A funny thing happens when you stop paying workers a decent wage – they can’t buy stuff. By outsourcing jobs to foreign countries, corporate America has managed to wipe out its consumer base. We are now witnessing the fallout. Sure, we’ve been able to purchase products for less money as a result, but when you don’t have a job, you can’t afford to pay less for products, because you can’t afford to pay anything.
I remember all the talk of how the global economy was going to raise the standard of living for everyone around the world. Theoretically, it probably should have. However, when you outsource jobs to foreign countries where people are living on a few dollars a day, and you pay those workers barely enough to feed, clothe, and house their families, they don’t exactly have a boatload of disposable income to dole out for plasma TVs and fancy cars, strange as that may seem. In short, they couldn’t afford the stuff they were producing, and now we can’t afford that stuff either.
Instead of making us all a little more equally affluent, globalization has only succeeded in making us all more equally impoverished. And I highly doubt that patching the hole in the housing bubble is going to lift us out of this nose dive. It may give the economy a temporary lift, but without decent paying jobs, even a more affordable house payment will be unaffordable.
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I often wonder what the people who make all the gimcrack think of the Americans who will purchase the items.
Even if they could afford to, would the overseas factory worker want to buy any of the junk they produce?