The purpose of my earlier post was in fact to look precisely at the trees that seem to go unnoticed when arguments in favor of the “forests” like Detroit get thrown around.In certain areas auto-manufacturing is huge. I would like for defenders of “Detroit” to go down to the Toyota factory towns in Kentucky and the Hyundai factory towns in Alabama and explain why their towns are less important than the failing Detroit factory towns. Or go tell the coal miners in Wyoming that they should stop mining coal because the people in Western, PA would prefer to do that kind of a job. And for that matter, go tell the hundreds of thousands of families that will never have the opportunity to get a “good” job or buy an affordable car, because we have thrown billions of dollars into the continued production of a monorail.
What is disgusting is that by point of a gun, resources are being taken from Citizen A to give to Citizen B, simply because Citizen A, and hundreds of millions like him, have no interest in purchasing the products sold by Citizen B.These resources are forcibly taken because members of Citizen group B seem to have more political clout than members of Citizen group A.
At this time, rather than getting into the economic theory of regulation, it would be wise to consider something a colleague of mine has oft reminded us of … there is perhaps a better case for the taxation of the workers and companies that comprise the Big Three auto-manufacturers than there is for a bailout. After all, they have been earning rents in excess of what they would have been able to receive if there had been free-trade in America for the entire 20th century, and had they not had the advantages of belonging to labor unions that push wages and compensation costs higher, and make employment in certain auto plants impossible unless you had the favor of union membership. Why should a $20,000 per year meat-packer worker, painter, or assistant, after working a lifetime and paying high prices to support the compensation of auto-workers that make 50% more, or 100% more, or 3 times more their salary, have any obligation to continue supporting these auto workers? It would be little different than asking a freed slave to compensate his former owner for the loss of profits the owner suffered upon emancipation. Now, THAT is disgusting.
And if we grant that Detroit needs to be saved because the loss of auto jobs would devastate it, two further questions naturally arise:
- Would a falling out of favor of wicker baskets require us to save Frazeysburg, OH? Would a falling out of favor of 35mm cameras require us to save Rochester, NY? Would the creation of new screen technologies require us to save Cortland, NY? Or how about the impact of paper recycling on the paper mill towns in New England? Should we rescue all of those? These guys used to employ a lot of people in Ithaca, NY. This city got crushed when other people started making computers. And the Triple Cities have been devastated since EJ went down. Should we have tried to keep WWII going for many years since hundreds of towns thrived due to wartime production moving to those towns? Here is one such town.
- If we grant the “rescuers” that Detroit is deserving, at what point should something have been done? After all, they have been hemorrhaging auto jobs and population for years. And isn’t the following chart somewhat interesting?
Manufacturing is not even the largest sector in Detroit. Nor is it the second largest. Nor are all those manufacturing jobs in the automotive sector. And yes, lots of other non-manufacturing sectors depend on it, but that brings us back to the previous post. Manhattan was once a prosperous farming town. All along the New England coast textile mills and small farms have been destroyed, and the “character” of many of the places changed dramatically. And what about the character of Rome, Italy, after all those Chariot makers were no longer in business?
The larger point is to remember that the misfortune of a particular worker is not to be celebrated – despite proponents of bailing out the American auto manufacturers calling opponents all kinds of nasty things. But if the bailout arguments are to be taken seriously, then we might as well all put ourselves back into lean-tos, tents, and tee-pees, and plan on gathering nuts and berries while wearing pelts of beaver for clothing. Because job destruction (and job creation) is inescapable in a world of progress.
1. Is it really the same as if there was some new technology that was making the major car manufacturers obsolete, though? It would be something if we were on the forefront of some new magic shellfish powered car or something but we aren’t. One year ago those same manufacturers were perfectly strong, today they aren’t? The problem for them is sales, and that seems to have more to do with other parts of the economy collapsing, causing Americans to not be able or want to purchase cars. I’m not sure how much of the blame you can place on circumstance vs. bad practices and decisions by the companies. Of course, I guess that argument’s a bad one. Welcome to the world of snowballing. “Hey, the FINANCIAL sector got a bail-out, why can’t we?” “Hey, the AUTO industries got a bail-out, why can’t we?” “Hey, the STUDENT LOAN industries got a bail-out, why can’t we?” Nonetheless, it doesn’t seem to be the result of any new technology. It is the result of us giving a bail-out to one sector that makes the others want one too.
2. Detroit is just the obvious example that popped into my head. That’s not the point, specifically. My only point was that even if it is a small sector of the economy, as you said, their misfortune is not to be celebrated. And there’s nothing to say those jobs will come back in any form, whether in another state or in Detroit itself. People just don’t want to buy cars right now, that’s nothing one company or another will be able to solve better. Maybe it is, if they make more cost-efficient cars. Once again, I can’t say I can deny the logic but making an argument for job destruction in the name of “Progress!” feels rotten. I have much of an emotional connection to the idea anyway, after looking at poor Johnstown, PA. because my entire family going back 100 years were all been coal miners or laborers of some sort. My parents were the first to go to college. Then again, there’s absolutely nothing to be envied about a coal mining job. I can’t think of anything I would like to do less. It’s dangerous, unsanitary, and leads to an early and painful death. No one would want to have to do that. It’s a rotten, low paying job as well. Then again, 25% unemployment is nuts too.
There’s nothing that the government can or should do about it, but there’s no reason to be happy about job destruction. The best you can say is, well, it’s inevitable, and anything we do will either be unfair or make things worse for someone else. In the long run things will improve. But in the short run it is a very bad thing for quite a few people. Makes me sick to my stomach to think about the impact on people who will lose their jobs anyway. The companies I want to collapse, the workers who did nothing wrong I feel bad for. I suppose that’s the essence of it.
In other news, I heard some guy on NPR today say that “laissez-faire economics is dead.” I wonder why they didn’t say that socialism was dead once China, Russia, and oh every country that has ever tried it inevitably has famines, deaths, and various horrors plaguing their society. Funny that.
Too much Capitalism doesn’t mean too many Capitalists, it means too few…
This website made me LAUGH too. http://anarchocyclist.ca/2005/06/20/universal-basic-income/
“one of the essential elements of capitalism is private property, which embodies the idea that people get remunerated based on the power they have (ie, how many property deeds) rather than how much work they do.”
Not exactly, mate. Quite the opposite in fact. The ONLY way to get property is through work, obviously. If you don’t work, you get nothing. He’s assuming that all wealth is constant and that it is impossible to gain or lose. This is pretty obviously an incorrect assumption…I would comment, but it is a 2 year old post anyway. I’ll be looking into their more recent posts to see if I can find some other basic economic fact to refute them on. This is how I spend my free time, haha.
There’s someone named Patrick already commenting on that blog. Creepy, in fact.