Unlevel Playing Field

Best I can figure by compiling several sources, I can deduce that the workers in Chinese factories make around $1.00 per hour (this is rounded up to the nearest dollar, but sources vary from 44 cents per hour to 83 cents per hour) before overtime in factored in (whatever that means in China). Some sources make a point to state how much worse the rates are in places like Mexico or Indonesia, but being most goods I see at our local stores are Chinese, I'll pick on them specifically.

I can't say whether $1.00 per hour is considered a decent wage there, but that aside, it does go to illustrate a fundamental problem with our trade policies. Some call it free trade – that basically we put a minimal level of restrictions on what comes in or out, but I think we should have placed one huge restriction on incoming trade a long time ago. Fact is, businesses in the United States are required to pay their employees a certain “minimum wage,” and other countries may not have such a standard, or their standard is far below ours.

Now I know people can cry foul because the cost of living is simply not at high in those countries, but I simply see that as the main disadvantage we're facing today. If companies in other countries were required to pay at least the U.S. idea of minimum wage to their workers, we would probably still manufacture a great deal of these products here at a competitive price. Of course, we can't just change this now – I'm pretty sure that would spell disaster. It is important, however, to recognize a major flaw in our trade policy and remember it as we move on to the future.

I seriously believe that our nation would be in a better position today, at least economically, if we had made a few key decisions differently. In 1935, the federal government instituted the nation's first federal minimum wage standards. At that time, it is my belief that we should have insisted any company desiring to sell products in the U.S. pay that wage and prove it to the federal government in order to be permitted the right to sell it here. If this had happened, and been adhered to even half of the time, not only would we have forced the improvement of living standards in those countries, but we would have kept prices consistent with that which manufacturers in the U.S. can compete – keeping jobs here in the U.S.

I'm sure enforcing this would have been a nightmare in the 30s, but today I imagine it would be relatively easy (not that it would be without problems or cost).

Again, I wouldn't advise trying to implement this today, considering we have so little real manufacturing left in this country. What we would be left with is a bunch of super expensive import products and no American-made options. That, and our trading partners would be really pissed off.

Anyway, just thought I'd use a little lunacy to help illustrate what I think to be one of the fundamental reasons why the U.S. is hurting today in the global economy. Come back tomorrow to read the second part of this ongoing ramble.