Zelig Edition (Matthew Yglesias & Reihan Salam)

[Bloggingheads]

[harkin]

What do you mean can they (UK riots) happen here? They are happening here already on a smaller scale. Flash mobs have occurred recently in Philly, Chicago, Milwaukee, even Denver where the purpose is to be part of the trendy mob, inflict harm to persons and/or property and (best of all) get away with free stuff.

The left's spin that this is due to austerity measures or angst with capitalism is so bankrupt, it's a result the destruction of the family, the complete absence of teaching kids self-reliance and reponsibility for their actions and of course the now ingrained belief that someone else owes them everything from food to a job to health care (coming up next, housing).

As to the UK, here's hoping the common sense of the past 24 hrs in response will take over:

"But it is more than childish destructiveness motivating the rioters. These are youngsters who are uniquely alienated from the communities in which they grew up. Nurtured in large part by the welfare state, financially, physically and educationally, socialised more by the agents of welfarism than by their own neighbours or local representatives, these youth have little moral or emotional attachment to their communities. Their rioting reveals not that Britain is in a time warp in 1981 or 1985 with politically motivated riots against the police, but that the tentacle-like spread of the welfare state into every area of people's lives has utterly zapped old social bonds, the relationship of sharing and solidarity that once existed in working-class communities. These riots suggest that the welfare state is giving rise to a generation happy to sh*t on its own doorstep.

This is not a political rebellion; it is a mollycoddled mob, a riotous expression of carelessness for one's own community. And as a left-winger I refuse to celebrate nihilistic behaviour that has a profoundly adverse affect on working people's lives. Far from being an instance of working-class action, this welfare-state mob has more in common with what Marx described as the lumpenproletariat."

Still waiting on how the far left will charcterize these rioting looters, they already used up the 'terrorist' tag to describe anyone who wants to slow the growth of public debt by 15%. No way is smashing windows, burning down businesses and looting anything close to that.

[BornAgainDemocrat]

Disclosure: I think Yglesias is the most clueless, inane pundit out there.

That said, I take issue with his statement that the days in which Americans make things are over forever and there is nothing we can do about it ("we can't turn time back"). Why do I take issue? Because a stiff tariff on low-wage imports from Asia would almost certainly rejuvenate American manufacturing. Gatt took us down. Getting rid of Gatt would take up back up. Cf. Here.

I also marvel at his cluelessness as to why wages in service industries are so low? They are low, in part, because we have outsourced all our labor-intensive manufacturing jobs overseas, forcing those who were formerly employed in those industries into the service sector. When the supply of labor goes up, the wages of labor go down. Duh?

Yglesias! How did such a talentless dufus ever rise to the top?

[AemJeff]

Originally Posted by harkin

What do you mean can they (UK riots) happen here? They are happening here already on a smaller scale. Flash mobs have occurred recently in Philly, Chicago, Milwaukee, even Denver where the purpose is to be part of the trendy mob, inflict harm to persons and/or property and (best of all) get away with free stuff.

The left's spin that this is due to austerity measures or angst with capitalism is so bankrupt, it's a result the destruction of the family, the complete absence of teaching kids self-reliance and reponsibility for their actions and of course the now ingrained belief that someone else owes them everything from food to a job to health care (coming up next, housing).

As to the UK, here's hoping the common sense of the past 24 hrs in response will take over:

"But it is more than childish destructiveness motivating the rioters. These are youngsters who are uniquely alienated from the communities in which they grew up. Nurtured in large part by the welfare state, financially, physically and educationally, socialised more by the agents of welfarism than by their own neighbours or local representatives, these youth have little moral or emotional attachment to their communities. Their rioting reveals not that Britain is in a time warp in 1981 or 1985 with politically motivated riots against the police, but that the tentacle-like spread of the welfare state into every area of people's lives has utterly zapped old social bonds, the relationship of sharing and solidarity that once existed in working-class communities. These riots suggest that the welfare state is giving rise to a generation happy to sh*t on its own doorstep.

