Thursday, November 18, 2010

it's the labor/capital dynamic, stupid

07:06:24  ME :
07:10:31  *** FRIEND 2 acknowledged the chat request.

10:48:48  ME :
10:49:02  ME : i think i beat him to this analysis
10:54:18  FRIEND 2 : I think as long as china artificially suppresses the value of their currency, they cannot complain too loudly.  They keep it low to create export jobs.  We need jobs too
10:56:43  ME : you're misattributing
10:56:53  ME : you’re looking at a symptom
10:57:10  ME : the factories would just roll out to the next impoverished place
10:57:18  ME : already happening
10:57:29  ME : roll out
10:58:13  ME : 'free trade' and 'international economics' are just dogmas
10:58:42  ME : void of any real foundational theory at least as far as they are currently constructed
10:58:57  ME : we live in an industrial./post industrial world
10:59:07  FRIEND 2 : we need freely traded currencies which reflect economic strengths and weaknesses.  Any attempt to artificially impact the value creates imbalances.  China is complaining because we are doing what they do
10:59:16  ME : where labor cost and regulatory environments are the main costs to production
10:59:52  ME : i object to the implicit definition of 'we' as a unified interest
11:00:14  ME : i object to the implicit definition of 'china' as a monolithic unified entity as well
11:00:19  ME : that is the misattribution
11:01:14  ME : international trade is based on arbitraging living standards on the labor force
11:01:25  ME : as well as seeking the lowest regulatory cost
11:01:45  ME : in effect rolling back the advances made by the historically democratic capitalist western economies
11:01:54  ME : and returning the world to plutocracy/serfdom
11:02:00  FRIEND 2 : we use the dollar.  they use the yuan.  I am not suggesting we are unified in the way we or they think, only the currency we and they use
11:02:21  ME : 'they' are doing this, 'we' are doing that
11:02:48  ME : the nation-state analysis is an obfuscation of the real dynamic in the world economy
11:02:56  ME : sorry to use such strong language
11:03:02  ME : it is not directed at you personally
11:03:18  ME : and i have been guilty of it as well
11:03:29  ME : buying into the soap operatic day to day piece of us and them
11:03:36  ME : as it plays out on the international stage
11:03:39  ME : with the various actors
11:04:03  FRIEND 2 : china was an emerging economy.  they will soon rival us for influence on a global scale.  does the US just sit by and watch, or stay strong by using the only policy tool we have left?  congress is impotent
11:04:31  ME : i suggest spending some time evaluating the causes of that last statement
11:04:49  ME : the U.S. has not sat by and idly watched
11:05:07  FRIEND 2 : no offense taken.  i get frustrated as the US sinks due to numerous policy mistakes we have made over recent administrations.
11:05:09  ME : the 'powers that be' here have in fact perpetuated that very dynamic you attribute to the chinese
11:05:11  ME : !
11:05:47  ME : it’s the classic labor/capital framework
11:05:55  ME : that is relevant
11:06:10  ME : the trade agreements are the most anti-democratic documents ever perpetuated on the world
11:07:19  ME : please refute my postulate!
11:07:39  FRIEND 2 : I am in the middle of a trade inquiry.  back soon
11:08:43  ME : it all ties together quite nicely
11:08:59  ME : the  electoral/campaign process has been completely coopted by special interests
11:11:32  ME : the special interests represent the big businesses that have 'offshored' u.s. manufacturing jobs enabled by the enaction of the trade agreements championed by the big business lobbies]
11:12:27  ME : profits have accrued to management, shareholders and the various chinese entities that had to be 'cut in' to the profit participation to have access to the proletarian chinese workforce/population
11:12:41  ME : mainly the chinese military and communist party officials
11:13:03  ME : the new faces of 'capitalism'!!
11:14:42  ME : in an effective quid pro quo, gov't incents the financial sector to create/provide credit to the american population in order to offset the income shock of the above
11:15:37  ME : and provide a put on asset prices when the inevitable ponzi scheme from that dynamic breaks down
11:15:47  ME : that's exactly what has happened

No comments:

Post a Comment