Free Trade With a Turd-World Nation?
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2018-06-26 07:16 by Karl Denninger
in Editorial , 259 references Ignore this thread
Free Trade With a Turd-World Nation?
[Comments enabled]

We were told NAFTA -- and free trade generally -- would lift people from poverty, and that while there might originally be serious wage and working condition disparities they'd quickly dissipate as workers would demand better wages and working conditions when their standard of living began to lift.

Ross Perot said that was bull****, and they tried to laugh him out of the conversation -- and when that didn't work they threatened his family, forcing him from the Presidential race.  The date of all of this was in 1993, when Clinton signed NAFTA into law.

Ross Perot and the few who agreed with him -- including myself -- was right, and everyone else was wrong.  The signing of NAFTA resulted in the movement of millions of middle-class manufacturing jobs to Mexico along with billions of capital investment that occurred for one and only one reason -- labor was cheaper there and the people who moved their factories believed it would remain that way.  Indeed without such a belief there was no reason to move the factory at all.

Worse, the American people have refused to hold a single person to account for this outrageous fraud run upon them and the millions of lost jobs, shipped to a turd-world nation, to this very day.

 

In truth Mexican manufacturing wages reached an all-time low of $1.90/hour in January of 2017 and in fact their record high was in 2013 -- $3.60/hour.

The alleged "lift" to first-world wages and working conditions never happened.  There certainly was no grand, massive and obvious move from the lower left to the upper right of that chart!

Those who orchestrated this fraud upon the American public knew in advance that would be the outcome -- they knew they could place Goliath's boot on the scale (theirs) and screw both Americans and Mexicans alike.  How do we know that?  Because they had exactly zero reason to advocate for it otherwise.

We were also told that the extremely high murder and other crime rate in Mexico would be attenuated by free trade.  The truth is that the number of murders has expanded by nearly six times, most of it drug-related.  Our "free trade" in fact is used to import precursor chemicals from Asia, mostly China, drugs are manufactured in Mexico and then brought into the United States using our "free trade" border as a ruse.

Even worse only 1 in 10 crimes is actually reported in Mexico due to fears that the criminals will come back and kill anyone who reports an offense.

Mexico is due to go to the polls on July 1st and has a Presidential candidate who has openly claimed the US border is illegitimate and that Mexicans should flood the United States taking whatever they want.  He is leading in the polls and likely to win..

Over 100 candidates have been murdered thus far in this election cycle.

Let that sink in folks; Mexico is a nation with about a third of our population which means for the United States we would have had to have 300 candidates murdered in a typical election cycle to be comparable.  Can you remember the last time there was one such murder?  It literally happens every three days in Mexico.

ALL of the "good things" we were told would happen by the so-called "classical" economists didn't and an awful lot of bad things did happen.  Mexico's murder rate has skyrocketed.  Their use of "free trade" as a foil to import deadly drug precursors from China to sell in the United States has expanded at a ridiculous rate; it used to be that Mexico was mostly a marijuana source for the US (which has never killed anyone), where now they're responsible for a huge percentage of the meth and synthetic heroin that are killing Americans by the tens of thousands.

We were told that free trade would stop illegal immigration since there'd be no reason to come here when Mexicans had a great standard of living -- in Mexico.  Instead illegal immigration skyrocketed and what's worse so did human smuggling, gang activity and trafficking, including child sex trafficking, since the "open border" and "free trade" also meant that the illegal flow of money to pay said smugglers, traffickers and gang members on both sides of the border was facilitated.

The much-ballyhooed and promised "lift" in Mexico's standard of living never happened, nor did their wages and working conditions normalize with America's.  Instead their labor force was used as effective slaves for American manufacturers and this continues today with GM just announcing they're going to build the new Blazer in Mexico.

Worse, their level of violence has extended to the point that running for office is a literal death wish and just the other day an entire police force was arrested for corruption -- in a murder.

Not one single economist or politician in the United States has ever been held to account for this outrageous set of frauds nor has any single manufacturing firm been held accountable either for the jobs they exported to Mexico and the flat-out lies they told and have maintained since 1993.

Every one of these firms, including all of the automakers, should be destroyed for this treachery, every single politician should lose his or her office and be living under a freeway overpass, and the border should be closed now, enforced by the military if necessary.

Stop listening to the bull**** folks -- we were told in 1993 that none of this would happen.

Every single person who said so was lying through their teeth and have made billions screwing not only Americans but Mexicans as well.  This sort of outrageous fraud deserves prison sentences and the murders it has engendered need to be answered with trials, convictions and a very well-deserved use for Westinghouse's preferred form of electrical power - alternating current.

