L.A. Political Hack as Trade Rep?

President-elect Barack Obama has apparently offered the U.S. trade representative job to Xavier Becerra, a truly mediocre machine-politics hack from Southern California. My former colleagues at the L.A. Times editorial board say it well:

He's a terrible choice, and not just because of a history of unsavory behavior -- such as his successful efforts  to win a pardon from President Clinton for convicted cocaine kingpin Carlos Vignali, or the screamingly unethical robo-calls his campaign engineered during his run for Los Angeles mayor in 2001. Becerra is a leader of the Democratic Party's protectionist wing, which opposes NAFTA, the Dominican Republic-Central American Free Trade Agreement and most other trade deals.

Free trade irks many liberals because it can shift American jobs to other countries, but it almost invariably does more good than harm, lowering prices for goods and creating new jobs to make up for those it displaces. What's more, history shows that the last thing the country should do during an economic downturn is become more protectionist.

Obama railed against trade agreements every day on the campaign trail, so this pick, and the new president's potentially disastrous approach toward trade, should really come as no surprise.

David Weigel wrote about the death of free-trade Democrats back in the May issue, and Tim Cavanaugh lamented the passing of the New Democrats during the party's national convention this summer.


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  • Bingo||

    Paging joe to explain why this represents hope, change, a good idea, etc

  • PAc||

    So freeing cocaine kingpins is a bad thing?

  • ||

    I doubt Joe comments on this or if he does he will have an excuse about how reasonable the guy really is.

  • SIV||

    Another win for the Obamatarians!

  • Pac||

    HOw about recommending him for Drug Czar instead?

  • ||

    "HOw about recommending him for Drug Czar instead?"

    That would just mean the dealers with money would get off. Trust that me that bastard wouldn't walk accross the street to get someone off on a drug charge if it didn't involve collecting a lot of money.

  • ||

    I don't know what y'all are complaining about, It's well documented that protectionism brought us out of the great depression lickity split. Worldwide, everybody raised tariffs on imported goods, protecting their own industries. Thus, the worldwide calamity ended in 1931.

    ♪You go back, Jack, do it again, wheels turning' 'round and 'round
    You go back, Jack, do it again♪

  • ||

    Progressives must be very disappointed.

  • Jordan||

    Oh boy, subsidizing American corporations, moving from free trade to "fair" trade, and making the scary-looking-guns-ban permanent. What won't President Hopey do? Keep the change, you piece of shit.

  • ||

    Let us now recite the mantra:

    level the playing field
    *ding*
    level the playing field
    *ding*
    level the playing field
    *ding*
    level the playing field
    *ding*
    level the playing field
    *ding*
    level the playing field

  • ||

    Bingo | December 5, 2008, 12:32pm | #

    Paging joe to explain why this represents hope, change, a good idea, etc


    What are you, kidding me? You don't think this appointment represents a change?

    Whatever.

    Anyway, for a major media outlet to refer to "the Democratic Party's protectionist wing" tells me very little. The media is very lockstep in their support for the Free Trade agenda. Even wishy-washy stuff like negotiating more trade deals, but including worker and environmental standards, is routinely described in hysterical terms.

  • ||

    "I doubt Joe comments on this or if he does he will have an excuse about how reasonable the guy really is."


    Joe is nothing if not predictable.

  • BDB||

    Even wishy-washy stuff like negotiating more trade deals, but including worker and environmental standards poison pills, is routinely described in hysterical terms.

    FTFY, joe.

  • ||

    President-elect Barack Obama has apparently offered the U.S. trade representative job to Xavier Becerra, a truly mediocre machine-politics hack from Southern California.

    At least he's branching out from Chicago machine-politics hacks to machine-politics hacks across the country.

  • ||

    Speaking of disppointed progressives, anybody see this?

    http://www.gallup.com/poll/112804/Obama-National-Security-Picks-Get-High-Marks.aspx

    Man, I'll tell you, it's civil war in the Democratic Party! Civil war!

    94% approval among Democrats? Approval of the Clinton pick ten points higher among Democrats than among the public, at 79%? Clearly, progressives are terribly disappointed.

    I hope Ken Burns doesd the documentary. Dear mother *wah wah wah wah* my battalion engaged the DLCer today *rwah wah wah rwah wah* There were four thousand of us when the battle began *wah rwah wah* Now there are fourteen *wah rwah rah wah* Lord, I miss Maine.

  • ||

    "I doubt Joe comments on this or if he does he will have an excuse about how reasonable the guy really is."

    So, by commenting on this, and not saying anything about the guy, I proved your prediction right?

    Whatever.

  • bubiyuqn||

    I'm inclined to agree with joe, to some degree. Keep in mind that change isn't always for the better, even when you think you've hit rock bottom. Although this guy seems like a loss, he will realistically probably represent a change in trade policy.

  • ||

    BDB,

    It's difficult to call something a poison pill when it is routine, and common, and has widespread support.

    Heck, Clinton negotiated labor and environmental deals into NAFTA - he just made them side bars instead of working them into the body of the deal.

  • ||

    I don't think this guy is what you'd call "reasonable," John. I think you're going to hate him. I think he's going to make you froth at the mouth.

    Which would be pretty awesome all by itself.

    The times they are a-changin'. We're going to get centrist trade policy instead of center-right trade policy, with new trade deals that are moderately more responsible than the last few being struck with different countries.

  • ||

    I want trade anarchy.

  • ||

    Does anyone remember how Democrats once Clinton was safely out of office and there wasn't an election to win all said the end of term pardons were so bad and how Clinton had embarassed himself? I do. Of course now eight years later and the first time the Dems are back in power, Holder and this clown, two guys closely associated with the two most outragous pardons get top spots. I guess all that outrage was really sincere.

