"Germany is Booming"

  There has been a lot of angst in Washington and other countries abroad about the growing trade surplus that Germany is experiencing. President Trump has been eyeing the growing trend with an elevated degree of skepticism, and tensions are rising between the U.S and Germany. Germany argues that the trade surplus is a product of prudent fiscal policy as well as an aging population that is more interested in saving than it is in consuming. We also know that Germany is one of the most technologically advanced countries in the world, which is making it an unstoppable force in producing and exporting goods, and subsequently lending to its ever-improving trade surplus.

  The President has been mulling over possible solutions to curtail Germany's trade surplus, not the least of which, inducing trade restrictions. So, how would this resolve the trade imbalance? If anything, this could lead to retaliation from Germany and other countries, similar to events following the implementation of the Smoot-Hawley Tariff of 1930 that arguably exacerbated the Great Depression by fostering ill-bred beliefs of protectionism, the likes of which we are seeing today; The parallels are a bit unnerving. I think it is important to keep in mind, that by trading freely and openly, that people are de facto better off, more goods are made available by countries producing items that they are most efficient in producing, effectively driving down costs and providing the consumers on all sides with more surpluses and more utility.

For further reading on this topic, please click link below:
https://www.usnews.com/opinion/economic-intelligence/articles/2017-09-13/germanys-trade-surplus-creates-tension-with-the-trump-administration

Thoughts on Technological Advancement

Some of the largest news from last week was the announcement of Apple's new iPhone X. This was particularly exciting since many of us relay heavily on these palm sized devices (I just asked mine how to spell announcement). For only $1000, you too can own this new technological marvel.
The excitement was quickly overshadowed by disappointing news, faulty features, and a further delayed release date. While it was scheduled to be sold starting in late September, Apple reported at the beginning of this week that they pushed the release date back to November. The iPhone X has no Apple signature "home button" but will operate by facial recognition which brings protests and memes about invasion on privacy. However, people are not impressed anymore. Many think that each new phone is not different enough for the last, does have enough cool features, or is in some way disappointing. There have been numerous articles this week echoing those some thoughts including "iPhone X: Imitation not Innovation".
This article (listed at the bottom) acts as a reminder of the technological progress that we have made and continue to make. Technology, business, and communications are becoming more and more efficient. We take for granted how far we have come (maybe since a majority of the college-aged population has gone up with this technology). As a comparison, this article explains what it would take in 1957 to reproduce the device (the iPhone X) that we carry in our pockets.

http://www.bradford-delong.com/2017/09/do-they-really-say-technological-progress-is-slowing-down.html

It seems that technological advancement is not slowing; we are becoming desensitized to it. In 50 years from now, imagine what technological will be in the daily lives of billions.

The North American Free-Trade Agreement renegotiation begins

Negotiations for the NAFTA reform are moving quickly, two five-day long meetings have already come to an end. These three countries rely heavily on each other and it is essential for them to come to an agreement for trade to continue smoothly. Without NAFTA, not only would relations between these countries be torn, but various imports and exports would decline within each country. Some progress has taken place so far, but only the less controversial topics. The key issues are still left unresolved. This is where there are most of the difference of opinions.

            Canada and the United States are pushing a raise in Mexico’s wages, although, Mexico is arguing “that salaries cannot be harmonized yet, that a growth in trade and competitiveness will eventually raise salaries to higher levels.” (Report on the first round of negotiations to update NAFTA) The US and Mexico heavily rely on each other in their agricultural trade and trade between them is only increasing. The US is looking to reduce the trade deficit with Mexico and pursue more dairy sales in Canada. Trump wants to eliminate Chapter 19 (Review and Dispute Settlement in Antidumping and Countervailing Duty Matters) from NAFTA, which Mexico and Canada have already shown strong opposition to. Trump has also expressed his willingness to completely abandon NAFTA. He also raised a threat to “kill an amnesty program for young immigrants brought illegally into the US…more than 622,000 Mexican born people registered for the program after Barack Obama created it.” (NAFTA Negotiations: Second Round Of Talks Ends With 3 Countries Saying Some Progress Made).

What could happen if Trump decides not to agree with Mexico or Canada and in turn cancel the NAFTA negotiation? How would trade between the three countries differ?

