Email to Jon Markman concerning Supermodels column

Email to Jon Markman concerning Supermodels column, “China is no job-stealing bully,” Oct. 29, 2003

Hey Modelman: We are not just losing buggy-whip manufacturing jobs to China . We are losing all types of manufacturing jobs including high-tech. If we keep following the free traders, in 10 to 20 years, this country will be a shell of its former self. The manufacturing base will be depleted and most of America will look look like one big Wal-Mart. – C.W. Jackson

Hey Modelman: Hey Modelman, I lost my job to India and the technical job I have spent the last 30 years training and educating myself on is gone. I do not want to here Bush say he is going to create jobs! I had a job! It slipped out the back door when the Bush Admin wasnt looking, or there is another global plan that I dont understand! – R. Turner

Hey Modelman: Good points about China, but it's not them I'm worried about. India is eating our IT lunch, and one reason I've been unable to find a job for seven months. – Juan

Hey Modelman: I fully agree with your position that China is not taking U.S. jobs. We are exporting jobs to China! Our corporate greed is the killing machine here. My company has 22,000 employees in India and 11,000 in China. In last two years alone, my engineering organization in the U.S. declined 80% while India and China offices grew by hundreds of percentage points. We justify this by calling it "Globalization". Better term would be "Destruction of U.S. Intellect". We hire 5 engineers at $5,000-$8,000/year and lay off five in the U.S.! The problem is that Indian and Chinese employees are not paying U.S. taxes. They are not protecting your Constitutional Rights. They are not on front lines in Iraq protecting your freedom. They have no morals or ethics regarding business transactions nor do they respect business law (as what you and I are used to).

I have two sons, who may have to spill blood to protect the welfare of our "globalizing" CEOs and their families. Where is their future? Engineering? Computers? Technology? No, more like choices in "service industry" (hamburger flipping or working at Wal-Mart). I have

worked with many nations and nationals, and I have yet to see one nation less united than U.S. when it comes to our businessmen and politicians (relative to protecting the welfare of our nation as a whole). We love to flex our muscles, but have no patriotism. I have seen people from other nations laugh at us, as to our naiveness and trust.

We are replacing steel mills and textile mills with Wal-Marts and fast food franchises. Last century was fueled by Industrial revolution. Last two decades, ‘80s and ‘90s, by computer and network/internet revolution. The problem now is that we have done "nothing" in the last four years and have absolutely nothing on the plate to carry us forward. If China and India are so great, then let those CEO's and politicians move there! We are in trouble. PS. My overseas tenure includes living 3 years in Asia, 4 years in Africa, 5 years in Europe, 12 years in Communism, 1 year in South America. I grea up in the U.S. and have lived here 22 years. I love this country and will defend it to the death. – M.C.

Modelman: I have a manufacturing company that has to deal with tight price pressures. Everyone has closed their eyes for the last 10 years (thanks Bill) while China has scooped

up, first the simple long running jobs and now high precision work, and now high tech positions. They seek American investment for companies to build and employ their people

while getting their piece of the pie. Why is it they can supply a stainless casting that has been machined, approx 10 minutes worth of CNC machining time, for less that the cost of what we can buy just the casting? And they include shipping!

You are on the outside looking in. I'm inside. My average employee makes $ 18.75, high end for

my machinists is $25.00 . If this keeps going we will be buying military parts and planes and bombs from China. I suppose you think that will be a good thing?

Wait until the China cars hit our country in 2005. You will be able to kiss one of the big three goodbye! Yes , some of it is their fault, they started some of this. It’s time to stop letting other countries wipe their feet all over us. The hell with worring about investors, lets worry about this countries future and our childrens future. China is not doing its job! -- Richard Fall

Modelman: I just finished reading your article regarding the demonizing of China that appears to be formulating. While I agree with your concerns on aggressive diplomacy, I really didn't see you suggest any solution. You are absolutely right, that Walmart, GE, Ford, and the other major global corporations are the greatest benefactors of China's unreal costs and pricing. My concern as a manufacturer, is that currency valuation or not, there is a continual flood of business, and therefore jobs from the manufacturing sector, and soon to be service sector flowing into China, and other Third World countries. The hypocrisy is evident.

It is illegal for American companies to pay below minimum wage
It is illegal for American companies to have an unsafe workplace
It is illegal for American companies to hire minors, convicts
It is illegal for American companies to negatively impact the environment

All Americans would agree that we want the fore mentioned standards for our country. Why would we look the other way, when China, India, et al, have no such standards nor intend to.

I also do not favor tariffs and protectionism. However, I see no resolution, without a set of minimum guidelines that any country must meet in order to have commerce with. If you have another solution, please advise. – Gary Neidig, Plymouth, IN

Modelman: Obiviously you were born with a silver spoon in your mouth and never had to work for a living.Try telling your crap to the folks who have worked for a living in the mills for little money and benefits and put in 30 plus years only to be laid off before they can recieve their pension.NAFTA is unfair to American workers, the inflated work pay and all cheap labor countries, Mexico, China, Phillipines, Taiwan, India etc put Americans out of work.Corprate greed to make big bucks.When you purchase clothing,look and see which country your supporting, maybe some terrorist group will impregnate that particular article of clothing with a harmful substance or disease. When this country losses the skill to make their on clothing, metal, planes ships,and tanks, etc. it will be open to attack by any group. Buy American and support the People of the USA. – Rob Potter

Modelman: Thanks for your fine China article. Being in engineering and science most of my life, I can't claim great expertise in economics. Still, it seems that in the last 30 years there has been a huge transfer of wealth from these shores to SE Asia.

