On Tue, 18 Nov 2003 19:42:19 -0800, "Harold & Susan Vordos"
wrote:

I'm having a bit of a struggle coming to terms with your statement above.
Isn't that exactly what I've been saying right along? What I've proposed
is folks coming to terms with their inflated incomes and settling for pay in
keeping with its value. That, in turn, keeps them on the job, albeit at a
lower income, because the savings to the corporation that may have been
realized by jumping to China, for example, no longer exists. We keep jobs
home, inflation is not a problem (not out of control), and perhaps prices at
the store even decline to some degree. Not many of us prefer no money
as opposed to less money. I think rational people would accept a pay cut
instead of a pink slip.

Nice idea, but in this current culture..it will never work.

"How Dare you say that my contribution is worth less than that person
over there! I work 8 hours a day, very hard, filing these papers. She
only works 4-6 hours a day, and comes in when she wants to. Just because
she is an outside sales person, doenst mean that her contribution is any
more important than mine!! If these papers dont get filed in the correct
order, the business would simply fall apart.

If you think that you are going to harm my self esteem like that, its
workplace harrasment and Im going to consult a lawyer and sue your ass
off! Its not FAIR that she gets paid more than I do!! Why should SHE
get a commission? Its not FAIR!!! "

(snip a long diatribe about the MTV generation and value systems)

Gunner

Antiquis temporibus, nati tibi similes in rupibus
ventosissimis exponebantur ad necem.

In article , Gunner says...

On Tue, 18 Nov 2003 19:42:19 -0800, "Harold & Susan Vordos"
wrote:

I'm having a bit of a struggle coming to terms with your statement above.
Isn't that exactly what I've been saying right along? What I've proposed
is folks coming to terms with their inflated incomes and settling for pay in
keeping with its value. That, in turn, keeps them on the job, albeit at a
lower income, because the savings to the corporation that may have been
realized by jumping to China, for example, no longer exists. We keep jobs
home, inflation is not a problem (not out of control), and perhaps prices at
the store even decline to some degree. Not many of us prefer no money
as opposed to less money. I think rational people would accept a pay cut
instead of a pink slip.

Nice idea, but in this current culture..it will never work.

"How Dare you say that my contribution is worth less than that person
over there! I work 8 hours a day, very hard, filing these papers. She
only works 4-6 hours a day, and comes in when she wants to. Just because
she is an outside sales person, doenst mean that her contribution is any
more important than mine!! If these papers dont get filed in the correct
order, the business would simply fall apart.

If you think that you are going to harm my self esteem like that, its
workplace harrasment and Im going to consult a lawyer and sue your ass
off! Its not FAIR that she gets paid more than I do!! Why should SHE
get a commission? Its not FAIR!!! "

I think this might work in a couple of instances but by
an large we're all employees at will, so they just do the
layoff.

I think the other problem is, at some point the person is
going to say, hey, if you're gonna pay me X much less, then
it's not worth my while to work. So they quit. OK, but
was that person doing an important job, that needed to
be done? Because if not, then you have to hire that person
for the Y - X that you were going to pay the person who
quit.

And they had better have all the skills, too, or you
might wind up replacing the disgruntled departure with
*two* new hires!

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

In article , Harold & Susan Vordos says...

In other words, laid-off folks don't buy much of anything.

Jim

I'm having a bit of a struggle coming to terms with your statement above.
Isn't that exactly what I've been saying right along? What I've proposed
is folks coming to terms with their inflated incomes and settling for pay in
keeping with its value.

Ah, "value."

I think we're talking about the same thing, but you are
approaching it from the ground up, saying that workers
should take voluntary pay cuts.

I'm approaching it from the top down - saying that
if companies move all their operations overseas, and
fire all the US workers, the *market* for their
goods and services (those same individuals who
used to work for the US companies) will basically
dry up.

At your end you see wages being depressed, because
of the glut of unemployed workes. At my end, I see
prices being depressed, because nobody want to by
the cheap stuff the companies try to import.

Kinda looks like deflation, and depression to me.

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

On 19 Nov 2003 11:37:57 -0800, the renowned jim rozen
wrote:

At your end you see wages being depressed, because
of the glut of unemployed workes. At my end, I see
prices being depressed, because nobody want to by
the cheap stuff the companies try to import.

Kinda looks like deflation, and depression to me.

Didn't the last one start with a trade war too?

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog Info for designers: http://www.speff.com

Yes, and ended with a big war, WW2
Didn't the last one start with a trade war too?

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers:
http://www.trexon.com
Embedded software/hardware/analog Info for designers:
http://www.speff.com

"jim rozen" wrote in message
...
In article , Harold & Susan Vordos says...

... I refuse to toss over $400/year for tv
programming, then be subjected to commercials endlessly. What little tv
we
watch, aside from news, is generally recorded and then watched at a more
convenient time, bypassing all the advertising. I don't give a damn
that
advertising pays the tab, if I have to choose between watching those
lame,
insulting, head banging commercials and not watching tv, I'll take the
silence and some good jazz on the stereo in its place anytime.

We have a TV, but no live feed into the house. So we
can watch recorded stuff that we choose. This works
out pretty well, we do a library run once a week and
get a stack of books to work through.

My daughter was recently rewarded with a small portable
dvd player, for watching stuff in her room.

Jim

Likely a formula for success in raising your daughter, Jim. The garbage
on TV these days is mind numbing, about the same level of quality as the
advertising.

Your library runs seem to reflect the attitude of those that have been
educated. The typical run made by many would be for beer and videos! :-)
In our household, we're more inclined to listen to some Monk or MJQ with
leisure time. We might even toss in some Sinatra or Nat King Cole.

While I read books, I generally am seeking particular information when I do.
I think by poor study habits, and the fact that I was not a good student is
reflected in my reading habits, even now. Susan enjoys reading, though,
and does so every night before going to bed.

Harold

"GJRepesh" wrote in message
...

Harold,

I want to commend you on your story. There are lessons here that would
keep
people out of financial trouble. My plan is to retire in 3 1/2 years at
57.

Gary Repesh

Thanks, Gary. I don't claim to be any kind of financial wizard, but what
we do seems to work for us. I attribute the overall success to having
avoided the debt trap, and being married to a fine woman that is not in
competition with the human race.

We pay cash for everything. That includes new vehicles, which we do not
buy yearly, choosing instead to "drive them until they drop". We're not
concerned about how we may look to "The Smiths", especially when competing
with them would keep us hopelessly bound in debt. Yep, life is good, and
yours can be, too, Gary.

I wish you well with your upcoming retirement. I can say with total
honesty, I've never regretted retiring when I did, and I have enjoyed,
beyond words, my retirement days. I earned them by working hard and long.
The joy of being retired is the reward for having done so.

Harold

"Gunner" wrote in message
...
On Tue, 18 Nov 2003 19:42:19 -0800, "Harold & Susan Vordos"
wrote:

I'm having a bit of a struggle coming to terms with your statement above.
Isn't that exactly what I've been saying right along? What I've
proposed
is folks coming to terms with their inflated incomes and settling for pay
in
keeping with its value. That, in turn, keeps them on the job, albeit at
a
lower income, because the savings to the corporation that may have been
realized by jumping to China, for example, no longer exists. We keep
jobs
home, inflation is not a problem (not out of control), and perhaps prices
at
the store even decline to some degree. Not many of us prefer no
money
as opposed to less money. I think rational people would accept a pay cut
instead of a pink slip.

