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Abuse of the free trade policy

BY: Tim | Category: Politics | Post Date: 2008-10-20
 



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   Tim
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Although its true that no country can prosper by shutting its doors to all foreign goods or by telling it's own corporations not to ship jobs overseas. I am a supporter of free trade only to a certain level, but at all times the government should oversee that those open policies are not aiding pure corporate greed and loss to it's citizens in the form of jobs and indirect financial loss.

It's true that goods made in China freely flow in United States, this is all because of free trade policies. There was a time in 1970's when US was the major manufacturer and was a major supplier to the world. Corporate giants actually started outsourcing manufacturing plants to low cost destinations so that they could cut the production costs. Although the short term benefit was cheaper goods for American people, but behind the scenes it has been wiping out the entire blue collar American workforce. what will you do of cheaper goods if there are no jobs. Free trade policy is nothing more than re-distribution of wealth and it underestimates the previous progress and economic strides made by the developed nation into the hands of developing nations. There is no harm in helping citizens of developing countries, but when it is at the expense of someone, that is not right.

Similarly, United States has benefited from the talent of Indian software engineers greatly. On the flip side outsourcing has led to thousands of job losses in United States itself. 80% of total H1B visa is issued to Indian outsourcers and not American companies seeking to get Indian talent in US itself. H1B visa was always to bring people from overseas by American companies where there is a worker shortage and not for the purpose of outsourcing. Outsourcers open a small office in America and claim that they need workers in that office, once software engineers land in US a they actually work on client locations for outsourcing purpose. Net jobs have been positive, but in specific industries some people have taken permanent irreplaceable losses.

We all like cheap labor, what happens if even cheaper destinations like Vietnam, Cambodia, African countries take away these outsourced operations from India and China too. There will be a vast outcry and the number of people becoming jobless will shoot up. We should allow technology and jobs to be transferred, no doubt but under a controlled environment.

United States has some of the most outrageous immigration laws, anyone born in US (to Legal or illegal parents) are immediately given US citizenship, every year 50,000 people come to US just on the base of green card lottery and if any person from Cuba is able to step on US soil, he is granted permanent residency (green card) and not to mention there are about 12 million illegal workers in United States majority of whom pay no taxes and use several social facilities putting burden on people who genuine pay taxes.

Back to my original point, free trade policy allows companies to any countries with the cheapest work force and cost to produce their items and then still able to sell their products without any tariff in any participating countries. Another disadvantage is tax-evasion - many countries open offices (on papers - actual size may be just a cubicle) in countries considered tax-safe-haven like Cayman island thus avoiding the higher US tax rate but still actually having their main operation inside US.

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