Educational Propaganda

Obfuscating the Trade Problem

The media moguls of the United States have so confused the contemporary economic debate with disinformation that it is difficult to determine which arguments belong to which ideological effort. We are bombarded daily with "news" of the deficiencies of our system of public education. If we were to believe all that is written and spoken through the communications media, we would think that our educational system is the cause of almost every negative in our society, for examples, our poor showing in international trade or our manufacturing base going to hell. Everybody "knows" that the Japanese and the Germans and practically every other country has a better educational system than ours and, therefore, is running a trade surplus with us. Our public school system is deemed so bad that the President and the Secretary of Education are dusting off the voucher system again to enable parents to send their children to private (read better) schools at public expense.

Our schools, through the neglect of the Nixon, Reagan, and Bush presidencies have taken a hit, particularly in the Reagan years when all Federally funded domestic programs were severely curtailed or eliminated.

Two more or less unrelated but confused things are happening: (1) U.S. companies are moving their manufacturing facilities off shore, and (2) U.S. workers with college training are increasing their incomes while those with less training are losing ground. The reason U.S. companies are moving to foreign countries is wages. The reason that cheap foreign labor is undercutting U.S. manufacturing is that many foreign manufacturers, particularly those in Japan, are using cheap Mexican laborers to assemble their products in Mexico "dumping" the products in the U.S. (Before they did the cheap labor trick, the Japanese simply dumped Japanese goods in the United States.)

It turns out that one reason the U.S. companies don't get a fair break in foreign trade is that our own government has tilted the playing field in favor of our foreign competitors, particularly Japan.

Many U.S. companies, of their own accord, are also moving into cheap labor markets in order to meet the competition. In some of our industries, it is almost a trend. Auto companies are moving assembly plants into Mexico to take advantage of cheap Mexican labor and in anticipation of the free trade agreement Mexico has with the U.S. under which they won't have to pay duty on those goods. Secondly, manufacturers, like the sports shoe company Nike, have moved manufacturing facilities to Indonesia where the going rate for a twelve hour days is 14¢/hour. (Good sportsmanship?)

In the situation vis-a-vis Mexico, an American auto worker is competing against a Mexican eighth grader who makes $1.38/hour; in the Indonesian case, the American shoe factory worker is competing against a sixth grade worker who makes 14¢/hour. The worker in Mexico may live in a large crate in a neighborhood with no running water or electricity; the worker in Indonesia may live in a shanty, with the same amenities.

American industries are not failing because our workers are more poorly trained than our competitors. Our industries are failing because American manufacturing plants have moved overseas to take advantage of uneducated cheap labor, and they are using the trade laws to give themselves further advantage to the disadvantage of the American worker. The Mexican worker cannot afford to buy a car. The Indonesian worker cannot afford to buy a pair of Nikes.

The situation compels one to ask whether we are looking at or listening to a mere myth when we hear that American workers and American manufacturers can't compete? Is the education argument being used to hide the fact that the U.S. government is failing to execute the trade laws? The manufacturers who move overseas or to Mexico fully expect to sell their goods in the United States. However, they have forgotten that by disemploying American workers they are killing the golden goose, for their actions are shrinking the middle class that buys their products.

Why would think tanks and the media—TV and print press—continually harp on the question of the quality of American education if, in fact, our inability to compete is due to our own government tilting the playing field to favor our competitors? And why do not our communications people bring this latter point to our attention?

Criticism of Japan typically brings a response of "Japan bashing." Is it bashing of Japan to call attention to the fact that Japan regularly breaks United States laws on dumping? That Japan has corrupted our Office of the Trade Negotiator by bribing the ex-officials of that agency? Or that when Japan is caught red-handed in a trade violation and found guilty, the fines are reduced or not levied?

There is more than a suspicion that the domestic policy of President Bush is, in fact, his trade policy. Both the North American Free Trade Agreement (NAFTA) and the General Agreement on Tariff and Trade (GATT) have provisions that, if adopted and ratified by the Senate, would seriously undermine both the environmental and labor laws of the United States. Each of the treaties would have tribunals to settle international trade disputes that could nullify Acts of the Congress for if these treaties are ratified with their tribunal provisions they would be come the law of the land by our own Constitution.

The harmful effects of these treaties would be added to the assault on labor that has been ongoing ever since Reagan abolished the Air Traffic Controllers Union. They would continue the assaults on our manufacturing base that were begun when Nixon looked the other way while the Japanese trashed our domestic electronics industry through dumping and acquiring fatally wounded electronic companies. Taken together with the flight away from U.S.A. shores of American manufacturing, these actions add up to the most egregious assault on the American economy since the Civil War, or when we were a colony of England.

Education is not the reason for the decline in our economy. Even if we accept the present criticism that our educational system could be improved, it's not all that bad.

It is not correct to compare the United States as a whole with Japan or Germany or any other country smaller than we are. To properly compare our educational system with Japan, a country of 80 million people, we should compare the top 80 million of our 260 million with the Japanese 80 million. I'm sure that when that is done the story will be a whole lot different. Our top 80 million people will compare favorably with any 80 million in the world. It is true that we are carrying a great burden of people who are ill trained, badly trained, or not trained at all. This is a shortcoming we have to address just to keep our head high and call ourselves a democracy, never mind the international comparisons. The fact that we have denied the unalienable rights to so many of our people is a handicap we have set for ourself. It verges on the criminal in a country that has our Declaration of Independence and our Constitution. Having said that, it doesn't follow that we can't compete internationally because of our educational system. We are not competing because we do not have the leadership either in our government or in our business community. More specifically, we have not defined our economy to be in our national interest. We have no industrial policy, and we have leadership of our general government that is not concerned with the health of American business and industry. Until that changes, we will have difficulty competing. We need to improve our schools, all of them, but it is far more important that we improve our economy since it is the economy that makes everything else possible.

...Ted Sudia...

© Copyright 1992
Institute for domestic Tranquility