The March to Globalization

I started writing this using examples of past public/private partnerships that have built America, and it is a worthy topic within our historic march towards globalization, but it would have taken a book's worth of material in order to talk about something that ends up at the same place.

And that place is where we find ourselves right now.  The stages we have gone through from Manifest Destiny to the rise of the American middle wage earner, there have been all types of forces for and against the people, mostly on the against side.

But we have also had governmental recognition of corporate bad actors that resulted in an effort to contain these bad actors with what Republicans today would call extreme regulatory practices.

The problem is that some of the political players over the years have not had the people's best interest at heart, even after the people have voted for them.

Lawrence Lessig, a professor of Law at Harvard University, has often brought forward the idea that even I, coming to the conclusion myself, have written about here on my blog, which is the inequality of Wealth by offering the rich more access to the halls of Congress, and politicians have acquiesced to the designs of the rich over the desires of the people that elected them.

This represents a loss of the power of the people to address their government, although the government itself requires the votes of the people to have power at all.  It is the end of democracy as we have known it, so it is not surprising that we have a new set of values and a new set of concerns, each being the property of the respective influences.

For you see, there aren't enough rich people to elect even a local sheriff, much less a person of power that can benefit the rich, so their power has always been the cigar smoke filled back rooms that predominated during the maturation of our country.

Just the creation of the Federal Reserve was based upon a series of lies foisted upon the American public by touting this bill as an end to the "Money Trust" which had been vilified for a couple of years in print, but whom happened to be the people behind the development of the Federal Reserve.  Prior to the Fed's creation, most banks created their own printed script, but a bank run in Chicago would negate the value of the money in a man's pocket it Denver without recourse of recovery.  At the turn of the 20th Century we were in just a situation where banks were not honoring the script from other banks.

So the banking system needed to grow and become more consolidated, but it wasn't possible to buy all the banks to create a single source of easily carried printed money, so the Fed was born out of a secret meeting on a South Carolina Island in 1912, and passed into law in the 1913 Federal Reserve Act.

Now this creation didn't even pass the test of time, for by 1929, everyone knows just how well the Fed functioned.  Without specifics in terms of regulations and oversight, the same function of banks was overshadowed by the inability of federal oversight.  Wealth inequality was running rampant, the market was way over leveraged, and things went badly in spite of the creation of the Fed.

All the tools were not in place and the political will to maintain control over the growth of the economy took precedence over the necessity to maintain a certain level of growth equality.

And we were starting to see the growth of multi-national conglomerates which had divergent interests between the United States and some European countries, such a Germany.

Many American industrialists supported the Nazi regime in Germany, to the point where political support was provided by such as Henry Ford, and American banking became a substantial support mechanism by receiving deposits of questionable value by the Nazi regime in Averill, Brown Brothers Bank, managed by Prescott Bush, the father of George H. W. Bush and grandfather of George W. Bush.

Now understand me, I'm not making claims here that cannot be substantiated and in fact the United States congress brought charges against Averill, Brown Brothers Bank as dealing with enemy in 1942.

And the real point here is that in the development of this country, many of our most influential industrialists held views that were contrary to the concerns of the people of the country.  At the beginning of the War in Europe the United States was politically an isolationist environment, harkening back to the precepts of George Washington in terms of international entanglements.

But our banking systems did not involve themselves with such a brick wall limit with concerns as to whom they could deal with.

And the idea still holds today.  The concept of the banking industry as somehow being American corporations is simply not the circumstance.  In fact, almost all American corporations are no longer American corporations and this is where we start to see the divergence of the will of the people in terms of our electoral system, and the will of the corporations, whose ideology no longer fit within the same constraints as those of the American people.

Now it is obvious that almost all major corporations with their origins in the United States are no longer US concentric, but rather they have a world expanse that incorporates all of the laws and regulations of other countries within which they operate.  And this has been one of the methodologies used by the Republicans to suggest that corporations get a better deal overseas than they get here at home.

There are two problems with this supposition.  One is that multinational corporations no longer have real roots in any country, and if they get better deals overseas, then shouldn't the United States be applying for a greater scale of economies with its trading partners?

GE, as an example, has such a good bank of lawyers that they pay no tax in the US even when they make $5 Billion in profits, but they are able to shift those funds overseas to their lending arm, which has an even lower requirement on paying international taxes.  In Europe they lend money they earn in the US when they create consumer products.  And they get taxed less elsewhere in the world because their money is out on loan, regardless of the posted profits.

Last year GE had $14 Billion in profits overseas, $5 Billion profit here in the US, and they didn't pay any taxes, as I said, but in a new CBO report some of the 238 greatest grossing corporations operating in the US paid their fair share whilst others paid little or no taxes at all, but in the overall, the average was about 14%.

Where, might I ask, are the tax disadvantages to our corporations?  Yes, we could reform the tax code, but since one congress cannot place a burden on subsequent congresses, one has to assume that special dispensation for special interests will creep right back into the tax code over the next few years.

And even a smaller tax burden will not cause corporations to just hire people.  Anyone who did shouldn't be a position of power in a corporation.  Corporations' mandates have nothing to do with the well being of people.  It is to create the best return possible for the investors.

So what's the point in these corporations making demands on a cheaper tax structure when they don't even pay the rate in the first place?  Well, for one thing it is proof that they not only have no intention of hiring Americans, but it is also proof that they will continue to wrangle their special interest ways with congress in return for jobs Congress knows will not be forthcoming.

In other words it is just one more way to work the last bit of money the people have up the totem pole before the whole country goes bust.

And going bust may well be in the cards if we don't recognize the one basic fact in all of this.

Corporations are not job creators.  Investors are not job creators.  Even the government cannot be a long term job creator, although our infrastructure will take a good 20 years to get back in shape.

Real jobs are the result of creating a new environment for growth, either by the discovery of new resources, or the creation of new technologies.  But there is a drawback.

The rate of change in the world has become a phenomenon in and of itself.  It took thousands of years to go from a horse and cart to the locomotive, and only 50 to go from the locomotive to the car.  Air travel to the moon in less than 60 years.  From Einstein's E=MC2 to the atom bomb in 30 years.  The transistor to the CPU in 25.

In all the above cases old jobs were destroyed or transformed and new jobs were created.  The lorries that hauled freight became short haul jobs from railroad stations to local businesses, so the number of lorry drivers was not as great as it was before and the railroads did not replace these jobs with new ones.

In almost every situation where our technology has taken an up tick the net result has been an adjustment in both the number and requirements of available jobs.  Mostly jobs were eliminated.  As the jobs disappeared we have constantly had to come up with new jobs, almost always with some basic level of manual skills, but as the technology has advanced the manual jobs have fallen off and are essentially not even available today.  There virtually aren't any jobs today that haven't been cut by the addition of technology.

Even in something like sewer maintenance, today's jobs use little robots that go through the pipes relining them with a new layer of concrete.  What used to take an entire working team to expose the pipe and replace it is now down to a few individuals.

And this is why there won't be any new jobs coming down the road any time soon.  We have had our economic boost by the addition of computer and robotic technology over the past 15 years or so, and nothing has come along to replace the lost jobs because of an increase in productivity with less people requirements, and nothing new has come into focus yet.  Even something that would be new today doesn't mean that this "something" would drop right into place and help create jobs.  Even PCs didn't fit everywhere at once.

I was picked to create a company computer store at a large corporation where we were trying to stop desktop computers from coming in the back door.  That way we could maintain continuity in data file formats and set standards, rather than one person working on an Apple ][C and VisiCalc in one office and an IBM PC with Lotus 1-2-3 in another.

But now computers are ubiquitous and even the janitor of a company has one.  And there are fewer people doing the jobs.

By the way, that company did such a good job of incorporating computers onto the desktop in the early 80s that a brand-new $240 Million building was no longer necessary by the time it got finished being built.  The computer store killed jobs.  It was supposed to facilitate recruitment and retention since we had 0% interest loans for the purchases.  So not only did it kill jobs, but the people let go owed money to the corporation that had to be paid off in cash or check.

So I don't know how congressional Republicans can talk about helping job creators when there are no changes in the level of work, the tools to do the job, and the new technology which will help put people into jobs?

Well, there are only two avenues right now that might be able to create jobs, but this is somewhat problematic in and of itself.

We absolutely need to repair our failing infrastructure, which is undoubtedly a 20 year $2 Trillion project, and that will put a lot of people to work.

But it won't be the 50-year-old out of work right now, because they aren't going to be the ones out there grunting to build concrete forms and install re-bar.  They might be the ones driving the pavers or the bulldozers, etc., but the jobs are limited to the young for the most part.

Unless you're an engineer, and if you are, you have a job.

The other avenue requires a complete change in mindset for these same 50-year-olds out of work, and it is called retraining.

You're going to have to go back to school and study subjects you probably can't even fathom right now.  All the jobs that are currently available, and there are about 7 million of them, require skill levels you don't have and cannot get without going back to school.

In this sense, you are in the right place at the right time.  You can earn your way back into the workplace by getting the training in application specific highly skilled jobs, or you can learn how to create the environments that these application specific highly skilled jobs work within.

The problem is that I can't think of anyone who has worked 30 years in one environment who will actually want to learn a new high tech skill in the classroom.  It requires attendance, which throws off your daily life, it requires hours of study and you don't have the proper habits, and you haven't been in that environment for 30 years or more where the kids outnumber you and may well seem smarter than you.

But you have the time.  The only thing you don't have is money, and it costs money for training.

However there are some avenues available to you for acquiring new knowledge and skill sets.

Although I'm certain that Saul Khan had this in mind when he created www.KhanAcademy.org, the fact is that he has some two thousand videos of educational training he originally designed to help his cousin with learning subjects she didn't understand.  It is comprehensive and can be a good tool for you to get back into the mode of learning new things or brushing up on knowledge you haven't used in a while.

About the only other thing that I can see which might tide you over until this scarcity of jobs has a new driver in it to somehow apply your particular set of skills as your job.

For instance, say you have woodworking skills and the equipment to do woodworking.  You can approach cabinet companies or others where your skills could be applied, but you wouldn't be an employee.  You'd be a contractor, perhaps taking some of the workload off a company who needs skilled labor but cannot afford to take on the tax burden at the moment.  There is always a little wiggle room when companies take on certain types of jobs, and rather than these companies paying overtime they would be more than willing to contract out a specific portion of a job.  And we're not just talking about woodworking, but welding or any number of other skill sets.  Nobody says you have to work for someone else, but nothing says you cannot sell your skill set to those who might need it.

If you know how to fix computers you don't have to work for some computer store, but you can make arrangements that allow you to accomplish the job under your own business.

These are the times that entrepreneurs are born.  We have become such a job based society that we no longer see ourselves as important unless we have a job.  But we have skills.  We have a lifetime of knowledge.  They can't take that away from you, and if you can imagine how to apply those things, you can earn an income.

Yeah, take the time to look for a job if that is what you need to do.  But place yourself into a new environment of trying to promote yourself for your current skill set, find the people that can help you and whom you can help, and you've got the beginnings of a business that isn't based on what someone else wants, but filling a space that someone else needs.  That is all a job is in the first place.  The difference is that you are the boss.

You know you can do it.  You have the cell phone and instant communications, you have the computer (undoubtedly), but if you don't, the library does, or the internet cafe down the street does.

Try to figure out how to negate all the negatives you think you are facing right now.  You can't depend on anyone else but yourself.  You can't afford to sit and wait for jobs to be created because jobs won't be created so that you can have work.  You need to create that job for yourself.

And that is the new economy.  There is nothing coming down the line that will create 14 million jobs except for the 14 million people needing work.  For you see, we all do work.  We all know how to do it.

Not to be nasty, but you're not worthless because you don't have a job.  You are worth less if you let the opportunity pass you by to use your skills in helping you obtain your dreams.  Just because your skills don't match the job description of an open position doesn't mean that they don't have worth.

Comments

[Bill Perkins]

I like your last dozen or so paragraphs about what people might be able to do to help them to survive this economic cycle.

I have an in-law who has taught welding classes in a high school vo-tech program for 25 years. We've spent many hours discussing the push for everyone to go to college resulting in few skilled machinists, welders, mechanics to take those jobs that are available. He has about a 98% employment rate for anyone successfully completing his two-year part time program, even in this economy.

Seems to me the reason the wealthy and businesses spend so much money trying to influence politicians is because the government is so pervasively involved in every aspect of business and our personal lives. Much of lobbying is actually defensive in nature, trying to educate politicians of the often dire impact of apparently populist policy. We need to stop government subsidies of businesses, so-called crony capitalism, and reform taxes so that it is fair and simple across the board for everyone. That's an idealistic thought, particularly in light of current political stalemate, but it seems to me to be the only thing that can save this country from stagnation and collapse.

I don't disagree that progress, as we generally define it in the Western world, often comes in the form of automation, resulting in fewer jobs. Also, we have experienced a cultural trade-off for the last 40 years plus of exchanging a higher standard of living for the middle class that has made us less competitive internationally resulting in manufacturing jobs departing for many labor intensive operations. But what are the alternatives? We can't go back to family farms and barter. There are too many folks for such inefficient production.

