Valuing Our Markets
A Way to Reduce Job Loss from Globalization
by Robert Winter
SYNOPSIS: Like cropland or timber, a market is a resource that can be depleted--and may be capable of being replenished.
Business and economics may be becoming increasingly globalized, but does this need to put American workers in a common and interchangeable labor pool with those of emerging countries? Have we no choice but to unquestioningly accept declines in American wages until they match those of the poorest comparably skilled societies?
If were looking for an alternative, maybe theres something else to learn from an emerging economy. Maybe we should reconsider what China is doing.
China knows it has something of value in the simple existence of its billion-person market. And China doesnt give just anybody entry into this enormous opportunity. It negotiates for something of value in return.
Of course, the American market is not so huge in terms of raw numbers as Chinas. But ours is substantially more affluent. Everybody in the world knows this, and everybody in the world consequently wants to sell here. Why couldnt we ask for something in return, also?
I realize that even raising such a question constitutes major heresy. How can any contemporary American advocate anything other than free trade? Doesnt everybody in the U.S. (as well as everybody who wants to trade with the U.S.) unswervingly propound the Adam Smith-style view that the more open the trade, the better off everyone is?
Well, a lot of people certainly do continue to share that belief. And its hard to argue with the notion that when everybody sticks to producing what theyre best and most efficient at producing, theres more good stuff for everybody. Ive even seen the point demonstrated mathematically.
But there seem to be times when this kind of reasoning can be overdone, owing largely to differences between the circumstances in which Adam Smith wrote and the conditions that prevail today.
(c) COPYRIGHT 1998 ROBERT WINTER. ALL RIGHTS RESERVED.
When partners are too unequal, trade can be highly destructive--even of markets.
A healthy employment base is the foundation of a healthy market.
As an incentive to replenish markets, a company might earn (and trade) the right to sell to a market where it is an employer.