Americans might believe in capitalism (I was born in Israel and grew up
socialist), but my feeling is that at this stage the system is faltering.
If you ask, then yes; I am not preaching socialism but think that we need
more government regulations. We have got to try to keep some jobs here.

My observation is that we are living beyond our means, that the gap between
the poor and rich is catastrophic and that economically we are in decline
I am not sure what can be done while they can produce almost everything so
cheaply. But I am not sure that your solution of China purchasing our bonds
will work well for long. At a certain point they might not wish to give us
goods for green paper, then what? In the meantime, we can't manufacture anything, (but food). Can we be a nation of 300 dealmakers, analyzers and brokers? I hope so. But
as a student of history I remember Bonaparte calling the Brits a nation of
"shopkeepers" and see what happened to the mighty British Empire...

I, in some ways like you (and most scientists), make a wonderful living by
solving equations and developing all kind of bs theories. Its interesting,
profitable and great, but is this right?

Jon, most of us do not understand how this will work. Economy with no
production? -- Bar-Giora Goldberg, San Diego

Modelman: Excellent article. You clearly demonstrate the lack of sound economic theory
on the Bush administration's rhetoric with regards to China. It is
politically motivated. If the Demoncrats oppose Bush in his quest toward
liberalizing China's capital markets, which they should, then they will look
like traitors to the American people. Why don't any T.V. or radio
commentators talk about the fact that China is a developing country (despite
what Bush cronies will tell you)?

Why doesn't anyone look at history? The attempt to prematurely liberalize capital markets in developing nations has had a devastating effect on economies. Inviting speculation into a fragile
economy sounds a bit idiotic to me. One american with a job is not better
than twenty Chinese in poverty. The past demonstates that the IMF (and the
Washington concesus) has confused ends with means. A developed country
should not have a fixed or pegged exchange rate. Correct. But China is not
there yet and won't be for atleast another decade or two.

This potically motivated nonsense by the Bush administration is frustrating.
People need to know the truth and I think that there need to be more
journalists like you to convey an objective view of what is going on in the
world. I hope America does not once again return to protectionist economics
like we did with the steel subsidies last year. It is a shame to see the
most powerful economy on earth place blame outwardly on others when we
should be trying to help the world, not exploit it. – Kevin Sherry

--

Modelman: You’re right. China isn’t a job thief -- Mexico is, thanks to NAFTA.

Until recently, I had worked in manufacturing on the sales end: automotive, small appliance components, etc. In the beginning of my 13 year career, I saw companies leave the north to go to the south to save money. Then NAFTA came and opened the floodgates into Mexico. My clients' main reason? Money. It was cheaper for them to operate in Mexico in many ways: Tax savings, payroll savings, utility savings...the list was endless. One major manufacturer of vacuum cleaners (oh the hell with it, I'll name names...Eureka) left Illinois claiming that the city it was located in "blew it" by not offering them the tax breaks they sought. Their sales rep tried to justify the move and the loss of American jobs by saying that if they could no longer afford their operating costs, they would be unable to offer their products at their current price. Funny, but when their operating costs were nearly halved, I don't remember their products being sold at half price. They are not the only ones: Texas Instruments has pretty much killed all of its American Mfg jobs in favor of setting up shop in Mexico, really hurting the local economy (I live in Attleboro MA...TI once employed over 4000 workers as recently as 7 years ago and now employs approximately 1/4 that amount). I could run a list as long as my arm of companies whose business I helped to grow while they sold out American jobs in favor of the cheap labor and lenient ways of our southern neighbor.

Bottom line: NAFTA is directly responsible for the loss of 600,000 American jobs. In fact, since NAFTA, Mexican MFG products account for 90% of their exports...compared to 35% before NAFTA.

So am I saying Americans should shift the blame from China to Mexico? Absolutely not. Mexicans in general have not seen their financial reward for winning the job lotto: they are poorly paid and lack the training to advance in their companies to positions that would afford them a decent wage. No...we cannot blame the country. We need to look closer to home: American manufacturers should all bear the brunt of the American anger over the loss of these jobs. The companies I mentioned above are merely 2 fish in a vast ocean of companies who have sold out American jobs and exploited both Mexican labor and lenient environmental standards. Shame should be felt by every one of these major manufacturers for not only selling out their country, but for trying to blame another country for their crime. -- Kim Alessandro

Modelman: You focused on manufacturing jobs being lost but they are not the only jobs going to China. Professional and clerical jobs are also moving to China. The high-tech distribution company I work for has decided not to hire more US citizens to take care of the increases in business but to hire citizens of China they can pay a quarter of my salary to do the same job (review company's credit worthiness and working capital to grant credit terms) and the clerical help who set-up and investigate the company's,. Already they have flown in someone to see what parts can be done in China and are having me work overtime (salary, no extra income here) until it can be implemented.

Now with no job being brought into the economy because they are going to China the US citizen will have less money to spend. Companies will cut more US Jobs and move them to China causing even less jobs and money to be available in the US economy.