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Vermonttech
Posts: 28
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Malta ny
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Shortly after NAFTA was signed, I was assigned by the major corporation that employed me as a corporate engineer to begin making plans to move a number of US facilitates to Juarez Mexico. I got to see the destruction of US industry first hand. Almost every major company that you can think of was moving to the Maquiladora zone. Watching the exploitation of the hard working Mexican people
at the same time as the destruction of everything we had worked for in the US destroyed my faith in our goverment. Even then, the border towns were dangerous places to work. A few years after I got out of the international manufacturing business, I watched a portion of what I had moved to Mexico move to China because it was even cheaper.
Whitehat
Posts: 543
Incept: 2017-06-27

The People's Republic of New York
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always wondered if this mess was not necessarily some type of globalism but a long game to disburse consumer culture to areas resistant to it. yes, we have the current problems in the short term, perhaps the plan for Mexico was something similar to the areas of Singapore and Hong Kong. in these areas modernity completely replaced tradition and there was always a hard authoritarian edge to these super cities. even Korea and the predecessor to all of this, modern Japan, both became de facto technocracies where people could be manipulated and controlled by the same modernity that gave them 21st century techno existence. we here have often warned what the miracle of technology can take from you.

the constant influx of tech into our lives is a highway that can interfere with native culture as well as it can liberate and expand us. the smart home and other techno baubles are a type of soft tyranny which are slowly molding society into something else unrecognizable in the distant future. being culturally and personally autonomous is the true freedom and consequently, this is the real target not the economy.

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There are two ways to be rich: One is by acquiring much, and the other is by desiring little.
snow, seasons, distance and dirt roads: SSDD
"Be not deceived; God is not mocked; for whatsoever a man soweth, that shall he also reap" (Gal. 6:7)
Tickerguy
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The problem with that theory Whitehat is that it presumes that the nation will lift out of poverty and the general wage level will rise.

That's the "classical" economic theory; that concerns about using people as effective slaves is misplaced, because as you bring manufacturing there you inevitably bring higher wages - they see the goods and what civilized behavior can bring, want it, and it transforms the society.

The problem is that theory has NEVER WORKED, ANYWHERE.

INEVITABLY the people who held the power previously steal ALL of the increased "wealth", suppress the people, the slavery still exists and in many cases gets worse, and while the wage may rise SOME (e.g. the rice farmer in China who is displaced) the REASON it rises is that their rice paddy is paved over for a factory and they either work at the factory or starve! At the same time the average price level for what they need to survive TRIPLES, so they're actually worse off -- they have to work harder for less.

That's what happened in Mexico. Wages did NOT rise in real terms, crazy inflation was present and remained, the people at the top made a ****-ton of money but the people doing manufacturing and other "line style" jobs actually LOST standard of living in real terms. Thus crime and drugs became MORE lucrative, not less, and the murder rate exploded upward by FIVE HUNDRED PERCENT over that 25-year period.

Note that utterly NOBODY is EVER held to account for their projections in America as to what WOULD happen (they claimed) to Mexican wages and working conditions .vs. what ACTUALLY DID happen. Nor are ANY of them held to account for the FIVE HUNDRED PERCENT increase in murders.

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Winding it down.

Whitehat
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i agree with you 100% and was very vocal against the beginning of this crap which has managed to damage two countries in our example here. the comment is that the future technocrats are using the flawed economical model which you rightly highlight as being "classical" in modern parlance for a societal dream of theirs. i have access to somewhat involved people of this mindset and they do seem to like a techno non-historic cultural replacement model. i disagree with them on this point and they are using a very flawed economic model to do it anyway. in addition, this flawed economic model is quite a cruel pill.

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There are two ways to be rich: One is by acquiring much, and the other is by desiring little.
snow, seasons, distance and dirt roads: SSDD
"Be not deceived; God is not mocked; for whatsoever a man soweth, that shall he also reap" (Gal. 6:7)
Blackswan
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Ross Perot. I was in college, a bit naive but I understood NAFTA was a disaster. I made phone calls for his campaign and I still have the Ross Perot coffee mugs.

It is a shame he was silenced.
Tickerguy
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The trade unions to a large degree put together their own bed when it came to their demise in this regard, but that doesn't change the outcome or the fact that the arguments made for the "other side" were lies, were intentional lies, and were intended not to address the union pressure groups but rather to screw both Americans AND foreigners for the enslavement of foreigners and enrichment of a handful.

That you're a dick doesn't mean I get to **** EVERYONE ELSE.

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Winding it down.
Wa9jml
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I have done some reading about the history of "free trade" in the US. Apparently, going all the way back to the FDR administration, so long as the free trade ideology was in place through public policy, they didn't care much about anything else and also pretty much gave our domestic market away for free during trade negotiations. I suspect that they would have made changes if our ruling elite were the ones taking it on the chin for ideology, but instead it was the working class being destroyed, and the elite could care less about them.