  • ||

    "I don't think this guy is what you'd call "reasonable," John. I think you're going to hate him. I think he's going to make you froth at the mouth."


    Why do say that? I like Nepolotano and Clinton and lots of other Obama appointments. Other than Holder, Daschle and this guy, Obama hasn't made a bad appointment. If anything it is surprising, given his record so far, that he would flub this so badly.

  • BDB||

    It makes no sense that pardons can't be overridden by 2/3 of Congress. There ought to be an amendment.

  • ||

    That's not a bad idea, BDB.

  • ||

    J Sub D,

    Get with the program. The begining of a deep recession is just the time to batten down the hatches and keep all those evil foreigners from taking our market. That was Hoover did and you know we could use man like Herbert Hoover again. Also, didn't you hear that Obama is going to make us loved in the world? Screwing all of our allies on trade deals will certainly go a long way towards that.

  • ||

    It makes no sense that pardons can't be overridden by 2/3 of Congress.

    Checks and balances. The guy was convicted under laws passed by Congress. Presidential pardon is a relieve valve against the event Congress is behaving wrongly. It should not require Congressional approval.

  • BDB||

    Isn't there SOME governmental body that could check Presidential pardons? It really shouldn't be absolute. It's way too monarchial.

  • ||

    The begining of a deep recession is just the time to batten down the hatches and keep all those evil foreigners from taking our market.

    I defy you to name a single trade barrier that will be increased by the Obama administration.

    One. C'mon, smart guy, you're so certain we're going to "batten down the hatches."

    So, spill it. Is he going to raise tariffs on Pakistani steel? Set a quota on Japanese trucks?

    Herbert Hoover actually imposed protective tariffs and quotas. I dare you to put in writing a prediction that you think Obama is going to do the same.

  • ||

    BDB | December 5, 2008, 1:43pm | #

    Isn't there SOME governmental body that could check Presidential pardons? It really shouldn't be absolute. It's way too monarchial.


    Let's keep in mind here, the pardon power is one that is solely concerned with preventing state power for being exercised against an individual. The founders were rather more concerned with preventing an overabundance of that sort of thing than its opposite.

    Is there really a problem related to too many pardons that is worth reducing the president's discretion to call off the dogs?

  • ||

    Joe,

    I think trying to renegotiate NAFTA would count. Certainly, that is what Becerra would like to do. But maybe Obama was lying about that. That is what he told the Canadians anyway.

    More importantly, even if you are right, and I hope you are, that Obama won't renig on our trade deals and raise tarriffs, it is pretty clear that by appointing this guy, he is had no interest in lowering them. That is wrong. It is wrong for the country's economy and wrong for us internationally. If Obama doesn't intend to do that, why the hell did he make someone who is opposed to new trade deals his trade representative? Even beyond that, it would be nice if someone were ever held accountable for the Clinton Pardons, but the Holder appointment and this one make it clear no one ever will be.

  • BDB||

    Joe, someday there is going to be a horribly corrupt President who, at the end of his term, issues a blanket pardon for himself and everyone in his administration that bars them from any investigation or conviction of wrongdoing if the pardon power isn't checked somehow. It WILL happen.

  • ||

    Heck, Clinton negotiated labor and environmental deals into NAFTA - he just made them side bars instead of working them into the body of the deal.

    joe,
    If Obama follows the Clinton method, all will be ducky. This appointment seems to indicate a far different approach. I know you read this comment (with links) from a couple of months ago.

  • ||

    The search function here can be such a time saver.

  • ||

    Pardon is, in effect, a monarchical power. The democracy has screwed one of the president's "subjects" and there is but one mechanism the democracy allows that can work outside the democracy: presidential pardon.

    That lame duck presidents whore it out is a problem, but not a problem that overrides the need for it.

  • ||

    I think trying to renegotiate NAFTA would count.

    Wouldn't that depend on what he renegotiated into it?

    There are a lot of things in NAFTA. Some of them lower trade barriers, some of them harmonize standards, some of them establish courses of action if one or another party violate the agreement.

    So, c'mon, what trade barrier do you think he would increase?

    More importantly, even if you are right, and I hope you are, that Obama won't renig on our trade deals and raise tarriffs, it is pretty clear that by appointing this guy, he is had no interest in lowering them. See, I think you're wrong. I think you're confusing "not lower them" with "not lower them to precisely the same degree, and in precisely the manner, I'd like to see."

    I'll make my prediction right now: there will be several trade deals signed during the Obama administration, probably including a deal at Doha, and the sum total of international trade between us and the rest of the world will increase as a result.

  • BDB||

    Maybe there should be an amendment banning pardons after Election Day.

  • ||

    Maybe they move the inauguration up to the first Sunday in December.

  • ||

    See, I think you're wrong. I think you're confusing "not lower them" with "not lower them to precisely the same degree, and in precisely the manner, I'd like to see."


    You may be right. Since neither of us can read Obama's mind, only time will tell. If you are right though, this guy is a terrible choice to be trade rep. What ever Obama thinks, this guy has shown he had no interest in signing trade deals or lowering tarriffs. It would be like making Radley Balko the head of DEA. Yeah, maybe the President who did it wants to enforce the drug laws, but he would sure be making a strange choice in Balko to do it.

  • Orange Line Special||

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    This really is too rich. The LAT's beloved TonyVillar also pushed for the pardon.

    And, the idea that BHO is against "free trade" (and thus would cost the buddies of the LAT money) is ludicrous. Obama supports Bush's SPP.gov, he's lied about the CFR, and he admits to misleading about his opposition to NAFTA.