There is a simple solution. The biggest consumer in the US just needs to stop buying from companies that use Chinese labor and use the smaller companies (100 employees or less) that make of 98% of jobs in the US.

This will make the economy hum and our European comrades can give their jobs to China. – Thomas Weathers

Modelman: First let me say that I have been waiting for an opportunity to address this type of article for a while. The whole philosophy of free trade and Kenseyan economics is skewed by a couple of little details that have been overlooked in the cozy little offices of the people who thought this up. First and foremost is the security of our country and second is the health and well being both mental and physical of our citizens. I know that your first thought is going to be that I am some super conservative who is a NRA card-carrying member. Nothing could be further from the truth. The philosophy behind free trade and Kensyan economics makes perfect sense until you apply it to a world where there are borders and different politics. The first mistake everyone makes when studying and believing this is that it is a perfect world, and everyone is our friend and thinks like us, and has the same respect for life, property and opportunity. Now if I were simply an investor (which I am) and had no concern for my fellow man I would love free trade because it allows me to have the companies I own make the maximum profit. They can manufacture in countries that pay the least, offer no health benefits and dispose of workers that do not follow the company line without worrying about potential sexual harassment cases, or workers compensation.

Thanks to our out of control legal system and jurors that love to award multi million dollar awards for nonsense, and lawyers that have nothing better to do than think of some class action suit that will bankrupt the next big company, we have added to companies list of reasons to want to leave the United States. Our unions have not helped all that much either. They have been willing recently as is the case with the UAW to sacrifice manufacturing jobs so their present members do not have to give up compensation and retirement benefits that are unsustainable for these companies.

In your article you state that the administration is going to try to blame the high U.S. unemployment on the Chinese, your right when you say they should not, we should be blaming our own government for making it easy for U.S. manufacturers to leave, we are responsible for our unemployment and could correct the problem fairly easily. Now you ask why should we have companies manufacture here, since as you state that the natural evolution makes this wrong and makes us a protectionist country. I could not agree more it would make us a protectionist country and since you are a writer you should appreciate that aspect, because if you were writing this article in China they may not let you write whatever happened to be on your mind.

The old saying that we never learn from history and that it keeps repeating itself is true as well. In this case it would be the lesson from the Civil War that gets ignored here. The whole reason the North beat the South in that little skirmish was because the North had the manufacturing. Last I checked China had a slightly different perception of how people should be treated and that little Communist party is still in charge. So if and when they decided they had enough of how we protect Taiwan and how we dictate our morals and views on the rest of the world and they attack us, or one our allies, we may have a problem defending ourselves or others if we are getting all our parts for our military shipped over to us from our attacker. Even if our supplier were not our attacker how hard would it be to disrupt or stop our supply chain. Back in Dec of 2001 we had the longshoreman strike out on the West Coast and we had to ground some of our F-16 fighters because replacement parts were sitting off the shore in containers. So you say if that happens we will just start to manufacture again. Well you had better hope they can UN-moth ball the steel mills that are over 100 years old fast enough, before you have to write for the State run paper. We talk about our dependence on foreign energy supplies, but what about our lack of independence to cloth ourselves, now they want to take down our tariffs on agriculture goods, soon we will not be able to feed ourselves.

What is the end game of free trade total unemployment in the U.S. or is it brining our standard of living down to those you speak of with such sympathy for in China, those with stagnant and dropping incomes. The wide explosion between haves and have-nots. We will all work at Wal-Mart as greeters without health care and without opportunity. I personally do not care if China decides to stop investing in our bonds, I would actually welcome it. Have we gotten to the point where if the Chinese stop buying our bonds we will go bankrupt, give me a break. The Chinese steal more in property rights in one month then they add to our economy.

Now I am sure you are probably thinking 6% unemployment is no big deal but this does not take underemployment into account, people who struggle to make ends meet, and even struggle to feed their families. Well what happens to all these plants throughout the world if we stop consuming because we are all home without jobs. Last I checked we make up two thirds of the worlds economy, and if we stop buying the Chinese goods sold by Wal-Mart, I seriously doubt the rest of the world will fill that void. It is a catch 22 if GM stops building cars here and everyone is making $5.85 an hour GM will not be able to sell too many $30,000 SUV’s. So in our mad rush to help the poor Chinese and save the multi-million dollar salaries of our CEO’s we may cause more harm than good. What the world needs is fair trade not free trade. Now I do not pretend to think you can ignore the whole world and not import anything but you must maintain a certain base of manufacturing and middle class or you will have unrest on your hands.

However you do not have to worry because greed is what runs this country and the only reason this issue has come up is that the President has to get the little nobodies to vote for him, so he can continue on with his pro business anti citizen administration. Unfortunately most of America is consumed with who will win The Bachelor or what Britney Spears will wear to the music awards next month than the future of our country.

So the free trade experiment will continue right up to the point where we may have to explain to our kids that they do not have to worry about saying “one nation under God” because the new red flag does not believe in God so we no longer believe either. – Joe

Modelman: As a very successful businessman, now semi retired, that has reaped great rewards from current policies I can't agree with your findings. Their is a direct correlation between massive trade deficits and loss of jobs in the industrial sector. The longer these jobs go away the less chance we have in bringing them back. We have gone from a 10 billion trade deficit to 120 billion in just a few short years.

