Stop the China job drain

We are just beginning to piece together the various causes for the current recession, from sub-prime lending, to reckless behavior on Wall Street, to lack of government regulation and oversight. A new report by Dr. Robert Scott, International Economist for the Economic Policy Institute, sheds more light on our ailing economy. In a recent paper, “Unfair China Trade Costs Local Jobs,” he explains yet another reason why Americans are struggling to find work. According to Scott, since China joined the World Trade Organization (WTO) in 2001, more than 2.4 million U.S. jobs have been lost or displaced as a result of our growing trade deficit with that nation. Literally every Congressional District, including the District of Columbia and Puerto Rico, has lost jobs due to China. Click here to see how many jobs have been lost in your district.

Robert Oak at The Economic Populist has a good summary of Scott’s study, and reprints some of his bullet points in easy-to-read fashion. According to Scott, tech-sector manufacturing jobs have been steadily moving to China and leaving US citizens with even fewer opportunities for work. Corporations such as Dell, Microsoft, HP and IBM outsource jobs to take advantage of low wages and lack of labor laws overseas. The low pay rates and poor working conditions in their high-tech Chinese factories would be illegal in the United States.

Companies should have to pay a price for moving manufacturing and other jobs out of the country, either through increased taxes or tax penalties. In other words, Washington needs to make it less profitable for businesses to abandon American workers, so that they might be more inclined to keep their manufacturing plants in the United States.

One might argue that, if they were manufactured here by workers being paid a fair wage, computers and electronic goods would cost too much. But, imagine a country with a vibrant manufacturing sector in electronics and other areas. Entry-level and more advanced manufacturing jobs could help move the country to full or near-full employment. If the United States took the lead in green technology and alternative energy, we could sell to China and other countries, bringing more balance to our trade relationships. Because we would be more economically stable and secure as a nation, we could afford to pay more for what we buy.