    If Welch weren't simply a hack, he'd realize that BHO is in the bag, he's just playing a game to keep those on the left happy.

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  • Seward||

    Given the mercantilist policies that the Obama folks proposed during the campaign, yeah a protectionist stance isn't that surprising. Then again, mercantilism/protectionism is what a large swath of the U.S. population favors.

  • bubiyuqn||

    slightly off topic, but I fail to see the importance, cleverness, or utility of repeatedly framing joe as a democrat, because, well, he is. the problem here is that when you accuse joe of being predictable, etc, I think you overlook the fact that some people might actually agree with restricting free trade, and a lot of those people vote democrat. people are basically saying, "well, joe, you're a democrat. tell us how this democrat serves libertarian interests". well, the dude doesn't serve libertarian interests, but he serves a whole lot democrat-voting union interests, etc. it's not any sort of cleverness on your part to predict that democrats support their own platform. not that I agree with joe on many things, but I mean, come on, this is just getting old.

    on pardons: the executive's purpose is to enforce the law. the pardon is one manifestation of the president's power to do so. as everyone who has participated in a conviction on the part of the government (except the impartial judge) has been under the executive's authority, it should be the sole discretion of the chief executive to decide if his underlings were correct in their conviction. congress already did its job. in regards to a blanket pardon of everyone involved in corruption, to say it WILL happen requires a crystal ball, and then in the event that it does happen, you have a systematic failing of the government to enforce the laws, in which case the fact that the people voted for a non-function government is kind of their fault. if it pissed people off enough, then you'd probably see justice in the form of a mob, whose vigilantism could very well be pardoned.

  • Alice Bowie||

    Free trade irks many liberals because it can shift American jobs to other countries, but it almost invariably does more good than harm, lowering prices for goods and creating new jobs to make up for those it displaces.


    What New Fuck'n JOBS have been created via OUTSOURCING. I mean, besides the administration of outsourcing and laying people off?

  • Seward||

    joe,

    ...there will be several trade deals signed during the Obama administration, probably including a deal at Doha...

    The Doha is dead and even if it is successfully brought back to life the U.S. is one but many actors in the Doha round.

    Oh, and they haven't met at Doha since the first ministerial round back in 2001.

  • Mad Max||

    "It makes no sense that pardons can't be overridden by 2/3 of Congress. There ought to be an amendment."

    As if the problem with federal criminal justice is that there aren't *enough* people being convicted and sent to prison.

    I can see requiring Congressional approval if the President wants to pardon *himself.* I can see *impeaching* a President for abusing the power (eg, doing it for bribes, or to cover up his own crimes), without affecting the validity of the underlying pardon. Otherwise, the pardon power is such an important last-resort protection for individuals that I don't want it curtailed on the federal level.

  • Seward||

    bubiyuqn,

    Well, protectionist notions cut across both parties and they serve interests in both parties.

    Alice Bowie,

    Focusing on what policy creates X amounts of jobs is really not that important of a question. Job creation is far less important than levels and types of production. Indeed, isn't that one of the more significant insights of comparative advantage?

  • Orange Line Special||

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  • Seward||

    BTW, one of the things that convinced me not to vote for Obama was the whole we'll give tax credits to companies which create jobs in America. It is a policy which simply makes no sense. We really should not care where something is produced, and even if we did (say if we had a criteria of free vs. unfree nations) we shouldn't be concerned with whether it was produced in the U.S.

  • ||

    What New Fuck'n JOBS have been created via OUTSOURCING.

    Outsourcing creates new higher value jobs. For instance, outsourcing phone call support could be exactly the difference between an entire company that provides a support-intensive product existing -- with all the higher valued jobs that entails -- and not existing.

    In less on-the-margin cases, the outsourcing of lower valued work means that domestic employees can concentrate on higher valued work and receive greater compensation for it. And the savings of outsourcing are passed to consumers, providing them more wealth to buy other products and services, creating jobs in those arenas.

    Or maybe you were just being sarcastic...

  • Alice Bowie||

    Seward ... u say job creation is not that important ... well, perhaps.

    Take IT jobs, for example, these good paying middle-class jobs are gone forever. Yea, there's still some people here working in IT. However, very soon, US companies that want to compete will have to pretty much let go of most of their IT professionals in the US.

    This will probably be true for any job that can be done behind a desk. Accounting, IT, customer service, collections, etc.

    What's the point in saving for children's college education? Corporate America wants cheap-meek labor. The type of labor that doesn't make to much demands on senior management. You know, those pesty things like healthcare, time off, raises, good work env, etc.

    The way it's goin' the best thing we can do 4 our children is leave them a lot of money...so, stock up on life insurance :>

  • Alice Bowie||

    Outsourcing creates new higher value jobs.

    Yea Mike, I can tell by the forever rise in the unemployment rate.

  • Pac||

    Hey Alice, i think you need to ask again. You sure as hell didn't get an answer

  • ||

    You mean the unemployment rate that, until the recent financial crisis and government overreaction, was at historic lows for fifteen solid years?

    Now I know you are being sarcastic.

  • Seward||

    Outsourcing does not create newer, better jobs, nor is it bad for an economy. Innovation and trade (the two most important areas of economic growth) are the keys to that, and those have to do with levels and types of production. Jobs are an outgrowth of that, but job creation should likely never be the goal of either a private or public policy, plan, etc.

  • Orange Line Special||

    Of course, there isn't anything to laugh at me about. I'm a brilliant InvestigativeJournalist, while the rest of you libruhtarian hacks wallow in your impotence.

  • rhywun||

    The only reason free trade in goods works so well for us is because we don't have free movement of people. If we did, there wouldn't be a labor cost differential to take advantage of.

