Someone please explain how free trade has helped America (buy, sell, companies)

[MorningGlory]

Everywhere I look I see bad indicators for the US economy. Our factories are being shut down. I know so many white collar workers who have been laid off, and can't find a new job. IT jobs are going to India and anywhere else where workers are cheap. AMERICAN companies are striving for a 20/80 ratio (20% American workers, 80% off-shored). They are being VERY quiet about this.These are not low paying jobs, they are the high paying IT jobs.

So, if America makes nothing, produces nothing, and survives basically on selling cheap stuff from other countries, where does that leave us? Remember when Fords were made in the US? Now they are made in Mexico, but are the cars cheaper for us? NO! The only benefactors are the CEOs and stockholders.

How long til the US wakes up???

Oh, and China's economy grew over 11% in the fourth quarter last year. What a coincidence.

I can't tell you what I would do for, say, a vacuum cleaner, made in America by Americans, that didn't BREAK within 1 month of its purchase!

[S6Sputnik]

All trade is good....We have gotten a lot of things for less than we could make them for ourselves.
We have to be smarter and make stuff they cannot make and sell it to them for more We are failing a bit on the last part, but not entirely...

[MorningGlory]

Originally Posted by S6Sputnik

All trade is good....We have gotten a lot of things for less than we could make them for ourselves.
We have to be smarter and make stuff they cannot make and sell it to them for more We are failing a bit on the last part, but not entirely...

Well name something we are making and selling to them for more.

[Niners fan]

There is something I have been wondering for a while....

Don't they teach Comparative Advantage in school anymore? It seems like so many people don't understand that concept or that it exists. It directly answers how free trade is good for America.

(I don't know how old you are MorningGlory. I am 37.)

[MorningGlory]

Originally Posted by Niners fan

There is something I have been wondering for a while....

Don't they teach Comparative Advantage in school anymore? It seems like so many people don't understand that concept or that it exists. It directly answers how free trade is good for America.

(I don't know how old you are MorningGlory. I am 37.)

I am 37 too, and have a lot of college-educated friends with no jobs.

[Huckleberry3911948]

free trade would help america
we never got it
we got not free trade (trade deficit)
is now a good time for me to start canning tomatoes?

[Niners fan]

Originally Posted by MorningGlory

I am 37 too, and have a lot of college-educated friends with no jobs.

So we are the same age. I didn't mean any disrespect by my response.

Comparative Advantage states that if a country can make a product better or more efficient than us then it free us up to make things that we can do better.

There is a book by John Stossel about Lies and Myths. I don't recall the exact title off-hand. He talks about how outsourcing jobs actually helps the US economy in the long-run. He interviewed a group of outsourced employees and all of them had better jobs than the ones they lost.

This is a complicated question and I am not economics expert but competition is what keeps prices down. To use an example of you cited, cars are made in Mexico more cheaply than here. But are the auto companies more profitable than they were before? I doubt it. Because if one of them was then a competitor would undercut them until price was at a balanced level. (This doesn't work with gas prices very well because there are some competition issues there.) Part of the problem with the auto industry is the cost of health care for retired workers. A worker can retire at 50 and live for another 30 years collecting full pay and benefits. I am not passing judgement on that (in this thread, at least) but it does drive up the cost of the car. Plus the amount of regulations on the industry has went up over the years.

CEOs do make A LOT more money than the workers. But for every person that can make a competent CEO there are thousands of people than can make a competent worker. The skill set of a CEO is much rarer than a worker and thus more valuable.

Competition is always good for the consumer. Look how much better our cars are because we have to compete with the Japanese.

I don't know what your unemployed friends are trained to do or where you live but the unemployment rate is 5%. That is extremely low in historical terms.

I lived in Argentina for a while and they have a closed society there. Imports are very expensive because of tariffs and they try to make everything in the country. But their standard of living has not risen as fast as ours, their unemployment rate is higher, and inflation is a constant problem.

I know this response is a little scattered but I'm getting tired!

[meimei88]

Like boeing airplanes! We sold a lot of them to china and made billions of dollars. At the same time, a chinese company only got paid 2$ to making a brand name shirt or a pair of Nike shoes. Do the math! Who get the big fat profit! As for the trade deficit, the number
you get from the goverment is not totally ture. For example, for one pair of Nike shoes, chinese company only got 2$ from Nike (a american company). But that pair of shoes is priced 100$ in US store, so our goverment put that 100$ into that so called Trade Deficit. Is that fair? Who got that big piece of pie? Chinese worker? Average american comsumer? Or those big company?

[mikeyyc]

You forget who owns the big companies - shareholders. People want to complain all the time about big oil, Walmart, Nike, et al. Rather than complaining, and then buying the useless product, buy their shares, and MAKE money when someone buys their stuff.

[meimei88]

I agree with you Mikeyyc! My point is we do get benifits from the free trade. Like cheaper products we need for daily life. But we are too good at spending instand of saving. Talking about trade deficit, nobody points a gun at us and say "Buy This". We did it in our own will. So stop acting like victims here, stop buying unnessery things. Put the money in the bank or buy Nike and Boeing stocks like Mikeyyc recommanded!