Perot was prophetic and had to be silenced. But the resentment gradually built up here in flyover country, and led to Trump being elected. It remains to be seen if he can do anything about this. I get a chuckle when the talking heads say that we are in a trade war and it is all Trump's fault! This has been going on ever since the Progressives took over the country about the time of the Great War. Progressives are strong adherents to ideology, and since there is always going to be inevitable and perpetual Progress, who cares about those eggs sacrificed to make an omelet?

There is also an element of greed in moving manufacturing out of the country to third world crap holes. I worked in the Motorola CB radio area during the early 1970s. Motorola got some incredible tax breaks to move some work to Puerto Rico. I was the tech who checked out the first CB microphones they made in that plant. There were 144 microphones in that box, and none of them worked. But thanks to the massive tax breaks, they could pay us $6.50 an hour to fix them. Then there were the MOCOM 70 radios made in Puerto Rico, modified in Texas, and shipped up to Schaumburg, Illinois for final testing, packing and shipping to the Chicago Police Department. Almost none of them worked, and they were a very complex radio. I had to violate a bunch of company policies to make any of them work. It was a penalty contract, due on January 1, and for years I saved the pay check stub showing that I worked 56 hours in 3 days, trying to get that order shipped.
Aquapura
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At the time of NAFTA's passing I was in high school and remember debating the subject in social studies class. Even in my naive adolescent mind I knew it was a bad deal. My entire platform was J-O-B-S. Spoofed HW's line saying something like, "read my lips, it'll cost American jobs." Maybe I was smarter then than I give myself credit for.

25 years on and I don't think your average American is too keen on what free trade has done to things in these United States and think it's a major reason Trump won.
Tickticktick
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Barbarous Mexico
by John Kenneth Turner
1909


When the slave system "ended" in the USA after the civil war, it didn't disappear; it was exported to Mexico, which made the US version seem tame and gentile/civilized.


A review and an excerpt:

While Mexicos present anarchy and violence along the border has cost thousands of lives, it pales in comparison to the horrors the country suffered under dictator Porfirio Diaz a mere 100 years ago, until the Mexican Revolution ousted him.

The literal slavery, kidnappings, starvation, rape, torture, repression and peonage of millions of underclass Mexicans at the hands of their largely Spanish lords was perhaps best documented by muckraking American journalist John Kenneth Turner in his pivotal book "Barbarous Mexico".

I first read it some 25 years ago when living in San Miguel de Allende, Mexico, at the behest of my landlady, a retired Mexican school teacher. I never forgot it. Now, thanks to Microsoft digitization, I was able to download a free pdf of the third edition.

From 1908 to 1910 Turner visited Mexicoposing as a potential American investor and winning the confidence of Mexican slave owners and managersto report their ruthlessness firsthand:


The philosophy of beating was made very clear to me
by Don Felipe G. Canton, secretary of the Camara.

It is necessary to whip themoh, yes, very necessary,
he told me, with a smile, for there is no other
way to make them do what you wish. What other
means is there of enforcing the discipline of the farm?
If we did not whip them they would do nothing.

I could make no reply. I could think of no ground
upon which to assail Don Felipe's logic. For what,
pray, can be done to a chattel slave to make him work
but to beat him? With the wage worker you have the
fear of discharge or the reduction of wages to hold over
his head and make him toe the mark, but the chattel
slave would welcome discharge, and as to reducing his
food supply, you don't dare to do that or you kill him
outright. At least, that is the case in Yucatan.


Turner documentedboth with keen reporting and in grisly photographs reproduced in Barbarous Mexicothe numbing work and subhuman conditions of the mestizo and indio forced to harvest hemp in the Yucatan. However, he discovered that slave owners in the state of Oaxaca, in the fertile Valle Nacional, were even more ruthless:


In Valle Nacional all of the slaves, all but a
very fewperhaps five per centpass back to earth
within a space of seven or eight months.

This statement is almost unbelievable. I would not
have believed it; possibly not even after I had seen the
whole process of working them and beating them and
starving them to death, were it not the fact that the
masters themselves told me that it was true. And there
are fifteen thousand of these Valle Nacional slaves
fifteen thousand new ones every year!

By the sixth or seventh month they begin to die off
like flies at the first winter frost, and after that they're
not worth keeping. The cheapest thing to do is to let
them die; there are plenty more where they came from.
Word for word, this is a statement made to me by
Antonio Pla, general manager of one-third the tobacco
lands in Valle Nacional.


In the compelling first six chapters, Turner also details the recruitment, management and economics of slaveryhow the slaves were seduced or shanghaied, the transportation and breakup of families, their cost and value to the landowners and middle men.

