Washington Post, May 8, 2009 on pages A1,A22:
US government is pouring billions into GM in hopes of reviving the domestic economy, but when the automaker completes its restructuring plan, many of the company's new jobs will be filled by workers overseas.
Former labor secretary Robert Reich, now a professor at University of California in Berkeley said:" It is an impossible dilemma,GM is a global company -so for that matter is AIG and the Wall Street banks. Bailing them out does not necessarily redound to the benefit of the US or American workers." But the expression of "What is good for GM is good for America" has been in the minds and hearts of folks in USA for decades.
My comment: Globalization involves US firms overseas and the CEOs optimize the situations:
Labor costsare far lower. US autoworker with benefits costs about $54 an hour, a South Korean worker earns about 22 an hour,a Mexican workers earns less than $10 an hour and some Chinese workers can earn as little as $3 an hour, industry sources said as published by the Washington Post,May 8, 2009.
It should be noted that the cost of living of the workers overseas are different from workers in USA. Purchasing power parity must be understood and not the hourly pay for US dollars only. Moreover,lifestyles of the workers are different as well.
GM posts $5.98 billion loss for first 3 months of this year amid steep drop in revenue due to economic crisis and slumping auto sales.
Economist Paul Romer at Stanford raised the query:"What makes some economies grow faster than others?"
China has changed to the market system after reforms and China is doing OK recently as known to the world. Lifestyle of the folks in China with the leadership may be the answer to such query. A priori versus A posteriori. Cause orEffect? That is to be observed from empirical evidnce from independent observers with insights.
On page B5: Raymond J. Saulnier, age 100, economics professor passed away. Perhaps economics professors strive to be centenarians due to the nature of the discipline leading to laughter and laughter begets longevity for psychological and physical reasons as known to the medical professionals.
Francis Shieh aka Xie Shihao,an octogenarian student in economics on Friday,May 8, 2009 at 12.06 p.m.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment