TCS Daily


Who Deserves Jobs?

By Fredrik Segerfeldt - October 19, 2004 12:00 AM

The outsourcing/off-shoring debate is still hot. In France and Germany, fears about de-industrialization are voiced over and again. In the US, the loss of jobs plays an important role in the presidential campaign. Lou Dobbs of CNN has just released a book called Exporting America: Why Corporate Greed is Shipping Jobs Overseas and French politicians want to force new EU member states to raise corporate tax levels, in order to stop them luring investors to their countries. These are all expressions of the same concern: the rich, old industrial west seems to be shipping its jobs south and east. Statists and leftists try to score political points.

True, we can always find heartbreaking stories about people who have lost their jobs due to the internationalization of business activities. And these anecdotes offer pedagogical value. In defense, economists and free-traders usually argue that these stories hardly give the complete picture and raise issues like net job creation, the role of education and innovation in climbing up the value-added ladder and the long-term benefits of enhanced international division of labor. Very rarely do they give a counter-picture, namely that of the living conditions of the people in other countries who get the jobs that are lost in the US and Western Europe.

Let us leave aside all the economics talk. Let us talk ethics, an issue the left usually considers to be its home turf. Let us also assume that we are actually seeing huge job losses due to international trade and investment.

The principal question that is never raised in this debate is: who needs and deserves the jobs most? Does a steelworker in Ohio deserve his job more than his counterpart in Brazil? Do automotive workers in Bavaria need their jobs more than unemployed people in Bratislava? And is an out-of-work programmer in California worse off than an Indian one? The answer to all these questions is no.

The income level in Brazil is much lower than in Ohio. Even though Latin America's biggest country is experiencing high economic growth right now, unemployment is rife and salaries are but a fraction of that in the US. People in Sao Paolo therefore need steel-plant jobs much more than do people in Ohio. Unemployed factory workers from eastern Slovakia, hit really hard by the structural changes the country has gone through these last 15 years, could probably make better use of that BMW plant job than their counterparts in southern Germany. And programmers in India most likely have many more family members to feed than their colleagues in Palo Alto.

However much I read and hear about the "devastating effects of globalization on jobs in the rich West", I have yet to see one sustainable and credible argument explaining why those who have the jobs now should be more entitled to them than anyone else, except that status quo is to be preferred over change. In particular, I have a hard time understanding why rich US or West European workers deserve these jobs more than workers in India, Brazil and Slovakia.

The left claims to defend the interest of the poor. In the international field, this usually takes the expression of development assistance. But at the same time, they want to stop jobs from moving overseas. Why are cash transfers good, but job transfers bad? I just do not get it. The talk of international solidarity rings more hollowly for me each day.


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