I am merely floating the possibility that First World nations may never recover from the current ‘Wealth Shift’, and that ‘Shift’ of wealth will effectively usher in Global Governence (under a Socialist Dictator).

I follow the first point and agree that something like that is a possibility. But how on earth does that follow to global governance under a socialist dictator – China ruling the world? What about India? What about the Muslims?

Pete, many of those pushing for Global Governance believe that you have to depose First World nations from their current position of global dominance, and additionally remove all National Sovereignty as well. By bankrupting the West via a Global Free Marketplace; one where there is no minimum wage, it would be possible to bring about the above two objectives of the One Worlders. And therefore the way is paved to usher in Global Governance; with a global economy and currency (similar to the Euro in Europe), and a Global Ecumenical Religion (from my Source material) which will embrace Islam, Catholocism, Liberal ‘Christianity’, Hinduism, etc. Basically an all encompassing umbrella.

I believe (and this is where I go to my main Resource again) that it is unlikely China (and perhaps part of the old USSR) will sign up to this One World Government. But I do see those that come under such an authority consisting of the existing First World nations (the US, Europe, etc., and including Israel), most of the Muslim world, and perhaps India (not sure here).

Many of the indicators are in place, along with the required technologies, that imply this ‘shift’ may not be too far off in the future. The first indicator; the first domino, is the fall of the US (which we are observing currently) – the rest (Europe, etc.) will likely follow quick on its heels.

Watch this space.

On a whole dfferent argument, is it necessarily try that people who get paid minimum wage (youth or otherwise) and who are working jobs that would pay even less if there was no minimum wage law are actually getting on an escalator (which goes up) or are they just getting on one of those moving walkways (never rising from the floor on which they start)?

I am merely floating the possibility that First World nations may never recover from the current ‘Wealth Shift’, and that ‘Shift’ of wealth will effectively usher in Global Governence (under a Socialist Dictator).

I follow the first point and agree that something like that is a possibility. But how on earth does that follow to global governance under a socialist dictator – China ruling the world? What about India? What about the Muslims?

Let’s hope these ‘trends’ kick in before the First World nations go broke.
Based on what I see currently, though, the only trend seems to be ‘down’.

Kris, I do see what you’re saying.

Let’s say in an extreme world, China produces everything so cheaply that no one outside of China can work.

Who buys China’s goods?

Exactly, Ryan.
And while this, too, would lead to China’s eventual demise (ie no customers), the rest of the globe has long since been sucked dry by China gobbling up all the global wealth and resources.

Malcolm 3:45 pm,

Anyway, we don’t have any choice, Kris. They only way to deny the market is protectionism, and that’s a sure route to relative economic decline.

Perhaps so, but is not Ryan’s summation of my comments at 3:43 pm also a recipe for “relative economic decline”?

I guess I see problems with both absolute National Protectionism, and also with an absolutely Free Global Market.
There has to be another ‘System’, or at least some common sense middle ground, surely?

And ultimately, what if EVERYTHING WE DO IN NEW ZEALAND is able to be done elsewhere at 50% of our labour rates?

As this has been an on-going process for hundreds of years, both because of new technology and new labour entering the world market, I think things will be OK (in the long-term and on average across the world). Those software jobs in Wellington will indeed disappear one day, and be replaced by something else which we probably can’t imagine (provided we stay competitive and learn new things, develop new products/services etc). 40 years ago my father probably couldn’t imagine what everyone would be doing in the future as he then lived in a country where loads of people worked in farming and freezing works, assembling CKD cars and working for the railways.

I don’t think globalisation guarantees that everyone will be better off, or that whole communities and countries won’t be blighted by decline for generations, but I do think that on average people will be better off. The way to ensure that we’re in the winning group is all the usual stuff; education, new skills, new ideas and new businesses.

Anyway, we don’t have any choice, Kris. The only way to deny the market is protectionism, and that’s a sure route to relative economic decline.

I do see what you’re saying.

Let’s say in an extreme world, China produces everything so cheaply that no one outside of China can work.

Who buys China’s goods?

Kris, I think you’re stating with a conclusion (Global Socialism under a One World Government) and trying to twist the facts to fit. You’ll have an uphill battle to explain how global free-markets will lead to global socialism.

As for this being unprecedented, I don’t believe it is. Increasing trade and new countries entering the world market has been happening for hundreds of years. To show that globalisation is a bad idea, you’d need to point to an example where trade has been restricted and everyone has benefited.

I’m not starting with a conclusion, so much, but rather commenting on what I observe is happening, and may continue to happen at an increasing rate as China, India, etc continue to gobble up the available labour market by undercutting current labour rates. When have we seen two such large nations as China and India simultaneously tooling up in past human history?

And of course I can’t substantiate something which I believe is unprecedented.
The one resource I could cite to support my assertions is automatically regarded as invalid by many here (and you know what Source I mean).

I am merely floating the possibility that First World nations may never recover from the current ‘Wealth Shift’, and that ‘Shift’ of wealth will effectively usher in Global Governence (under a Socialist Dictator).
I guess time will tell.

As for this being unprecedented, I don’t believe it is. Increasing trade and new countries entering the world market has been happening for hundreds of years. To show that globalisation is a bad idea, you’d need to point to an example where trade has been restricted and everyone has benefited.

