Efficiency, The Death Of Us
I used to think an open global economy was not such a bad idea – cheaper goods, and people who had fewer work opportunities, at least had work. And workers’ rights issues would work themselves out, hopefully. Anyway that’s one way of rationalizing freedom in the marketplace.
What took a long time for me to understand was how paying less meant I would have less to spend, and ultimately would have fewer job possibilities to choose from.
The problem of any country’s job loss to another country is not one of nationalism – the argument of workers unions in the U.S. – buy American, help keep jobs in the U.S.. The issue is much bigger than that. Actually this view misses the point altogether.
Life used to be so simple. As someone who wants to make more profit in business, all one had to do was increase sales by lowering price (make a smaller unit price, but sell greater quantities), reduce manufacturing cost through centralized production and lower wages. As a consumer faced with similar products, one priced lower, buy the cheaper one. In some circles this is called, win-win: employers make greater profits, improving business stability; consumers save money and/or can afford to make more purchases.
But where does the money to make these purchases come from? It’s no secret, it comes from your and everyone’s income. And it’s no secret where manufacturing jobs have gone – the thing is, squeezing the system to make a buck does not just revolve around manufacturing, anymore than B. Madoff is the only (or last) con man. Centralization, corporatization, consolidation – as usual, those with the money and specialized skills to move and manipulate a system, any system, will do so in order to maximize control and profit.
To some extent, a job category that has managed to escape notice in this merry-go-round chase for dominance are local trades and services, like plumbers, electricians, computer repair, and dog grooming. But long gone are the bakers, butchers, tailors, and milkman – and a long list of jobs that someone somewhere has figured out a way to maximize for profit.
The industrial revolution introduced lots of machines to the workplace, for the wage earner, it’s been downhill ever since. Machines, electronics, and websites, are tools, combined with the perfectly natural tendency for humans to do things with greater efficiency has meant that we will build ourselves out of the jobs we need to subsist.
Going from a lesser to a greater efficiency of scale enabled McDonald’s, and killed the “mom and pop” owned diners. It enabled U.S. consumers to scale back inflation by buying goods made in China, and killed jobs and a living wage in manufacturing.
Economic globalization has placed inappropriate technology in the hands of those who do not relate to it and cannot maintain it, has created a world market for products beyond the capacity of world resources, lowers wages for locally employed by moving job functions to other countries.
We’ve been bought and sold, and to go back means giving up many of the toys we so eagerly traded for the work we used to perform.
Here’s another way to put it.
1. The incentive for globalization of manufacturing and finance, was/is to enable greater efficiencies and profit through scale of production and the use of cheaper human and material resources.
2. What was sacrificed were small, independently owned, locally managed businesses, from grocery stores to hardware stores and diners.
3. Some results of this transition were lower prices of material goods, lower wages or the replacement of owners with managers, and the flow of capital rerouted from towns and villages, to financial centers and stockholders.
Globalization resulted in lower prices of goods, at the same time decreasing the number of jobs due to automation, and lowering wages due to the use of foreign labor and the elimination of locally owned business owners.
Another result is a self perpetuating system of cheaper goods, purchased with lower wages, encouraging greater efficiencies to keep up with a decreasing ability to buy, resulting in lower wages due to shrinking profit margins, and so on.
And a result of this is more efficient centralized resource management – and decreased resilience of local communities and their economies. To go back is painful.