Nice idea, but in this current culture..it will never work.

Not until the last job has been shipped to India, anyway! :-)

"How Dare you say that my contribution is worth less than that person
over there! I work 8 hours a day, very hard, filing these papers. She
only works 4-6 hours a day, and comes in when she wants to. Just because
she is an outside sales person, doenst mean that her contribution is any
more important than mine!! If these papers dont get filed in the correct
order, the business would simply fall apart.

If you think that you are going to harm my self esteem like that, its
workplace harrasment and Im going to consult a lawyer and sue your ass
off! Its not FAIR that she gets paid more than I do!! Why should SHE
get a commission? Its not FAIR!!! "

(snip a long diatribe about the MTV generation and value systems)

Gunner


I rest my case! g

Harold

"jim rozen" wrote in message
...
In article , Harold & Susan Vordos says...

In other words, laid-off folks don't buy much of anything.

Jim

I'm having a bit of a struggle coming to terms with your statement above.
Isn't that exactly what I've been saying right along? What I've
proposed
is folks coming to terms with their inflated incomes and settling for pay
in
keeping with its value.

Ah, "value."

I think we're talking about the same thing, but you are
approaching it from the ground up, saying that workers
should take voluntary pay cuts.

I'm approaching it from the top down - saying that
if companies move all their operations overseas, and
fire all the US workers, the *market* for their
goods and services (those same individuals who
used to work for the US companies) will basically
dry up.

At your end you see wages being depressed, because
of the glut of unemployed workes. At my end, I see
prices being depressed, because nobody want to by
the cheap stuff the companies try to import.

Kinda looks like deflation, and depression to me.

Jim

Now I see it from your eyes, and, yes, we are both saying the same thing.
There's no way in hell we can survive with things as they are. For
workers to come to terms with the fact (yes, it is a fact, almost to the
man, we are all overpaid when it comes to our VALUE) that we are not
competitive in the world market and will lose our jobs as a result if we do
not adjust our expectations and our hourly rate, removing the advantage
corporations are now enjoying by moving to foreign countries.

Ed seems to ridicule my suggestion that the jobs are headed for other
countries, something that baffles me no end, for just as I'm typing this,
Susan just brought to my attention the fact that AT&T is shipping work to
India because of the lower cost of doing business there. It was just
mentioned on the news. I have no clue what will be shipped, but,
according to Susan, they made explicit mention of the fact that it was
cheaper to go to India than to remain here, at least with that particular
project. Sigh!

Harold

In article , Harold & Susan Vordos says...

Your library runs seem to reflect the attitude of those that have been
educated. The typical run made by many would be for beer and videos! :-)

Well we do that too on occasion. It used to be that when my
daughter was very small, that was the ultimate figure of
merit, being able to get her in bed in time for us to sit
and watch a video. That happened once a week, maybe!

Now we manage to watch, on average, about 1/4 of a film
per night. This week it's _The_General_.

While I read books, I generally am seeking particular information when I do.
I think by poor study habits, and the fact that I was not a good student is
reflected in my reading habits, even now.

But hey, you're reading. That's what counts.
Peekskill has a nice library, and it's within walking
distance of our house, when it's not pouring rain
(it is).

I never did seem to figure out *any* study habits. Just read
the stuff, do the problem sets. If you could do the problem
sets, there was really no need to go to class.

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

In article , Harold & Susan Vordos says...

Now I see it from your eyes, and, yes, we are both saying the same thing.
There's no way in hell we can survive with things as they are. For
workers to come to terms with the fact (yes, it is a fact, almost to the
man, we are all overpaid when it comes to our VALUE) that we are not
competitive in the world market and will lose our jobs as a result if we do
not adjust our expectations and our hourly rate, removing the advantage
corporations are now enjoying by moving to foreign countries.

But this is something that will happen on its own. The market
will 'give the pay cut' if it's going to happen. There's
no need to rush out and volunteer!

Ed seems to ridicule my suggestion that the jobs are headed for other
countries, something that baffles me no end,

How odd, because Ed's comments on this subject, which began
nearly a year ago, made it painfully clear that he was predicting
exactly *that* - a departure of manufacturing jobs to china.
He's been saying that all along, and I quote his "1/20th"
number almost every day. Frankly it seems like *every*
*single* person I meet has this exact issue on their mind,
and they are struggling to wrap their mind around the concept.

But there is no head-in-the-sand effect with any of them.

for just as I'm typing this,
Susan just brought to my attention the fact that AT&T is shipping work to
India because of the lower cost of doing business there. It was just
mentioned on the news. I have no clue what will be shipped, but,
according to Susan, they made explicit mention of the fact that it was
cheaper to go to India than to remain here, at least with that particular
project. Sigh!

That's right, Verizon is laying off and buying workers out.
Will the work still get done? Yes, but offshore wherever
possible.

You can be darn sure that the laid off verizon workers will
*not* be shopping around for a brand new car. All of a sudden
the market that GM predicted just shrank a tiny bit - so the
predicted profit they would achieve by selling a car, with
an engine made in china, just vaporized.

I personally think that after 10 years, the overall
equilibrium in the economy will be much clearer. Until
then, it's going to be a bumpy ride.

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

"jim rozen" wrote in message
...
snip--
I never did seem to figure out *any* study habits. Just read
the stuff, do the problem sets. If you could do the problem
sets, there was really no need to go to class.

Jim

I didn't let doing the problem sets interfere with anything. Do them or
not, I didn't study. I'd do it in a different way if I had it to do over,
assuming I could take a brain with me on that trip. I'd likely do it all
over the same way otherwise. Some people never learn! :-)

Harold

"jim rozen" wrote in message
...
In article , Harold & Susan Vordos says...

Now I see it from your eyes, and, yes, we are both saying the same
thing.
There's no way in hell we can survive with things as they are. For
workers to come to terms with the fact (yes, it is a fact, almost to the
man, we are all overpaid when it comes to our VALUE) that we are not
competitive in the world market and will lose our jobs as a result if we
do
not adjust our expectations and our hourly rate, removing the advantage
corporations are now enjoying by moving to foreign countries.

But this is something that will happen on its own. The market
will 'give the pay cut' if it's going to happen. There's
no need to rush out and volunteer!

Oh, but there is! To preserve the job is the reason. If that doesn't
matter, then I agree. I offer you the steel industry as an example.
Assuming we could suddenly become competitive, and wanted to be back in the
market place, how would we? The industry is largely gone now. Gone to
other countries, likely never to return in our life times. That might have
been avoided had workers and management had a different attitude.

Ed seems to ridicule my suggestion that the jobs are headed for other
countries, something that baffles me no end,

How odd, because Ed's comments on this subject, which began
nearly a year ago, made it painfully clear that he was predicting
exactly *that* - a departure of manufacturing jobs to china.
He's been saying that all along, and I quote his "1/20th"
number almost every day. Frankly it seems like *every*
*single* person I meet has this exact issue on their mind,
and they are struggling to wrap their mind around the concept.

