Trouble With Trade
Paul Krugman has written a very interesting op ed piece in the New York Times.
The piece is good as far as it goes. He recognizes the problem for American workers when the U.S. imports a large amount of manufactured goods from low wage countries.
One quote that I would like to focus on is the following:
Although the outsourcing of some high-tech jobs to India has made headlines, on balance, highly educated workers in the United States benefit from higher wages and expanded job opportunities because of trade.
I find this statement to be rather ironic. In the article he admitted that he had not foreseen the negative impact of free trade on American manufacturing workers. He is now missing the impending impact on American knowledge workers.
Outsourcing of high tech jobs is happening in India, China, and many of the former republics of the Soviet Union. It is only a matter of time before the impact on knowledge workers becomes as severe as the impact on manufacturing workers.
I was just glad that I was able to retire from the high tech industry before the impact became too severe.
I do agree with Krugman that ending free trade is not the ultimate answer.
I think we need to start by allowing U.S. trade negotiators to discuss labor rights, environmental, and safety issues in all future trade talks. The Republicans in Congress during the Clinton administration passed laws preventing this. It is about time we changed these rules.
These changes may not be sufficient, but it is a start in the right direction. As with any negotiation, it is never clear that one can get what one wants out of the deal. However, you are certainly not going to get something if you don’t even ask.