You Got to Be Kidding Me!

Retraining For "Victims of Globalization"

Posted in Economics, Politics by Stacy McMahon on January 22, 2007

Here’s an interesting description of what happened when free trade came to Galax, Virginia:

Trade Adjustment Assistance (TAA) […] includes up to two years of unemployment benefits while retraining, temporary subsidies to help pay medical insurance and, for those over 50, a short-term top-up to any lower-paying new job. The centre also co-ordinates more basic help, from child care to food banks run by private charities.

That’s an apparantly federal program intended to transition blue-collar workers to new careers when their jobs go overseas. How’s it working? According to the article, three big textile factories in Galax closed down all at once, laying off 1,000 people. The result:

At 6%, Galax’s unemployment rate is twice Virginia’s average, but no higher than it was a year ago.

[…] other, mainly younger, workers are already better off. After 19 years in a textile factory, Bobby Edwards has retrained as a radiologist. Brian Deaton has set up a thriving picture-framing business and has started selling gourmet coffee. Few of these people are enthusiastic about globalisation. “No one trusts China around here,” is a common refrain. But government help has cushioned the shock. “I’d be lost if they weren’t here,” says Mr Rotan, nodding towards the centre’s staff.

When I was younger, the national unemployment rate was 6% and things were said to be in good shape. In fact, most economists consider 6% or less to be effectively zero unemployment. Which means we seem to have a rare case here: a government program that actually works!

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One Response

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  1. Clint said, on January 24, 2007 at 12:21 pm

    IMNSHO:

    Unemployment stats are pretty b.s. the way they are computed. I think they should include EVERYONE who doensn’t work. Just another case of macroeconomic numbers being used to try to justify that individuals are not harmed by certain processes of globalization.

    Did it account for the fact that these people now probably work at Wal-Mart or McDonalds without medical benefits, i.e. “underemployed”?

    Or that some of them may have never found a job again, gone homeless, but because a couple new 16 year old kids got jobs, the statistic say employment stayed the same. There is always fresh, young blood to hire. If you force old people out of work early and replace them with young people, on an macroeconomic level — nothing was lost. Employment is the same (2 kids vs 1 old person is actually an increase, I used 2 kids instead of 1 to offset the population growth argument).

    A lot of pro-accelerated-globalization thoughts are based on macroeconomic numbers which make zero consideration for the experience of the individual, which in the end, to me, is what actually matters.

    Why else would the WTO be constantly protested against in every country they meet? Inviduals are the ones affected negatively. Invididuals are the ones who protest. You’ll never see a corporation protest the WTO.

    Of course globalization is inevitable, and ultimately probably good for many. Forcing its hand via backroom deals is not the same thing.

    You see, as a GENERAL rule, the goal of globalization seems to be to have every job X to eventually reside at place Y where job X gets paid the least on the planet. This maximizes the aggregate amount of profit that corporations keep for themselves, and minimizes the amount people can make working. If every job pays out the lowest possible amount on the planet, products will be cheap as hell — but none of the proletariat-types will be able to afford most of it. Rich win, poor lose.

    Looks like we’ll all have nice careers in the service industry someday. Or we’ll have to move. Or we’ll have to go to college and get a new hot job — until it is outsourced. Shorter careers also mean less ROI on tuition costs. If I have to switch careers and re-educate multiple times in my life, do I really come out ahead if I was happy before? Not in my book.


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