I think we supposedly reached our 7 billionth world citizen recently--pretty remarkable given the past predictions of dire consequences of population numbers billions smaller. There is remarkable opportunity for those who are smart and agile enough to compete for the demands of emerging middle classes the world over. We need an agile, lean, competitive government focused on what it should be doing to promote agile, lean business who can employ our people and maintain, no improve, our standard of living.

[Roger W. Norman]

As always, you can I disagree.

I really didn't want to talk about the loss of jobs that won't be coming back, but I've always suggested that learning new skills was a simple necessity of life.

However, if we get into the governmental aspect of this, the movement from public/private partnerships to large scale lobbies working only to garner a particular company or a specific industry dispensation over and above what others would receive seems to me a manipulation of the system.

The 20 thousand pages of tax code isn't due to government placing restrictions on business, but rather lobbyist writing new laws that simply go through the motions via "friends" in congress and they add up to the inequality of wealth I have talked about a number of times.

But what I wanted people to recognize is that they need not simply sit down and wait, because there is not one entity out there that is willing to help. There is no demand, thus no jobs. All the jobs today are getting the job done. Without jobs people only have the ability to take their adversity to the extreme and create their own help.

And I've never said different. In fact, I've written about doing things on the community level that allows a "lower level" economy to flourish and grow, and even to the point that might include micro lending or other avenues of funding. But the point has always been to say "there are no more jobs" and one has to take their own well being upon themselves.

How we got here you and I may disagree with, but facts are facts, and the tally is in.

I'd rather see unemployment insurance continue, but I'd like to see that include some national program which includes training and job sharing rather than just having Republicans claiming that out of work people are lazy. That is not productive. If our elected leaders are being negative about the people they have helped leave behind, then who has hope?

We have forgotten many things about being American in the past thirty years as we've been told lies that only help those in power in the near term. Show me someone with long term hope for Americans and I'll show you someone that knows where we came from and how we got here.

Not pointing fingers, but real knowledge of the situation.

Farmers don't have the time to pay attention to all the goings one. I do. So I write what I see going on and try to express it so that if a person only has the time to read my writings, then they'll get some sense of what has been going on.

I spent 3 days trying to write Marching to Globalization, and really I haven't finished yet, so there may be a number of ancillary articles.

But the slap in the face is that anyone suggesting they can create jobs is ignorant that Americans simply have no new jobs to do. But they can use their skills and they can increase their skill level and they now have the time. Ten years from now is way too late to start.

Roger

[Roger W. Norman]

Geez, can't even edit my own comments.

You sneaked one by me Bill.

"Also, we have experienced a cultural trade-off for the last 40 years plus of exchanging a higher standard of living for the middle class that has made us less competitive internationally resulting in manufacturing jobs departing for many labor intensive operations."

Well, as always, I call you on this. The facts are different than you represent. For at least 30 years the middle wage earners have been under assault with stagnating wages and added costs, and I'm sorry but there's not much documentation that suggests different.

I offer the "now legal" marketing of criminal shyster-ism. Pay day loans. Now Capitalism assumes that one knows what they are signing when they sign the dotted line, but the facts are that we have way too many uneducated people to allow the willful manipulation of people unable to read a 20 page legal document.

As Tom Waits said, the large print giveth what the small print taketh away.

So should government step in and create an environment where the people won't be prayed upon, or do you believe that evolution works between one generation and the other?

If the people aren't educated, they are marks for the educated, and the educated have all the power of the law, whilst the immediate NEED of the people places them at a disadvantage.

The difference is in the way the legal paper is written. Back in the early days of credit cards, the legal paper was a legal page, both sides. Today your bill has more paper, and the form you sign can be a postcard. Without knowing the terms, because the information suggests the terms are limited by the application you fill out.

This is a specifically designed system to leave you uninformed and liable for charges they wish to apply.

Then only last week Bank of America decided not to charge $5 per debit card per month, with they exception of their big clients. Again, shifting revenues to the least likely to be able to afford it and giving others a pass.

The overdraft protection option itself has been shown to be a rip-off specifically tied to small depositors with manipulation of purchases so that larger withdrawals might overdraft their account with $30 charges, when if the timeline were followed there would be no overcharge at all.

No, we are not weaker because of a strong American middle wage earner, but we are weaker because we no longer have one.

Roger

[excel development]

Globalization does affect the number of day work week. Foreign companies might prefer 10-hour,6-day work week. They also pay over time. This has changed the old pattern of 8-hour 5 -day work week in the host countries completely. Workers love to work long to add their income. The companies love to let them work long, because part-time workers will not match with skills and efficiency.