Jobs Jobs Jobs

Counterpunch has an article by about how the “Bush War Economy” is impacting the US economy.

I have some common ground, but it’s articles like these that just leave me wondering where some people’s economic thinking comes from.

I’m going to deconstruct the article here.

The Bush War Economy:
Exporting Jobs and Security

By BRUCE K. GAGNON

Ford Motor Company announced On January 23 that it will be cutting as many as 30,000 jobs and will shut down 14 factories as a result of continuing losses.

Ford, now hires about 123,000 workers in North America and lost $5.5 billion in those operations in 2005.

General Motors Corporation last year decided to close all or part of 12 plants and 30,000 jobs in the U.S. by 2008.

With China’s recent introduction of a car selling for $10,000 in the U.S., Ford and GM have hit the wall. They have been building big SUV’s in recent years and now that gas prices are rising dramatically their sales are dropping significantly. The workers on the China car are making $3.50 an hour compared to the good wages and benefits at the unionized auto plants in the U.S.

Ok, so why did these companies downsize? Maybe it has to do with the fact that Fords and Chevys suck. (Chevys less so, and Dodge - don’t get me started on those crapheaps). GM has had losses because they have lost market share. These losses, apparently, came to the SUV market. Geez, could that have anything to do with the high price of oil? Could it have anything to do with the fact that Toyota and Honda have responded by building better, more efficient vehicles?

Man, Asian companies build a better vehicle and suddenly the “Bush Oil Machine” is to blame because consumers demand cars that are better on gas.

So what if Chinese auto workers make $3.50 an hour? The CIA world Fact Book claims the Per Capita Purchase-Power Parity level of GDP in China is around $6,200 US. Now, at $3.50 an hour, 40 hours a week, 50 weeks of the year, a Chinese worker is making $7,000 US per year. But since it’s China, they probably don’t get two weeks worth of vacation and likely put in 80 hour work weeks, which would put a Chinese auto worker at just above $14,000 per year. Man, that probably beats rice farming by a long shot.

Nevetheless, here’s an interesting nugget of insight:

What does this mean for social spending back home? As the job base dries up in the U.S. so will the tax base at the local-state-federal levels. There will increasingly be cuts in social programs. Education will be cut and privatized so that only the children of the rich can afford, without incurring massive debt, a college education. Thus the only real job prospects for many young people will be in the military - endless warriors. Thus the Pentagon’s statement that there will be no need for a draft. When the military is the only job around legions of poor and working class kids will have few other options.

Hmm. Sounds somewhat right.

But this article closes with a classic clincher:

We must fight to have a fair tax system in the U.S. that does not let the rich, powerful, and corporate elite get away with not paying taxes. We must fight for public education and affordable college options for our kids. We must fight to create new jobs in manufacturing sustainable technologies like solar, wind power and public mass transit systems. We must fight for health care for all. And we must escalate our educational work and action now, before it becomes too late.

Man I hate those closings. We must make reality conform to our ideals rather than adapting to it. Reality is whatever we say it is, and if things appear out of line, we must fight. Before it’s too late. You know, before we get sent to the Conservative reeducation camps to manufacture RFID chips for infared surveillance sattelites. Or whatever.