Comment by maxsilver
11 days ago
> So paying everyone living wages doesn’t really do anything to solve the problem because the products created by people who are paid living wages are by definition more expensive due to labor costs.
They aren't though. In America, "Paying living wages" always means "pay way more", because America underpays labour and overcharges for literally everything (products, services, basic cost of living -- every product on American soil has a insane profit margin on it)
In China, "Paying living wages" doesn't necessarily mean "pay labor more", because they have stronger control over pricing and margins, so it often actually means "make orgs charge way less".
You end up with Chinese folks living in a major city in China, with a 2bed apartment that costs $200USD/month, and a meal out cost $2USD/each, cars that start at like $6k, and they get paid $5USD/hr, but they feel like they're living well, despite only making around $640USD/month, because they can save 10% of their income each month, and have like 40% of their income as discretionary spending, and still get to own their apartment.
But in the US, a 2bed apartment in a big city like that costs at least $2,000/month or more, a meal out there costs at least $20/each, and a basic starter car starts at like $26k, so you can pay someone in a ostensibly-"high labor cost" job of $20/hr, and they feel like their constantly underwater, and have zero chance of ever owning a home, because they only have like 20% of their income as discretionary spending, and they can't save anything at all. (and that's before we even mention differences like how you don't have to worry about being hit with a crazy bill for an ER visit or an Ambulance in China, but Americans have to worry about that 24/7/365).
(It's the same reason many American's dream of getting a job in Europe and leaving the US, because despite making less money-on-paper, you get to generate more real wealth and do so with less life risk and life stress)
The Factories and the labor pool and the infrastructure being absent in the US is hard to solve for, of course -- but it isn't even the hardest part of any of this. The American view of capitalism would have to be completely rewritten to be more diverse, more equitable, and more inclusive to Americans who do actual labor, before Americans could be anywhere close to competitive with most of these Chinese industries.
That's right now. For China to even get to the state they are in now, workers were heavily, heavily exploited.
In fact exploitation is the reason why they are the way they are now.
Isn't that the case for every country? My grandfather lived in a shack. He was a farmhand. In the winter his family almost starved.
Our nation's prosperity is a very recent phenomenon.
Yep. With one difference. The US is regressing and now we want to reignite manufacturing without relying on exploitation.
My argument is that this isn't possible. Well let me rephrase that. It is possible but you need to inflict some form of pain to get it going. Tariffs is one way to do this.
I don't think the four year presidency is enough to do this. You need to do this for at least 2 decades.
PPP is the only way to compare expenses between different economies. You can't just convert RMB into dollars and say "see how cheap they have it".