But there is no head-in-the-sand effect with any of them.

for just as I'm typing this,
Susan just brought to my attention the fact that AT&T is shipping work to
India because of the lower cost of doing business there. It was just
mentioned on the news. I have no clue what will be shipped, but,
according to Susan, they made explicit mention of the fact that it was
cheaper to go to India than to remain here, at least with that particular
project. Sigh!

That's right, Verizon is laying off and buying workers out.
Will the work still get done? Yes, but offshore wherever
possible.

You can be darn sure that the laid off verizon workers will
*not* be shopping around for a brand new car. All of a sudden
the market that GM predicted just shrank a tiny bit - so the
predicted profit they would achieve by selling a car, with
an engine made in china, just vaporized.

I personally think that after 10 years, the overall
equilibrium in the economy will be much clearer. Until
then, it's going to be a bumpy ride.

Jim

Agreed, and your comments about the engine, that would have been made in
China, is helping me see things slightly differently. Given enough time,
perhaps this whole thing will iron itself out just fine. I can't help but
think that our country went through something similar to this as it
developed. State against state, perhaps?

Harold

"jim rozen" wrote in message
...

Ed seems to ridicule my suggestion that the jobs are headed for other
countries, something that baffles me no end,

How odd, because Ed's comments on this subject, which began
nearly a year ago, made it painfully clear that he was predicting
exactly *that* - a departure of manufacturing jobs to china.
He's been saying that all along, and I quote his "1/20th"
number almost every day. Frankly it seems like *every*
*single* person I meet has this exact issue on their mind,
and they are struggling to wrap their mind around the concept.

I didn't hear Harold say those jobs are headed for other countries. I
thought he said that we have to drop our wages to compete with them.

A lot of the jobs have already left. There's a range of opinion on this, but
the median opinion among economists right now seems to be that, of the 2.7
million US manufacturing jobs that have been lost over the past three years,
between 500,000 and 800,000 of them have been lost to low-wage countries,
primarily to China. The rest have been lost to recession and the collapse of
a capacity bubble.

But I don't see any way that wages are going to drop drastically. The
Chinese are competing in only a few small segments of our economy. I doubt
if they're actually in competition with more than maybe 15% of our workers.
The US economy is exceptionally flexible and it seems much more likely that
people will simply find other work before they'll work in manufacturing for
a fraction of the present wages.

I worry more about the social structure of an economy that doesn't provide
the entrepreneurial opportunities and the good wages provided by a strong
manufacturing base. Those jobs will continue to drain away, inevitably,
perhaps. But the natural process would be a slow movement. The radical
surges of imports we're experiencing aren't part of any natural evolution.

BTW, Robert Rubin (former administration economist and one of the top two or
three policy-type economists in the world) was on Charlie Rose tonight, and
he had some surprising things to say about China's trade situation. He says
that some economists on the ground in Asia expect China to run a trade
*deficit* in 2005 or 2006. He also reminded us that, although China is
running a surplus of around $125 billion with the US right now, their
worldwide surplus is only around $25 billion (these are figures I've
reported here in the past). Among other things, this tells us that their
trade with the US is abnormal; a result of our policies as much as their
prices.

Ed Huntress

What we have done is visit the local tape and DVD rental places that
go out of business. Often the good shows are new or once played.
Typically the ones worn out are not our type of movie.

Our only fear is obsoleting of CD in 5 years when is DVD ? and VHS is
dying now ?
Hum.

Martin
--
Martin Eastburn, Barbara Eastburn
@ home at Lion's Lair with our computer
NRA LOH, NRA Life
NRA Second Amendment Task Force Charter Founder


jim rozen wrote:

In article , Harold & Susan Vordos says...

... I refuse to toss over $400/year for tv
programming, then be subjected to commercials endlessly. What little tv we
watch, aside from news, is generally recorded and then watched at a more
convenient time, bypassing all the advertising. I don't give a damn that
advertising pays the tab, if I have to choose between watching those lame,
insulting, head banging commercials and not watching tv, I'll take the
silence and some good jazz on the stereo in its place anytime.

We have a TV, but no live feed into the house. So we
can watch recorded stuff that we choose. This works
out pretty well, we do a library run once a week and
get a stack of books to work through.

My daughter was recently rewarded with a small portable
dvd player, for watching stuff in her room.

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

Pick yer pony, take yer ride. A business must be competitive to
survive. Every individual is a business even if he/she works for an
hourly wage providing value for compensation received. It's up to
each to deliver value commeasurate with compensation and with
success of the enterprise. If they can't or won't do that, they're
not competitive or earning their keep. Life lurches on.

Once a biz is viable, then those that run it can choose how the
rewards of being competitive are distributed. They can choose to
greedily exploit the wage-earners or they can share the wealth -- but
the wealth must first be won in a competitive world market,

Many U.S. corporations still do that quite well, most of them fairly
small and privately-owned so they're insulated from Wall Street
greed.

We surely should provide for the infirm, disadvantaged and unfortuate
to the extent we can do so as a wealthy nation with a healthy economy.
But life is competitive, now on a global scale where there are hungry
people eager to compete and getting better at it every day.

Leaders must work to chart the course, followers must work to help
make it happen. Oh****ohdear poor-me whining won't get it done.









On Mon, 17 Nov 2003 16:59:38 -0500, "Tom Gardner"
wrote:

After following some of the links showing job loss and productivity gains,
it's quite depressing, I've come to the conclusion that one of my main goals
has been to eliminate employees' jobs. In the past year I have eliminated 3
people and outsourced semi-finished goods from other American companies at
least. But guess what? Boxes of parts don't have mood swings, PMS,
holidays, don't have to be heated or cooled, and NO SCRAP! They come in at
a set cost with out the variables. Kind of sad that I can no longer devote
the HR to barely breaking even ...on good days. But, specialized suppliers
can do so much better due to their economy of scale than I can.

My newest built machine will eliminate 2 more jobs and a hefty bonus
structure. I just came to realize that the next 3 projects will be such a
boost in productivity that 4 or 5 more jobs are in jeopardy. So does this
make me a bad guy? I don't really think so, but multiply this around the
country and that's a LOT of jobs lost with a net gain in products produced.
So, who's going to have money to BUY products in the future?

"Ed Huntress" wrote in message
et...
"jim rozen" wrote in message
...

Ed seems to ridicule my suggestion that the jobs are headed for other
countries, something that baffles me no end,

How odd, because Ed's comments on this subject, which began
nearly a year ago, made it painfully clear that he was predicting
exactly *that* - a departure of manufacturing jobs to china.
He's been saying that all along, and I quote his "1/20th"
number almost every day. Frankly it seems like *every*
*single* person I meet has this exact issue on their mind,
and they are struggling to wrap their mind around the concept.

I didn't hear Harold say those jobs are headed for other countries. I
thought he said that we have to drop our wages to compete with them.

I may not have said that in any particular post, but I have said it, and it
is the basis of my suggestion that we all must learn to compete by lowering
our excessive (read that unearned, or more than value) wages, but that would
obviously only apply to those that wish to keep their jobs, even at lower
pay. If one chooses to sit with their thumb up their butt, unemployed,
still talking about the good old days when they made money hand over fist,
because they helped their employer send his/her job over seas because they
demanded a raise when they were already overpaid, then perhaps it wouldn't
apply.

