Have American Jobs Been Shanghaied?
There used to be a practice in seafaring towns in the United States back in the 1800s and early 1900s. Merchant ships bound for the far east needed a crew of sailors. If the crew was shorthanded, the sea captain sent out the first mate and a few burly sailors to conscript new crew members. They used whatever means necessary including coersion, trickery, drugging and violence. This practice became known as “Shanghaiing” because the ship’s destination was often Shanghai, China.
Modern-Day Shanghaiing
Today in the 21st century, there is a new form of Shanghaiing being practiced throughout America. But rather than by captains of sailing ships, it is now practiced by captains of industry, the CEOs and upper management that run American businesses. And instead of able-bodied men, it is jobs which are being shanghaied and shipped to China. Again the final destination is often Shanghai, but it can also be Nanjing, Guangdong, Shenzhen and other Chinese cities.
Chinese factories employ well over 100 million manufacturing workers producing everything from cameras to cars to clothes for consumers in the United States, Europe and the rest of the world. Many of these manufactured good were once produced in America or Europe. But cheap labor has moved many jobs to China. Our jobs have been shanghaied.
A Boon for Consumers
This is a great boon for American consumers. Televisions and toasters are available in abundance in huge stores like Walmart and Best Buy at low prices. The Chinese do all the work; Americans get all the stuff. Sounds like a sweet deal for Americans.
But is this sustainable?
The High Price of Cheap Goods
Remember that every American consumer is also an American worker. The cash wages paid to an American worker is what he uses to purchase goods and services from American businesses. What happens when the American worker is out of work and without wages? How can he continue buying those cheap goods made in China.
For a while he can put his purchases on his credit card. But the debt builds up. Eventually there is so much debt that the debt service kills you. Maybe we have already witnessed this effect in the 2000’s when Americans over extended themselves in a massive credit binge. We got the credit crisis and Panic of 2008.
Those cheap Chinese goods resulting from shanghaied jobs actually come at a steep price. Americans can’t stop producing yet continue to consume at the same rate. No matter how cheap the price of VCRs and DVD players, eventually you are buried in debt.
Time for America to Start Producing
Americans either need stop consuming or start producing. Only the independently wealthy can afford to buy things with no job or income. So the standard of living must go down. If you want to keep living large you have to produce larger.
The time has come for America to start producing again. And I am not talking about selling each other lattes and other low-paying service jobs. America needs to produce hard goods that can be exported; things like cars, airplanes, machinery, appliances and televisions–things we once knew how to make that put meat on the table.
Read this article about Chinese factories in The Atlantic magazineChina Makes, The World Takes by James Fallow
The views expressed in this article are those of the author and do not necessarily represent the views of Laguna Beach Bikini, its editors, staff or any other organization.