Terry Paulson

It’s an election year again, and protectionist policies are again being played to a populist drumbeat in Democrat primaries. Facing difficult economic times and a painful housing market downturn, too many Americans are taking the wrong lessons. NAFTA is not the problem!

America has been getting a wakeup call from the world, but far too many are whining and clamoring for more government support instead of responding to the challenge. Many feel that they are entitled to a good standard of living, increasing salaries and increasing benefits. Most workers thought they could learn a skill, find a comfortable career, and work comfortably into retirement. Unfortunately, the world has changed, and too many Americans are desperately trying to hold on to jobs that are rapidly becoming unnecessary.

For the first time in history, anything can be made almost anywhere and sold everywhere. Talented and motivated workforces in India, South Korea and China are just a mouse-click away! These changes aren’t just taking American jobs; they’re also creating jobs. Most of those foreign workers are using American software. Most are drinking Cokes. They watch our TV shows, and they want the brands that we have. As other countries become more successful, they can afford to buy more American goods and services. The weakening dollar has already accelerated our export numbers.

It is true that when manufacturers in the U.S. can’t compete because of high labor costs, some move operations offshore while still others innovate more efficient manufacturing processes. Both strategies can eliminate U.S. jobs. But such changes bring down the cost of the products so more can afford them.

The expanded market for cheaper goods means more people need training to use what they buy, so trainers are hired. Anything purchased must be maintained locally; people are hired to repair and service the new products.

Such changes are painful for people unwilling to learn new skills. Economists call it “churning,” and it has happened over and over again throughout the history of capitalism. Its playing field is now global, and the speed of the churn is faster.

A few years back, Lee Kuan Yew, called by many the “Father of modern Singapore,” made some eye-opening observations about the global economy and America’s role in the world: “I see a very troubling and at the same time exciting new world in which international boundaries can be penetrated without difficulty. The flow of information, of capital cannot be stopped. ... Whether we like it or not, technology has made this a one-world market for labor. Jobs can leapfrog boundaries. But good minds in the world will command very high salaries, very high fees.”


Terry Paulson

Terry Paulson, PhD is a psychologist, award-winning professional speaker, author of The Optimism Advantage: 50 Simple Truths to Transform Your Attitudes and Actions into Results, and long-time columnist for the Ventura County Star.

 
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