A lot of the jobs have already left. There's a range of opinion on this,
but
the median opinion among economists right now seems to be that, of the 2.7
million US manufacturing jobs that have been lost over the past three
years,
between 500,000 and 800,000 of them have been lost to low-wage countries,
primarily to China. The rest have been lost to recession and the collapse
of
a capacity bubble.

But I don't see any way that wages are going to drop drastically.

Nor do I, especially if they have to drop to the same level as the
developing countries, but surely we could take a more realistic approach and
pay workers appropriately for their contribution. That could encourage
corporations to keep some of the work here.

I still maintain that we are paid wages beyond those that we earn.
Unrelated to manufacturing, I've offered examples, one of which is UPS
drivers that make near $30/hr., assuming it's true. If it is, how in hell
can anyone justify wages like that when they have little, if any, training,
and the job is far from a skilled profession or trade. The main point is
you or I could learn to do their job in a day. Do you think anyone out
there could have learned tool making over night? Could I take your job of
writing from you? Could the man off the street push me out of my job (as if
I have one!) because he could do it cheaper, yet he's never done it before?
Some things are unlikely, but not this one, because it is a resounding NO.
It takes years of experience and training to do work of that nature, at
least to do it properly and achieve success routinely. Once again, if
anyone can easily take any given job away from another, it isn't worth much.
I don't think a delivery van driver is worth as much as a tool maker, nor a
well trained machinist. They certainly aren't worth more, yet they are
paid far more. Does that make sense?

Harold

On Thu, 20 Nov 2003 06:26:21 GMT, Eastburn wrote:

What we have done is visit the local tape and DVD rental places that
go out of business. Often the good shows are new or once played.
Typically the ones worn out are not our type of movie.

Our only fear is obsoleting of CD in 5 years when is DVD ? and VHS is
dying now ?
Hum.

Martin

Ive heard from reliable sources that the next medium will be solid
state storage. Much akin to those tiny USB tags that are now being used
for portable hard drives. Key ring sized

Gunner

Antiquis temporibus, nati tibi similes in rupibus
ventosissimis exponebantur ad necem.

In article , Ed Huntress
says...

But I don't see any way that wages are going to drop drastically. The
Chinese are competing in only a few small segments of our economy. I doubt
if they're actually in competition with more than maybe 15% of our workers.
The US economy is exceptionally flexible and it seems much more likely that
people will simply find other work before they'll work in manufacturing for
a fraction of the present wages.

Ok, but maybe you have to include the countries that are
syphoning off the more service, software oriented jobs,
like India? And don't forget, it's often quoted that
the 15 percent number you mention above is direct
manufacturing jobs - but there's another two or three
service jobs that go along with one of those. So a
bleak-minded individual might say those service jobs
will go too, so the real number might be 30 percent or
more.

I worry more about the social structure of an economy that doesn't provide
the entrepreneurial opportunities and the good wages provided by a strong
manufacturing base. Those jobs will continue to drain away, inevitably,
perhaps. But the natural process would be a slow movement. The radical
surges of imports we're experiencing aren't part of any natural evolution.

I would think that one think the present adminstration should do
here is to keep changes from happening too rapidly - they should
do all in their power to be *true* conservatives. Instead I see
things like the proposed federal rules that will pre-empt all
the state banking regulations, and put the banks beholden only
to the weaker federal laws. Who thought that one up?? It sounds
like a recipie for 1929 all over again.

That, and the fact that the largest year ever for bankrupcies
has been - last year.

Jim

==================================================
please reply to:
JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com
==================================================

"jim rozen" wrote in message
...
In article , Ed Huntress
says...

But I don't see any way that wages are going to drop drastically. The
Chinese are competing in only a few small segments of our economy. I
doubt
if they're actually in competition with more than maybe 15% of our
workers.
The US economy is exceptionally flexible and it seems much more likely
that
people will simply find other work before they'll work in manufacturing
for
a fraction of the present wages.

Ok, but maybe you have to include the countries that are
syphoning off the more service, software oriented jobs,
like India? And don't forget, it's often quoted that
the 15 percent number you mention above is direct
manufacturing jobs - but there's another two or three
service jobs that go along with one of those. So a
bleak-minded individual might say those service jobs
will go too, so the real number might be 30 percent or
more.

I already factored in the 3.28 service jobs/manufacturing job that the DoC
has used in some of its reports. I'm basing my guesstimate on the actual
segments of manufacturing and services in which the Chinese actually are
competing with our domestic manufacturers.

Like the real figures on Walmart's Chinese imports, the facts of this don't
jibe well with the common perception. If you want to see a profile of where
the competition is, take a look at the product breakdown of China's exports
to the US. It's somewhere in the DoC website.



I worry more about the social structure of an economy that doesn't
provide
the entrepreneurial opportunities and the good wages provided by a strong
manufacturing base. Those jobs will continue to drain away, inevitably,
perhaps. But the natural process would be a slow movement. The radical
surges of imports we're experiencing aren't part of any natural
evolution.

I would think that one think the present adminstration should do
here is to keep changes from happening too rapidly - they should
do all in their power to be *true* conservatives.

Easier said than done. That's the kind of thing that stimulated the "export
credits" plan that Warren Buffet wrote about recently.

--
Ed Huntress
(remove "3" from email address for email reply)

My guesses are that a way to play CD's will be around for a long time.
Mostly because it is trivial to make DVD players also play CD's.
DVD's as such may not stay around as long. I noted that the Chinese
are going to another standard for their Video discs to save big bucks
on royalties but also technically better recordings. But I think this
is all software changes and the player is the same. If that is
correct, it will also be trivial to have machines that play CD's,
DVD's, and EVD's.

My guess is that Solid State will not displace optical, regardless of
what your friend predicts. Oh I do believe that Solid State will
become much cheaper and would displace optical if optical would just
stand still. But that is kind of like solid state displacing disk
drives. Disk drives keep getting cheaper and bigger. It will be a
while before Solid State can provide 100 gigabytes for $100, and by
then disks drives will be providing terabytes for $100.

Dan


Gunner wrote in message . ..
On Thu, 20 Nov 2003 06:26:21 GMT, Eastburn wrote:

Our only fear is obsoleting of CD in 5 years when is DVD ? and VHS is
dying now ?
Hum.

Martin

Ive heard from reliable sources that the next medium will be solid
state storage. Much akin to those tiny USB tags that are now being used
for portable hard drives. Key ring sized

Gunner

On 20 Nov 2003 09:55:32 -0800, the renowned (Dan
Caster) wrote:

My guesses are that a way to play CD's will be around for a long time.
Mostly because it is trivial to make DVD players also play CD's.
DVD's as such may not stay around as long. I noted that the Chinese
are going to another standard for their Video discs to save big bucks
on royalties but also technically better recordings. But I think this
is all software changes and the player is the same. If that is
correct, it will also be trivial to have machines that play CD's,
DVD's, and EVD's.

My guess is that Solid State will not displace optical, regardless of
what your friend predicts. Oh I do believe that Solid State will
become much cheaper and would displace optical if optical would just
stand still. But that is kind of like solid state displacing disk
drives. Disk drives keep getting cheaper and bigger. It will be a
while before Solid State can provide 100 gigabytes for $100, and by
then disks drives will be providing terabytes for $100.