China-Pakistan Free Trade Agreement

https://www.geo.tv/latest/158202-eighth-china-pakistan-free-trade-agreement-conference-commences-in-beijing

China-Pakistan Free Trade Agreement

The main principle in chapter 1 and 2 of International trade is revolved around two countries trading with each other. The short article doesn’t give many details about the negotiation between China and Pakistan free trade agreement other than the fact that “the current volume of trade between Pakistan and China of $16 billion (U.S) is a testimony to the ever-growing economic co-operation”. What we can assume however is that with a free trade agreement between the two would mean that they will be exporting and importing more to each other. “Pakistan’s key exports to China where raw materials and intermediate products, such as cotton yarn, woven fabric, gray fabric etc” (Khan).

Both these countries will be better off considering there trading will improve expecting a growth in there already growing economies. On the other hand, we don’t know exactly what that will mean for the rest of the world in terms of the world trade. We know that China accounts for a large portion of the world's trade. What I can theorize is that this could make the market more competitive in terms of cost to produce the goods would be cheaper optimally make everyone competing to have the best price. This could be perceived good or bad depending on the country. What I can say for certain is that negation will improve for both China and Pakistan in terms of their trading power.        

Khan, Mubarak Zeb. “Pakistan seeks changes in free trade agreement with China.” DAWN.COM, 9 Sept. 2017, www.dawn.com/news/1356432. Accessed 15 Sept. 2017.

Launch of iPhone 8 and the Potential Market

Apple has recently launched iPhone 8. The phone is predicted to be not a big success as much as iPhone 6 or iPhone 7 was. The central concept is the customer preferences, the competition in the Market dynamics. The launch of the iPhone 8 helps us in the understanding of how market and the customer behaves to a certain specific product. It gives insights in relation to both the microeconomics factors and the macroeconomic factors. As far as microeconomic factors are concerned, the launch tells about the target market that is the affluent class that prefer the luxury products and this customer preferences drives are referred to as the demand giving company answer about the core problem that is “What to produce?”. As far as the macroeconomic factors are concerned, the potential success of the phone will add to the economic growth of the country and thus will help in the improvement of the standard of living of the common people. The entrepreneurial motive of Apple is to earn more and more profit and return and this is why it is quite important to keep the cost of the produce as low as possible in order to have more gains. The mass production and the sale of the iPhone 8 at the global level will help Apple achieve economies of scale and thus production at the minimum possible cost reaping more returns. The success of iPhone 8 would largely depend upon the customer preferences however since the product does not feature much innovation than the previous versions, there is big question mark on the success of the new product launched. 

The Economic Costs of Linguistic Diversity

We know from Chapter 1 of our textbook that "similar" countries tend to engage in high volumes of trade with one another. But why? European countries trade frequently with each other for a multitude of reasons, the biggest being geographical proximity (easier to ship goods/services) and low import tariffs. However, in a market like the European Union (EU) we also see a multitude of different languages spoken by different people. How exactly does this affect trade?

Freakonomics Radio - the podcast that explores the hidden side of everything - ventures into that very question along with the other implications of linguistic diversity at both macro and microeconomic levels. In general, they find that the multitude of languages has a negative impact on economic growth. In looking at the European market, Shlomo Weber, gives a real world example of why not having one unified language in the EU creates a barrier to trade: "[To] give another, even more painful example, about the patent application: if you need a patent in different countries, you really have to do it in every country, because there is no unified legislation across the Union. Every company in every country has to go for different patent, and it delays so many things."

His economic analysis shows that there is indeed a conflict between localization and globalization as we can also observe positive impacts between two countries who trade in the same language. “Weber documented that a 10 percent increase in the probability that two people from different countries share a language increases their trading by 10 percent.”

Some other major takeaways from this week's episode:

• Linguists predict that of the roughly 7,000 languages now spoken on earth, some 3,000 will go extinct within the next century
• Language and religion are the two most important factors in the self-identification of people and groups
• We spend roughly $40 billion a year on “global language services” - primarily translation and interpretation
• Another $50 billion a year is spent learning other languages

Incentives and Migration: Push Factors or Pull Factors?