  • Paul||

    Compare:

    pardon from President Clinton for convicted cocaine kingpin Carlos Vignali,



    with:

    Becerra is a leader of the Democratic Party's protectionist wing, which opposes NAFTA, the Dominican Republic-Central American Free Trade Agreement and most other trade deals.



    I wonder if Vignali was for "free trade" with Latin America?

  • Paul||

    Paging joe to explain why this represents hope, change, a good idea, etc

    In a way, this does represent change. Possible change to free-trade agreements.

  • ||

    If anyone with more tolerance for idiocy than I clicked on one or more of LoneWacko's links, anything new or interesting?

  • Pac||

    You mean the unemployment rate that, until the recent financial crisis and government overreaction, was at historic lows for fifteen solid years?

    Now I know you are being sarcastic.


    I'm so glad to hear you rely and trust govt. statistics.

    Now i know you don't have a clue.

    In other news, I'm interested in hearing what new high paying jobs have been created.

  • Alice Bowie||

    Then perhaps we should send ALL of the JOBS to Mexico. This was Americans will have better jobs.

  • Pac||

    C'mon Matt, besides using piss poor citations, what jobs have been created versus the outsourcing?

  • No Name Guy||

    Well, as it typical for nannies of all stripes - left, right and otherwise, this clown represents those that want to tell me, no.....force me my coecerive measure, to do things THEIR way.

    In this case, this bastard wants to force me to buy shit from folks I wouldn't freely choose to buy from.

    (shakes head, wishing meddling nanny bastards would JUST....LEAVE.....ME.....ALONE).

  • Alice Bowie||

    So...according to you guys:

    If we follow what we learned in Macro-Economics 101...The cheaper the labor, the more Owner Equity...and higher stock price.

    So americas private/public sector shouldn't concern herself with job creation/loss...just let capitalism run its course.

  • Jordan||

    Then perhaps we should send ALL of the JOBS to Mexico. This was Americans will have better jobs.



    Typical protectionist strawman bullshit. If one dose of Tylenol helps your headache, then why not eat the entire bottle?

    If one glass of wine per day is good for your heart, than an entire bottle a day must be even better.

  • Alice Bowie||

    Typical protectionist strawman bullshit ??

    Can you explain to me why any American Corporation should employee people that cost 3-to-5 times a much as they do abroad ??

  • Seward||

    Alice Bowie,

    Most of your assertions appear to assume a stagnant production sector. Imagine if I were to assume that 19th century levels of agricultural employment ought to be the norm today?

  • Pac||

    Oh well, didn't think i would get an answer, but since i aint got time to listen to LALA I'll proceed to guess how the rest of this thread will go.

    criket criket

    Rightous indignation

    criket criket

    Strawman accusation

    criket criket

    Freemarket strawman argument

    criket criket

    more rightous indignation

    criket criket

    i get called a troll

    criket criket

    someone pretends to be me

    criket criket

    REASON SUCKS

  • ||

    Can you explain to me why any American Corporation should employee people that cost 3-to-5 times a much as they do abroad ??

    Because they provide 4-6 times the benefit?

    You tell me: Why do American corporations employ people that cost 3-to-5 times as much as they do abroad? Because they clearly do...

  • Alice Bowie||

    Seward & Jordon,

    What i'm say'n is that in a GLOBAL ECONOMY...you're gonna need some form of EMPLOYMENT PROTECTIONISM...similar to that of Germany, Australia, UK, China, and even Japan.

  • Alice Bowie||

    They do now MikeP ... But, as the trend continues...companies that employe americans will not be able to complete globally.

  • Jordan||

    Can you explain to me why any American Corporation should employee people that cost 3-to-5 times a much as they do abroad ??



    Could it possibly be that labor costs are not the only factor that comes into play here?

    By the way, if foreign companies decided to take you protectionist morons seriously, millions of American jobs would vanish overnight. Outsourcing goes both ways.

  • ||

    You gotta admit, Pac defintely knows how the threads go.

  • Seward||

    Alice Bowie,

    You need about as much employment protection in the global economy as one does between U.S. states. Even if other countries had protectionist policies and the U.S. had none it would still be a boon for the U.S. Protectionism hurts consumers, harms future innovation (and thus future expansion of levels and types of production), and ultimately harms almost all workers. Indeed, protectionism is basically a form of rent seeking, which is why protectionist cannot overcome the Baptists and Bootlegger problem.

  • Alice Bowie||

    All I can say is look at the ENTIRE electronics and manufacturing industry....IT'S GONE. Between labor costs, unions, Department of Enviormental Protection, etc. etc. etc. Companies tend to go elsewhere.

    When factories had to deal with the pesty DEP and were forbidden to pollute the rivers (i know you anti-protectionist just hate the DEP) they went elsewhere.

    Same is true with union jobs.

    And, as america became more and more service oriented and less involved in manufacturing, well, of course the clerical/technical/professional jobs have (and will) go abroad.

  • Jordan||

    All I can say is look at the ENTIRE electronics and manufacturing industry....IT'S GONE. Between labor costs, unions, Department of Enviormental Protection, etc. etc. etc. Companies tend to go elsewhere.



    There are more domestic manufacturing and engineering jobs than ever before in American history. They're just a smaller percentage of the economy because other sectors have grown much more quickly.

  • Seward||

    Alice Bowie,

    All I can say is look at the ENTIRE electronics and manufacturing industry....IT'S GONE.

    Actually, the manufacturing industry is doing quite well; what has gone away are all the assembly line jobs associated with that. Of course why anyone would want to say that those sorts of jobs are worthy of state intervention to protect I cannot say.

