Wal-Mart names new head of online site

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Ok, I will back up a bit.

Walmart wasn't blameless with it came to dumping. Since it probably did know that China was subbing stuff. But they were found out, and they got punished for it (still are?). As for the whole taxpayers footing the bill. I hate it too, but we should change the system. Don't blame an entity for taking LEGAL advantage of something that we provide. We don't blame accounting for going LIFO or FIFO and financially stating the other cause it has tax benefits. In the end, as a consumer, I fail to understand why I must pay more than the value of a product. It is one of the cornerstones of economics.

On to trade. We call them sweatshops and such, but they aren't from their point of view. Over in the underdeveloped nations, there are crowds of people waiting all day outside the factories just hoping a position opens up that they can take. From their point of view, the job is very well worth it. The theory is that initially you start off small. You pay $2.50 a day (current "good companies") which is a lot higher than what the environment provides. But as the buying power of the communities go up, their life styles move up, demand for more expensive goods go up, which leads to higher end goods production, which creates higher paying jobs, and the cycle starts all over again. It has worked for us (long ago), for Mexico!, Chile, Brazil!... and it will work for China, India, Taiwan... Brazil and Mexico are EXCELLENT examples. The amount of trade we do with them and the benefit has skyrocketed when we opened the trade barriers. Initially, everyone said the same thing you are saying about China.

The idea about China is that there is a tremendous amount of potential there. If we trade with them, initially it might be mostly one way, but as their wealth gets traded (goods for cash) into buying power, they will buy back from others. That doesn't mean it WILL be us, as they will buy back from those who offer the best value, but it could be us. Ofcourse the WTO (not us, as we are biased) needs to keep a very close eye on China and act accordingly.

Also, the dollar only has "real" value in the US. Every dollar that gets set out has to somehow end up back here. Same goes with the currencies of other nations. The only way to do that is to trade. We might trade in a dollar deficit with China, and Japan, but they might trade in a deficit with some other nations who might others, and eventually, the dollar will come back to us. Depending on the productivity of our nation and how we maintain relations with others, that dollar might come back with a higher or lower buying power than it left. Economic theories state the net effect would be positive and more than the growth from no trade. So far, it has proven to be true.

Posted by: doe_z   Posted on: 06/17/05 You are currently: a Guest | Members login | Terms of Use

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