This week's hot international economics topic: immigration, and specifically the Deferred Action for Childhood Arrivals (DACA) order. Let's not get too far ahead of ourselves with the course material (we will analyze migration later in the course), and instead stick to basic individual cost-benefit analysis. Taking a rational choice perspective, the decision to migrate hinges on (1) the net benefits of staying; and (2) the net benefits of leaving (to a particular destination). In other words, there are push factors (reasons to leave) and pull factors reasons to choose a particular destination.
In the rollout of the DACA phaseout yesterday, Jeff Sessions stated, “The effect of this unilateral executive amnesty, among other things contributed to a surge of minors at the southern border with humanitarian consequences.” Let's analyze the plausibility of this theoretically, then see what the evidence says. At first blush it seems there should be no doubt that a program like DACA would cause an influx of new migrants hoping to qualify for it. It gives new minor children - especially teenagers - a sort of legal status that might qualify them to work legally in the US later on. On closer inspection it is not so clear. The law requires minors to be in school, meaning they cannot work to support themselves. It also makes their immigration status uncertain since, as an executive order, it is something that a subsequent administration can - and now apparently will - revoke. So the duration of the minor migrant's trip might be longer (because they are legal and do not face fear of ICE) or shorter (because since they are registered a policy reversal makes deportation almost certain). Hence, the immigrant trades one source of uncertainty for another.
Catalina Amuedo-Dorantes, a well-known immigration economist, along with her coauthor Thitima Puttitanun, find a negligible effect on apprehensions of minors to be attributable to DACA. Most of the recent rise in minors coming to the US comes from a 2008 law to help combat human trafficking and assist victims of trafficking, and from families fleeing increased in violence in Mexico.

More on the Robopocalypse

One more thing: there is some chance that in the long run human capital will adapt to the Robopocalypse and worker skills will complement the capabilities of our future new robot overlords. LinkedIn founder and executive Reid Hoffman sums it up well (trying a little too hard to be cool) in this interview with The Daily Show:

Trevor Noah: If robots are doing the jobs...what do humans do? What is our purpose?
RH: ...That's a possible universe, but there are many other possible universes...So it's not that the robots do all the teaching, but it enables [sic] people to be much more productive. 

Finally, we probably don't need to worry about robots killing us and ending human existence as we know it, because...

TN: Will Artificial Intelligence kill us all?
RH: Very unlikely...Asteroids may kill us all; nuclear weapons may kill us all...
...
TN: Why would the robot not want to make me not exist?
RN: ...Then you get to the whole question of the robot "wanting."... When do robots become fully wanting, sentient people, and what language of "want" describes them?

In other words, robot preferences will probably not be the same as human preferences, and will probably be less spiteful, hateful, and vengeful. Maybe a bit more like... homo economicus? At least our robot overlords might be programmed to have preferences that are complete, montonic, and transitive (even when we aggregate them!). 

Robopocalypse or Globopocalypse?

American Public Media Marketplace host Kai Ryssdal interviewed "Robopocalypse" author James Surowiecki about jobs this week. Here's the podcast of the conversation. I want to focus on a couple of passages. First, Surowiecki claims that the Robopocalypse is "a very, very, long way off." This is probably true. Artificial Intelligence does not really exist yet - "Machine Learning" is a more accurate summary of the current state of the art.
Second, Surowiecki claims, "economic evidence at this point suggests that trade and in particular trade with China since 2000 has been responsible for many, many, many more lost American jobs than automation has." He continues, "Really the jobs lost to trade is just an order of magnitude greater." The best research out there now does not support this claim. While Autor, et al. (2015) finds:

"Labour markets whose initial industry composition exposes them to rising Chinese import competition experience significant falls in employment, particularly in manufacturing and among non-college workers. Labour markets susceptible to computerisation due to specialisation in routine task-intensive activities instead experience occupational polarisation within manufacturing and non-manufacturing but do not experience a net employment decline."

In other words: trade, bad - technology, meh. But science doesn't just stop with one finding. Remember, until Autor and his colleagues began looking into trade, the prevailing hypothesis was that skill-biased automation had more to do with widening income distribution and stagnating wages. To falsify the hypothesis that technology matters (and possibly a lot) you need a lot more than that. So Acemoglu, et al. (2017) took a stab at it. They find:

The impact of robots is distinct from the impact of imports from China and Mexico, the decline of routine jobs, offshoring, other types of IT capital, and the total capital stock (in fact, exposure to robots is only weakly correlated with these other variables). According to our estimates, one more robot per thousand workers reduces the employment to population ratio by about 0.18-0.34 percentage points and wages by 0.25-0.5 percent.

Who's right? We don't know yet. I tend to favor the conventional view about technology until more than one or two papers come in from the other direction (and preferably not all of them by Autor and some combination of coauthors).

"Dealmaker" Trump to China: "Stop or we'll shoot ourselves!"

Donald Trump campaigned - in part - on his reputation as a deal-maker. While some have disputed his acumen for making business deals, and others have questioned the ethics of his tactics, he made a convincing case to some loyal supporters that he would make good trade deals. 