Recently I was outfitting my third home (Lake Lanie, Georgia) and was on a buying frenzy. Guess what? virtually 80% of my purchases had an orginal orgination of China. That included Furniture, Garden tools, and a large variety of accessories. Even my ladder was made in China. All my electronics are made in the Far East as well.

Just one year ago I bought another home in Florida which I did he same thing and virtually all my furniture was made in North Carolina. Now their prices are at least 30% higher and not competitive and I am now buying from other companies that have quality made in China furniture.

The only items that I can still buy for my homes made in the U.S.A. is carpeting and A/C/Heating systems and possibly new roofing.

The labor I am using for all my homes is from Mexico. They are at least 20% cheaper, but more important they do quality work around my homes.

When I buy cars it is either a Jaguar, Infiniti, Honda, or mercedes. Bottom line the closest made in the USA was a Honda Pilot made in Toronto.

I have save several hundreds of thousand of dollars by doing all this at the cost of U.S. jobs and frankly I am feeling guilty and would be willing to see higher prices in order for more American's getting jobs.

Our middle class is disappearing fast and you folks who live in the Cities don't see this as well as someone in my position. Our low inflation and yes, disinflation, can be attributed to the above problems.

We are not going to ever had a truly healthy economy with the status quo. We cannot continue to artificially prop up our economy with massive deficit spending and funny money supply policies. Trust me, I know what I am talking about. – Brett Sorge, Atlanta/Philadelphia/Palm Beach

Modelman: I disagree with you wholeheartedly. If you go to a Target or K-Mart, it seems that everything is made in China. From appliances to pajamas to shoes to coat hangers. We don't make hardly anything in this country anymore because of labor costs. So, it makes economical sense to farm these products out to other countries with lower paying labor, and China has more of it than anyone.

China has never played by the rules, and as long as it gets what it wants, when it wants it, China will continue doing as it pleases. When we let them into the WTO last year, we played right into their hands. Your statements about the Bush administration sound more political than common sense. -- S. M. Palmer, Las Vegas, NV.

Modelman: You're spot on with your recent China article. Someone should count the number of marketing, sales, warehousing, accounting, administrative, etc., jobs are created for Americans who participate in bringing the Chinese manufactured goods into the US. I do lament the loss of manufacturing jobs but it's probably offset or even in our favor when it comes to the support positions created. -- Jack Sullivan

Modelman: I'd just like a make a few comments on US jobs.

First, 50 or 60 US jobs in the small town of Wappinger Falls, NY went to China. I know the details. I was over in Stavanger, Norway; I spoke directly with Tor Laerdal about this. Everyone else is doing it; we must also. Secondly, I confounded by the lack of truth as well as the lack of historical basis upon which arguments for and against China, etc.. rest upon.

I went back to visit Adam Smith - the Scot - and the so-called father of economics. In his Wealth of Nations, he lays the groundwork for free and fair trade.

These common place arguments are destructive. There are ONLY 2 ways for free trade to exist:

Each must rest upon the principle of balanced trade. One is to induce Fordist ( 80 cents to $5 a day) policies; the second is to levy serious tariffs based upon marginal cost principles of domestic manufacturers.

The first is impractical; the second would require a host of principles that would mandate via legislation direct worker involvement and worker representation. It has risk, but is workable. Look at Norway and Germany. Ignore the labor costs for now. These systems work, but are not without their own unique problems. In addition, executive salary and buyouts would have to execute compensation taxes of 70% on salaries exceeding $1 million dollars; stock options would be balanced, asserting that executive pay and achieveement is impossible without workers. They must share proportionately.

Tax credits are limited to R&D and plant investment and export support. All other credits are disallowed. The Malcolm Baldridge Award becomes a nation standard. It is amended to reflect the most competitive practices in the world. Companies are rated every 3 years. Companies would lacking would lose a legislated 10% tax credit dervied from operating earnings.

Plant and equipment would be subject to a 20% refund immediately - from the gov't. The equipment can only be made in the US or must have at least 75% US manufactured parts.

Job creation would be reward with incremental tax credits - up to 25% of the total salary and benefits package; year 2 would be 15%; year 3 thru year 5 is 10%. If the employee is terminated , 80% of the credits must be given back.

What did Smith say? He was a strict,, parochial proponent of balanced trade; he despised mercantilism. While he despised government involvement, and supported a laissez faire policy, he neglected to realize that governments would not necessarily do what is best for their existence and for their citizens.

No system is perfect. However, without balance and the ability of foreign corps to invest in the USA, jobs flow to what is now the concept of American laissez faire - shareholder value and profit maximization.

See Andy Grove - 10-10-2003 Washington Post; he urges government involvement. It is not China's fault; it is Reagan's, Bush, Clintons and Bush's fault for not recognizing the obvious need for balance and national prosperity. I have neglected to shed all of my knowledge with Adam Smith, preferring another opportunity to express myself.

While I am certain that I do not have the perfect answer, I do feel that I am much closer than the current discussions. Mr. Bush is political; Mr. Snow is lost in a blizzard. Mr Bush's economic policies are questionable and tread on an environment where failure is more likely than success. I truly questions the validity of the current economic and trade policy. I do not believe it will work as intended. Good intentions aside, other than competing directly with countries on their wage level while reducing the federal budget by 95% -- I see no tenable solution other than one that involves balanced trade with some competitive caveats that prevent run-away wages in certain US industries. The proper balance would to to up=level the less fortunate workers while capping those folks that seem capable of making $3000 a week by working in strict accordance with union mandated rules.