  • Seward||

    Jordan,

    What Alice Bowie fails to understand is the role of the rise of new types of employment related to innovation.

  • Alice Bowie||

    OK guys I'll give. Just keep me posted when innovation creates NEW JOBS.

  • Jordan||

    OK guys I'll give. Just keep me posted when innovation creates NEW JOBS.



    It already has. Do you think Google, Amazon, Microsoft, etc have been around since the beginning of time?

  • ||

    Outsourcing, when it increases profits, creates wealth.

    --Spending wealth is the only way to create capital.

    --Capital (education, labor-saving tools, etc.) increases the usefulness of people by increasing their potential to produce stuff.

    --When people are more useful, they become more employable and earn more.

    Thus, outsourcing can "create jobs". (I assume Alice Bowie is not interested in the kind of job creation that results from reducing human productivity to the point where all are employed in assuring basic survival)

    Now, outsourcing doesn't necessarily "create jobs", because wealth needn't be spent on capital. However, wealth is the only means to "create jobs", and stopping outsourcing is stopping a potential source of wealth.

  • Seward||

    Alice Bowie,

    It happens every day. Otherwise, again, over 50% of the U.S. population would still be agricultural workers. Right now it is roughly 2% to 3% if I recall correctly (and even in absolute numbers I would imagine that it is far smaller than it was say in 1900). Indeed, we have entire areas of employment that did not exist even twenty years ago.

  • Alice Bowie||

    and how many people do google and amazon really employ ?

  • Jordan||

    and how many people do google and amazon really employ

    Cute. Those were just my examples. I could have picked any company, because none existed at the beginning of time. If innovation didn't create jobs, we would all be subsistence farmers.

  • Jordan||

    Argh. Forgot the blockquote tags.

    and how many people do google and amazon really employ ?



    Cute. Those were just my examples. I could have picked any company, because none existed at the beginning of time. If innovation didn't create jobs, we would all be subsistence farmers.

  • ||

    Alice Bowie | December 5, 2008, 3:27pm | #

    OK guys I'll give. Just keep me posted when innovation creates NEW JOBS.


    Alice, read some Robert Reich. Innovation is the engine of our economic success, and always has been.

  • ||

    Look at textile manufacturing, Alice. Southern New England - always ground zero for innovation in the United States - founded that industry, based on the intellectual capital produced by the shipbuilding industry way back shen, and now it's almost entirely gone.

    But we're still just about the wealthiest, most advanced, most dynamic part of the country, because the skills and markets in that industry led to further innovation in manufacturing, leading us to innovate in new industries, which left in their turn, but not before they lead to the innovation of yet more industries. You can see this right up to the modern era, when we watched our computer manufacturing industry go away - but we're still not poor and jobless. We're still at the forefront of the economy.

  • ||

    The moral of the story is that innovation rulez, while places that aren't the southern half of New England suxx.

  • Alice Bowie||

    I guess I can only speak from where I am. I'm an IT manager in NYC...and we've pretty much moved everything out to Singapore, russia, and india. That is, the data centers, the glass houses, support, customer service, development.

    The only thing here is my type of job...the project manager/ba. I suppose a business line. Pretty soon, the personnel in the business line i support will be move out too. So will my type of positions.

    For me, it's not really the end of the world...i've saved up a buck to two over the last 25years of work'n...But i see no reason to send my kids to school for engineering, accting, business, comp sci, etc. We, in fact, no longer recruit from ivy league schools as we use to. No need. We haven't had an intern program since 1995.

    And, as the one responsible for the budget of my 43 person group, there's no way i can justify hiring an american DBA, programmer, analyst...It's significantly cheaper abroad.

  • Zeb||

    As someone who works in an electronics manufacturing industry, Alice, you are a nit-wit. There is an enormous amount of manufacturing going on in the US, and the attendant R&D that goes with it. Yes, much (perhaps most) of the consumer electronics industry manufactures overseas now. Would you rather pay many times what you do now for your TV, ipod, computer, etc?

  • ||

    Money Magazine doesn't share your bleak outlook: software engineer was number 1 of their Best Jobs in America with a growth potential second only to physician's assistant.

    And one of the reasons software engineers are so employable at such high salaries in the US is that drudgery and support work that can be outsourced is being outsourced, letting them focus on higher value labor.

  • Alice Bowie||

    Zeb ... no need 4 name calling.

    and forgive me...perhaps i lack the foresight of the future of the american worker.

    it just doesn't look good for the highly skilled...or should i really say ... the highly paid.

  • Alice Bowie||

    MikeP ... outsourcing IT work is EXTEMLY difficult in the beginning. But, speaking from experience, after 8-10years...it runs smoothly.

  • Alice Bowie||

    Remember why we outsourced IT Work. Programmers in the Metro NYC area were demanding $600-$800 per day in 1999. The same program in china, russia, or india is about $800 per wk.

  • ||

    Alice, I am a software developer. My job exists SOLELY through innovations of the past fifty years. Far from destroying jobs, computers have created so many new jobs I'm astounded you cannot see it.

    In 1950, the typical business had a room full of bookkeepers wearing green shades and tallying numbers. Today those bookkeepers have all been replaced by a single person with bookkeeping software. And he's only doing the bookkeeping part of the time. Have we lost jobs? Yes. But were more jobs created then were lost? OF COURSE THERE WERE! DUH! Besides the very large (and well paying) computer and software industries, you have the jobs the increased productivity of that business creates: Reduced costs and greater efficiency means they can sell their product cheaper (benefiting consumers); means they can expand and thus hire new people; means they have higher profits with which to invest, etc, etc. And since the cost of running a business is lower, more businesses will start up.