This is not a political rebellion; it is a mollycoddled mob, a riotous expression of carelessness for one's own community. And as a left-winger I refuse to celebrate nihilistic behaviour that has a profoundly adverse affect on working people's lives. Far from being an instance of working-class action, this welfare-state mob has more in common with what Marx described as the lumpenproletariat."

Still waiting on how the far left will charcterize these rioting looters, they already used up the 'terrorist' tag to describe anyone who wants to slow the growth of public debt by 15%. No way is smashing windows, burning down businesses and looting anything close to that.

Yup, a couple of dozen kids in Philadelphia are exactly the same thing as thousands of people across multiple towns all over England; and not content with spinning silly analogies, harkin offers fact free sociological theorizing about root causes! Common sense!

[miceelf]

Originally Posted by AemJeff

Yup, a couple of dozen kids in Philadelphia are exactly the same thing as thousands of people across multiple towns all over England; and not content with spinning silly analogies, harkin offers fact free sociological theorizing about root causes! Common sense!

Living here in Chicago, I must have missed the liberal theorizing that the flash mobbers were due to some deepseated social ennui and the liberal handwringing and whatnot.

Instead, our democratic mayor responded with curfews and increased police presence.
But he may have been doing what harkin says on the inside.

[sugarkang]

Originally Posted by BornAgainDemocrat

When the supply of labor goes up, the wages of labor go down. Duh?

And when the cost of labor goes down, the cost of production goes down and goods sold on the market are cheaper. Therefore, all Americans get access to cheap goods in the United States versus the slight bit of special interest protection that your special interest industry would get.

Remember when computers were $2,000? Now, they're $500 and several thousand times faster. Only, you just take that miracle for granted.

[bkjazfan]

I wonder why President Obama has not weighed in on the flash mobs where apparently from the news I get is that young blacks are primarily attacking whites so much so in Philadelphia they have had to institute a curfew for teens. Other areas where it is or has occurred is Boston, Chicago, and Milwaukee. I say this in light that he felt obligated to comment on the arrest of a famous black college professor for entering his own home in (I can't remember the particulars of the case).

[stephanie]

Originally Posted by bkjazfan

I wonder why President Obama has not weighed in on the flash mobs where apparently from the news I get is the young blacks are primarily attacking whites so much so in Philadelphia they have had to institute a curfew for teens. Other areas where it is or has occurred is Boston, Chicago, and Milwaukee. I say this in light that he felt obligated to comment on the arrest of a famous black college professor for entering his own home in (I can't remember the particulars of the case).

I don't think you can assume serious problem from curfew. Curfews are often first and easy reactions. Same with increased police presence.

[bkjazfan]

Originally Posted by stephanie

I don't think you can assume serious problem from curfew. Curfews are often first and easy reactions. Same with increased police presence.

Have you heard Philadelphia's Mayor Nutter's speech on this problem - the one delivered at a church? It wasn't barnburner but was quite forceful in it's condemnation of what's going on.

[Sulla the Dictator]

Originally Posted by BornAgainDemocrat

Disclosure: I think Yglesias is the most clueless, inane pundit out there.

That said, I take issue with his statement that the days in which Americans make things are over forever and there is nothing we can do about it ("we can't turn time back"). Why do I take issue? Because a stiff tariff on low-wage imports from Asia would almost certainly rejuvenate American manufacturing. Gatt took us down. Getting rid of Gatt would take up back up. Cf. Here.

You don't even need protectionism to do it. We have a hostile regulatory and labor scheme towards industry.

[stephanie]

Originally Posted by bkjazfan

Have you heard Philadelphia's Mayor Nutter's speech on this problem? He was very/quite forceful in condemning it.

I'm only talking about your suggestion that "they even had to institute a curfew" somehow means anything much. That seems to suggest that curfews are some extremely unusual and only-in-the-most-extreme-circumstances kind of reaction, which they are not. More generally, obviously I'd expect a mayor to consider it serious and so on.

[Sulla the Dictator]

The problem is that the cultural rot in Britain had gone so far, even the ruling classes have no visceral sense of self preservation. A healthy society would consider deploying the Army to crush these vermin. Questions about rubber bullets and water cannons would have been answered in the first five hours of the riots.

