HOW HE SEES IT Our jobs, money go overseas
By JIM WRIGHt
As the old year closed its books amid hopes for a long-awaited economic upswing, statistics pointed in several different directions.
At year's end, the stock market showed healthy gains, but there were 3 million fewer Americans employed. Economists say our country requires 1.8 million new jobs annually just to compensate for population growth and automation.
Corporate profits were up 22 percent over the preceding year. But wages were up a miserly 2 percent, hardly enough to hold even with prices.
Taken together, these figures highlight the ever-declining share of corporate income that goes to America's working families -- those who make the goods and deliver the services that produce the income.
Absent a major shift in public policy, the foreseeable future offers few good tidings for members of America's work force.
For one thing, technology has reduced the number of manufacturing jobs. A quarter-century ago, General Motors, with 450,000 employees, was America's biggest employer. That company today produces roughly the same number of vehicles with only 118,000 workers.
That phenomenon is compounded dramatically by what globalization critic Arthur Tonelson has called "the race to the bottom."
NAFTA and our trade agreements with China were advertised to Americans as grand opportunities to create U.S. jobs by selling more U.S.-made goods abroad. Instead, we've exported American jobs.
In a race to find the cheapest labor markets on earth, one U.S. corporation after another has closed facilities in this country, throwing Americans out of work, to open new ones in China, India, Mexico, Malaysia, the Philippines, Chile -- wherever people can be induced to work for much less.
When the first President Bush, and later President Clinton, sought congressional support for negotiations with Canada and Mexico to lower tariffs and quotas with our neighbors, I did what I could to help as speaker of the House. I understood the deal to include specific agreements establishing definite labor standards for the production of goods being sold in the neighbor's marketplace.
In the spirit of the rising tide that lifts all ships, the result could have been lifting wages in Mexico rather than depressing them in the United States. Sadly, that was not to be.
Wages have not risen in Mexico. If anything, they've declined. Assembly-line people who build cars in Mexico surely can't buy them. And fewer American autoworkers can afford new ones.
Underpaid workers in Mexico and China, with which we negotiated a separate treaty, cannot afford American goods. We're now running big annual trade deficits with both countries.
Last May 26, CNN broadcast a special Memorial Day edition of "Lou Dobbs Moneyline" devoted exclusively to the exporting of American jobs to low-wage countries. The program featured specific examples:
UHoneywell laid off 374 workers in Rhode Island, transferring their work to facilities in Mexico and China.
UAlcoa invested $400 million in South America and $1.1 billion in Iceland while cutting jobs in Texas, New York and Washington.
UDelta Air Lines outsourced 600 reservations jobs from U.S. offices to India and the Philippines.
It isn't just low-skilled labor but high-tech jobs that are skittering away in search of the cheapest wages. According to the CNN reports, the American-based high-tech industry lost a total of 560,000 jobs in 2001 and 2002.
Figures are unavailable for 2003, but the pace of outsourcing accelerated greatly. Three U.S. firms -- Motorola, General Electric and Kodak -- have invested more than $6 billion in new facilities in China, whose government permits -- perhaps encourages -- wages at bare subsistence levels.
Neither Labor nor Commerce department statistics offer a cumulative count of U.S. jobs lost to the global outsourcing of cheap labor by American companies. But the practice is widespread and growing.
American firms already send $8 billion annually to India for labor services. One Indian city, Bangalore, boasts 100,000 high-tech workers, most employed by American companies. Throughout India, it is estimated that 1 million people work for U.S.-based firms.
Small wonder, considering the lack of any worldwide standards of fair wages, or any requirements at all in our most recent trade agreements.
Although we've long lamented the long hours and heartless plight of what we once called "coolie" labor, we now are subsidizing an only slightly upgraded form in high-tech wage destabilization.
X Jim Wright is a former speaker of the U.S. House of Representatives. Distributed by Knight Ridder/Tribune Information Services.