That's my impression too.. advances in both seem to be taking place at
a similar pace. Blue laser DVDs should push the storage capacity way
up (24G ??) something like that.

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog Info for designers: http://www.speff.com

THey are selling the MP3 boxes that are palm size - big time.
I feel those are the way.

Frankly I think that is so so. I want both.

I don't plan on jogging with one in my ear when the time comes.

Martin
--
Martin Eastburn, Barbara Eastburn
@ home at Lion's Lair with our computer
NRA LOH, NRA Life
NRA Second Amendment Task Force Charter Founder

"Harold & Susan Vordos" wrote in message
...

I still maintain that we are paid wages beyond those that we earn.
Unrelated to manufacturing, I've offered examples, one of which is UPS
drivers that make near $30/hr., assuming it's true. If it is, how in
hell
can anyone justify wages like that when they have little, if any,
training,
and the job is far from a skilled profession or trade. The main point
is
you or I could learn to do their job in a day. Do you think anyone out
there could have learned tool making over night? Could I take your job
of
writing from you? Could the man off the street push me out of my job (as
if
I have one!) because he could do it cheaper, yet he's never done it
before?

These are valid questions, but, without making an eternal correspondance out
of it, let me just point out a couple of issues that I think you're missing.
Assume, first, that we're working in a system that lets the market decide
what "value" is.

Those UPS drivers (making around $22.50/hr., BTW, on the average) have a
union and the union is a market force. Yes, I know that flies in the face of
anti-union dogma, but in one sense it is true. If UPS doesn't like it, they
just take their capital and put it into another business. That's what they
tell workers to do when they don't like their wages -- they're just supposed
to find another job. Either one will incur very high costs by making a
change, but, hey, that's the way it goes. UPS is large enough that it has a
coercive power over drivers; the union is large enough that is has a
countervailing coercive power over UPS. Fair enough?

So UPS operates or not with those wages, and the market accepts them or not
by paying UPS's rates or not. The free market at work. Right? Everything is
ducky as long as it works, and we'll leave it to academicians to decide who
is distorting what.

Let's apply that principle to toolmakers. A fairly good one, with moderate
experience, makes $20/hour or so in the US. An equally good one in China
with the same experience makes less than $1/hour. So, if the market
principle is to be applied, the US toolmaker is overpriced by $19/hour. Or
the Chinese worker is underpriced by $19/hour. Which is it? Low wages tend
to drive out high ones, like bad money drives out good. But if you believe
in markets setting prices, you'd say that the market is severely distorted
in this case, because the two equal workers can't be worth such different
rates of pay. The market will work it out, some say. Either the US worker
will wind up making less, or the Chinese worker will make more, or some of
both. Right?

Now, which set of valuations is more "real," the one operating in China, or
the one operating in the US, Europe, Canada, Australia, and Japan? Which
system is more "realistic" in setting value? It can't be both, at least not
now. One or the other is highly distorted, in the way an economist would use
the term.

Which has the "right" set of values for jobs, goods, and services? Well,
before China became such a big market force, it was the West and Japan. We
dominated the world economy. We all had growth, and prosperity, and so on.
It was "right" in the sense that it produced those benefits that a free
market is supposed to produce. Now we have an injection of vast volumes of
goods (and services, from India) that threaten to upset the basis of value.
Coming out of an economic black hole, they both have wage rates that are
totally unrelated to those of the developed world, and they have social and
economic conditions that threaten to resist a levelling like the one that
classical economics predicts. In China's terms, you might be worth
$1.50/hour rather than $35/hour. What is your "real" value?

You appear to have a sense of value based on your relative contribution to
the economy, and that's been the traditional basis on which people have
acquired a sense of their worth in the marketplace. But it is the
marketplace, at least as you accept the term, that says you were 'way, 'way
overpaid.

One man's market force is another man's market distortion. It would take a
book to elaborate how this relates to our discussion, but, FWIW, I accept
the idea that UPS's union wages are a distortion. But so is China. At the
bottom, a distortion is either a coercive force on the market (a very
powerful union, or a business monopoly) or a breakdown in value that's the
result of some non-systematic or non-evolutionary change. China is such a
change, and it's causing a breakdown in value that's distorting constructive
market forces, based on my conclusion, and that of an increasing number of
others who have much more expertise. (Alan Greenspan said today that this is
not true, that the market is working just fine and that China is not a
problem. Paul Krugman, an equally respected economist, says that Uncle Alan
is losing his marbles. Look around you, decide if low-wage competition from
China is negatively affecting your industry, and then you decide who is
closer to the truth -- at least, to the truth that matters most.)

I've got to cut this long-winded discussion short, which risks screwing it
up completely, but here's the most important final point. Since the 1970's,
there has been no way for the US, or any other developed economy, to wind up
with inflated values because its workers or industries are "spoiled". Since
currencies were cut free of gold and silver standards, and since they were
allowed to float free on world markets, it has been those currency markets
that determine relative value. If the US economy, overall, was puffed-up by
wishful thinking or greed, the currency markets would cut it down to size in
about 15 minutes. So your set of relative values, which all of us share to
some degree deep inside, and which we might call the "high-school civics
class system of valuation" g, is utterly shot to pieces on the world
currencies markets. They don't care what your idea of value is. They only
care what the market thinks value is. And they think that our wages,
relative to our production, are just about right. We won't know what they
think about China unless and until China cuts its currency loose to float
and to be traded freely on world markets.

Wphew. Sorry. That's 'way too short to be very useful, but 'way too long for
this NG.


--
Ed Huntress
(remove "3" from email address for email reply)

On Thu, 20 Nov 2003 16:56:32 GMT, "Ed Huntress"
wrote:

Like the real figures on Walmart's Chinese imports, the facts of this don't
jibe well with the common perception. If you want to see a profile of where
the competition is, take a look at the product breakdown of China's exports
to the US. It's somewhere in the DoC website.
Would this apparent disparity between the the dollar value and
product shelf space be a result of the Chinese stuff being so cheap?
US items cost more, so a eg a US made bike equals 5 or 10 Chinese
ones.
Geoff

"geoff merryweather" wrote in message
...
On Thu, 20 Nov 2003 16:56:32 GMT, "Ed Huntress"
wrote:

Like the real figures on Walmart's Chinese imports, the facts of this
don't
jibe well with the common perception. If you want to see a profile of
where
the competition is, take a look at the product breakdown of China's
exports
to the US. It's somewhere in the DoC website.

Would this apparent disparity between the the dollar value and
product shelf space be a result of the Chinese stuff being so cheap?
US items cost more, so a eg a US made bike equals 5 or 10 Chinese
ones.
Geoff

I don't know how much of that is in the mix, but my guess is that it's not
much. Walmart seems to be seeking low prices across the board, gaining a
competitive edge in every possible category, so it's probably using a fairly
level markup rate.

More likely, I think, is that a high percentage of what it buys from China
is products in low-price categories. That would mean that a higher
percentage of items on the shelf are made in China, overall, than the dollar
volume of their China purchases would otherwise indicate.

This is just a guess. I doubt if Walmart makes this information public.

Ed Huntress

"Ed Huntress" wrote in message
...
Very big snip------

Wphew. Sorry. That's 'way too short to be very useful, but 'way too long
for
this NG.

