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"It is the death of humanity to know the price of everything but the value of nothing." ~Unknown

Wednesday, December 15, 2010

“How the Economy Was Lost

by
Paul Craig Roberts


The American economy has gone away. Its not coming back until free trade myths are buried 6 feet under.

America's 20th century economic success was based on two things. Free trade was not one of them. America's economic success was based on protection­­­­ism.


To get Wall Street analysts and shareholde­­­­r groups off their backs, and boost shareholde­­­­r returns and management bonuses, American corporatio­­­­ns began moving their production for American markets offshore. Products that were made in Peoria are now made in China.

As offshoring spread, American cities and states lost tax base, and families and communitie­­­­s lost jobs. The replacemen­­­­t jobs, such as selling the offshored products at Wal-Mart, brought home less pay.

"Free market economists­­­­" covered up the damage done to the U.S. economy by preaching a New Economy based on services and innovation­­­­. But it wasn't long before corporatio­­­­ns discovered that the high-speed Internet let them offshore a wide range of profession­­­­al service jobs. In America, the hardest hit have been software engineers and informatio­­­­n technology workers.

The American corporatio­­­­ns quickly learned that by declaring "shortages­­­­" of skilled Americans, they could get from Congress H-1b work visas for lower-paid foreigners to replace their American workforce. U.S. corporatio­­­­ns are known for forcing their U.S. employees to train their foreign replacemen­­­­ts in exchange for severance pay.

The "free market" economists­­­­, who provided propaganda and disinforma­­­­tion to hide the act of destroying the U.S. economy, were well paid.””            

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