    Schumpeter called innovation "creative destruction". Old obsolete jobs are destroyed to make way for the creation of new and more numerous jobs. Those who lost the obsolete jobs will of course experience temporary economic hardship. But the pain of not innovating will be far far worse. There are ways to deal with their temporary pain that does not require protectionism and heavy-handed government intervention.

  • ||

    outsourcing IT work is EXTEMLY difficult in the beginning. But, speaking from experience, after 8-10years...it runs smoothly.

    I know that outsourcing IT is extremely difficult: That is precisely why only peripheral work or work that carries easy specification and evaluation will be outsourced.

    It is precisely the difficulty in outsourcing that keeps the highest value -- i.e., those that are hardest to compose specifications for, i.e., those with greatest comparative advantage -- in the US.

  • Alice Bowie||

    It is precisely the difficulty in outsourcing that keeps the highest value -- i.e., those that are hardest to compose specifications for, i.e., those with greatest comparative advantage -- in the US.

    very very TRUE ... for now.

  • ||

    The second best alternative to outsourcing support and peripheral roles is to outsource the whole company. High valued engineering needs to be near product management. Product management needs to be near marketing. Marketing needs to be near corporate.

    If government tries to outlaw outsourcing, they will find themselves inducing the outsourcing of entire companies.

  • bubiyuqn||

    btw, google, microsoft, and amazon collectively employ about 127,000

  • Alice Bowie||

    If government tries to outlaw outsourcing, they will find themselves inducing the outsourcing of entire companies.

    It's been happening for years. General Electric, for example, is about 65% out the door. In about 10 years, a significant number service-based industries will be outside the 1st world.

  • ||

    Giant conglomerates that already put layers of strategic management between corporate and marketing/product management are of course ripe to have entire business units outsourced wherever the highest value labor in the BU finds the greatest comparative advantage. That's a good thing for the wealth of the company, the wealth of the local consumer, and the wealth of the world.

    Question: How much has GE grown since the benchmark of that 65% outsourcing? Was the entirety of the company then equal to the 35% domestic portion of the present company now?

  • Seward||

    joe,

    Innovation (Schumpeterian growth) and trade (Smithian growth) are the primary engines of economic growth. An economy grows for two other reasons well: population growth and the extension into new resource areas (the latter is often significantly tied to Schumpeterian growth though, but not always). The latter two are more problematic of course.

  • ||

    Seward,

    Thanks a lot for the Econ 101 lesson, but I was talking specifically about the American economy, and what has made it so dynamic compared to other countries (and what makes the economy in places like Massachusetts so dynamic compared to other areas of the country). In our case, we have an outsized capacity for innovation, which has driven trade.

  • Seward||

    joe,

    Trade and innovation drive one another; both are required for an economy to stand. Your New England cotton mills would not have succeeded without access to trade in technology (much of the industry got off the ground after all as a result of "borrowing" technology from English factories*) and in goods (New England doesn't grow much cotton).

    *This is well documented.

    The same is true for the Berkshire papermaking industry, etc. - all those rags came from England after all.

  • Seward||

    joe,

    As for Southern New England being ground zero for innovation, it was eclipsed by midwestern states in the 19th century and by Califoria in the 20th. It is being eclipsed by states like North Carolina, Georgia, etc. these days. There is a reason why all those folks are moving the Sun Belt after all and why population growth in New England and other northern states is quite stagnant.

  • Seward||

    joe,

    Or let's put it this way, there is a good reason why Gustavus Swift moved from Mass. to Chicago and in doing so created one of the most innovative industries of the late 19th century - meat packing.

  • Alice Bowie||

    You See.

    You guys are all talk'n about companies moving resources from one place in the US to another.
    At least, if i need 2 move from NYC to S. Carolina (which I may infact do), I'm still in the US. I don't wanna move to India.

  • Nick||

    Let's pray that Secretaray of Commerce Bill Richardson can slap some damn sense into both Obama and Becerra.

  • economist||

    "Let's pray that Secretaray of Commerce Bill Richardson can slap some damn sense into both Obama and Becerra."
    While we're at it, I'd like to lose twenty pounds.

  • ||

    Trade and innovation drive one another

    Additionally so in this case, as much of the technology and skills that allowed New England to innovate in the industrial sector came from the shipbuilding and other maritime industries that were developed to support trade.

    As for Southern New England being ground zero for innovation, it was eclipsed by midwestern states in the 19th century and by Califoria in the 20th. It is being eclipsed by states like North Carolina, Georgia, etc. these days.

    Not so much, except for California. The other examples you mention were recipients of industries that developed in and then migrated out of the northeast - whether we're talking about textiles (early 20th century) or software (late 20th) in the south, or heavy manufacturing in the midwest in the late 19th.

    Now California/west coast - that's a region that's developed into a major innovation center, like the northeast, with the aircraft industry.

    There is a reason why all those folks are moving the Sun Belt after all and why population growth in New England and other northern states is quite stagnant. Yes, capacity for growth. Southern New England is very land-scarce these days, compared to the sun belt. Nonetheless, the northeast corridor remains the primary birthplace of innovation (along with California now). Why do you think all of those tech-industry professionals moving to places like North Carolina and the southwest come from here?

    Or let's put it this way, there is a good reason why Gustavus Swift moved from Mass. to Chicago and in doing so created one of the most innovative industries of the late 19th century - meat packing. Yes, there is. Location, location, location.

    PS - meatpacking is not a field that's generally considered to be an example of industrial and intellectual innovation.

  • ||

    Alice,

    You guys are all talk'n about companies moving resources from one place in the US to another.