Ed Huntress


Got it, Ed, and in the end you're telling me the same things I'm thinking,
all except for the relative value as established by the market. My
feelings are that they are more driven by such entities as the strong
unions, but for now I think you've opened a few doors for me so I can see
things in a slightly different light. Whether I agree or not will be the
next challenge.

You're talking to someone that would be slow to understand some of the
things that you have so patiently tried to explain, so the conversation
could go on almost endlessly. You have spent a good deal of your time on
just my thoughts, and for that I'm grateful.

I'll continue to read your posts and learn more. Thanks.

Harold

On Fri, 21 Nov 2003 06:29:11 GMT, "Ed Huntress" wrote:
I've got to cut this long-winded discussion short, which risks screwing it
up completely, but here's the most important final point. Since the 1970's,
there has been no way for the US, or any other developed economy, to wind up
with inflated values because its workers or industries are "spoiled". Since
currencies were cut free of gold and silver standards, and since they were
allowed to float free on world markets, it has been those currency markets
that determine relative value. If the US economy, overall, was puffed-up by
wishful thinking or greed, the currency markets would cut it down to size in
about 15 minutes. So your set of relative values, which all of us share to
some degree deep inside, and which we might call the "high-school civics
class system of valuation" g, is utterly shot to pieces on the world
currencies markets. They don't care what your idea of value is. They only
care what the market thinks value is. And they think that our wages,
relative to our production, are just about right. We won't know what they
think about China unless and until China cuts its currency loose to float
and to be traded freely on world markets.

Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

"Gary Coffman" wrote in message
...
On Fri, 21 Nov 2003 06:29:11 GMT, "Ed Huntress"
wrote:
I've got to cut this long-winded discussion short, which risks screwing
it
up completely, but here's the most important final point. Since the
1970's,
there has been no way for the US, or any other developed economy, to wind
up
with inflated values because its workers or industries are "spoiled".
Since
currencies were cut free of gold and silver standards, and since they
were
allowed to float free on world markets, it has been those currency
markets
that determine relative value. If the US economy, overall, was puffed-up
by
wishful thinking or greed, the currency markets would cut it down to size
in
about 15 minutes. So your set of relative values, which all of us share
to
some degree deep inside, and which we might call the "high-school civics
class system of valuation" g, is utterly shot to pieces on the world
currencies markets. They don't care what your idea of value is. They only
care what the market thinks value is. And they think that our wages,
relative to our production, are just about right. We won't know what they
think about China unless and until China cuts its currency loose to float
and to be traded freely on world markets.

Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Nobody knows what would happen to the yuan if it were to float. The 40%
figure we hear so often came from a US Congressional commission that was
evaluating China's military threat to the US. Some economists have said the
real figure is 20%. Andy Xie, an highly respected economist based in Asia
who works for Morgan Stanley, says it could be that the yuan is actually
overvalued. Hamei said last year that the black market for yuan was slightly
over 9 to the dollar, which indicates that it's overvalued.

US Congressmen and the US press have been using the 40% figure, passing it
around without knowing where it actually came from, for the most part.

What matters to the Chinese is the rate at which they can accumulate foreign
reserves. That's how they've set their rate.

In any case, your underlying point that a revaluation wouldn't do much to
improve our trade situation certainly is true, as I also said in one of my
articles for Machining about China trade.

The trouble with the fixed exchange rate, for us, is that nothing we can do
to improve our own productivity, and no adjustment of the value of the US
dollar, will work to level our trade situation with China as long as they
have their rate pegged to ours. Improving our productivity will only raise
the value of the dollar while China's edge in trade will remain unchanged;
running an excessively negative current account balance that will reduce the
value of the dollar will result in theirs going down along with ours, which
they won't care about one way or the other.

It's a very distorting thing, in other words, although not for the reason
that Phil English (R-PA) and some other Congressmen are claiming.

Ed Huntress

On Fri, 21 Nov 2003 05:27:42 -0500, the renowned Gary Coffman
wrote:

Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making.

*Some* are saying that- it's the official line. Others are saying that
it could as easily be 30% overvalued.

I think the main difference for the US if the Chinese currency was
forced up in value like Japan's was (or if it floated up) would be
that the Chinese could afford to buy more stuff- particularly
agricultural products, which is one area where the US can compete with
any other place on earth, with both price and quality.

This idea of devaluing the USD by 30% or so with respect to major
trading partners (already most of the way there vis a vis the Canadian
dollar and the Euro) seems more like a short term gain, long term pain
strategy to stimulate the economy quickly, and damn the consequences.
Together with the policy of "getting tough" with trading partners
(breaching the parts of negotiated agreements that are deemed
disadvantageous, especially to special interests, while taking full
advantage of those that are to the US advantage) and massive domestic
deficit spending it forms a kind of strategy. There are a couple of
things wrong with it- it is a game of chicken that assumes that the
trading partners have the sanity not to retaliate fully and start a
trade war (or that they are weak and prepared to eat the losses) and
secondly, if it doesn't work, there's not a lot more that can be done,
the levers the government has available are already at their stops.
There are also long-term consequences to making Americans 1/3 poorer
that will take some time to show up- such as in resource prices. The
failed Cancun round of trade talks show that even the poorest of
countries can gang up on the rest of us.

Here's one take on the trade war strategy from a Bloomberg columnist:

http://quote.bloomberg.com/apps/news...lumnist _baum

and another

http://quote.bloomberg.com/apps/news...umnist _levin

China, which seldom has a need to visibly flex her muscles much these
days, with growing regional clout, has not responded as passively or
patiently as European and Canadian targets. They immediately cancelled
a massive buying mission to the US (for "technical" reasons), and are
considering reducing their purchases of US debt instruments. As the
second largest lender to the US (after Japan) that could have negative
consequences- a dollar spiraling ever-lower is not in anybody's
interests. This is in addition to retaliation for the illegal steel
tariffs if they are not removed and the foreign sales corporation
subsidy (also ruled to breach the WTO agreement). Probably they have
made an accurate assessment that strength is the only thing that will
be respected, and weakness will be "provocative", to use Rumsfeld's
term.

If there's a big boom in the US economy real soon, all this stuff will
probably go away.. but if there is isn't, something is going to have
to give soon (probably more than one thing). Maybe some painful
changes in US domestic spending to reduce dependency on foreigners,
and more managed trade and managed exchange rates.

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog Info for designers: http://www.speff.com

On Fri, 21 Nov 2003 05:27:42 -0500, Gary Coffman
wrote:


Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

Gunner


Antiquis temporibus, nati tibi similes in rupibus
ventosissimis exponebantur ad necem.

