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Old 10-31-2007, 12:07 PM
 
Location: The world, where will fate take me this time?
3,162 posts, read 10,295,946 times
Reputation: 1423

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Hello people!

After getting the impression that a lot of people involved in the American government plays double standards, acting tough on illegal immigration and encouraging it at the same time I thought on the possible causes of this, then I got the idea that the might just be playing the capitalism game.

Supply and Demand


Everybody knows that this is a basic rule of the market, prices are driven by this rule, when there is demand for something and the supply is scarce prices will go up, when there is supply for something and the demand is scarce prices go down.

We happen to be in a situation where American economy is rich in capital and Mexican economy rich in workforce, following the rules of the market these two driving forces have the consequence of workers crossing the border without caring if they are violating a border or the law and employeers hire them without any concern for the law, this happens because the law of the market seems to be stronger than the immigration law.

Competitivity

This is one of the most savage laws of capitalism, you either sink or swim because if you sit still for too much, your competence will end beating you, either because they are offering better prices or better quality.

What's happening with China for example? they are offering prices so low that they are impossible to beat, this is killing the economies of most developed nations in the world and most of the rising nations like Brasil, Mexico, India or Russia because we pay higher wages and offer better welfare services for our workforces, in the cases of developed nations is even worse because these wages and welfare are much higher so the prices of the manufactured goods and services in these nations tend to be higher, consumers following the wild laws of the market won't think about patriotism or ethics but of their purses and buy the cheapest good.

This creates an even stronger temptation of having an underground workforce that can receive lower wages and has less rights or cost less to employeers because this way they can offer their products of services at lower and more competitive prices, this is also the reason behind the dollar slide, politicians know this but they refuse to speak with the truth because if they did abd this workforce was legalized those competitive advantage would be reduced, they are also afraid that american citizens would be mad at them, but I guess it's worse to lie because it just creates more anger at the end.

Consequences

We all know the consequences of illegal immigration, but nobody of us ever thought what would be the consequences if the laws were really enforced and this phenomenon stopped.

Inflation

If this underground workforce disappeared, we would face a nasty inflation because then food prices would rise exponentially, after nafta was enacted the economies of America, Mexico and Canada, became very dependant on each other, we all buy and consume products made in these countries so if food prices rise they would rise in the entire region. Food prices, as well as energy prices are among the most important in economic law, because if these rise then prices in the rest of products would rise, if this happens then people will demand wages to be raised as well, if wages are raised then we would enter into a price race that will have a much nastier consequence.

Devaluation

We all know that money is just worthless paper, what makes it valuable are the products made in the country and exported abroad, if prices raise too much then products would be less competitive and government central banks would have to devaluate currency in order to be able to continue exporting them, if a currency suffers a drastic devaluation then another phenomenon would happen.

Hyperinflation

Hyperinflation is something really nasty, because if this happens, then a country's life standards will be wiped out for generations, this phenomenon would occur if a devaluation is enacted, because import products would be much higher, so we would have to enter into another price/wages race that could continue forever, futher shattering those life standards, once hyperinflation starts is very hard to control and it's very nasty because as money keeps loosing and loosing it's value, banks can't grant loans, credit becomes unavailable, retirement funds become worthless, etc.

imho these are the real reasons behind illegal immigration and the reasons of why our governments support it, they know of these consequences and fear them.

I hope I was as clear as I wanted to be.

Love and Light!

Last edited by Travelling fella; 10-31-2007 at 01:41 PM..
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Old 10-31-2007, 01:50 PM
 
Location: Sacramento
13,755 posts, read 23,217,198 times
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Let me ask a basic question. Much discussion has taken place about the products produced in China, and some problems with the quality of these products.

In light of the illegal immigration issue and overall economics, wouldn't it make sense to have some of this production moved to Mexico instead of China, and provide better overall opportunities. What precludes this migration of some of the product production? Wouldn't this be within the objectives and goals of NAFTA?
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Old 10-31-2007, 02:04 PM
 
Location: Sitting on a bar stool. Guinness in hand.
4,428 posts, read 5,491,844 times
Reputation: 1691
Default nafta theory.

Quote:
Originally Posted by NewToCA View Post
Let me ask a basic question. Much discussion has taken place about the products produced in China, and some problems with the quality of these products.

