Quote:
Originally Posted by GGG
Trade in general is found to create definite loosers that do not recover. However the net effect of trade is positive for people.
So by bringing jobs back to America you increase the cost of all goods. An IPhone would cost $100 or so more to manufacture in the US.
So everyone pays more for a new phone while a small number of people get jobs
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It only works if the consumers in the trade-deficit nation (USA) earn enough money to afford those cheaper goods while said trade-deficit nation makes it up in other areas. Its all about competitive advantage and balance-- you have to have something to sell, otherwise you will not be able to buy. The problem with China is they are an emerging economy with a controlled currency and also have 1 billion plus people to work, many of whom are at the bottom of the heap who earn far less than their American counterparts. These and many other factors have lead to an imbalance. Those cheap iPhones are cheap in price, not person-hours.