The ultimate outcome will be wrong, because its based on emotion rather than historical fact. Words have meanings peculiar to the period; these are not universal, perpetual meanings. Ex: laissez faire.

Politics removed, the solution is possible closer to the principle of balanced trade; also required is a strong economic and industrial policy that support and rewards investment and innovation, while limiting the ability of executive's and worthless rubber-stamping Boards of Director's to defend ridiculous compensation policies.

If an executive group is awarded a $10 million bonuses, then workers should receive -- at minimum, $50 million. This is just a rough example of a provision designed to balance rewards more equitable --- whether deserved or not. If an exec gets $200 million, then every employee must get at least $1 million -with the same tax deals. In many large companies, the company uplifts the exec;s compensation to cover the taxes due at execution of tax options. I've seen this in the payroll system.

Anyway, Jon, this is my brief, hurried, response to your article. I am not critical; I am only hoping that this may guide a search to the correct solution. -- Ed Wisniewski

Wappinger Falls, NY

Modelman: China has done nothing, we did it to ourselves. We have created trade policies since post W.W.II that has favored other countries over our own interests. We are now the world's largest debtor nation. Our trade policies have allowed not only foreigners to profit but also created an environment where it has become legal and profitable for US companies to leave the US go off shore or to any foreign country of their choice, manufacturer goods then import them back the US.

If NAFTA worked it would have stemmed the flow of illegal immigrants to the US. NAFTA has been a failure from the get go profiting the few and sacrificing the many.

China has enough of our paper money that it could rebuild the Great Wall of China with US paper. So China buys 10 billion dollars worth of T-Bills a month, is that going to happen for the next 100, 50, or even 20 years? I don't think so. China and the United States being in love with each other is irrelevant. We are two large countries but not the whole world. No other currency is strong enough to topple the dollar, no we are doing it ourselves through debt. The main thing that keeps our dollar respected is a super powerful military.....now Iraq is proving it is not so super.

Think about this, if you were in a business in the United States and you must survive on exports only to survive what would you choose besides agriculture or raw materials? There is really nothing we have that the rest of the world wants to buy that they can't make cheaper. We are a stock that has grown too big and too overpriced and we can't fool the stock holders much because we will soon no longer be able to pay a dividend.

I am afraid that we got into this global economy and we are headed for that proverbial "ECONOMIC TRAIN WRECK" and it is not a question of if but when. -- Dennis Garwitz, Sr.
Garland, TX

Modelman: In response to your article “China is no job-stealing bully,” you have made a poor assumption which throws off your logic and has led you to a denial of crisis and reality. You assume that it is China’s intent to become a consumer of western products. In our business dealings with the Chinese in the manufacturing of CDs, DVDs, and other emerging technology products, I have found that it is commonly accepted by them that they will eventually make these items themselves by acquiring the know-how with or without proper licensing of the patented technology or by any other means possible. Any private companies that you see there are owned or controlled by government officials, their families or friends or by the Chinese government itself, which, because of the way the country is run by the government, will ensure that you can never undercut their labor costs by playing according the rules by which American companies are bound by its government.

Walmart, the example you used, is not concerned with the trade deficit, fair trade or anything remotely resembling economic balance or fairness in trade. Their focus is strictly on the bottom line, as it should be. The Chinese government, on the whole, is doing exactly as they should be doing by protecting their economic interests and taking advantage of every opportunity presented to them. Personally, we like doing business with them because they are real and admit that this is a game to play and be won, not an exercise in social economics. But, because the U.S. government refuses to use the same tools as the rest of the world when doing business (real subsidies, tariffs,… etc), I and other businessmen are forced to play with a deck of cards devoid of jokers or aces to draw upon. I do not to pretend to know all of the answers, but as a former engineer in the telecommunications industry and now entrepreneur, I assure you, the jobs that are leaving this country now will not be coming back any time soon (a decade or more), unless we start playing with a full deck.

One way to battle this, without protectionist measures, is to support small businesses who, because of the overhead of exporting jobs, will likely not utilize the cheap labor available abroad because it is to expensive to setup and manage. Our federal and local governments however are not supportive of small businesses and fail to comprehend the necessity of doing so.

For instance in Tulsa, Oklahoma, the city passed a consumption tax worth $350 million to Boeing if they put a facility here employing 1,000 to 1,200 people. City officials tied this issue to other issues on the same ballot to ensure that it passed. I won’t get into the details of who actually profits from this, but it suffices to say that $350 million invested in manufacturing and services, by small businesses, would employ a lot more than 1200 people and deliver an even greater ripple effect in creating other jobs to support these businesses. If you gave 350 people $1 million dollars a piece and told them to add only the interest to their income and spend it in the community it would generate as much or more benefit than letting the fickle monster that is Boeing come in the door and leave at its discretion. This move was not just ignorant, but stupid, and is representative of what is going on in all levels of government.