He goes on to report at length on the political repression, the complicity of American capitalists in Mexican slavery and the peonage that extended to millions of workers, both in the campo and the cities. We learn that a hundred years ago, when the population of Mexico City numbered half a million, some 200,000 there were homeless, sleeping on the streets or in abject flophouses. His stunning photos document it.

Barbarous Mexico is not a book for the squeamish. But it gives us a compelling and emotionally affecting view of Mexicos violent and wrenching recent past. It helps perhaps better comprehend its unsettling present.
Dcsleeper
Posts: 424
Incept: 2012-10-11

Northern VA
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And Harley (HD) is leaving.

They're either utter progs or they got paid to make a stink about it.

How anyone could even presume to know how this will work out (tariffs) is beyond me. Do they think they are friggin' omniscient
Tickerguy
Posts: 153444
Incept: 2007-06-26
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Harley is going to be out of business if they don't watch out.

Bikers have a rather dim view of turd-world bull****, and Harleys are expensive. Go ahead,******off a bunch of old ****ers with both money and a pair of balls and see how that works out for you....

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Winding it down.

Dcsleeper
Posts: 424
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Northern VA
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Oh I agree.
In fact I will lay 5 bux that says this is the beginning (or even the middle) of them.
It actually boggles my mind, but I had a consumerist view of them and was obviously misinformed.

uh-bye
Wa9jml
Posts: 171
Incept: 2017-04-29

DeKalb, Illinois
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In the last implosion, Harley had to be bailed out by TARP. I guess that they made too many subprime loans on their overpriced bikes.

Fortunately, I just had the engine rebuilt on my ancient Shovelhead, and now am good for at least another 40,000 miles. If the company goes away, I will still be able to get parts from aftermarket suppliers.
Eleua
Posts: 15270
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N 47.72/ W 122.55
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HOG is already in trouble. The HD craze is concentrated in the Boomer generation, which are now late 50s to early 70s. GenX and Millenials are not HD riders. Marketing built them in the Boomers, but failed them afterwards.

They can't cut costs to fix their problem.

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http://clearcutbainbridge.blogspot.com/?....
"My object in life is to dethrone God and destroy capitalism." - Karl Marx
"Destroy the family, you destroy the country." - Lenin
"Education is a weapon whose effects depend on who holds it in his hands and at whom it is aimed." - Stalin
Whitehat
Posts: 543
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The People's Republic of New York
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HD is also facing the demographics of their core group; old guys don't ride anymore. the next two generations are not into these bikes in anything approaching similar numbers and the few who are have plenty of lightly used models to purchase used at yard sale prices. this demographic consumer trend is affecting a lot of consumer items as they are running out of generational cohorts to which they can sell their stuff. a lot of expensive hobbies are being sent to the garbage dump by their children.

----------
There are two ways to be rich: One is by acquiring much, and the other is by desiring little.
snow, seasons, distance and dirt roads: SSDD
"Be not deceived; God is not mocked; for whatsoever a man soweth, that shall he also reap" (Gal. 6:7)
12bolt
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Blueridge
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When NAFTA passed, I was a young industrial engineer working in sewing plant in rural Louisiana. That plant employed about 550 people in a very small town. Most of the 'good' jobs in that town were in that plant. All the hourly people were on piecework, and many made over $13 an hour.

It was a small business started by one woman out of her garage that grew to that point.

I was let go on a Friday, while working on a new assembly line configuration that would improve efficiency and output.

They said "12 bolt, today is your last day". I said "why?". The boss said "we're moving this plant to Mexico. You see, down there we don't have OSHA inspections, EPA regulations or a minimum wage. And the workers cannot sue us".

I was escorted to my office, allowed to clean out my ****, then walked out the parking lot.

Within a month the whole place was shut down. It changed that town forever and I never went back to Industrial Engineering. I saw the writing on the wall.

I also supported Perot in my senior year of college. So did most of my engineering peers.

They couldn't let him win.

Now I live in a region where mothballed factories are everywhere. A formerly prosperous region that is now riddled with opiod and meth addicts, petty crime, and where wages are lower than they were in the 1980s.

It's a terrible outcome. The people who are responsible should be stripped of all assets and hung.

My feelings about mercy have changed quite a bit. How many suicides, drug overdoses, and ruined lives has NAFTA caused? Too ****ing many.

Gen I;'m like you in that I'm ready to enlist. I'm 50. But I'm very fit and extremely motivated.

Let's get it on. We have to if want anything left for our children and their posterity.

If Trump said the word, I'm pretty certain millions of us would volunteer.

See you at the recruit depot!



Huskysig
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Incept: 2014-09-23

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What I really want to know, is how tens of thousands of Mexicans were able to get themselves to Russia for the World Cup? They must be the Mexican 1%ers...
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