Friedman of the NYT Imagines America and Stumbles into Reality [for a brief while]
Abstract: Thomas L. Friedman of the New York makes some rare sense in one of his recent op-eds. This too shall pass.
To begin:
We are mostly annoyed by the political essays slickly embedded in sausage-machine grade propaganda pieces that are proffered to be authentic [or at least sincere] but which seem to magically blend in with most all the previous erstwhile rants published in the Walter Duranty Papers[1][2]—aka [the near-bankrupt] New York Times. Most of the time the scribbling that appear on the OPINION section is a hash of unfettered rants that create trash and unreasonable rubble upon the sidewalks of NY C. The notion that the Times is ‘fair’ or objective is pushed to the outer limits of ridiculousness by crafting frequent, careful fabrications of highly effective propaganda pieces[3][4][5][6][7] and other blends of sheer nonsense. In rare times, they make some very good points. Most of this is sausage-machine drivel and rusty boilerplate.
How to best read my blogs:
[I offer extensive quotes in this blog so that the reader can view the exact language and can be confident that nothing was taken out of context or that nobody was misquoted. The easiest way to take in the salient points is to read the emphatic points in the quotes and then peruse my comments. Comments on my comments are always welcome: ryckki@gmail.com.]
Consider Thomas L. Friedman’s piece of Oct 11, 2011:
“After spending last week talking with Hong Kong entrepreneurs about a bill, just passed by the U.S. Senate, to clear the way for tariffs on Chinese exports to America if China doesn’t revalue its currency, there are three things I have to say. One, I really hope the people pushing this bill do not give up. Two, I really hope the people pushing this bill do not succeed. And, three, I really hope no one thinks this legislation will make any sustainable dent in our unemployment problem, which requires much more radical rethinking.”[8]--- Imagined in America By THOMAS L. FRIEDMAN OP-ED COLUMNIST Published: October 18, 2011
There is much information here and the apparent contradictory comments are surprising valid at this time. Tariffs do contribute to trade wars although the US gets stuck with direct and indirect tariffs all the time as in the Mexican Case and elsewhere. In the Great Depression, such tariffs the Smoot–Hawley Tariff Act of 1930[9] put up high tariffs on some imported 20,000 trade items and started a trade war that cut our exports in half. The unemployment rate then went from 9% to the mid-twenties by the third year after this blunder.
This was a complex era and we cannot put full blame on this Act for all of it. Today, many countries employ such protection factors in direct and mostly indirect ways. Japanese car imports, for example in the 60s and 70s, were required to undergo a close inspection of the paint and no American car could meet the specifications so each car had to be repainted. France pulled a similar stunt when VHS tape players were first introduced by requiring that ALL such products be ‘inspected’ in some tiny postal location in an obscure town in Central France with only a handful of people to process thousands. These were tariffs by bottleneck.
