|David Ricardo (1772-1823). Image source|
Until recent times, it was understood that the prosperity of a nation depended on three factors: capital invested in industry; the skills and experience of the workforce, and the availability of land for economic activity, i.e., the three factors of production, land, labor and capital.
International trade was acknowledged to be advantageous to all parties insofar as it enabled each country to do more of what it is did best. This was the theory of comparative advantage, enunciated by 19th Century British economist and bond trader, David Ricardo.
Ricardo was explicit, however, in stating that international free trade is beneficial to all parties only if capital is immobile, since exporting capital, one of the factors of production, will inevitably lower the productivity and hence reduce the prosperity of the population.
Consistent with these ideas, enlightened national governments endeavored to restrict capital outflow, promote workforce education and training, and in the Western World, limit mass immigration from the developing World since that diluted the capital stock of the nation on a per capita basis, reduced the per capita availability of land and infrastructure, and lowered average workforce skills and education -- aside from its potential for destroying the nation through population replacement and reproductive competition.
But today, to hear the media, the Nobel-prize-winning economists, the politicians-on-the-make, and the human rights activists tell it, that's all anti-diluvian racist rubbish.
In one word, globalization.
Or in several words: We're an empire now and the leadership elected nationally, serves the empire not you, the people, who elected them.
But how does that change the principles of economics?
Easily: through the allocation of money, fame and power.
Thus, says J.J. goldberg in a Jewish Daily Forward article entitled: A Low-Rent America Can't Be a Strong Friend of Israel.
Fans of New York Times columnist Paul Krugman might get a kick out of this. Nearly a decade and a half ago, the acclaimed economist savagely reviewed a new book on the perils of economic globalization, dismissing it as “simplistic,” “foolish,” “thoroughly silly” and more. He said the author, Rolling Stone investigative journalist William Greider, had naively failed to consult “competent economists,” which led him to “trip on his own intellectual shoelaces.” Classic Krugman.
Krugman has since moved from MIT to a tenured chair at Princeton and a Nobel Prize. Greider moved from Rolling Stone to the smaller and less remunerative weekly The Nation. The funny thing is, Greider turned out to be right. Krugman got globalization very wrong.
Then there's the case of Paul Craig Roberts, a better man than Krugman, surely. Former Deputy Secretary of the US Treasury, former associate editor of the Wall Street Journal, Business Week, and Scripps Howard News Service, senior fellow in political economy at the Center for Strategic and International Studies, contributor to numerous magazines and newspapers, author or co-author of eight books.
On March 26, 2010, Roberts wrote Truth Has Fallen and Taken Liberty With It
There was a time when the pen was mightier than the sword. That was a time when people believed in truth and regarded truth as an independent power and not as an auxiliary for government, class, race, ideological, personal, or financial interest.In evidence of this charge of treason by America's elite Roberts continued:
Today Americans are ruled by propaganda. Americans have little regard for truth, little access to it, and little ability to recognize it.
Truth is an unwelcome entity. It is disturbing. It is off limits. Those who speak it run the risk of being branded “anti-American,” “anti-semite” or “conspiracy theorist.”
Truth is an inconvenience for government and for the interest groups whose campaign contributions control government.
Truth is an inconvenience for prosecutors who want convictions, not the discovery of innocence or guilt.
Truth is inconvenient for ideologues.
Today many whose goal once was the discovery of truth are now paid handsomely to hide it. “Free market economists” are paid to sell offshoring to the American people. High-productivity, high value-added American jobs are denigrated as dirty, old industrial jobs. Relicts from long ago, we are best shed of them. Their place has been taken by “the New Economy,” a mythical economy that allegedly consists of high-tech white collar jobs in which Americans innovate and finance activities that occur offshore. All Americans need in order to participate in this “new economy” are finance degrees from Ivy League universities, and then they will work on Wall Street at million dollar jobs.
Economists who were once respectable took money to contribute to this myth of “the New Economy.”
I was associate editor and columnist for the Wall Street Journal. I was Business Week’s first outside columnist, a position I held for 15 years. I was columnist for a decade for Scripps Howard News Service, carried in 300 newspapers. I was a columnist for the Washington Times and for newspapers in France and Italy and for a magazine in Germany. I was a contributor to the New York Times and a regular feature in the Los Angeles Times. Today I cannot publish in, or appear on, the American “mainstream media.”
For the last six years I have been banned from the “mainstream media.” My last column in the New York Times appeared in January, 2004, coauthored with Democratic U.S. Senator Charles Schumer representing New York. We addressed the offshoring of U.S. jobs. Our op-ed article produced a conference at the Brookings Institution in Washington, D.C. and live coverage by C-Span. A debate was launched. No such thing could happen today.
...The American corporate media does not serve the truth. It serves the government and the interest groups that empower the government.
And what Roberts says of the American elite and the American corporate media is true of the elite and the corporate media throughout the West. The interests of the people are to be sacrificed without limit for the "interest groups that empower the government."
Thus, jobs are off-shored and outsourced to take advantage of cheap labor in Asia, the Middle East and Africa. Thus, mass migration from the developing world to densely populated Western Europe is promoted to drive down wages, while it destroys local culture, and in an increasing number of urban areas, reduces the indigenous populations to a demoralized minority that is being out-bred by the immigrants, of whom some show an unconcealed contempt for local customs and religion.
Likewise in America, native born citizens are displaced from the labor pool by millions of illegal immigrants who work in the underground economy at below minimum wages and often under appalling and illegal conditions, a process enabled by the Federal Government by the deliberate non-enforcement of Federal immigration law.
Thus, also, Nobel Prizes and newspaper columns for bent economists, power and prestige for "human rights advocates" who promote mass immigration and genocidal policies of political correctness and multi-culturalism, and massive profits for those enabled by a corrupt political establishment to engage in unrestricted global wage arbitrage resulting in mass unemployment in the West, collapsing welfare services, failing schools, underfunded pensions, and racial and cultural demoralization and destruction.
And astonishingly, so callous is the ruling elite that the fate of the unemployed and the underemployed is barely discussed. Indeed, it is enforced by minimum wage laws, bad schools, and welfare legislation that scandalously deny employment and the opportunity to gain work experience to a large part of the workforce that cannot compete with Asian labour that in some industries earns only pennies per hour.
What Milton Friedman said in 1978 about black poverty in the United States, is now applicable to much of the white working class in the U.S., Canada and Europe. Sadly, Milton Friedman is no longer around to state the fact.