It’s not easy bein’ an American worker these days.  There’s a lot of pressure coming from around the world; folks wantin’ our jobs, willing to work for less money than we’re workin’ for.

It’s hard being an America sometimes.

But there’s an upside.  For the folks who care about such things, the world’s poorest people, people living a life exactly like their parents, grandparents and ancestors have lived for generations, are finally emerging from poverty.  Perhaps for the first time ever, families are leaving the shackles of poverty and rising towards the hope of a middle class, perhaps dare I say, even more.

There is a lot of hand wringing, by both sides – conservatives and liberals – over the fact that we’re losing jobs overseas.  And I have to agree, we’ve seen lot and lots of work head down that road.  And slowly, as the nation finds itself having access to less expensive sources of labor, the natural order of things is to create an environment where some of our labor, American labor, is less expensive too.

However, the upside is that we have access to a far greater menu of goods at prices that are the envy of the ages.  We have blueberries from Chili in February for $2.50 a pint.  Swiss chocolate next to French wines.  We have sausages made from every where next to mustards made no where near the sausages.

Scientific calculators capable of being programed now sell for less than $20.  When I was 11, calculators that could add, subtract, multiple and divide were $110.

And you know what else is good news?

The world’s poor are being yanked out of poverty:

The best estimates for global poverty come from the World Bank’s Development Research Group, which has just updated from 2005 its figures for those living in absolute poverty (not be confused with the relative measure commonly used in rich countries). The new estimates show that in 2008, the first year of the finance-and-food crisis, both the number and share of the population living on less than $1.25 a day (at 2005 prices, the most commonly accepted poverty line) was falling in every part of the world. This was the first instance of declines across the board since the bank started collecting the figures in 1981 (see chart).

The estimates for 2010 are partial but, says the bank, they show global poverty that year was half its 1990 level. The world reached the UN’s “millennium development goal” of halving world poverty between 1990 and 2015 five years early. This implies that the long-term rate of poverty reduction—slightly over one percentage point a year—continued unabated in 2008-10, despite the dual crisis.

And where has most of this progress been seen?

A lot of the credit goes to China. Half the long-term rate of decline is attributable to that country alone, which has taken 660m people out of poverty since 1981.

660,000,000 people have escaped bone CRUSHING poverty in the last 30 years.  That’s 22,000,000 per year.  That’s just about 2,000,000 people a month!

A month.

We’re richer because we get great and awesome things that cost much less.  THEY are richer because they are richer.  And THAT is a great story about how capitalism reduces poverty.  Don’t ever forget, where man has been more wealthy in the history of the world is when he has been most free,  free to trade, to create to innovate.  In all of time, man is better off when he can sell what he owns.

6 Comments

  1. Some people are not convinced that workers in China are better off. The media often shows us images of Chinese workers stuck at boring manufacturing jobs for 10 hours a day. I would not want one of those jobs, but I would certainly not want to spend 16+ hours a day at hard labor working in the fields for half the wages paid by the factories in China.
    We want a better life for ourselves and others. This often means “Do Gooders” are reluctant to take little steps that do not entirely solve the problem.
    Example:
    There were a lot of complaints regarding the use of homeless people as Internet hot spots at SXSW.

    One of the homeless men said, “Everyone thinks I’m getting the rough end of the stick, but I don’t feel that. I love talking to people and it’s a job. An honest day of work and pay.”
    http://www.nytimes.com/2012/03/13/technology/homeless-as-wi-fi-transmitters-creates-a-stir-in-austin.html?_r=2&ref=technology

    Clarence and the other homeless men in the project were only paid $20 a day, but they were allowed to keep all the money that they were able to collect. Why is that so terrible? The suggested donation was $2 for 15 minutes of service. I am guessing that there could be at least 10 simultaneous users. That could generate $80 per hour of tax free money, but I guess it is unfair. It is unfair to provide an out of work person all the equipment to make some spending money. It is unfair because the earnings are not guarantied. It is unfair because it is a temporary income, and it is unfair because it only generates money for unemployed folks that are friendly, outgoing, and endowed with social skills. Clarence is a “people person”; he admits that he loves to talk to people. He can be successful in this type of situation, but those “Do Gooders” demand a solution that can be applied to every unemployed homeless person on every day of the week.

    • The media often shows us images of Chinese workers stuck at boring manufacturing jobs for 10 hours a day. I would not want one of those jobs, but I would certainly not want to spend 16+ hours a day at hard labor working in the fields for half the wages paid by the factories in China.

      That’s the message we have to work hard at delivering. Sure the folks in China don’t have the great jobs that we might enjoy, but the fact is, moving from bone crushing poverty to an affluent life is going to take generations.

      I guess it is unfair. It is unfair to provide an out of work person all the equipment to make some spending money. It is unfair because the earnings are not guarantied. It is unfair because it is a temporary income, and it is unfair because it only generates money for unemployed folks that are friendly, outgoing, and endowed with social skills.

      Yup.

      The idea that you have to earn the money you receive is increasingly unfamiliar to many people.

  2. Though if you look at the third world, those who embrace free markets tend not to develop. China, like South Korea, Taiwan, Brazil and many others, have taken a very statist role to development (as Japan and Germany did after WWII). They embrace international markets, but domestically the government works with business to plot a strategy at expanding exports and promoting domestic growth. State-led capitalism or “statist capitalism” has been the most effective engine of development (though officially China still calls itself communism — if that were true, then communism would be the most effective engine of economic growth in recent decades!).

  3. If our primary goal is to help people in developing countries, is it better for FoxConn to employ a million workers at mind numbing tasks for 10 hours a day, or is it better to employ 500 skilled workers in a factory that is 99% automated? I do not know the answer, but I bet the 999,500 workers without the steady paycheck would favor the first option. I am not saying that it is right, but it is a reality.

    • If our primary goal is to help people in developing countries, is it better for FoxConn to employ a million workers at mind numbing tasks for 10 hours a day, or is it better to employ 500 skilled workers in a factory that is 99% automated? I do not know the answer

      I think that we have the happy coincidence that where people are most free, where liberty exists, that is where people are most wealthy.

      If we let people work for any wage they can negotiate, and let employers hire workers at any wage THEY can negotiate, you will see that people value their time and will work when the value swings in their favor.

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