You even have the opposition political party trying to profit from the disaster. These people are lumpenproles, the finished product of the welfare state. They deserve the bayonet, not anyone's sympathy!

[bkjazfan]

Originally Posted by stephanie

I'm only talking about your suggestion that "they even had to institute a curfew" somehow means anything much. That seems to suggest that curfews are some extremely unusual and serious reaction. More generally, obviously I'd expect a mayor to consider it serious and so on.

I have never seen a mayor or any politician in my city, Los Angeles, making forceful speeches on the topic of crime like he did at that church. For some reason they are reticent to do so.

[Starwatcher162536]

Originally Posted by sugarkang

Remember when computers were $2,000? Now, they're $500 and several thousand times faster. Only, you just take that miracle for granted.

Was labor ever a major component of hardware costs?

[stephanie]

Originally Posted by bkjazfan

I have never seen a mayor or any politician in my city, Los Angeles, making forceful speeches on the topic of crime like he did at that church.

If a mayor can help address a problem by making a forceful speech (seems to me it's worth a try), isn't that good? Doesn't it suggest that the response of the cities in question is not "liberal handwringing" and blah blah?

My objection is to the idea that the fact that a curfew was imposed and I guess now that the mayor spoke out forcefully means that these events are some unprecedented crisis or akin to the '60s riots or London or whatever. But maybe I was misunderstanding your point.

[AemJeff]

Originally Posted by bkjazfan

I wonder why President Obama has not weighed in on the flash mobs where apparently from the news I get is that young blacks are primarily attacking whites so much so in Philadelphia they have had to institute a curfew for teens. Other areas where it is or has occurred is Boston, Chicago, and Milwaukee. I say this in light that he felt obligated to comment on the arrest of a famous black college professor for entering his own home in (I can't remember the particulars of the case).

Arresting a man inside his own house? What possible relationship that bear to so-called "flash-mobs?" He was black?

There haven't been many incidents in Philly. The city administration has taken steps to deal with them. Violent crime has been trending down there and elsewhere for a long time. What exactly are we talking about here, except amplifying right-wing bullshit about a crime wave that doesn't exist?

Here's Roy Edroso, perfectly on-point:

OOGA BOOGA REDUX. As I've mentioned before, the hip thing among conservatives these days is to pretend that a black crime wave is sweeping America, and to blame Obama. Not only racist cut-and-paste trolls promote the theory -- rightbloggers have been doing their part, and now more classy-like conservatives seem to be getting on board.

...Crime in U.S. cities is at historically low levels, yet Mead repeats some of the black-on-white crime stories that have excited the goobers into a Little-Colonel-versus-Silas-Lynch state, and proceeds into deep political analysis -- nearly all of it absolutely ludicrous (Obama and Oprah are involved, and years after welfare became workfare Mead's still bitching about the Great Society), but I'll confine myself to this:

[stephanie]

Originally Posted by BornAgainDemocrat

Yglesias! How did such a talentless dufus ever rise to the top?

Disclosure: I like Yglesias. And I don't think he's talentless. But the simple answer to your question is good timing, plus he's reflective of a pretty significant segment of the population that is likely over-represented on the internet. Pragmatic, socially liberal Dems, who tend to buy into neoliberal ideas, especially about economics. This is why the mainstream in both parties agrees with Yglesias on the points to which you object and about trade in particular.

a stiff tariff on low-wage imports from Asia would almost certainly rejuvenate American manufacturing.

I'm skeptical about this, but in any case you'd have to consider the costs also.

[look]

Originally Posted by stephanie

Disclosure: I like Yglesias. And I don't think he's talentless. But the simple answer to your question is good timing, plus he's reflective of a pretty significant segment of the population that is likely over-represented on the internet. Pragmatic, socially liberal Dems, who tend to buy into neoliberal ideas, especially about economics. This is why the mainstream in both parties agrees with Yglesias on the points to which you object and about trade in particular.

I'm skeptical about this, but in any case you'd have to consider the costs also.

Has this been touched upon in your Dem Party thread? I think the crux of the matter is that both parties tend in a neoliberal direction...pragmatic streamlining toward globalism.

