Rizzo started off class by saying that as long as he specializes in things he’s god at and we exchange, the world becomes richer. When we trade, we reduce the costs by taking advantage of people machines. People say that trading with other countries loses jobs. Jobs going away are gone because we economized. These jobs suck. Jobs we lose suck. Jobs today are high sectored jobs. It causes an increase in income technology in America. Technologies today enrich people who have skills for them. 100 years ago, we could make everyone productive. Advances today only make us better. Jobs that go away come up somewhere else in the economy that are created economizing (who in the 1900s thought there would be jobs as auto mechanics) No one thought a car would be imported when they first came out. Nuclear engineer jobs, website designers, no one knew that these jobs would happen until they did. We have to constantly change our specializations. Constant retraining is needed. Trades do have costs. People who lose their jobs from trade are distinguishable to 0. Every year 4,000,000 jobs are created and destroyed.
People who lose their job to trade, benefitted from them initially. Cost of sustaining unemployed is easier than other countries and in the past. The more risk to keeping a job, the higher the wages are for that job. If we want to argue that trade costs jobs, technology is the biggest job destroyer in history. A person used to get paid to open the door of an elevator. Now no one has this job. Technology kills jobs by a factor of 40 over trade. We need to match people’s skills with needs out there. If we buy more than we sell, this is a trade deficit. If we sell more than we buy, this is a trade surplus. Trade statistics are meaningless. The US buys more from abroad than they buy from us.
The US total employment continues to rise over time. Recessions have an affect on employment. There are less jobs because of it. There have been 51 million jobs created since the trade deficit started. Trade deficit affects types of jobs you see distributed in an economy. Manufacturing has gone down since the deficit. Rizzo thinks that it is not coming back up. A share of the total employment manufacturing has plummeted. We’ve been losing manufacturing jobs since WW2 ended. This was before the trade deficit started. Manufacturing output has increased drastically over time. We produce more than every country except China and Japan. We have six times the manufacturing output than 1959. Globalization doesn’t make us poorer. Increased productivity because we are producing more with workers and more machinery than ever before. People today on an assembly line produce $300,000 worth of stuff. Machines work more efficiently than people.
Workers are more educated and productive today than ever. Savings from higher productivity goes to lower prices. Higher productivity doesn’t mean higher profit. Only non increase in productivity is health care and education. How can this class be more efficient. It is hard to see how a doctor can do more than one surgery at a time. This is the future. When it’s cheaper to make new clothes and jobs, we need more resources. We create jobs to get these extra resources. Rizzo’s gas bill was down 30% last year. This is 30% more to spend on other stuff. Jobs come from increased productivity.
In 1985, there were 60,000 ATM’s and 485,000 bank tellers. In 2008, there were 600,500 tellers plus 152,900 ATMs. These tellers now have more time to do other things. They are more productive due to ATMs. New machines compliment high skilled jobs. They also replace low skilled jobs. Computers make radio announcers more productive with the easier access to information that they can deliver over the air.
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