In light of the illegal immigration issue and overall economics, wouldn't it make sense to have some of this production moved to Mexico instead of China, and provide better overall opportunities. What precludes this migration of some of the product production? Wouldn't this be within the objectives and goals of NAFTA?

Agree in theory. I would rather if production have to be move anyways why not Mexico. The only problem I see is that the Mexican worker not getting a livable wage. And that cost to goods might not be what the multinationals are will to "suffer".
Also I really think the only way to stop illegal immigration is at is origin, that is Mexico itself. The Mexican government/economic structure needs to get out it culture of corruption and give something back to it's people like let say................some jobs with a livable wage. This should slowdown the flight of people from Mexico to the U.S.
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Old 10-31-2007, 02:05 PM
 
4,182 posts, read 5,658,702 times
Reputation: 1719
Quote:
Hello people!

After getting the impression that a lot of people involved in the American government plays double standards, acting tough on illegal immigration and encouraging it at the same time I thought on the possible causes of this, then I got the idea that the might just be playing the capitalism game.

Travelling fella,

I like the way you think. At least you are putting the illegal immigration issue in the context of economics. I will react to your post in due time. Right now I'm really busy with work. Thanks for your input.
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Old 10-31-2007, 02:16 PM
 
Location: The world, where will fate take me this time?
3,162 posts, read 10,295,946 times
Reputation: 1423
Quote:
Originally Posted by NewToCA View Post
Let me ask a basic question. Much discussion has taken place about the products produced in China, and some problems with the quality of these products.

In light of the illegal immigration issue and overall economics, wouldn't it make sense to have some of this production moved to Mexico instead of China, and provide better overall opportunities. What precludes this migration of some of the product production? Wouldn't this be within the objectives and goals of NAFTA?
NewToCa, Originally a lot of manufacturing plants moved to Mexico we still have lots of Maquiladoras as we call them here, specially in the Border states, they pay much better wages and give better benefits than most jobs here, unfortunately then investors saw China as a better option because they have thousands of workers there who live under slavery conditions and it's dirt cheap.
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Old 10-31-2007, 03:26 PM
 
Location: Pa
20,310 posts, read 18,881,481 times
Reputation: 6517
Quote:
Originally Posted by NewToCA View Post
Let me ask a basic question. Much discussion has taken place about the products produced in China, and some problems with the quality of these products.

In light of the illegal immigration issue and overall economics, wouldn't it make sense to have some of this production moved to Mexico instead of China, and provide better overall opportunities. What precludes this migration of some of the product production? Wouldn't this be within the objectives and goals of NAFTA?
LOL Mexico did get these benifits and in turn outsourced to China.... Lets not forget the mad rush of companys on US soil pulling up roots and dashing to mexico only to be handicapped by the mexican gov.
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Old 10-31-2007, 04:14 PM
 
Location: California
3,432 posts, read 2,157,153 times
Reputation: 138
Quote:
Originally Posted by tinman01 View Post
LOL Mexico did get these benifits and in turn outsourced to China.... Lets not forget the mad rush of companys on US soil pulling up roots and dashing to mexico only to be handicapped by the mexican gov.
Mainly why there is not much outsourcing going to Mexico. All going to china.
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Old 10-31-2007, 04:20 PM
 
259 posts, read 852,582 times
Reputation: 132
An original by Travelling Fella
Quote:

Capitalism, and the economics behind illegal immigration.


Hello people!

After getting the impression that a lot of people involved in the American government plays double standards, acting tough on illegal immigration and encouraging it at the same time I thought on the possible causes of this, then I got the idea that the might just be playing the capitalism game.

Supply and Demand

Everybody knows that this is a basic rule of the market, prices are driven by this rule, when there is demand for something and the supply is scarce prices will go up, when there is supply for something and the demand is scarce prices go down.

We happen to be in a situation where American economy is rich in capital and Mexican economy rich in workforce, following the rules of the market these two driving forces have the consequence of workers crossing the border without caring if they are violating a border or the law and employeers hire them without any concern for the law, this happens because the law of the market seems to be stronger than the immigration law.

Competitivity

This is one of the most savage laws of capitalism, you either sink or swim because if you sit still for too much, your competence will end beating you, either because they are offering better prices or better quality.