[sugarkang]

Originally Posted by Starwatcher162536

Was labor ever a major component of hardware costs?

I don't see how it wouldn't be, despite their almost unlimited supply of slave labor. I'm sure labor cost reflected a much higher proportion of total business costs while in the United States.

Americans aren't any "poorer" in terms of standard of living. It's just that a lot of old jobs that provided people with purpose and dignity are gone. This is the heart of what people are upset about. Cheap cellphones don't make up for lost dignity, particularly because everyone you know has them. From a technical standpoint, it's amazing what we can do with our gadgets. Their ubiquity makes them uninteresting.

[ohreally]

The reason you don't see London-style riots here is that most of the potential rioters in America are already in prison.

[sugarkang]

Originally Posted by ohreally

The reason you don't see London-style riots here is that most of the potential rioters in America are already in prison.

I think it's because Americans are too fat to riot. They get angry, they get started, they get tired, they go home.

[look]

Originally Posted by sugarkang

I think it's because Americans are too fat to riot. They get angry, they get started, they get tired, they go home.

Or as Ana-Marie Cox quipped, you can't have a revolution if you don't get out of your pajamas. Something like that.

[stephanie]

Originally Posted by look

Has this been touched upon in your Dem Party thread?

Somewhat. I'd actually love for a Dem who is skeptical about the consensus view on trade issues to raise the issues over there.

[Starwatcher162536]

Originally Posted by sugarkang

I don't see how it wouldn't be, despite their almost unlimited supply of slave labor. I'm sure labor cost reflected a much higher proportion of total business costs while in the United States.

Americans aren't any "poorer" in terms of standard of living. It's just that a lot of old jobs that provided people with purpose and dignity are gone. This is the heart of what people are upset about.

Not trying to be offensive here; Do you know anything about the manufacturing process for various types of computer components? I wouldn't say I have a good understanding myself, but I happen to know some about one stage in this process. Photolithography. When I extrapolate my intuitions about this one segment of computer manufacturing onto the rest of the process I estimate a situation where labor (But not just because of wages, also because of health/environmental regulations) costs are a vanishingly small part of total costs. It's all basically machines making machines with a few maintenance men and quality control guys tacked on.

I have no real data to support this, but I can't shake the feeling labor costs are really overemphasized relative to their actual importance when speaking of "Globalization"

I don't have anything to say about the rest of your post.

[look]

Originally Posted by BornAgainDemocrat

That said, I take issue with his statement that the days in which Americans make things are over forever and there is nothing we can do about it ("we can't turn time back"). Why do I take issue? Because a stiff tariff on low-wage imports from Asia would almost certainly rejuvenate American manufacturing. Gatt took us down. Getting rid of Gatt would take up back up. Cf. Here.

I think gloabalism is a done deal these days, but over the last year or so, I've been considering the problem of flight from big northern cities and the possibility of a sort of voluntary protectionism. For example, the Cleveland-Akron-Canton corridor and surrounding rural areas. Obviously there could not be total isolation, nor would it be desirable. But what if a massive campaign was put forth involving billboards, public service announcements, commercials, etc., supportive of local buying? Maybe even on a whole-Ohio level? The problem, of course is Amazon One-Click

It seems we need a stopgap from what Sulla talks about:

The problem is that the cultural rot in Britain had gone so far, even the ruling classes have no visceral sense of self preservation...

You even have the opposition political party trying to profit from the disaster. These people are lumpenproles, the finished product of the welfare state...

[miceelf]

Originally Posted by sugarkang

I think it's because Americans are too fat to riot. They get angry, they get started, they get tired, they go home.

And when they don't go home they get labeled terrorists or parasites.

[look]

Originally Posted by stephanie

Somewhat. I'd actually love for a Dem who is skeptical about the consensus view on trade issues to raise the issues over there.

I don't know his views on overall trade issues, but maybe TS could chime in about the Detroit area, the Chrysler bailout, etc., and his take on the decrease in our manufacturing base.