He elaborates:
“I support this legislation in theory because China needs a wake-up call.” --- Imagined in America By THOMAS L. FRIEDMAN
“China is spending tons of money manipulating its currency downward and, in the process, creating domestic inflation and a real estate bubble, which is weakening its competiveness.” --- Imagined in America By THOMAS L. FRIEDMAN
“But, Lord in heaven, do not let the House pass this bill. That would trigger a trade war in the middle of our Great Recession” --- Imagined in America By THOMAS L. FRIEDMAN
These reasons are all reasonable, but the Big Whammy comes in the next comment:
“We are never going to get those labor-intensive assembly jobs back from China — the wage differentials are far too great, no matter how much China revalues its currency. We need to focus on multiplying more people at the high-value ideation and orchestration end of the supply chain, and in the manufacturing processes where one person can be highly productive, and well paid, by operating multiple machines. We need to focus on “Imagined in America” and “Orchestrated From America” and “Made in America by a smart worker using a phalanx of smarter robots.”--- Imagined in America By THOMAS L. FRIEDMAN
Somebody at the NYT finally comes leaping off the stogy notion that greedy corporations deliberately pushed jobs to Asia in some kind of reflexive fit of greed and insouciance and now revel in the misery of the high American unemployment rate. They refuse to understand capitalism. [10]
Labor costs control prices ultimately:
Given some widget to be made where the global price is firmly fixed by markets while the cost of materials and as such are very close in total production costs, which is the case now in the world, the labor costs tend to dominate and fix the physical location of production of many products. Competition thus tends to force profits to zero [or negative] for a given labor cost level for production of a given widget at a fixed price. The sale price of any item that requires one hour of labor and might be constructed anywhere in various parts of the world with differential costs of say $35/hr [US] or $12/hr in Japan or $7/hr in India or $4 in Viet Nam or even $2 in Indonesia or Africa is clearly controlled by such costs. Thus, there is a sliding scale whereby low labor costs become the only dominating profit vector. This effect forces nations with high labor costs to make things that are either very expensive or have little labor input. Items and services that they cannot make pass to mostly emerging nations and they are stacked up in proportion to how low their labor and costs turn out. Once labor costs dominate a product then those jobs pass away never to return. When the labor costs become competitive then secondary costs[11] like energy[12] [13]or taxes or regulations tend to dominate. He avoids his usual comments on how Washington is trying to crush our domestic oil business.[14][15]
Strange:
“But we also need to stop thinking that a middle class can be sustained only by factory jobs. Thirty years ago, Hong Kong was a manufacturing center. Now its economy is 97 percent services. It has adjusted so well that this year the Hong Kong government is giving a bonus of $775 to each of its residents. One reason is that Hong Kong has transformed itself into a huge tourist center that last year received 36 million visitors — 23 million from China.” --- Imagined in America
I was in Hong Kong in 1966-1968 several times and noted how efficient workers were. They could fabricate numerous items in small shops and create excellent food on the sidewalks or in auto parking places that were cleared out after a fix time in the afternoon. They were willing to wrap themselves in rags and descend into our ship’s fuel bunkers to scrub out the insoluble remains of oil.
Off onto the blue now:
“Another idea officials here offer is that the United States invites Chinese firms to invest in toll bridges, toll roads, and rail systems across the United States, in partnership with American companies. They could build them, and operate them for a set number of years, until their investment pays out, and then transfer them to full U.S. ownership. It may be the only way we can rebuild our infrastructure.” --- Imagined in America
Friedman wanders off into the wilderness on this one. Why should China build mundane structures and roads here or in London or Paris when they have the same ideas in mind to expand their own country and give employment to a mere 500 million or more people?
The author winds up with this summary:
“Yes, China manipulates its currency and market access. But the reason we are so vulnerable is that we have no leverage. We don’t save; we overconsume; we don’t plan; and we have not invested enough in infrastructure and education. Dealing with a superpower like China without leverage? Let me know how that works out for you.” --- Imagined in America
Our hero then addresses structural defects in our society and economic system but glosses over some defects by calling for more of the same. Investing in infrastructure[16] is essential where we have poor roads or bridges that need repair and maintenance. I think Friedman extends this too far to insist that we add in light rail and other follies just for the sake of ‘creating jobs’ and to encourage people not to buy cars. Most infrastructure projects are government funded and union[17] mandated workers by law. He carefully avoids the solar panel mess[18] and how it wrecked Spain’s economy.[19] He avoids the phony Carbon Tax Follies[20] or the phony Bloom fuel cells.[21] He ignores the frightful mess that EU is in with their mindless spending. [22]
He misses an opportunity to examine ‘education’[23][24] in the US in terms of matching people ultimately with jobs. He neglects to mention that half the US high school students never graduate and also half the college students. There is some myth in liberalism that states, in effect: you can choose any career you wish and expect to get a job in that area when you graduate. The difficulty with this is obvious with the number of unemployed history majors, biologists and other fields. He is silent on the failure of GM. [25][26] He carefully avoids the Global Warming Follies as well. [27]
Friedman is making some progress in realizing that the progressive view of how to run a society has failed.
