American jobs, recently even white-collar jobs, have been, and are now being, transferred to low-wage workers in other countries.
Since 2000, the U.S. has lost 5.5 million manufacturing jobs, with 2.1 million of those jobs being lost in the last two years alone. Since 2001, over 42,400 factories have closed in the U.S., and another 90,000 are considered to be at severe risk of closing. The last time so few people were employed in manufacturing was in 1941, before World War II spending pulled that sector out of its Great Depression slump.
As a result of the loss of all these outsourced jobs, poverty in America is going to keep getting worse if they cannot be brought back, and ever more American children are as a result going to be raised in poverty and violence, with ever more hellish societal and personal consequences.
But Germans don’t
The Germans still slap import taxes on stuff that their companies might be tempted to manufacture abroad, and by this means and others, the German government protects German jobs and incomes. As a result, last quarter saw more German GDP growth than at anytime since the reunification of the country. Plus, their unemployment rate during the recent recession was never anywhere near as high as ours in America.
The German government subsidized worker salaries after it asked employers to cut their hours down to 30 or even 20 a week (rather than terminate any of them) if there wasn’t enough work to keep all of them busy full time. This enabled all workers to keep on spending just as they had been, and so a German recession was for the most part, by this two means, avoided. In short, high-wage countries like Germany figured out a way to compete with China and Mexico.
The proof of this: In 2008, Germany ran a $267-billion trade surplus, while the United States ran a $568-billion trade deficit.
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