Jobs in manufacturing, customer service, and technology are all being threatened by the perception of lower labor costs in countries abroad. And yes, those jobs leaving this country will hurt us. “Us” is not Capitol Hill or Washington, or the state and local governments. “Us” is you and me and the guy who can’t find a good paying job in the city where he lives or anywhere else he searches. “Us” is the people who have exhausted their savings and got screwed out of their retirement and have to give up their homes that won’t sell because no one has money to buy. “Us” are citizens under assault by illegal immigration which puts pressure on an already devastated job market and tax-funded social services network. “Us” is those people who paid these taxes so that the government could service and protect our financial, social, and cultural interests, not the interests of the other countries in the world. That is what charity is for.

If we will play our part in this game, we can maintain the economic balance in this country while being positively supportive of the rest of the world’s fiscal health by letting “balance” force other governments to play fair. If we, however, insist on letting the interests of a few greedy and power hungry fools (people, governments, and companies), under the auspices of maintaining relationship and “free trade” with other governments, we will have to suffer the consequences. Trade never has been nor will it ever be free. There is always a cost and someone has to pay it.

As in nature, balance is an unstoppable force. You can either go with the flow or be worn down and eliminated. What large business and government fail to see is that without jobs and prosperity we have no money; with no money we pay no taxes (income, consumption, or property), we buy no products or services (homes, cars, merchandise, or otherwise) and we do not travel. And as far as the cost of credit, Banks with Visa and Mastercard charge up to 29% interest while we only get 1.5% on interest from savings, and all levels of our government increase taxes, making you pay more for less; and reduce taxes temporarily, giving us a false sense of relief, which is the path that both the Democratic and Republican parties have led us to. And it will come to where we can no longer pay because we will have nothing with which to pay. Then the system will fall, our standard of living will collapse and we will become akin to a “third-world” nation as we will no longer be one of the worlds premiere consumers and the market in demand (i.e. consider the Soviet Union). And it is then that we will begin again, as we will have been forced to develop the cheap labor and the friendly business climate through economic crisis, collapse, and depression. And hopefully, the consequences of this won’t leave us vulnerable to a myriad of other possible political and social scenarios which could precipitate the redrawing of our US maps. But no, what happened to the Soviet Union was an illusion. It just couldn’t happen to us.

In summary, if you bite the hand that feeds you, you will no longer be fed and you will perish. But, since this could never happen, don’t worry about the job that you have or could have that has now been exported to India, China, Korea, or Malaysia. And don’t worry about paying taxes, you need to make and spend money to be subject to that. But let’s not fool ourselves about this one thing. The job market in this country is evaporating because the jobs are moving to other countries, and they’re not coming back any time soon. Your right Jon, we are picking a fight with ourselves. And from one hand that doesn’t know what the other is doing, I say, watch out political and business incumbents, Gray Davis and John Rigas are just the beginning. We no longer have anything to loose by bustin’ you in the mouth and cutting off the hand that offends!!! -- -- Mike Paris, Tulsa Oklahoma

Modelman: I agree whole heartedly with your article. I think that you did not go far enough. Bush's tax and economic policies have exacerbated the problems you talked about in your article. The rebates in Bush's tax package went right to Walmart and straight to China, improving domestic spending but worstening the balance of payments. Bush should instead have spent the money that went into rebates and tax cuts into job retraining and helping the state governments with education. Other countries spend more as a percentage of GNP on communications infrastructure to make high speed internet access widely available. Bush's misguided economic policies will negatively impact the US's competitiveness in the world market far into the future. – Larry Fujitani

Modelman: The problem with America today is a no-brainer. We need to start taking care of ourselves and stop the the flow (of both people and otherwise) into and out of this country if we are to survive. What is this about terrorists? If these people had any brains they would just sit back and watch us self destruct! I'm all for fair trade (when it is fair and equal) to which foreign competition is not and never will be until wages and all other costs are comparable. This will not happen in our lifetime. I don't know what you are earning but why not have your employer hire someone from China (of all places!!) Mexico, India or anyplace else in this world ( to do your job) that we can't compete with making minimum wages (let alone a decent paying job)! Americans have to be some of the dumbest people in the world. Every time you buy something not made here (when and where you have a choice) you are an idiot! Not only that, it is no doubt going to get worse because of greed and because we are raising a society of ignorant (and can't think for themselves) people. More and more "Big Brother" is watching and our people are getting dumber through technology. Computers for instance should not be allowed in schools until maybe 9th grade. Why? So our kids can maybe learn to think for themselves to enable them to problem solve. How about raising the passing grade to 75 again? What better way to manipulate society than to raise an ignorant (can't think for themselves) one?

It is too much of me and not enough of us in this country. People bash unions and fail to see that if it weren't for unions no one would have any benefits or decent paying jobs (unionized or not). No one is going to give you anything and the only way to get something positive is to stand together ,united. As in the "UNITED States of America". Do you or anyone else understand that? People form a union every week at the supermarket when they do not purchase a product on any given week because the price was too high (and they may not even realize it). It's called "just say no". Sooner or later the price will drop. Prices are out of line in this country, even with things made here (the proof is in the profits and the 50% or more off sales.) The only reason it is like this is because we dumb Americans allow it by paying for it. Sooner or later (and like it or not) I see the people of America standing up together and saying enough is enough. Then some will believe that you can fight city hall. Can you say "Revolution?"