rycK
Comments to: ryckki@gmail.com
[1] The Babbling Brooks of the
[2] In honor of that celebrated Communist stooge and liar and winner of the Pulitzer Prize for the
“He said that these people had to be "liquidated or melted in the hot fire of exile and labor into the proletarian mass". Duranty claimed that the Siberian labor camps were a means of giving individuals a chance to rejoin Soviet society but also said that for those who could not accept the system, "the final fate of such enemies is death." Duranty, though describing the system as cruel, says he has "no brief for or against it, nor any purpose save to try to tell the truth". He ends the article with the claim that the brutal collectivization campaign which led to the famine was motivated by the "hope or promise of a subsequent raising up" of Asian-minded masses in the Soviet Union which only history could judge.” http://en.wikipedia.org/wiki/Walter_Duranty
[3] Krugman Applies Protosimian Logic to Health Care. Big Government and Higher Taxes! Of Course!
[4] Propaganda Gem: Krugman Distorts History as He Grubs for More Taxes.
[5] Propaganda Alert: The New York Times Axes the Right Questions and then Answers Them with the Left Answers.
[6] Political Lessons from the Fairy Tales by the New York Times: Propaganda at Work.
[7] Propaganda Lesson: Economics and Recessions from The NYT: A Long [Sad] Story and Stern Tutorial on Tax Cuts.
http://rycksrationalizations.townhall.com/g/2bea69e5-bb30-4923-9ed4-192199970c1a
[8] Imagined in America By THOMAS L. FRIEDMAN OP-ED COLUMNIST Published: October 18, 2011 http://www.nytimes.com/2011/10/19/opinion/imagined-in-america.html?_r=2&ref=opinion
[10] The Pyramidal Theory of Capitalism Explained in Simple Terms.http://rycksrationalizations.blogtownhall.com/2010/01/07/the_pyramidal_theory_of_capitalism_explained_in_simple_terms.thtml
[11] Obozo Will [Willingly] Bankrupt the Coal Industry. We are Selfish if we Don’t Beg for Higher Taxes!
[12] Krugman Foams in Agony as the Phony Leftist Energy Plan is Exposed as Evil and Ignorant
[13] The Leftists Bawl for Grain-Based Fuels and the Prices Rise and they Bawl About the Prices.
[14] The Economy is in Danger and Obama Wants to Hike Taxes and Squelch Oil Drilling.
[15] Krugman of the NYT Condones, Predicts and Celebrates High Gas Prices.
[17] Herbert Moans about Hope Amidst the Gloom of Unionism. There is Not Enough Corruption.
[18] The Bloom May Be Off the Bloom Box Fuel Cell because the Politicians Cluster Around. A Farce in the Making? II: Update
The Bloom May Be Off the Bloom Box Fuel Cell because the Politicians Cluster Around. A Farce in the Making?
[19] Spain’s Solar Energy Bubble Bursts. California is Next. The First of a Series of GanGreen Asset Bubbles Bursting.
[20] England Votes 648:5 to Ruin Their Economy! A Lesson for California for Greatness
[21] The Bloom May Be Off the Bloom Box Fuel Cell because the Politicians Cluster Around. A Farce in the Making? II: Update
The Bloom May Be Off the Bloom Box Fuel Cell because the Politicians Cluster Around. A Farce in the Making?
[22] The British Left Now Hail the Expert Advice of Keynesian Economists: Spend More and More. New Political Support for California’s Spending Revealed.
[23] The Babbling Brooks of the
[24] Herbert Races for the Bottom as He Salutes Unionism and Apologizes for Educational Failure.
[25] A Translation of the Bailout Plan for Detroit: Bigger Government, Bigger Unions and Cars Designed by EcoNazis http://rycksrationalizations.blogtownhall.com/2008/11/16/a_translation_of_the_bailout_plan_for_detroit_bigger_government,_bigger_unions_and_cars_designed_by_econazis.thtml
[26] The NYT’s Friedman’s Flat Propagandistic Thinking on Auto Bailouts: Ignore Unions and Blame Management.
[27] Friedman of the
No comments:
Post a Comment