The Corner

Free Trade in Labor–An Objection

From a reader: “Mr. Derbyshire—Mr. Adler is getting away with a huge one

here. Yes, a company CAN move its factory to Argentina to take advantage of

cheaper labor. It is NOT the same as importing Argentines here to work for

less than the wage an American would demand for a specific job. The

company, should it move to Argentina, must build a new factory, assume the

risk of Argentina’s banks collapsing, pay Argentine taxes, perhaps bribe

Argentine officials, etc.

“This company would MUCH rather build in America, where laws are strong,

bribery is rare, courts (despite their flaws) work well, etc. It would ALSO

like to cut wages. Mr. Adler would allow it to do so on the incorrect

theory that it is just the same as sending the whole operation overseas.

But it’s not. The company wants to have its cake and eat it too – and

that’s ignoring the Bush plan under which a complaining worker can be fired

and then deported for not being employed – thus having even less protection

than an American.

“We conservatives have legitimate complaints about worker safety laws and

union activity, but they are not all bad. If a company wants to run the

political risk of sending operations overseas, fine. (It will also have to

ship its goods back to America at some costs.) What Adler proposes is that

the equity holders and managers should gain the benefit of the lowest

possible common denominator of wages in the world while reaping the benefits

of being based in America. This is, simply put, not right.”

[I made a tiny change here, substituting “Argentine” for my reader’s

“Argentinean.” It just looks better, but I’m open to objections.]

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