Kris, I believe the idea is that because Indonesia can produce them cheaper, those Kiwi workers who lost their jobs at Fisher & Paykel will – once they find new jobs – be able to purchase whiteware appliance more cheaply than they could before, as can everyone else, and so everyone is more materially wealthy as a result.

Malcolm 3:00 pm,

By moving offshore for cheaper manufacturing, F&P are positioning themselves to grow bigger and be more profitable. And you and I can share in that wealth by buying their shares.

As you highlight essentially the same point, I’ll address you both:
You both assume those people put out of work will find re-employment (elsewhere), and thus they will have access to ‘cheaper products’, or will be able to invest in shares of these (now offshore) companies.

Once again I come back to the youth rates argument; even if a youth is entitled to the GREATER minimum wage, it is of no benefit if he’s out of work and thus earning $0/hour.
Similarly, even if whiteware is now 50% of the old purchase price because F&P is manufacturing out of the likes of China, then this matters little to the old F&P worker if he has been unable to gain employment.

And Malcolm, to use your “let’s all go develop software in Wellington” analogy – what if someone else in China is prepared to develope software at half your labour rate? And ultimately, what if EVERYTHING WE DO IN NEW ZEALAND is able to be done elsewhere at 50% of our labour rates?
Where’s your software developer in Wellington then?

Do you see what I’m saying?

Kris, I think you need to distinguish between short-term effects and what happens in the long-term.

Perhaps so, but I believe what we are experiencing is unprecedented in human history, and thus the long term effects are unknown and unquantifiable.

Sure, adding 1 billion cheap manufacturing workers to the world economy in the space of 20-40 years will put a lot of people out of work in the First World. That has been happening for a very long time (remember when we had “Jap Junk” and “Made in Hong Kong”?). Yet we don’t have ever-increasing unemployment or lowering levels of wealth in the First World.

If we use your model of Japan tooling up, and consequently putting the Western car manufacturing sector on the back foot for a number of years. And then compare the population of China with that of Japan, and the fact that Chine is targetting every available market sector, I think that perhaps your “20-40 years” may be a little ‘light’.

What are the consequences if rather than 20-40 years it’s more like 200 years before the First World nations ‘catch up’? What happens in the mean time?

Global Socialism under a One World Government, anyone?

Fisher and Paykel, anyone?

By moving offshore for cheaper manufacturing, F&P are positioning themselves to grow bigger and be more profitable. And you and I can share in that wealth by buying their shares.

I think we’ve had this discussion before. It’s always easy to see the loss of jobs etc, but it’s less obvious to see the other side of a changing economy: the new industries and jobs which are created. Look at all the people in Wellington who create software for products which didn’t even exist 20 years ago (e.g. apps for mobile phones, games, online accounting software, movies etc).

I think many in the manufacturing/export industries may disagree.
How many companies that formerly had their manufacturing base in their First World (native) country have now relocated to China, India, etc? Fisher and Paykel, anyone?
So not only has that part of the labour market been lost, but also much of the tax take to the original First World nation has gone as well.

Kris, I believe the idea is that because Indonesia can produce them cheaper, those Kiwi workers who lost their jobs at Fisher & Paykel will – once they find new jobs – be able to purchase whiteware appliance more cheaply than they could before, as can everyone else, and so everyone is more materially wealthy as a result.

“Which in essence, as I said earlier, is the Socialists’ dream mechanism by which wealth is transferred from First World nations to Emerging/Developing nations?”

It’s not a zero-sum game. The Chinese and Indians can get richer without anyone getting poorer.

I think many in the manufacturing/export industries may disagree.
How many companies that formerly had their manufacturing base in their First World (native) country have now relocated to China, India, etc? Fisher and Paykel, anyone?
So not only has that part of the labour market been lost, but also much of the tax take to the original First World nation has gone as well.

Is this not what we are observing currently in the Emerging/Developing Economies (India, China, etc)?
And until THESE economies ‘normalise’, then First World nations will be undercut in the Global Labour Market, and will essentially be on the scrap heap until we can compete on a level footing.

Which in essence, as I said earlier, is the Socialists’ dream mechanism by which wealth is transferred from First World nations to Emerging/Developing nations?

Kris, I think you need to distinguish between short-term effects and what happens in the long-term.

Sure, adding 1 billion cheap manufacturing workers to the world economy in the space of 20-40 years will put a lot of people out of work in the First World. That has been happening for a very long time (remember when we had “Jap Junk” and “Made in Hong Kong”?). Yet we don’t have ever-increasing unemployment or lowering levels of wealth in the First World. We are actually getting wealthier. The world economy is not static. Those cheaper goods will enable everyone to consume more and everyone can move further up the value-chain. Wealthy Chinese and Indians will buy our products and we will all be better off (materially), at least in aggregate and so long as we keep competing.

Of course there will always be casualties. If you live in the First World but you cannot move up the value-chain of productivity, then you’re stuffed. But this has always been the case and most people seem to manage. If we didn’t then we’d all be out-of-work candlestick makers, wheelwrights and telegram delivers.

If you want to argue that globalisation isn’t better for everyone in the long-term, then you need to show an example where you reduce trade and everyone is better off. In both the short and long-term.