The key to it all has been trade with China. At first, it seemed Trump wanted a hard line and hoped to ensure that China would reciprocate our openness with more openness on their own part, and by stopping its alleged "currency manipulation" (an allegation with dubious support). Now, the goal is to coerce China into cooperating with sanctions against North Korea.
Tying US trade policy with China to China's own reciprocity, or to other factors ignores one important aspect of trade theory: When the US remains open to trade, it is US citizens who gain the most, and those gains are mostly independent of whether individual trade partners choose to reciprocate. This is the basic idea of the mutual gains from trade. Hence, threatening sanctions against China to try to get them to cooperate is a threat on a similar plane as telling the police, "Stop or I'll shoot myself!"

Protectionism and the Great Depression

Many fear that the current economic and political climate is pushing countries - especially the United States and many parts of Europe - towards protectionism. There are many reasons this might be a bad thing in general, but first, a little history. A recent episode of NPR's Planet Money discusses the debate in the US over the Smoot-Hawley Tariff Act. Aside from several hilarious reference to comical-economist-and-actor-turned-Fox-News-commentator Ben Stein's (also straight man to host Jimmy Kimmel on Win Ben Stein's Money) character in Ferris Bueller's Day Off, the article documents many similarities in the protectionist view between that time and today. The sentiments documented even includes a snide remark about academic economists, (or, "college professors who never earned a dollar" - ZING!).

The article is a good start towards understanding two big points in the course: 1. That trade is good overall; and 2. some groups are hurt by it. Here is a chart documenting world exports from 1900-1960 (using data from the IMF):

The drop from about 3,500 to about 1,500 occurs between 1929 and 1932, the beginning of the Great Depression in the US, and economic downturns throughout Europe. While correlation does not guarantee causation, most economic historians credit the drop in trade (which was largely caused by bad and protectionist policies) as one of the key factors in precipitating the global depression.

It also documents the political economy of trade policy: that the gains from trade are diffuse and unseen, whereas the gains from policy interventions are usually more concentrated and visible. 

So, so basic reasons not to be protectionist: 1. to avoid retaliation; 2. to make consumers of imports better off (and consumers in general better off); and 3. to make exporters better off. The third reason is generally the hardest to grasp, and one which has fallen out of discussion over the last 20 years or so, but one that policy makers understood pretty well in the aftermath of WWII. We can only see this impact on exporters by developing general equilibrium into our understanding of trade theory. 

Trade With China Has Hurt the US

I recently came across an article in Fortune magazine titled, Here's Why Donald Trump is Right About China. In the article, Chris Matthews talks about how trade between the US and China has decreased American innovation and as a result, the US has been worse off. He references a study done by the National Bureau of Economic Research that discusses how competition with Chinese exporters has diminished innovation in the US. The study was conducted by comparing research and development spending by US firms against increased import competition. The study showed that as import competition increased, R&D spending decreased in the US.

This study shows that US firms are finding problems in competition with the Chinese exporters, and that is reflected with the increased skepticism toward trade by the average American. While trade is beneficial in theory, something has to be said about the increasing skepticism toward trade by the American public. In a poll conducted by the Pew Research Center, 49% of the American general public said that trade is a "bad thing" compared to only 44% that said it is a "good thing". Imports from China have historically increased since the US opened to trade with them. In 2015, Chinese imports to the US reached an all time high. Could it be that lower and middle class Americans are no longer seeing any benefit from trade due to the increased Chinese imports?

Carrier to keep nearly 1000 jobs in Indiana

When Donald Trump won the presidency, he would not have done it for many reasons including carrying the rust belt states of Pennsylvania, Ohio, Indiana and even Michigan. This past week, the President Elect has reached his first deal to keep nearly 1,000 jobs here in the United States showing he knows what it takes to keep jobs in the United States. One reason as to potential for gaining the deal is roughly 10 percent of Carrier’s subsidiary United Technologies come from the federal government. The Pentagon being the single largest customer of theirs, and threats of losing government contracts could have been a major swing for the decision to remain in the United States. Other incentives include economic from the state of Indiana to further appeal them to remain here at home.

