To the Editor:
If you are sick and tired of high taxes, deficit spending and a lousy job market — blame the U.S. trade policy!
Over the last 30 years, corporate America has outsourced most of its industrial and manufacturing operations, the bulk of it going to China.
The Chinese produce most of what we now consume — just check your labels. Low labor costs, a highly structured workforce, fewer regulations, government assistance, and most importantly, a currency (the ‘yen’) that is deliberately undervalued by 30 to 40 percent (according to most economists), makes China a very attractive place to produce goods.
Many economists now recognize that corporate America and Wall Street are increasingly disconnected from Main Street, U.S.A., because quality manufacturing jobs as well as portable service sector positions are increasingly outsourced to China and other distant lands. Wall Street rewards corporations that take advantage of lower input costs — as indeed they should — and this is clearly reflected in the last stock market upswing which was prompted by recently released positive quarterly corporate earning reports.
There can be no American economic recovery timely and meaningful to Main Street without the recovery of those high quality jobs related both directly and indirectly by the manufacturing sector. Until we produce more of what we consume, taxation levels on the shrinking American business base will continue to rise, while at the same time total tax revenues will continue to fall in response to widespread outsourcing activity which contracts the pool of enterprises generating taxable revenue on U.S. soil.
In the U.S., record deficit spending brought on by wars in Afghanistan and Iraq, monumental corporate bailouts triggered by unsound lending practices and speculative high risk financial instruments, the escalating cost of estimates associated with national healthcare, and the mounting costs of social programs in general have given rise to the Tea Party movement with its sink or swim social and economic Darwinistic philosophy.
Libertarian observations and slogans often register as eminently sensible and praiseworthy, but as a master blueprint for reviving a weakened American economy, this ideology serves to accelerate our decline.
Should America duplicate China’s dollars-per-day wage rates and retreat to much lower standards for health, safety and environmental protection as the “Tea Party” doctrine dictates?
For now, Americans will not work in sweatshop environments or live and work in under-regulated toxic industrial settings akin to those in China. It is precisely our commitment to individual liberty which currently makes emulation of China incomprehensible.
The answer to our very serious economic predicament is not sidelining the U.S. government with one-sided U.S. market deregulation as the Tea Party espouses. Instead, this nation requires precisely targeted government intervention into this unbalanced trade arrangement in order to establish a level playing field for healthy, legitimate competition.
Like China, we also need a selfserving trade policy. We should begin to establish preferential trade arrangements with other democratic nations founded on individual liberty. Within a coordinated trading block, the U.S. should strive for a uniform, escalating tariff schedule placed on all Chinese imports that gradually increases to the full extent of the yen under-valuation.
This would send a clear and workable market signal to global corporations upon which they could base future production costs and adapt accordingly.
As economic factors stand today, America and our fellow European democracies are at a competitive disadvantage artifi- cially imposed by our authoritarian Chinese trading partner, which is truly proving to be economically fatal. Artificially cheap Chinese produced consumer goods come at a tremendously high price — the dismantling of our engine of wealth and revenue which is the productive American middle class.
A healthy middle class requires a robust and attractive domestic job market. The middle class is the greatest internal mechanism of wealth, creation, and circulation. The middle class is also the predominant source of government revenue.
Our government is fundamentally obligated to establish and maintain a framework for economic activity that enables the American middle class to legitimately compete within a setting that values productivity as well as liberty. If the middle class is simply allowed to wither, expect your economy and then your government-protected liberty to follow.
The bottom line is that liberty has a very real economic price. A liberated work force is more expensive than a semi-indentured labor pool. A culture constructed around individual rights and freedoms has higher built-in overhead costs than an authoritarian-driven command economy.
Liberty simply loses if all calculations are strictly dollar-denominated. Corporations are dollar driven by design. Only the federal government can step in and change all corporate cost calculations with tariff s and other economic policies designed to protect the American middle class.
Further deregulating U.S. markets play directly into China’s hand. It also nicely satisfied certain financially powerful segments of American society, which have benefited greatly from the current lopsided trading arrangement with China.
Radical Tea Party economics of complete market deregulation will only hasten our demise. The American middle class has interests which are quite distinct from either the interests of the super wealthy or the underclass.
The super-wealthy prefer deregulation, while the underclass desire free services and social programs. There is currently no party on the political landscape devoted to the long run economic interests of the American middle class.
JAMES LEWIS Whitesburg