimer]

The problem isn't inherently trade globalization. It just can't work right now because the world isn't trying to work towards any meaningful goal other than wealth and power.

The problem is inherently wealth inequality. Hypocrites act like "wealth distribution" is wrong, but only when it's concerning rich people. What about the poor people who worked and had their time/effort "distributed" to one person? They weren't "smart" enough to lobby bullshit legislation to take advantage of?

If every single job on the planet was rewarded with a fixed amount based on time alone, would rich people bother working? Likely not. They'll find some way to leech off the time invested in others to inflate their own wealth. Shit, they even made a movie about it in a literal sense.

"Rich people" cheat through life and play denial when they get caught. History just repeats itself because cheats will just wait till the dust settles and repeat the process.

Crap like the TPP is just cheaters trying to cheat more. There isn't a single ounce of good intention involved in it.

Adopting fiat money system was a mistake, and any country that threatens it is attacked harshly. Hillary as US President will only further that mistake.

[Theodarzna]

The problem isn't inherently trade globalization. It just can't work right now because the world isn't trying to work towards any meaningful goal other than wealth and power.

The problem is inherently wealth inequality. Hypocrites act like "wealth distribution" is wrong, but only when it's concerning rich people. What about the poor people who worked and had their time/effort "distributed" to one person? They weren't "smart" enough to lobby bullshit legislation to take advantage of?

If every single job on the planet was rewarded with a fixed amount based on time alone, would rich people bother working? Likely not. They'll find some way to leech off the time invested in others to inflate their own wealth. Shit, they even made a movie about it in a literal sense.

"Rich people" cheat through life and play denial when they get caught. History just repeats itself because cheats will just wait till the dust settles and repeat the process.

Crap like the TPP is just cheaters trying to cheat more. There isn't a single ounce of good intention involved in it.

Adopting fiat money system was a mistake, and any country that threatens it is attacked harshly. Hillary as US President will only further that mistake.

What some see as a bug, I think was the intended feature. Globalization was purely ABOUT wealth and power, the pretensions ramblings about helping people in incredibly poor countries was mostly an after the fact rationalization.

There was no intention to fix the problems globalization causes because those problems have a direct benefit to a specific social class, OR simply don't harm that class and thus don't matter.

- - - Updated - - -

- This is what I take issue with. You don't know, so for the displaced worker they might as well be rotting their entire life.
- Except trade agreements necessarily creates shocks such the one seen China, the magnitude of that shock is another thing. Trade liberalization can occur naturally without FTAs (or not) at a manageable rate, which will give us enought time to plan ahead.

So I'll repeat what Keynes said, from while I disagree with him a lot he nailed this one: In the long run we all die.

This is by far the most important part of Trade Liberalization and Globalization, or the biggest problem for its defenders.

Only the coldest of Technocrats can say "Well let them rot, this is for a greater long term good!" In the end you can't expect someone to passively wither and die for some power cliques future utopia. That is a recipe for reactionary insurrection and revolution.

IMHO its that attitude that creates the desire for Trump in the first place.

[NED funded]

To be fair, this elephant shows the global picture, not the picture for developed countries. If we look at how the income has changed in the same period in developed countries, we will see a different picture. For example, for the US:



While, indeed, it can be seen that the rich have benefited the most from globalization, there are more factors than just globalization that affected the growth of inequality; in fact, I would argue that globalization itself had nothing to do with it, it is the internal system of wealth distribution that is at fault.

1. Your example in the US doesn't really contradict the elephant graph
2. Prove it

Even temporary restrictions can have devastating effects on long-term trade, such as break in trust from potential foreign traders.

In the face of large trade shocks I don't see why not. Going back to China the issue of what happened is that companies outsourced too many jobs too fast, temporary tariffs could've slowed this process giving labor markets time to accomodate.

I think both natural and manual liberalization is needed. Same way, you are right, a worker might not be happy knowing that benefits of the current policies will only be reaped in dozens years, while currently they are harming their live; a hybrid approach is needed, gradual liberalization, but also not forgetting about the current situation.

Barriers to trade are in a all time low, I don't see the benefits of taking away such small barriers worth the price, even David Autor acknowledges that the current case for more trade agreements is based upon protecting American intellectual property. Which depending on your stance on the issue, its good or bad.

