Offshoring Destroyed America’s Economy: Paul Craig Roberts
(But What Caused Offshoring?)
By Paul Craig Roberts
October 16, 2012, 9:36 pm. VDARE
Posted by Nicholas Stix
During the second half of the 20th century the United States was an opportunity society. The ladders of upward mobility were plentiful, and the middle class expanded. Incomes rose, and ordinary people were able to achieve old-age security.
In the 21st century the opportunity society has disappeared. Middle class jobs are scarce. Indeed, jobs of any kind are scarce. To stay even with population growth from 2002 through 2011, the economy needed about 14 million new jobs. However, at the end of 2011 there were only 1 million more jobs than in 2002.
Only 426,000 of these jobs are in the private sector. The bulk of the net new jobs consist of waitresses and bartenders and health care and social assistance….
[N.S. And the health care and social assistance workers who are employed by “private” organizations are “private” in name only. Most are overwhelmingly paid for by the taxpayer.]
As for manufacturing jobs, they not only did not grow with the population but declined absolutely. During these nine years, 3.5 million middle class manufacturing jobs were lost. Over the entire nine years, only 48,000 new jobs were created for architects and engineers.
In the 21st century the US economy has been able to create only a few new jobs and these are in lowly paid domestic services that cannot be offshored, such as waitresses and bartenders.
The lack of jobs, especially high value-added, high productivity jobs, is the reason real median household income has declined and the distribution of income has worsened. Without rising real household income, there cannot be a consumer economy….
The cause of all of the problems is the offshoring of Americans’ jobs. When jobs are moved offshore, consumers’ careers and incomes, and the GDP and payroll and income tax base associated with those jobs, go with them. When the goods and services produced for American markets by offshored labor are brought into the US to be sold, the trade deficit rises, and downward pressure is put on the dollar, pushing up domestic inflation. (On October 12, statistician John Williams (shadowstats.com) reported that “third-quarter wholesale inflation jumped to an annualized 6.2%.”)
Jobs offshoring is driven by Wall Street, “shareholder advocates,” the threat of takeovers, and by large retailers, such as Walmart. By cutting labor costs, profits go up.
It is that simple.
[No, it isn’t. While I agree with most of Roberts’ analysis—excepting his usual assertion that we are fighting wars on behalf of Israel—as to what has been going on for the past 10-15 years, he’s wrong about the cause of offshoring. Offshoring and mass immigration were both responses to the violence and never-ending extortion of black supremacism, er, the “civil rights” movement.
I’ll have more to say about this matter in a future column.]