    But the point is, even with all of those industries migrating from the northeast to the recipient/production areas of the country - and even after this process has repeated itself again and again and again, decade after decade - places like metro-Boston and metro-New York continue to offer the highest wages, the most opportunity, have the most dynamic economies, and the most interesting companies - because we have the intellectual capital in the universities and hospitals and industrial parks to keep replacing those jobs. Now it's biotech and, shortly, nanotech.

    As places like the North Carolina and Texas (even California) grew and developed their economies on hi-tech industries that migrated there from the northeast, they didn't replace us; they joined us. YWe don't have to move physically as the economy evolves (though we can, and lots of people do, to take advantage of areas where their growing industries are booming); we can just move around within sectors, taking our skills from an older one to the newer one.

    As processes and creations move out of the lab space and into a brand new assembly plant, they don't close the lab, they just work on newer things. Here in the US, we're still the lab. We're still the ones creating the new industries.

  • ||

    Or let's put it this way, there is a good reason why Gustavus Swift moved from Mass. to Chicago...

    Let's put it this way - there's a reason the guy who was able to bring innovative industrial practices to the meatpacking industry was from Massachusetts. He brought ideas that were bubbling here, and applied them on a large scale elsewhere - and yet, having the large-scale meatpacking industry, which relied on innovations that came out of here, create all of those jobs in Chicago didn't beggar Massachusetts.

    This process was repeated hundreds, thousands of times, Alice, and continues to be repeated, and yet here we are, still with the highest incomes, the highest home values, the most expensive manufacturing space, low unemployment...all of the indicators of a strong, dynamic economy.

    Meanwhile, look at the places that were the big centers of industry fifty years, where innovative ideas were put into large-scale productions. Detroit, with the Big Three. Upstate New York and environs, with GE. Springfield, MA, with Colt Firearms. Pittsburgh. They all went through some very, very hard times, because they weren't innovation centers, so when their industries moved or declined, they weren't replaced. It's the ones that were able to turn themselves into idea centers - to become more like metro-Boston or metro-DC - like Chicago, that have been able to reinvent themselves successfully in the 21st century.

  • ||

    PS - meatpacking is not a field that's generally considered to be an example of industrial and intellectual innovation.

    I take that back.

  • Seward||

    joe,

    Additionally so in this case, as much of the technology and skills that allowed New England to innovate in the industrial sector came from the shipbuilding and other maritime industries that were developed to support trade.

    The technology and skills came from England (indeed, locals interested in the industry made a significant effort at enticing folks with knowhow from England to the U.S.). Shipbuilding, etc. skills had little to do with the development of that. See the biography of Samuel Slate for a good example of what I am getting at.

    Not so much, except for California.

    The other examples you mention were recipients of industries that developed in and then migrated out of the northeast - whether we're talking about textiles (early 20th century) or software (late 20th) in the south, or heavy manufacturing in the midwest in the late 19th.

    Well, here I thought we were talking about "New England." The northeast includes places outside of New England.

    Anyway, heavy manufacturing did not originate in the Northeast (the lack of iron ore is one reason why of course) and was never an important factor in the economy of the Northeast.

    As for the software industry, it developed in California and spread elsewhere (including to New England).

    Southern New England is very land-scarce these days, compared to the sun belt.

    Scarcity in land does not explain why soutern New England (and the rest of New England) is fairly stagnant when it comes to population growth. Areas of economic proposerity and innovation find ways around things like land scarcity.

    Nonetheless, the northeast corridor remains the primary birthplace of innovation (along with California now).

    Well, you at least have amended your earlier claim.

    In many, many industries the northeast corridor isn't and has never been a major site of innovation; software being one, biotech being another (biotech is dominated by two areas of the country, North Carolina and California).

    I take that back.

    Good. Because it was one of the most significant innovators of the latter half of the 20th century. Rerigeration, transport, communication, uniformity in processing, etc. were all part of the development of that industry. It completely transformed the way that meat was processed, brought to market, etc. Anyway, nice to see that you completely flip flopped on the issue.

  • Seward||

    joe,

    That would be Samuel Slater, actually.

    From Walter Licht, Industrializing America, pg. 22:

    "Samuel Slater is the best known of several scores of British skilled mechanics and mill managers who transferred the secrets of the new industrial to the United States. Americans would greatly benefit from England's early start in manufacture, and the first generations of American manufacturers, particularly in the textile industry, would rely heavily on British immigrants who brought information and drawings or models of carding devices, spinning frames, power looms, and cloth printing machines."

    Now, that isn't the entire story of early American industrialization (as the author notes), but it is a significant aspect of the story that you failed to mention, particularly with regard to the textile industry.

  • Seward||

    joe,

    Oh, and the italics in the quote are mine.

  • Seward||

    Anyway, it doesn't matter so much from an economic perspective where innovation occurs, or even if there are certain centers of innovation. That is as long as technology can be freely adopted. After all, wireless phone technology first came into being in Kentucky in the early 20th century.

    Indeed, what country or what area of the country was first at creating X is what underpins a lot of mercantilist thinking.

  • ||

    Scarcity in land does not explain why soutern New England (and the rest of New England) is fairly stagnant when it comes to population growth. Areas of economic proposerity and innovation find ways around things like land scarcity.

    The primary way that areas of economic prosperity and innovation find ways around things like land scarcity is, in fact, by outsourcing lower valued production, retaining the production that is most important to the area and that provides the greatest comparative advantage.

    If not for outsourcing, places like Silicon Valley would simply stall as they filled up. If companies had to keep all of their functions locally, there would be no space for new companies and new growth. In effect the prosperity and innovation bids the price of the land up so it is affordable only to higher valued producers. Lower valued production must move elsewhere for the prosperity of the region to continue to grow. Outsourcing is not a sign of an area getting poorer: It is a sign of an area getting richer.