[sugarkang]

Originally Posted by Starwatcher162536

I have no real data to support this, but I can't shake the feeling labor costs are really overemphasized relative to their actual importance when speaking of "Globalization"

Okay, but you're focused on the wrong question here. It doesn't matter how much labor in the United States costs. It only matters that the total product could be made cheaper somewhere else. Raw materials, commodities are going to cost the same no matter which country you're in. Variable costs are going to be real estate and labor. Infrastructure and business networks are also important. But if all these variables are more or less the same between China and the U.S.; if labor is the only really cheap variable, if you were a business, where would you do your business? When you see two different prices on eBay for the same thing, do you ever pay more for the same product?

My point is that our thinking of China as this separate country is the wrong way to think about it. That's just mixing nationalist sentiments with economic ones. In pure economic terms there is only one country: the world. Think of China as our 51st state with an unlimited amount of slaves where American law doesn't apply. These Chinese work even cheaper than African slaves worked on cotton plantations. Except, the new cotton is all of your electronics and household goods at WalMart.

[look]

There is a request for you in another thread:

deecue: I would like to make a specific request for a Douthat/Salam bhtv on what they would update about their book (The Grand New Party), which had some interesting ideas for flusher times (the book was published a quite a while back as far as these things go). I'd be interested in what different policy prescriptions they would push in the advocacy of shoring up the social capital of the Sam's Club Republican demographic given the current economic and political constraints...

[miceelf]

Originally Posted by sugarkang

My point is that our thinking of China as this separate country is the wrong way to think about it. That's just mixing nationalist sentiments with economic ones. In pure economic terms there is only one country: the world. Think of China as our 51st state with an unlimited amount of slaves where American law doesn't apply.

This would be more convincing if China had the same currency we have, or at the very least hadn't artificially manipulated their currency to make their products more competitive.

[Starwatcher162536]

We seem to be interested in different aspects of this. All I am positing is that there are a bunch of variables and the relative importance of the one labor cost variable is less important then people many times assume. This is especially true (I think) for computer hardware. Btw, commodity prices do change place from place. Cheers.

[sugarkang]

Originally Posted by miceelf

This would be more convincing if China had the same currency we have, or at the very least hadn't artificially manipulated their currency to make their products more competitive.

Okay, let's parse out what's actually happening. If they weaken their currency against ours, that means our dollars buy more yuan / renminbi. That means all imports become even cheaper. Yes, that means they become more competitive in certain jobs. It also means even cheaper imports for all Americans. This is the most efficient way to raise the standard of living for the poorest Americans.

Remember when computers were so expensive that only a small percentage of Americans could afford them? Now, if I work a minimum job for a week, I can buy a computer. The solution is to create new businesses, but America just wants to tax the haves. You know I'm fine with a bit of redistribution. But if we don't get back America's capitalist spirit, we are screwed.

[BornAgainDemocrat]

Originally Posted by sugarkang

And when the cost of labor goes down, the cost of production goes down and goods sold on the market are cheaper. Therefore, all Americans get access to cheap goods in the United States versus the slight bit of special interest protection that your special interest industry would get.

Remember when computers were $2,000? Now, they're $500 and several thousand times faster. Only, you just take that miracle for granted.

I'm sorry but you make a common mistake. The return to capital goes up, the return to labor goes down. Prices decline but not enough to compensate for the decline in wages. That's why Samuelson's article was titled Protection and Real Wages

Or to go to the real horse's mouth go here. For the plain English version go here, the classic teaching text.

The real scandal is that this is all standard, orthodox textbook economics, the marginal theory of free trade. In other words Samuelson lied to the American people (if insinuating an untruth is a lie) on the eve of the Nafta vote, while Ross Perot has been proven right when he predicted "a giant sucking noise." I believe Perot also coined the phrase "race to the bottom." Bottom line: the academic profession of economics, as opposed to economics itself, is corrupt: corrupted by a peculiarly conservative/libertarian piece of political correctness that rules in that field, namely, that free trade is always right.

[look]

Originally Posted by sugarkang

Okay, let's parse out what's actually happening. If they weaken their currency against ours, that means our dollars buy more yuan / renminbi. That means all imports become even cheaper. Yes, that means they become more competitive in certain jobs. It also means even cheaper imports for all Americans. This is the most efficient way to raise the standard of living for the poorest Americans.