So it is time Americans get smart and the rest who are here who do not support this country but yet want it's benefits to GET OUT! It is time we stop giving "outsiders" an education. It is time we stop pumping billions of dollars into worthless countries (i.e. Iraq) and start applying the money here because it is America first. It is time to make it an unwise move to produce anything off our shores by making it cost more to do so. It the playing field is level and the product made elsewhere is better, fine. Until it reaches that point (and it won't) we need to save ourselves and we need to do it fast.

Do you have an American flag? Where was it made? If it was made anywhere else but the USA it shouldn't be allowed to be sold here. If you find it was made elsewhere, burn it and find one that was made where it should have been!

God Bless America and God help it. Have a nice day. -- John Meczynski

I had to chuckle about your ridiculous claim that the Bush administration was leading the "bashing" of China for its "unfair" trade policies. Our country has got to wake up. Actually, the Bush administration (as the Clinton administration before it) is the biggest cheerleader for the industrialization of the U.S.

Certainly you can't take exception to the fact that the U.S. must keep a viable steel industry in place for reasons of national defense. We can't depend on China, Brazil and Japan to serve this vital supply need in the future. Who knows what to expect in the coming years. Once the steel industry is gone, it will be very hard to bring back because the skilled (and hardworking) people in that industry will be lost (maybe they will go on to work at Walmart.

The U.S. government needs to start looking after our economy as a whole. Free trade is important, but to go to extremes is foolish. We need to preserve our steel industry and the Bush administration must immediately put some bite into its policy rather than just having an empty policy in place. -- Timothy Legare, Ponte Vedra Beach, Florida

Modelman: You are just so wrong in your article it would appear that you have never visited China and certainly have never visited the factories where goods for Wal-Mart and other similar companies are purchase. It also appears that you have not spoken to people other than government officials and trade representatives. So here is the real story

Chinese workers make $ .40 - .50 per hour. This is slave labor wages under any condition and not at all like American in the early 1800 with black slave labor. They live in dormatories or slum-like apartments 8-10 per room. Imagine importing 1 million Chinese to America to work our farms and factories and live in barns. Not only would it be illegal, Americans would be outraged. But the slick marketing of Wal-Mart and others insulates Americans from the truth

Of the ten richest Americans, the Walton family occupies 5 of the positions. The richest family in the history of the world. The wealth of the Walton family would pay the wages of 8-10 million chinese factory workers for 10 years!

Talk to Chinese factory owners, most of whom do not live near their factories and many are from Singapore, Taiwan, Hong Kong and other countries. Their entire goal is to take every American job they can and bring it to China. You only talk to people who have a trade agenda.

How about paying the Chinese worker a minimum of $ 5 per hour. That is still not a livable wage, but it better than a slave wage. -- Dave Anderson

Modelman: So you turned against Bush. As I understand it we have two choices:

1- Destroy all the American Industrial base for the sake of few Companies such as Fort, Intel and Motorola plus few cheap pajamas. Few People are happy because the price of their pajamas is cheap and interest rates are low for home refinance. Some other people will be mad because they can't afford to buy cheap pajamas, not to mention bread and mustard.

2- Risk a trade war with China. Impose 40% custom duties on their products, raise the price of our underwear and Wall-Mart would not be able to meet the Street estimates. China will retaliate by selling our dollars and Bush would not be able to borrow money to support his Gun Boat diplomacy. The rich boys will fold their check books and Bush would not get his campaign millions. Some people will be mad because they are paying too much for pajamas.

Neither of these two approaches are good for Bush's keeping his job and this is music to my ears. I am bad!!

Seriously I am very sad for my country, I never believed the biggest democracy on earth, America the beautiful, America the great, America the rich came to depend on a poor country we used to call it Red China. Jon tell me what did go wrong? Is it our leadership or what? and I don't mean only Bush. Why didn't we see that coming 10 years ago before NAFTA. Why didn't we design the NAFTA and open trade to benefit the whole population not only some of the population. – Abraham M. Fadley

Modelman: Your China story was right on. This message needs to get into the popular media, and into Congress. Most Americans have little or no concept of the reality in China, or economic reality in general. Unfortunately the politicians aren't any smarter. – Richard Abel

Modelman: It was stated best that "foreign direct investment in China has boomed". Coca Cola and other retail product manufacturers see the 1.3 billion people in China, not to mention India as the future for many of there products, Why do US people buy products from Wal-Mart?

Many Economists call the loss of jobs a transitioning effect for the stabilization of the economies in these 2 countries. Which together account for almost 3 billion people or 10 times the population of the U.S.A. The consumer purchasing power of China and India could be unmatched if there currency had some real value and the people of these 2 countries actually could afford to purchase the products they make. look at Mexico !

Though the infrastructure of China with regards to environment (water, lumber) seems to need some reform they have also built the largest dams in history on the yellow river and you could also look at the former soviet union's vast resources for mining and lumber that have been literally untouched and the gold, silver, and oil that are beneath those countries could literally change the economic power of the world.