  • economist||

    "If innovation didn't create jobs, we would all be subsistence farmers."

    Actually, we would be nomadic hunter-gatherers.

    Go ahead, bow to my superior intellect.

    Bow, dammit!

  • ||

    The technology and skills came from England (indeed, locals interested in the industry made a significant effort at enticing folks with knowhow from England to the U.S.). Shipbuilding, etc. skills had little to do with the development of that.

    The specific technologies of his textile mill came from England, but the existence of the other milling industries in New England - paper, for example - grew first in the Northeast because the skills and technologies for industrial operations were already here, because of the shipbuilding industry. There was a Matthew Slater, and a Massachusetts Manufacturing Company, here and not in Virginia or Delaware, looking to build newer and more innovative industrial sectors, because this is where industry already existed, and that owes a lot to the maritime industries being here so much earlier.

    Well, here I thought we were talking about "New England." The northeast includes places outside of New England. Pedantic much?

    Anyway, heavy manufacturing did not originate in the Northeast (the lack of iron ore is one reason why of course) and was never an important factor in the economy of the Northeast. Who said anything about heavy manufacturing? My whole point has been that even if the large-scale applications of industry growing up elsewhere, the ideas behind them still come out of the innovation centers, like southern New England.

    As for the software industry, it developed in California and spread elsewhere (including to New England). Right, I meant computer hardware and instruments, not software - businesses like Digital and Wang.

    Scarcity in land does not explain why soutern New England (and the rest of New England) is fairly stagnant when it comes to population growth. As a matter of fact, they do. Whether we're talking about residential, commercial, or especially industrial, space in metro-Boston is at a premium, and prices are among the highest in the country. If the low growth figures were the consequences of stagnation, as you plainly wish so fervently to believe, our prices wouldn't be so high and vacancy rates so low.

    Areas of economic proposerity and innovation find ways around things like land scarcity. And we have - Massachusetts continues to be a national leader in innovation and prosperity, whether you want to measure it by incomes, education levels, or patent applications. One of the ways companies innovate around this space scarcity is, as Mike P writes, the very outsourcing you so wrongly point to as evidence of our decline. The R&D labs and the small-scale production of new products is done here, and then when they're ready to scale up to mass production, they set up shop in cheaper areas with more available space. Thus has it always been, thus will it always be, as long as we've still got MIT, MITRE, and the like.

    Well, you at least have amended your earlier claim. Most people would have picked up on the fact that I was using hyperbole by the spelling of "suxx," but if it makes you feel better to think that I was seriously arguing that only southern New England is an innovation center, you go right ahead.

    In many, many industries the northeast corridor isn't and has never been a major site of innovation; software being one, biotech being another (biotech is dominated by two areas of the country, North Carolina and California). Biotech was invented in the 128 belt, and was exported to the Research Triangle. Even as that particular industry has moved a little further down the industrial curve, it remains hugely vital in Massachusetts and environs, and the region continues to be in the forefront of research.

    Good. Because it was one of the most significant innovators of the latter half of the 20th century. You mean the 19th.

    Rerigeration, transport... Funny you should mention refrigeration and transport - the refrigerated railcar was invented in Massachusetts (Swift's home, remember?). Swift drew on this earlier innovation when he perfected, and put into widespread use, the idea from his midwestern headquarters. Once again, we see the same pattern - people, skills, and ideas from an innovation center migrating to a production center for large-scale operations.

    Anyway, nice to see that you completely flip flopped on the issue. It's predictable to see that you've taking this so personally, like someone backed into a corner trying not to look too bad.

    Now, that isn't the entire story of early American industrialization No, it's not. Rather, I mentioned the parts of the story that were relevant. But yet again, Slater's intellectual property theft and poaching of ideas proves my point once again - he didn't beggar England, because England just kept innovating.

    Anyway, it doesn't matter so much from an economic perspective where innovation occurs, or even if there are certain centers of innovation. That is as long as technology can be freely adopted. No, it doesn't matter - that's my point. Ideas and innovation coming out of ideopolises get implemented on a large scale elsewhere all the time, but as the example of Massachusetts shows, ideopolises don't need to hold onto the operations when the industries they innovate mature, in order to remain prosperous. In fact, as Mike P says, it can better if they don't. If Massachusetts hasn't exported its industries to North Carolina and the southwest, if the spaces in which DEC Rainbows and Wangs were manufactured in the 1982 were still cranking those out, instead of being converted into university, office, R&D, and business incubator space, we'd be less well off.

    Indeed, what country or what area of the country was first at creating X is what underpins a lot of mercantilist thinking. Noting where innovation comes from isn't mercantilist - that requires another step, the believe that those innovations and ideas need to stay where they were invented. Innovation economics, which I've been describing, makes the opposite point - that it's ok if the production gets farmed out from the innovation centers to less economically, educationally, and technologically advanced (and cheaper) areas, because the innovative capacity will remain, and the region's economic base will shift to the next generation of industrial sectors being created.

  • ||

    "If innovation didn't create jobs, we would all be subsistence farmers."

    Actually, we would be nomadic hunter-gatherers.


    There's a serious point here - the people who innovated agricultural practices and invented the hoe, and made money off of selling their surplus, didn't become poorer as other villages and countries adopted their practices. They became richer, as they were able to make more money selling hoes than selling wheat. Then, their capacities for manufacturing farming equipment allowed them to become the metalworking centers, and their advanced capacity for accounting harvests allowed them to become better merchants.

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