This just goes back to income distribution. We see that top percent, or however much, gets the vast majority of benefits. We don't want it to be that way. So the solution is to increase taxes, and use this extra governmental income to invest into lower classes. Not just give them the money for free, but to create jobs for them, more accessible education, healthcare, etc. Economy is all about investment into the future, and when the money is just sitting in people's pockets or goes into buying unnecessary luxuries, economical opportunities are being lost.

I think you are not understanding what distributional effects are. Let's use an example you might be more familiar with:
Suppose you gain 50$ and the firm gains 100$. A massive amount of workers enter into the marker increasing competition, thus decreasing wages. But the loss of wages is not reported as a loss, because that loss of wages translates into cheaper costs for the firm and cheaper prices for products for consumers.

So we have:

Firm: 150$
Worker: 80$

You might say, let's take 20 dollars from the company and pass it to the worker, but then you face other myriad of problems involving higher taxes. Then you have to add the political climate we have which opposes almost all forms of wealth redistribution, without major compromises, so in the light of current events its easier just to stop signing FTAs.

[Shadowferal]

Hmf...just means US workers get shafted as usual.

[May90]

1. Your example in the US doesn't really contradict the elephant graph
2. Prove it

You said that globalization cause decline in the middle class in developed countries. As you can see, this is not the case, taking the US as an example.

In the face of large trade shocks I don't see why not. Going back to China the issue of what happened is that companies outsourced too many jobs too fast, temporary tariffs could've slowed this process giving labor markets time to accomodate.

I don't see what's wrong with outsourcing either. If labor in a foreign country can do the same job cheaper than your citizens, then it is beneficial for the economy to hire them instead - provided unemployment in your country is low, which it is currently, again, speaking of the US.

Barriers to trade are in a all time low, I don't see the benefits of taking away such small barriers worth the price, even David Autor acknowledges that the current case for more trade agreements is based upon protecting American intellectual property. Which depending on your stance on the issue, its good or bad.

Taking barriers away so far has been worth the price. Why would it be different now?

I think you are not understanding what distributional effects are. Let's use an example you might be more familiar with:
Suppose you gain 50$ and the firm gains 100$. A massive amount of workers enter into the marker increasing competition, thus decreasing wages. But the loss of wages is not reported as a loss, because that loss of wages translates into cheaper costs for the firm and cheaper prices for products for consumers.

So we have:

Firm: 150$
Worker: 80$

You might say, let's take 20 dollars from the company and pass it to the worker, but then you face other myriad of problems involving higher taxes. Then you have to add the political climate we have which opposes almost all forms of wealth redistribution, without major compromises, so in the light of current events its easier just to stop signing FTAs.

I see it differently. The company gets $150 income. Suppose the "fair share" the worker is supposed to get is $100, but the company pays him only $80, putting $20 in investments. The government sees it and says, "Okay, cool, you want to pay only $80 to your worker. That's fine. But we don't think those $20 belong to you, so you will pay them as taxes: you pay $20 off $70. We take this $20 and, in turn, put it into investment, such as healthcare, education, science, etc. - which, in the end, compensates this worker's being underpaid". In short, the less companies pay to their workers, the more workers get from the government, keeping the overall balance, pretty much, no matter what the companies do. And the companies end up being interested in paying fair amount to the workers, to improve quality of the work force, since, due to taxes, they cannot save much on underpaying their workers anyway.

Of course, it is a very simplistic example, and there are many hidden variables in there - but, in the end, companies aren't going to just pay their workers money out of charity, the government needs to assure that they do. And when it happens, the problem of distribution is solved, regardless of the trade policies and where the companies keep their workers. The companies are free to outsource their jobs all they can, but they better be prepared to pay increased taxes if they do so trying to save the money.

[NED funded]

You said that globalization cause decline in the middle class in developed countries. As you can see, this is not the case, taking the US as an example.

Then again your graph is not disproving the idea of the decline of the middle class. Wages are stagnating, while the prices of essential things continues to rise. If that is not a decline IDK what it is.

Quick google search:
http://www.pewsocialtrends.org/2015/...losing-ground/

I don't see what's wrong with outsourcing either. If labor in a foreign country can do the same job cheaper than your citizens, then it is beneficial for the economy to hire them instead - provided unemployment in your country is low, which it is currently, again, speaking of the US.