On Fri, 21 Nov 2003 11:54:19 GMT, the renowned Gunner
wrote:

On Fri, 21 Nov 2003 05:27:42 -0500, Gary Coffman
wrote:


Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

It varies. Vegetables are quite cheap, meat is maybe 1/2 US price
levels per unit weight (at rather lower quality- chicken is almost
always tough and stringy, pork may come with skin and sometimes hair).
Anything that is just labor (eg. a shoeshine, haircut or manicure) it
buys about 8-10 times as much. Gasoline, I think about the same price,
give or take. An overnight first class train ticket (sleeper) of about
20 hours is around $80 US, or about 1/4 of that in "hard seat" second
class. Road tolls are about at US levels, cheaper than Europe.
Airfares are about the same as discount US fares, but the price is
pretty much fixed (you might get -10% by buying it directly from the
office with cash). A 25 minute taxi ride is only about $5-6. Major
appliances are about half the price retail and inferior/smaller than
their powerful North American cousins. Cars are roughly the same
price, I think. Housing costs are generally low for the majority of
people, but you can pay a small fortune for a nice place. Because
energy is relatively expensive, streets are dimly lit. They'd rather
post a security guard in an underpass ("subway") than put cameras and
bright lighting in place. Prices are higher in big booming cities and
cheaper in smaller places.

One rule of thumb I use for what's affordable there is to multiply the
price by about 8. If it would still seem reasonable at my income, then
they are probably buying it. For example, a $250 US clothes washer-
would it be worth $2000 to me to not have to wash clothes by hand?
Having tried the latter, once, in China with their crummy washing
powder, I say YES!

The overall feel is that of a place with a heck of a lot of cheap
labor (poor working people) and with prices for energy and good about
what you'd expect given that. It's not like former Eastern Europe with
grossly distorted prices (15 cents for a pack of cigarettes), nor is
it like Mexico was a few years ago where everything felt overpriced
considering quality etc. (before the peso collapsed).

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog Info for designers: http://www.speff.com

Great post, Ed! Not too long at all. Your points were very well made and
supported by believable examples.

Bob (loves a good teacher) Swinney
"Ed Huntress" wrote in message
...
"Harold & Susan Vordos" wrote in message
...

I still maintain that we are paid wages beyond those that we earn.
Unrelated to manufacturing, I've offered examples, one of which is UPS
drivers that make near $30/hr., assuming it's true. If it is, how in
hell
can anyone justify wages like that when they have little, if any,
training,
and the job is far from a skilled profession or trade. The main point
is
you or I could learn to do their job in a day. Do you think anyone out
there could have learned tool making over night? Could I take your job
of
writing from you? Could the man off the street push me out of my job
(as
if
I have one!) because he could do it cheaper, yet he's never done it
before?

These are valid questions, but, without making an eternal correspondance
out
of it, let me just point out a couple of issues that I think you're
missing.
Assume, first, that we're working in a system that lets the market decide
what "value" is.

Those UPS drivers (making around $22.50/hr., BTW, on the average) have a
union and the union is a market force. Yes, I know that flies in the face
of
anti-union dogma, but in one sense it is true. If UPS doesn't like it,
they
just take their capital and put it into another business. That's what they
tell workers to do when they don't like their wages -- they're just
supposed
to find another job. Either one will incur very high costs by making a
change, but, hey, that's the way it goes. UPS is large enough that it has
a
coercive power over drivers; the union is large enough that is has a
countervailing coercive power over UPS. Fair enough?

So UPS operates or not with those wages, and the market accepts them or
not
by paying UPS's rates or not. The free market at work. Right? Everything
is
ducky as long as it works, and we'll leave it to academicians to decide
who
is distorting what.

Let's apply that principle to toolmakers. A fairly good one, with moderate
experience, makes $20/hour or so in the US. An equally good one in China
with the same experience makes less than $1/hour. So, if the market
principle is to be applied, the US toolmaker is overpriced by $19/hour. Or
the Chinese worker is underpriced by $19/hour. Which is it? Low wages tend
to drive out high ones, like bad money drives out good. But if you believe
in markets setting prices, you'd say that the market is severely distorted
in this case, because the two equal workers can't be worth such different
rates of pay. The market will work it out, some say. Either the US worker
will wind up making less, or the Chinese worker will make more, or some of
both. Right?

Now, which set of valuations is more "real," the one operating in China,
or
the one operating in the US, Europe, Canada, Australia, and Japan? Which
system is more "realistic" in setting value? It can't be both, at least
not
now. One or the other is highly distorted, in the way an economist would
use
the term.

Which has the "right" set of values for jobs, goods, and services? Well,
before China became such a big market force, it was the West and Japan. We
dominated the world economy. We all had growth, and prosperity, and so on.
It was "right" in the sense that it produced those benefits that a free
market is supposed to produce. Now we have an injection of vast volumes of
goods (and services, from India) that threaten to upset the basis of
value.
Coming out of an economic black hole, they both have wage rates that are
totally unrelated to those of the developed world, and they have social
and
economic conditions that threaten to resist a levelling like the one that
classical economics predicts. In China's terms, you might be worth
$1.50/hour rather than $35/hour. What is your "real" value?

You appear to have a sense of value based on your relative contribution to
the economy, and that's been the traditional basis on which people have
acquired a sense of their worth in the marketplace. But it is the
marketplace, at least as you accept the term, that says you were 'way,
'way
overpaid.

One man's market force is another man's market distortion. It would take a
book to elaborate how this relates to our discussion, but, FWIW, I accept
the idea that UPS's union wages are a distortion. But so is China. At the
bottom, a distortion is either a coercive force on the market (a very
powerful union, or a business monopoly) or a breakdown in value that's the
result of some non-systematic or non-evolutionary change. China is such a
change, and it's causing a breakdown in value that's distorting
constructive
market forces, based on my conclusion, and that of an increasing number of
others who have much more expertise. (Alan Greenspan said today that this
is
not true, that the market is working just fine and that China is not a
problem. Paul Krugman, an equally respected economist, says that Uncle
Alan
is losing his marbles. Look around you, decide if low-wage competition
from
China is negatively affecting your industry, and then you decide who is
closer to the truth -- at least, to the truth that matters most.)

I've got to cut this long-winded discussion short, which risks screwing it
up completely, but here's the most important final point. Since the
1970's,
there has been no way for the US, or any other developed economy, to wind
up
with inflated values because its workers or industries are "spoiled".
Since
currencies were cut free of gold and silver standards, and since they were
allowed to float free on world markets, it has been those currency markets
that determine relative value. If the US economy, overall, was puffed-up
by
wishful thinking or greed, the currency markets would cut it down to size
in
about 15 minutes. So your set of relative values, which all of us share to
some degree deep inside, and which we might call the "high-school civics
class system of valuation" g, is utterly shot to pieces on the world
currencies markets. They don't care what your idea of value is. They only
care what the market thinks value is. And they think that our wages,
relative to our production, are just about right. We won't know what they
think about China unless and until China cuts its currency loose to float
and to be traded freely on world markets.

Wphew. Sorry. That's 'way too short to be very useful, but 'way too long
for
this NG.


--
Ed Huntress
(remove "3" from email address for email reply)

Gunner wrote in message So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

Gunner

Well that's a good point that never seems to get addressed, food, for
instance, in the US cost more then anywhere else in the world except
the artic, I suppose. You go to a typical store in the US and its
$3/pound for lousy tomatoes or almost a dollar each for those big
apples or $4 for a box of cold cereal that has 12 cents worth of
corn/sugar in it. $1/hour isn't that bad when you can buy a bushel of
apples for 32 cents.

