High Tech Research from U.S. Going to China with Devastating Effects on Our Ability to Compete and Our Future
American companies have been trying, and failing, to compete against state-subsidized companies all around the world. No company or industry can stand against the national champions of Europe and Asia. They often face only two possible choices; American companies can either be put out of business, or they can relocate to compete.
Increasingly, according to The New York Times, those relocations are ending up in China.
China has 1.4 billion consumers who have more collective purchasing power with each passing day. It has a government willing, and able, to pay a premium in exchange for new facilities. More importantly, China has almost no worker protections, wage standards, or environmental regulations.
When faced with the possibility of paying an American $20 per hour to do a job cleanly and safely, or paying a Chinese worker a fraction of that cost with no other cost considerations, a firm would be foolish to stay here.
It was one thing when America lost its textile industry, its toy making, and the production of basic consumer goods. It is another when we begin losing the core research and development that makes our companies operate. There is a growing shift in innovation. We are now outsourcing more than basic goods and simple service jobs. We are outsourcing high-paying work and sparkling facilities that were once Silicon Valley staples.
Multinational corporations have no reason to stay in the United States; they have no incentive to remain in our expensive market. We cannot expect them, and the jobs they support and create, to stick around based on altruism alone. Industries locate, relocate, and grow wherever the economy presents them with the best opportunities. The U.S. was once the focus of those opportunities, but it is no more.
We cannot hope for the invisible, non-existent, hand of “free markets” to save us. If we do, the nation will simply be left behind. If we hope to be competitive we must either descend to their levels in wages and environmental conditions or impose defensive tariffs that will allow us to profitably function and prevent us from working at slave labor salaries in impossible environmental conditions.
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