I believe this deal is a revolutionary deal for Mr. Trump because he brings precedent to future companies who want to leave the United States. Creating a tax on companies leaving the United States had been floated and rumored to be nearly 35% and would be able to cause many companies to relocate. If the export tax was being used as payment insurance for the employees losing their jobs this could be a revolutionary idea for the many manufacturing jobs harmed due to trade. We have learned the winners and losers of trade, and while there are about 1000 people winning right now, it could be at the cost to 300 million. Additionally, if this is treated to other companies such as Caterpillar whom also benefit with government contracts, we could see many more saved at the added costs to millions of others. 

Outlook of Brexit Effects

The article I read was on Bloomberg about the U.K. economy showing no signs of Brexit effect due to the rise inspending. Household spending rose about 0.7% from the second quarter and business investment grew 0.9% over the time frame per the Office of National Statistics. In a separate report was that retail sales grew at their fastest annual rate in more than a year in November, reasons being the holiday season coming up when consumer spending tends to increase. The Office for Budget Responsibility on Wednesday decreased their annual forecast to 1.4% down from 2.2% stating “uncertainty will lead firms to delay investment while the falling pound squeezes consumers by pushing up the cost of imports.” Alan Clarke of Scotiabank in London stated “In light of Brexit there was case for uncertainly holding back investment … However, things are never black and white. Projects to build planes, ships, buildings etc. will have been singed off 12-18 months ago, and that actively won’t shut off overnight.”

I found this article interesting due to the impact of the Brexit vote and the effects it has placed on the British economy. As the article mentioned there is a rise in the cost of imports which should lead the government with a couple options one being a decrease in an import tariff. This would allow consumers and business’ the ability to get cheaper products, as we have learned in class the taxing of a foreign monopolist can benefit the home country, the imports for Britain may not necessarily be a foreign monopolist and the reduction in tariff can benefit their country greatly.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

Export Subsidies in International Trade

In class we talked about the effects or tariffs and subsidy's on a country and the overall outcomes were quite surprising to us all. I wanted to look more into the outcome of giving a subsidy to a large country involved in international trade. I found this scholarly article Export subsidies and international market share rivalry.
     The authors of this article brought up the idea that we all assumed at the start of class which was that why wouldn't a subsidy be good for a country's welfare? The initial improvements to the home firms outputs in production are positive, however this is without competition from foreign firms. As the authors commented "A subsidy changes the initial conditions of the game firms play." With the subsidy the number of exports increase and producers surplus increases also, these are the only preserved positives of the subsidy. With the increase in supply of the subsidised product the price that the home country can sell the product will decrease, this means that the home country are basically helping out all the home countries by selling them their exports for cheaper prices. The only ones that lose out are the home country because they lose profits selling the product at a cheaper price. The decrease is price then leads to a decrease in the terms of trade for the home country and welfare is reduced.
   Government intervention in trade never seems to have a positive impact. We need the government their to support our firms, however tariffs and subsidies  need to be limited.

The article, China Halts Export-Subsidy Program After U.S. Challenge by William Mauldin, talks about how the United States acquired $1 billion in three years while China made $482 billion last year. As a result, the Obama administration wants to make a new trade agreements because of the alleged trade violation by China. The World Trade Organization also ended a program that aided small exporters throughout China. Americans employed in seven diverse sectors won because of this. This also showed Beijing taking initiative to easy trade tensions. Trump wants to continue to hit China because he wants the United States to, at least, be second to China.

We learned that subsidies encourage domestic firms to produce more in a given industry. China has the labor to do so and they found a way to use the smaller firms as a way to be considered a "small country." Like Ryan said in his post, It will not have a effect on small country, but will  hurt big countries instead. One of the sectors is fish, and we lost this impact of an export subsidiary because fish is more dominant in Asian than the United States.

Export Subsidies as a Revenue-Seeking Activity

Recently in class we have talked about subsidies and what they do for the home economy. It is stated that export subsidies are only paid on goods that are exported. This will have no effect on a small county, but will result in losses of efficiency and worsen the terms of trade in a large country such as ourselves.

I discovered a journal article written in 1999 by Paul Pecorino titled "Export Subsidies as a Revenue-Seeking Activity: Some Implications for the Evolution of Protection" Click to Read (This is a JSTOR article, you may need to log in to see it)

He discusses the output market and how "firms in the export industry costly overcome the free-rider problem lobbying for an optimal export subsidy". (Export Subsidies, 1999) This is relevant when discussing the optimal subsidy, which will have little if no effect on a small country.