On 21 Nov 2003 10:31:08 -0800, the renowned
(steve) wrote:

Gunner wrote in message So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

Gunner

Well that's a good point that never seems to get addressed, food, for
instance, in the US cost more then anywhere else in the world except
the artic, I suppose. You go to a typical store in the US and its
$3/pound for lousy tomatoes or almost a dollar each for those big
apples or $4 for a box of cold cereal that has 12 cents worth of
corn/sugar in it. $1/hour isn't that bad when you can buy a bushel of
apples for 32 cents.

I think basic food is pretty cheap in the US and Canada. Many people
can afford to pay a lot for "premium" products so you get yer perfect
unblemished hothou$e tomatoes, beatifully packaged basmati rice,
prepared entrees in 4-color boxes and so on, but if you want to fill
up on potatoes, regular rice, garbanzo beans, root vegetables and
bread, pork and chicken, it's pretty dirt cheap. I can't *ship* stuff
for what potatoes sell for per pound.

Apples ("pinguo") are not particularly cheap in China. If you're
willing to eat congee (rice gruel) and steamed bread... cold rice with
a bit of rat err... well, you know what I mean.

Best regards,
Spehro Pefhany
--
"it's the network..." "The Journey is the reward"
Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog Info for designers: http://www.speff.com

"steve" wrote in message
om...
Gunner wrote in message So if it were allowed to
float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

Gunner

Well that's a good point that never seems to get addressed, food, for
instance, in the US cost more then anywhere else in the world except
the artic, I suppose.

It may feel that way, but, actually, we're among the cheapest of the
developed countries. However, if you count meat pies and if you don't ask
which part of the animal kingdom it came from, there are a few places that
have the edge.

Ed Huntress

Spehro Pefhany wrote:

On 21 Nov 2003 10:31:08 -0800, the renowned
(steve) wrote:

Gunner wrote in message So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

Gunner

Well that's a good point that never seems to get addressed, food, for
instance, in the US cost more then anywhere else in the world except
the artic, I suppose. You go to a typical store in the US and its
$3/pound for lousy tomatoes or almost a dollar each for those big
apples or $4 for a box of cold cereal that has 12 cents worth of
corn/sugar in it. $1/hour isn't that bad when you can buy a bushel of
apples for 32 cents.

I think basic food is pretty cheap in the US and Canada. Many people
can afford to pay a lot for "premium" products so you get yer perfect
unblemished hothou$e tomatoes, beatifully packaged basmati rice,


Those hothouse things are not tomatoes. They are a styrofoam facsimile with some sort of acidic liquid added, along with some
red dye. They do not belong in a food store, but rather someplace that gag gifts are sold.

michael



Best regards,
Spehro Pefhany

Ed Huntress wrote:

"Tom Gardner" wrote in message
...


After following some of the links showing job loss and productivity gains,
it's quite depressing, I've come to the conclusion that one of my main


goals


has been to eliminate employees' jobs. In the past year I have eliminated


3


people and outsourced semi-finished goods from other American companies at
least. But guess what? Boxes of parts don't have mood swings, PMS,
holidays, don't have to be heated or cooled, and NO SCRAP! They come in


at


a set cost with out the variables. Kind of sad that I can no longer


devote


the HR to barely breaking even ...on good days. But, specialized


suppliers


can do so much better due to their economy of scale than I can.



I wouldn't say you're part of the problem, Tom. Outsourcing and productivity
improvements are part of the game. If it occurs gradually, the economy
adapts, we all benefit from the improved productivity, and life goes on.

The problems are surges of imports, companies chasing low wages around the
world and shutting down US plants to do so, and foreign countries
manipulating the factors of production for the purpose of predatory pricing.
It's a combination of profiteering and predation. When the numbers behind
those phenomena get large, we wind up with industries that, suddenly and
overwhelmingly, become non-competitive

Ed Huntress




Its all happened so many times over, over the last couple of centuries.
When the industrial revolution started, here in Britain, we had the
world as our market, We imported some raw materials, those that we
didn't have naturally here, and sold to everyone. It wasn't long before
all our customers caught up, and started making the things for
themmselves, and at rates well below our own, as their costs of living
were much lower. We then bought from them. In their turn, the same
happened, and again and again. Post war, its been the turn of Japan,
then Korea, then India and China. Since nearly all our companies reckon
that they are "global" and not "national" they see no reason not to
shift labour intensive work to wherever its cheapest at the moment. The
accountants hold the sway, and claim its all for the shareholders'
benefit, which is probably true, since if a company falls behind its
competitors, it loses their market and soon folds. They have little option.

Dave. UK

"spitfire2" wrote in message
...


Its all happened so many times over, over the last couple of centuries.
When the industrial revolution started, here in Britain, we had the
world as our market, We imported some raw materials, those that we
didn't have naturally here, and sold to everyone. It wasn't long before
all our customers caught up, and started making the things for
themmselves, and at rates well below our own, as their costs of living
were much lower. We then bought from them. In their turn, the same
happened, and again and again. Post war, its been the turn of Japan,
then Korea, then India and China. Since nearly all our companies reckon
that they are "global" and not "national" they see no reason not to
shift labour intensive work to wherever its cheapest at the moment. The
accountants hold the sway, and claim its all for the shareholders'
benefit, which is probably true, since if a company falls behind its
competitors, it loses their market and soon folds. They have little
option.

Dave. UK



That's all true, but there are two issues that bother many of us in the US
with the present circumstances. One is the huge volume and acceleration of
capacity we're seeing from those two enormously populous countries. Our
standard ways of adapting to increased imports may not be able to cope with
them except by suffering some severe displacements in our economy -- ones
that many of us feel can have a permanent deleterious effect.

The second is that it's true that our multinationals have no option, but the
options are determined by the rules of the game. And they've been writing
all of the rules.

Ed Huntress

On Fri, 21 Nov 2003 11:54:19 GMT, Gunner wrote:
On Fri, 21 Nov 2003 05:27:42 -0500, Gary Coffman
wrote:

Well, economists are saying that the yuan is about 30% overvalued.
So if it were allowed to float free, a Chinese machinist would have to
be paid the equivalent of $1.30 an hour instead of $1.00 an hour to
make the same amount he is now making. That's still far below the
$15 an hour a US machinist demands.

Gary

But what is the buying power of that $1.00 as opposed to the US
machinists $15?

A US dollar is a US dollar. It has the same buying power no matter
who holds it. That's why such things as wages and prices in different
places are converted to dollars before comparisons are made.

In other words, Chinese vegetables cost the same for the Chinese
machinist as they'd cost for the US machinist (plus shipping, of course).
And conversely, US vegetables cost the same for the US machinist as
they'd cost for the Chinese machinist (plus shipping of course). Same
for Korean TVs, Tiawanese computers, US cars, etc, etc, etc.

In other words, if they're buying the *same* products from the *same*
suppliers, the only difference is shipping costs. Where it gets complicated
is when they're buying different products from different suppliers. That's
where a lack of free trade can make large differences.

For example, the US machinist is paying a 30% premium for steel, and
US products made from steel, thanks to the illegal tariffs imposed by
the US government. The Chinese machinist is paying a nearly 400%
premium on gasoline compared to the US machinist, thanks to a punitive
tax on gasoline in China. Etc.

In very general terms, for a market basket of Chinese domestic goods,
the Chinese worker is getting about 4.7 times as much for his dollar as
the US machinist is for a similar (but not identical) market basket of
US domestic goods.

Gary