Remember when computers were so expensive that only a small percentage of Americans could afford them? Now, if I work a minimum job for a week, I can buy a computer. The solution is to create new businesses, but America just wants to tax the haves. You know I'm fine with a bit of redistribution. But if we don't get back America's capitalist spirit, we are screwed.

Ron Paul:

http://www.youtube.com/watch?v=JEjwa...mbedded#t=430s

[sugarkang]

Originally Posted by BornAgainDemocrat

Bottom line: the academic profession of economics, as opposed to economics itself, is corrupt: corrupted by a peculiarly conservative/libertarian piece of political correctness, namely, that free trade is always right.

How corrupt? So corrupt that it's affected Australian economists also? What do 530 Australian economists think about free trade?

Full Survey:



58.5% Agree or Strongly Agree that all trade should be completely free. No restrictions, no tariffs.
26.6% Disagree or Strongly Disagree
14.9% Unsure

[miceelf]

Originally Posted by sugarkang

Okay, let's parse out what's actually happening. If they weaken their currency against ours, that means our dollars buy more yuan / renminbi. That means all imports become even cheaper. Yes, that means they become more competitive in certain jobs. It also means even cheaper imports for all Americans. This is the most efficient way to raise the standard of living for the poorest Americans.

Possibly. That assumes that the downward pressure on prices is a net gain for poor americans, relative to the downward pressure on wages and benefits.

And, yes, they've kept their currency weak against ours on purpose for the reason you cite.

[cragger]

You are correct. The fact that computers are more powerful and rather cheaper then ten or twenty years ago has little to do with labor costs. The devices have grown much more highly integrated, faster, and more powerful, but this is certainly not due to production by cheaper labor. Device manufacture is not a manual operation, nor is assembly of those devices onto circuit boards, which is largely done by pick-and-place and wave soldering machinery, not by hand at a bench by someone with a soldering iron. The design processes involved arguably require a more skilled engineering force than was in place at the dawn of the home computer age, not access to unskilled labor willing to work for subsistence wages.

[sugarkang]

Originally Posted by miceelf

Possibly. That assumes that the downward pressure on prices is a net gain for poor americans, relative to the downward pressure on wages and benefits.

And, yes, they've kept their currency weak against ours on purpose for the reason you cite.

I don't know what to tell you. You can believe that free trade doesn't work or you can trust the majority of Australian economists. Though, I do understand the disinclination to trust those damn Aussies.

[whburgess]

Originally Posted by Starwatcher162536

Not trying to be offensive here; Do you know anything about the manufacturing process for various types of computer components? I wouldn't say I have a good understanding myself, but I happen to know some about one stage in this process. Photolithography. When I extrapolate my intuitions about this one segment of computer manufacturing onto the rest of the process I estimate a situation where labor (But not just because of wages, also because of health/environmental regulations) costs are a vanishingly small part of total costs. It's all basically machines making machines with a few maintenance men and quality control guys tacked on.

I have no real data to support this, but I can't shake the feeling labor costs are really overemphasized relative to their actual importance when speaking of "Globalization"

I don't have anything to say about the rest of your post.

The reason computer chips are manufactured overseas is because thats where the plants are built. The reason the plants are built overseas is because each chip plant costs billions of dollars to build in the states. This is because skilled labor makes about $70+ per hr in wages and benefits. I've participated in a number of these projects over the years and am currently working at this 8 billion dollar project.

Obviously the plants are much less expensively built in other countries. However, chip production is extremely sensitive to particulates--the air must be kept at much higher clean room environments then any hospital, for example, or costs in lost production of bad chips will surmount any savings in construction costs. The reason some of these plants are still built in the US is because US built plants have the best track record for producing clean chips. .

[brucds]

"Remember when computers were $2,000? Now, they're $500 and several thousand times faster."

Actually the ENIAC used to cost $6,000,000 in 2011 dollars, but thanks to the miracle of cheap overseas labor computers now cost much, much less. (As low as $199 if you assemble the imported components yourself, and don't count the cost of your all-American elbow-grease in terms of foreign-domestic labor value disparities.)

Why didn't someone think of this in 1945?