Exposed workers experience greater job churning and reduced lifetime income

In other words:

"Quality of jobs".As noted in the article and in Autor's article and in the Atlantic article as well, people move to low skill jobs with worse wages than their previous jobs, thus reducing their welfare. And as the Atlantic's article points, workers aren't moving to more prosperous places, be it, because of cultural reasons or due to how much it costs to move. We have data of the latter and it shows that costs of moving between industries blows away years of their income. Furthermore Autor notes that gains in employment have not managed to offset the loss of employment in exposed industries.

The benefits it brings it's cheaper products and I'm not of the believe that cheaper products in Walmart are worth the welfare of thousands.

Taking barriers away so far has been worth the price. Why would it be different now?

Times change, and the context changes as well. Back in the 80s and 90s, when the USA liberalized trade, workers could just move to similary skilled jobs elswhere. For example when the car industry started facing competition from Japan, workers just moved to operating tools in computer factories. That is no longer the case and as I pointed above gains in employment do not offset the losses.

I see it differently. The company gets $150 income. Suppose the "fair share" the worker is supposed to get is $100, but the company pays him only $80, putting $20 in investments. The government sees it and says, "Okay, cool, you want to pay only $80 to your worker. That's fine. But we don't think those $20 belong to you, so you will pay them as taxes: you pay $20 off $70. We take this $20 and, in turn, put it into investment, such as healthcare, education, science, etc. - which, in the end, compensates this worker's being underpaid". In short, the less companies pay to their workers, the more workers get from the government, keeping the overall balance, pretty much, no matter what the companies do. And the companies end up being interested in paying fair amount to the workers, to improve quality of the work force, since, due to taxes, they cannot save much on underpaying their workers anyway.

Of course, it is a very simplistic example, and there are many hidden variables in there - but, in the end, companies aren't going to just pay their workers money out of charity, the government needs to assure that they do. And when it happens, the problem of distribution is solved, regardless of the trade policies and where the companies keep their workers. The companies are free to outsource their jobs all they can, but they better be prepared to pay increased taxes if they do so trying to save the money.

What you just did is advocate for protectionism. In fact it's literally what is written on Hillary's plan to keep jobs in America.

[May90]

Then again your graph is not disproving the idea of the decline of the middle class. Wages are stagnating, while the prices of essential things continues to rise. If that is not a decline IDK what it is.

Quick google search:
http://www.pewsocialtrends.org/2015/...losing-ground/

I don't see how this article confirms your claim. This one, however, supports mine:

http://www.pewresearch.org/fact-tank...d-for-decades/

In other words:

"Quality of jobs".As noted in the article and in Autor's article and in the Atlantic article as well, people move to low skill jobs with worse wages than their previous jobs, thus reducing their welfare. And as the Atlantic's article points, workers aren't moving to more prosperous places, be it, because of cultural reasons or due to how much it costs to move. We have data of the latter and it shows that costs of moving between industries blows away years of their income. Furthermore Autor notes that gains in employment have not managed to offset the loss of employment in exposed industries.

The benefits it brings it's cheaper products and I'm not of the believe that cheaper products in Walmart are worth the welfare of thousands.

This doesn't make sense to me. The assumption is that it is high paid jobs that are primarily getting outsourced, which is pretty counter-intuitive, since high paid jobs are exactly the jobs for which you need very skilled specialists, lower skilled people willing to work for cheap.

Times change, and the context changes as well. Back in the 80s and 90s, when the USA liberalized trade, workers could just move to similary skilled jobs elswhere. For example when the car industry started facing competition from Japan, workers just moved to operating tools in computer factories. That is no longer the case and as I pointed above gains in employment do not offset the losses.

This still sounds like a point of view to me. The fact that the observed flow of the work force as a result of competition with foreign corporations is towards lower-skilled jobs, rather than similar jobs, demonstrates that something is wrong with domestic job market, not with trade liberalization itself.

What you just did is advocate for protectionism. In fact it's literally what is written on Hillary's plan to keep jobs in America.

It is not protectionism if you tax companies underpaying workers and saving on that, no matter what workers: domestic or foreign. Protectionism would be explicitly favoring hiring domestic workers and introducing penalties, tariffs or increased taxes for hiring foreign workers - which is something I would never advocate for.

Unless I understand the term wrong.