No. of Recommendations: 3
I will grant your point if you can show long-term structural changes in the employment and unemployment rates, or if you can show long-term declines in real per-capita income. Emphasis on long-term rather than the current business cycle.

Yes, it is painful to particular individuals when their jobs disappear because it is cheaper to do it in China. It is painful when jobs disappear due to productivity gains (it happened to me last year in the form of industry consolidation, and 1700 duplicate jobs were eliminated). However, I don't believe that it follows directly that employing domestic labor to produce stuffed toys instead of sophisticated business software (and the labor supply is finite, you have to make choices) will result in faster GDP growth.

The internet-enabled outsourcing wave has all the makings of a disaster in it.

Rate matters, and this is happening much, much too fast.

If you are walking along and you come to the top of a cliff, and you have to get to the bottom, you have two choices. You can clamber down that trail along the face and get there eventually, after some sweat and some toil, or you can jump.

When you take that trail, it might be a hard trip, and it will take awhile, but when you get to the bottom you are in shape to continue your journey.

If you jump, you get to the bottom very quickly, But you are in no shape to continue your journey.

That is the difference between a transition and a shock; the rate at which it happens and nothing more.

Garments left the US. It took years. There was a lot of howling, but it happened slowly enough that everyone could adapt.

Steel left the US. It took years. There was a lot of howling but it happened slowly enough that everyone could adapt.

IT and clerical jobs are leaving the US practically overnight. There is a lot of howling, and no time to adapt. We are going to take it on the chin. 20 years from now, we may be ahead of the game for having done it - or maybe not. But right now, it is happening at the speed of the internet, and it's gonna hurt.
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