Bring Jobs Home……….Literally
A Plan to Create 3 Billion Jobs
This is not a political blog, but I feel this opportunity should be used to chime in on a hot economic topic in this election cycle: globalization and the loss of American jobs. Both candidates embrace a posture of fighting the globalization trend and on keeping or even reacquiring American jobs that have been transplanted to other countries like Mexico and China.
My contribution to this debate is why should we stop there? As a Hoosier, I say we contemplate going a step further and focus on Indiana jobs. After all, Carrier has been one of the companies (tossing Hoosier jobs away in favor of Mexican ones) in focus for the Trump campaign. Maybe we should be focusing as much on keeping any Hoosier jobs in state as we, even if they would happen to be crossing one state line to say, Ohio, as we do keeping jobs in the country.
When I think about it in that case, why don’t I take it one step further and just focus on the Harter household? I am thinking we can bring back all the jobs we have given to others over the years. Rather than me produce financial management for households looking to trade other goods and services, perhaps we will now become farmers to grow our own food. We will also make our own clothes and build our own transportation devices. In the Harter household at alone, it seems I can create 100 new jobs by sunrise tomorrow! Multiply all those new jobs by yours and every other American household and we could quickly get to 3 billion new jobs.
Hopefully, by now it’s obvious that I am being facetious – and egregiously so in order to make a point. Few things are as important to the rise and growth of civilization itself as the division of labor. We benefit by doing things we are good at and trading with others for what they are good at. The more different we are, the greater the benefit from specialization and trade. Furthermore, it is personally very satisfying to have a conversation across the table from someone when realize how mutually thankful you are that you don’t have the other persons job.
This benefits of specialization doesn’t stop with just trading with others in your village, it carries to other states, and other countries as well. In academia as well as the economics and investing professions, few things are more widely adopted with little debate as to the benefits of free trade. Knowing this makes it very frustrating to see the populist rise against free trade and its benefits. Please don’t think I lack compassion for those that have their jobs displaced by globalization. I truly feel fortunate for this to not (yet) be me. But, before we get lost in complicated theory or rhetoric I felt it was worth discussing the topic in its simplest form and hopefully illuminated why this is important to the country as a whole.
US productivity is already an uphill battle for a number of reasons. The declining productivity has kept a lid on US growth and my opinion is that this low productivity would take its biggest blow yet by a reversal of free trade. If we were to take this gigantic step backwards – the consequences to our economy would be horrific.
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