However, your article focused mostly on labor jobs and jobs directly related to the ones threatened by China. All you have to do is go to Mexico. I was an Internal Auditor and I went there and worked for 6 weeks for a 3 billion dollar corporation and the Automobile jobs that were once here in the "heartland" are in Mexico. Why? 34.45 pesos a day was the minimum wage in 1998 that is per day not hour . or roughly $5 per day, some make more, maybe $8 or $9 per hour in the Auto Companies is that a good job in the USA not really see what kind of house you can buy on an $8 an hour job. Can the workers of these countries afford to buy the products they manufacture. I did not see to many! However manufacturers are there Mercedes, Ford, GM etc.... Many jobs have been created by NAFTA however; there not the manufacturing jobs in the Midwest, those are in Mexico and China! Many of these jobs have transitioned to transportation and distribution and tech sector. They still have to get the products to Market from people whose money is actually worth something yes the USA. China's Labor rate maybe worth 10 cents an hour due to the huge population and currency values and investment required in dollars. So who does not value currency correctly? and what can $10,000,000 buy in China, Mexico, and the USA. How many employees do you get in each country for a billion dollars? I hope they don’t call that productivity! -- Kevin Plank

Modelman: Wow, I wouldn't be surprised if the Chinese government paid you for that wonderful plug of China. Help poor China...give poor China jobs...feel sorry for poor China. Get a clue!

You are American right? First, let me just ask a few questions?

Is China still a communist nation? Are American multinational corporations exploiting Chinese cheap labor? Does China have a "turn their head the other way" approach to technology theft and copyright infringement? Is the current trade deficit with China the largest it has ever been?

The answer to all four of these questions is "yes." You economists....I love the way you guys spin your point of view. China to you is a way to exploit a third-world people with limited freedoms in order to line your pockets. And please don't bring up Wal-Mart in your defense of China. Wal-Mart is definitely not the knight in shining armor they were originally made out to be. Wal-Mart exemplifies the attitude of making the most money by encouraging third-world production and discouraging high-paying American jobs.

Just to show all you economists are talking to each other and comparing notes, you used the correlation to what is happening with our manufacturing jobs leaving to our economy transitioning from agriculture to manufacturing. That argument is weak and has been presented before. With the free trade mentality, multi-national countries can set up shop in countries like China and India and train their workforce to do whatever they need accomplished. The knowledge gap is closing significantly. The amount of engineers graduating from Chinese universities each year equates to the population of Pittsburgh, Pennsylvania. While much of the country is rural, there is a massive transformation going on right now.

This change is not just in manufacturing. Countries such as China and India have taken high-tech, service and banking jobs from the United States. This I know first hand from friends of mine who work at Mellon Financial in Pittsburgh.

You conveniently don't speak of the underemployment that exists in this country. You don't speak of the deteriorating middle class, those that make anywhere between 40,000 and 100,000, depending on family size, per capita income. Why don't you mention some of these points of view? It is probably because your argument would have more holes than Swiss cheese. I would imagine/assume you were a proponent of NAFTA too? What about the trade deficit with China?

Your answer to overcome American job losses is to learn new aptitudes and create more high-tech jobs. That is great, and what America is about. But guess what? We don't need an American to do this new aptitude. We can go to India or China and train someone to do that for less than a dollar an hour. Free trade equals lower-paying American jobs. The gap in technology is closing. China just put someone into outer space. Do you honestly feel that China really wants to co-exist with the U.S.? They want to become the new dominant nation on this planet. People like yourself are letting this happen. But hey, someday they (China) might come around, give their people more money and buy more American goods. Really? If a company can produce something cheaper in China, then there is no need to have the good imported from the United States. In your words "A terrific market for Western finished goods." Huh? You have be able to make goods in order to export them. Get a clue.

You are a typical economist. You care about one thing, making the most money possible, no matter who it affects and at what cost. You could care less about people that loose their jobs here due to cheap labor. They are, to you, a simple causality of profiteering.

Ten years after the implementation of the NAFTA, and many in congress who voted for its' passage are have had second thoughts about supporting it. One individual who voted for it in my area who regretted supporting was summarily defeated when he ran for re-election.

But hey, China is wonderful, China isn't a big deal, China will come around with the rest of the work, we can't alienate China. China, China, China...

Hopefully in 20 years we won't have the same revelation that we have had about the NAFTA. Unfortunately, history and head-in-the sand economists have a way of repeating themselves. -- Jim Latimer, Champion Township, Ohio

Modelman: I just finished reading your article, "China is no job-stealing bully" on the MSN Web site. I think it was an excellent article that made a number of valid points, not the least being that we live in a global interdependent world and must find a way (other than old style imperialistic dominance) to prosper. I personally believe there has been greater loss of job to Mexico than China.

I'm no economist, but I can tell you that 3 of my 4 children have had to move away from where I live in Ohio, because nothing has ever filled the void that the loss of largely blue-collar jobs that have left this area forever has caused. Now, even service type jobs and telemarketers are being driven to places like India where labor is cheap.

No Administration, (Democrat or Republican), has been able to resolve that problem. If we are not able to provide our people with the means to live, who is going to be left to buy all those foreign goods no matter how cheap they are? -- Bill Bagley, North Canton, Ohio

Modelman: Having been in China, I think that the point that the currency discussion misses is that, if the renminbi was 30% higher, and Chinese workers were paid 30% more, it would still make Chinese labor 2-5% of the cost of US Labor. The Chinese labor cost advantage is so extreme that no amount of currency rebalancing would affect it. – Mike Alsup, Houston, TX