What's happening with China for example? they are offering prices so low that they are impossible to beat, this is killing the economies of most developed nations in the world and most of the rising nations like Brasil, Mexico, India or Russia because we pay higher wages and offer better welfare services for our workforces, in the cases of developed nations is even worse because these wages and welfare are much higher so the prices of the manufactured goods and services in these nations tend to be higher, consumers following the wild laws of the market won't think about patriotism or ethics but of their purses and buy the cheapest good.

This creates an even stronger temptation of having an underground workforce that can receive lower wages and has less rights or cost less to employeers because this way they can offer their products of services at lower and more competitive prices, this is also the reason behind the dollar slide, politicians know this but they refuse to speak with the truth because if they did abd this workforce was legalized those competitive advantage would be reduced, they are also afraid that american citizens would be mad at them, but I guess it's worse to lie because it just creates more anger at the end.

Consequences

We all know the consequences of illegal immigration, but nobody of us ever thought what would be the consequences if the laws were really enforced and this phenomenon stopped.

Inflation

If this underground workforce disappeared, we would face a nasty inflation because then food prices would rise exponentially, after nafta was enacted the economies of America, Mexico and Canada, became very dependant on each other, we all buy and consume products made in these countries so if food prices rise they would rise in the entire region. Food prices, as well as energy prices are among the most important in economic law, because if these rise then prices in the rest of products would rise, if this happens then people will demand wages to be raised as well, if wages are raised then we would enter into a price race that will have a much nastier consequence.

Devaluation

We all know that money is just worthless paper, what makes it valuable are the products made in the country and exported abroad, if prices raise too much then products would be less competitive and government central banks would have to devaluate currency in order to be able to continue exporting them, if a currency suffers a drastic devaluation then another phenomenon would happen.

Hyperinflation

Hyperinflation is something really nasty, because if this happens, then a country's life standards will be wiped out for generations, this phenomenon would occur if a devaluation is enacted, because import products would be much higher, so we would have to enter into another price/wages race that could continue forever, futher shattering those life standards, once hyperinflation starts is very hard to control and it's very nasty because as money keeps loosing and loosing it's value, banks can't grant loans, credit becomes unavailable, retirement funds become worthless, etc.

imho these are the real reasons behind illegal immigration and the reasons of why our governments support it, they know of these consequences and fear them.

I hope I was as clear as I wanted to be.

Love and Light!
Not all of your economic points are accurate! There are two sides to every economic story!!! Lets see: What would happen if 20 million illegals left the US!!

Frosty Wooldridge -- What if 20 Million Illegal Aliens Vacated America?

Last edited by Dee62; 10-31-2007 at 04:30 PM..
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Old 10-31-2007, 04:30 PM
 
Location: California
3,432 posts, read 2,157,153 times
Reputation: 138
Quote:
Originally Posted by Dee62 View Post
An original by Travelling Fella

Not all of your economic points are accurate! There are two sides to every economic story!!! Lets see: What would happen if 20 million illegals left the US!!

Frosty Wooldridge -- What if 20 Million Illegal Aliens Vacated America?

I would actually like to see where that guy got his source from on all of that information.
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Old 10-31-2007, 07:50 PM
 
Location: The world, where will fate take me this time?
3,162 posts, read 10,295,946 times
Reputation: 1423
Quote:
Originally Posted by tinman01 View Post
LOL Mexico did get these benifits and in turn outsourced to China.... Lets not forget the mad rush of companys on US soil pulling up roots and dashing to mexico only to be handicapped by the mexican gov.
There is some truth on this indeed, Mexico has very high energy rates and some other things that are a handicap for foreign investments, that's one of the reasons they are passing a lot of reforms now, but what made the companies go to China is simple.

Nobody in the world even developing countries like Mexico can compete with China's conditions who pays slave wages and has a slave workforce with no benefits.

Mexican worker benefits are meager compared to American, but they are generous compared to China's

Also their currency is artificially undervalued, that makes good made in China dirt cheap, because of the growth the've been experiencing these years, their currency value should be higher than the Brazilian real and almost on pair with the dollar, but if this happened nobody would be buying Chinese goods because their price wouldn't be competitive.
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