He goes a little more in depth with the problem and talks about the lobbying problem. This is introducing the politics and special interest into the equation. That is really the driving force behind a government deciding to put an export subsidy on goods. The consumer will stay pay the same price as a foreign consumer would because we assume that the producers are acting logically. It would not make sense for them to charge consumers on the domestic end less than what they could get for it in the foreign market. This in turn would increase the price of that good due to the extra supply. All in all there is little evidence to support that an export subsidy would be good for the domestic economy and a tariff would be a better option, but still, not a very good choice.

Many problems can arise from export subsidies one of which being investment. Firms can invest in markets with subsidies when they normally wouldn't causing an imbalance in the market directly attributed to the subsidy. Also, there is no telling how long the subsidy will be in place. It is up to the ones making the decision and special interest groups to keep the subsidy going or nix it. The special interest groups would most likely rather keep it in place because it was intended to help them out to begin with and taking it away may change the landscape of business they are operating in.

Will Trump's Trade Policies Benefit India?

On Tuesday night, many Americans were shocked to hear that Donald Trump would become the 45th president of the United States of America. As a result, stricter trade policies will be a big part of President-Elect Trump's first 100 days. In the article, Here's how Donald Trump's win will impact India, Satyam Sharma talks about the possible gains and losses for India under a Trump presidency. He explains how lowering the corporate tax rate from 35% to 15% would encourage companies to move back to the US from India. This would of course cause India to lose both jobs and exports.

The possible gain for India could outweigh the possible loss mentioned above. Trump says he plans to classify China as a currency manipulator, which would allow him to impose large tariffs on imports from China. This could create an opening for India to become a trader of labor-intensive items to the US, in the same way that China has for many years. By imposing large tariffs on China, the US would heavily decrease their Chinese imports. This could lead to India becoming a substitute for China.

With the election of Donald Trump, along with a republican House and Senate, many policy changes are headed to Washington. If Trump is able to get his way, the US trade policies will see a significant change. The next 4 years will be filled with interesting new changes, hopefully for the benefit of the American people.

Declining Global Trade

The article A Little-Noticed Fact About Trade: It’s No Longer Rising points out that global trade is in fact declining over this year, remaining relatively flat in the first quarter and has fell about .8 percent over the second quarter. These numbers per statisticians in the Netherlands which happen to keep the best data. Trade in the United States has fallen by more than $470 billion for American imports and exports over this year, and fell by more than $200 billion in the previous year. The result of the sluggish growth is pointed towards a global slowdown in which is now becoming structural per Binyamin Appelbaum. With both presidential candidates opposing the Trans-Pacific Partnership it is a sign in which global trade will continue to decline. Christine Lagarde of the International Monetary Fund stated “Curbing free trade would be stalling an engine that has brought unprecedented welfare gains around the world over many decades.” The decline in global trade can be pointed to china for they can make more of what they consume, and consume more of what it makes, and making themselves less dependent on foreign direct investment. China’s ever changing role in the global economy has led to these changes in global trade.

I found this article as something that shines a light on how the global economy truly is around the world. China’s GDP growth hovers around 6 % which would be amazing here in the United States (2%), however is far lower than where they were at nearly 12%. With China being able to now support themselves this can cause harm to the United States as seen by our imports and exports have gone down over the past 2 years. This decline would benefit factory workers as there would be less imports however harms them on the same token because of less exports. We then can reasonably assume the United States and other countries are not able to operate at equilibrium on the Heckscher-Ohlin model because of the clear winners and losers of trade.  

Does Offshoring damage the US economy

I wanted to look into whether the increase in firms in the US offshoring over the last decade has had a impact on the US economy. One article that I found Economic damage to US economy from offshoring jobs may be exaggerated, argues that offshoring hasn't had that large of an impact on the economy. His argument was that offshoring has actually made the US firms more efficient because the savings made from offshoring get redirected into new products, research, and development. The article talks about how offshoring hasn't taken as many jobs as the public would think also.
         Only around 0.60% of the 60 million jobs have been lost due to offshoring. One more argument that can help people relax is that Americas largest industries such as catering, tourism, retail, hotels and restaurants cannot be off shored, therefore that is millions of jobs that the US labor force cannot lose out on as firms continue to offshore to other countries to reduce costs.
      Compared to a lot of the world the US have a fairly well educated labor force and this is another reason not to be worried about offshoring, the majority of jobs that are off shored are unskilled jobs that anyone could do, the high skilled jobs are more difficult to offshore and these are the ones most American citizens want as they will generally pay a higher wage. In my opinion offshoring is needed for the world economy as is help developing countries build their economies, and improves their welfare with increase technology, jobs and training.