Globalisation, EU, foreign workers, the future, take to make sense of it

tomstickland

I've been having a good think about a few things, and realised that there's a lot to think about.

Regarding the strikes this week, I really can't decide what the answer is. A free market proponent would say that the contract winner put in the best bid (or whatever else they do to win contracts).
But what if every contract in the country went out like this?
We'd have loads of unemployed people.

Should they get on their bike and move somewhere else?

If the answer to that is no, then we have to employ protectionalism of some form.

Before we go there, however, why can another country produce goods for so much less and still have some quality of life? Let's imagine that they have the same quality of life. Where do the lower costs come from then? Is it exchange rates?

I suspect that time delays explain part of it. It's rather like car insurance - in principle every customer would move to the cheapest quote and the insurance companies would struggle because they need the overpayers to keep the cheap quotes possible. So maybe the time delay in every country equalising itself is what provides the opportunity for lower costs.

In that case aren't the various companies just behaving like insurance customers? Putting time and effort into finding the next cheap place, but within a certain period of time that place is no longer the cheapest, so they move elsewhere.

If we move all our manufacturing to another country what do we do with our own potential workers? Now that comfortable middle class stuff is being outsourced of course it's more a visible problem.

Personally speaking I think we need to look at the bigger picture. It's not just profits, it has to be providing economic means for everyone to be active and have some quality of life. If that entails protection of local jobs, maybe that's the way to do it.

I believe that the country has allowed itself to bloat into a non-competitive situation. Rather like a household who have used credit cards to buy large tvs and expensive holidays whilst not actually earning enough to pay for it all. Maybe the new economic situation is going to cause a correction - less excess, less wastage, less administration and laws.

The last 10, 20, 30? years have been an illusion and now we will have to change. Maybe not, maybe some financial conjuring will allow it to go on for a while longer.

wisbech_lad

1) Almost all contracts are done like this. E.g. everytime I have a haircut, or buy eggs, or contract for a major IT upgrade. Sometime my search is short, sweet and local, sometimes it is long and global

2) People like to have choice. So, for example, German car workers are probably as expensive or more so than Italian or UK workers. But we like the choice of buying UK, German or Italian cars. So (for example) UK sends cars to Germany, and Germany to UK.

3) Some countries do just have lower QOL. I live in HK, China, which is very expensive. A graduate salary is about 10-11,000 pounds (and that would be, say, with a big accountancy firm, which I guess in UK was 20,000+) Let alone the factory workers in Shenzhen, who get very little, live in dormitories etc.

4) Japan does it quite well. They have a very efficient manufacturing centre, but then have laws that ensure the rest of the economy is very inefficient (= lots of jobs. Automated petrol pumps were illegal for example, so lots of jobs for petrol attendants) For example, there aren't any supermarkets as we understand them in Japan. So lots of small shops and markets, where people work. But it is inefficient, and so QOL suffers (food is very expensive, clothes are expensive, people live in small flats and have small cars or only use public transport. Very few Japanese go on foreign holidays. Haircut was 25 quid at the cheapest place in town, because you couldn't get a haircut without head and foot massage!)

maninthestreet

On a point of pendantry, it is 'Protectionism', not 'Protectionalism'.