No one's minding the store
By ERNEST F. HOLLINGS, former U. S. senator
AUG. 6, 2009 -- Henry Ford developed the middle class in America by doubling the minimum wage, providing health care and retirement benefits for his employees. We in public service trusted business to look out for the economy. After all, business knew how best to protect its investment and the nation's economy. As General Motors' Charlie Wilson said: "What's good for General Motors is good for the country." That's when business depended on the nation's economy.
Globalization changed all that. Now business doesn't necessarily depend on the economy of the country where it is headquartered. Globalization is nothing more than a trade war with production looking for a country cheaper to produce. Business now looks to the economy of the cheaper country, with GM, Intel, and Microsoft not only locating research and production but awarding community grants in China. The problem with the economy is that Congress has yet to cope with this change. We in Congress got so used to relying on Corporate America to tell us their needs; to tell us the needs of the nation's economy, that we forgot that the economy was -- not the responsibility of business -- but of the Congress.
I, Section 8, of the Constitution calls on Congress to regulate trade.
Any hint of this responsibility is avoided by Congress doing what Corporate
America counsels - free trade, avoid protecting the economy. As Henry
Clay said of free trade: "It never existed
it never will."
But all in Congress go along with the charade. We Democrats, particularly
in the Senate, can repair a major flaw in our political armor by becoming
pro-business, chanting "free trade," and doing nothing to have
the nation compete in globalization. Investment, research, development,
jobs, trade - literally the economy - follows production offshored. Congress
has no idea of doing anything to stop the job loss from offshored production
and strengthening the economy unless the President calls for it.
Serving in the state legislature in Illinois and just two years in the United States Senate before running for the presidency, President Obama hardly ever debated trade or voted on trade. In the presidential race the nearest they got to a debate on trade was that NAFTA was a flawed agreement. But there was never any understanding or debate about the cause of offshoring. Everybody was for jobs, but no debate of the loss of jobs to offshoring, the real loss of the nation's economy.
With Larry Summers in charge of the economy for President Obama, "mum" is the word on offshoring. Summers has just completed an appearance on Meet the Press to discuss the economy and jobs. Not a word about offshoring. Yet the Princeton economist, Alan Blinder, warned in February 2007 that in the next ten years the United States would lose thirty to forty million jobs to offshoring. When Summers was questioned on Meet the Press about a stimulus that was "supposed to create three to four million jobs when all is said and done," Summers never suggested anything to slow or stop an average loss of three to four million jobs to offshoring each year for the next seven years.
economist, Roger Lowenstein, in his recent article on jobs and the economy
in the New York Times Magazine never mentions the problem of offshoring.
Paul Krugman, the Nobel Prize economist, writes regularly about jobs and
the economy, but no mention of losing an average three to four million
jobs a year to offshoring. Business and their economists look upon offshoring
as an opportunity not a problem. That's because anything that can be produced
cheaper offshore from the United States is bound to be offshored from
the United States - including research, software, law work, accounting
work, and heart transplants.
for all, let's do away with outmoded ideas about "protectionism"
and "free trade." The fundamental of government is to protect.
Our nation was founded on protectionism. And enough of this trade charade
of entrepreneurship and innovation - windmills and diploma mills -- educate,
educate. We're producing a BMW in Spartanburg, South Carolina, of equal
quality as one produced in Munich, Germany. In fact, Intel used South
Carolina's technical training program to get its Dublin, Ireland, plant
up and running. The educated and skilled in the United States are without
jobs. What's needed to be educated is the President and Congress.
Senator Hollings of South Carolina served 38 years in the United States Senate, and for many years was Chairman of the Commerce, Space, Science & Transportation Committee. He is the author of the recently published book, Making Government Work (University of South Carolina Press, 2008).
© 2009, Ernest F. Hollings. All rights reserved. Contact us for republication permission.
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