America: The Third World

As a college student, it is not uncommon to hear fellow classmates, and even friends and family, to make offhand comments about how hard it will be for the new generation of college graduates to find a job. What is happening in America? It is like the country is regressing from its previously developed status. How America is Turning into a 3^rd World Country in 4 Easy Steps, by Thom Hartmann and Same Sacks, Why the Minimum Wage Shrinks, by Steve Breyman, and Why More Engineers are Loosing Jobs, by Janet Babin provide some insight as to why America is failing its labor force.

There used to be more protection for American labor, but most of that has been repealed at this point, which has destroyed America’s manufacturing base. America used to be protected by high tariffs on imports and strong government support, but the Reagan administration stripped away protective systems like Alexander Hamilton’s 11-point plan for American Manufactures and entered the United States into free-trade agreements as globalization spread (Hartmann & Sacks, 2012). Free trade agreements and cheap labor have significantly damaged America’s manufacturing base. American jobs have been outsourced to other countries with cheaper labor so that currently “only one-in-ten Americans work in manufacturing.” (Hartmann & Sacks, 2012). According to Hartmann and Sacks, “Over the last decade, 50,000 manufacturing plants in the United States have closed down and five million manufacturing jobs have been lost” (2012). Free trade agreements, private equity firms, and inflation have crippled wages in the last few years (Hartmann & Sacks, 2012). Minimum wage is an issue because inflation is making it shrink thanks to poor oversight from congress and employer’s unwillingness to raise wages (Breyman, 2012). Steve Breyman argues that a free trade system has no hope of solving this issue because there is no incentive for the market to do so. America has also switched to becoming the world’s largest importer of manufactured goods, when in the past it was the largest exporter of American goods (Hartmann & Sacks, 2012). This has lead to huge trade deficits. Now that the US is no longer a net exporter of manufactured goods, minimum wage is low, and labor protection has been significantly reduced. America is now a source of cheap labor that other countries can use. This is why Hartmann and Sacks feel they can say America is reverting to a third world country. The re-colonization of America with large foreign companies whose countries have higher minimum wages than the United States is becoming more and more common because outsourcing is cheaper for foreign investors than it is for United States manufacturers (Hartmann & Sacks, 2012). This will provide new jobs but they will be low paying jobs. Hartman and sacks blame Republican policy for these problems because “generations of labor law that produced minimum wage, a forty-hour work week, workplace safety laws, and child labor laws are all under attack by republicans in congress” (2012). All of these factors are steadily allowing the United States to become like the third world countries it exploits.

Rensselaer Polytechnic Institute is primarily an engineering school and unfortunately for the students here, engineers (as well as many other specialized labor sectors) aren’t guaranteed a job in the way previous generations were more apt to. It used to be that in times of recession engineers could generally still count on a job when others couldn’t, but know, according to an industry trade group known as IEEE, “engineers of all stripes are losing their jobs at a faster rate than other professionals” (Babin, 2009). This is primarily due to the factors that Hartmann and Sacks outlined, that are lightly summarized in Why More Engineers are Loosing Jobs. When the economy dips the first thing to go is often research and development, which happens to employ a lot of engineers. Recessions are yet another driver of the United State’s regression toward third world status, because it is so much easier for the remaining American companies to outsource labor. 

This is not an issue that will be cleared up with a very satisfactory level of expediency, especially since a lot of companies have already come to take advantage of America’s cheap labor. The only solution seems to be to strengthen regulations within the United States to protect its people. Unfortunately, the United States has made so many foreign agreements that it will not be able to protect its workers in the same way it once could because of free trade (and other related factors). America has a cheap source of skilled labor and RPI and its students will likely feel the effects of this as graduates enter the workplace. It is with this understanding that it would be wise for students to diversify and become as interdisciplinary as possible so that jobs skills don’t fall entirely into one department of employment that may be the first to go when times are tough.

References

Babin, J. (2009). Why more engineers are losing jobs. Marketplace.org. Retrieved November 15, 2012, from http://www.marketplace.org/topics/business/fallout-financial-crisis/why-more-engineers-are-losing-jobs

Breyman, S. (2012). OpEdNews Article: Article: Why the Minimum Wage Shrinks. OpEdNews. Retrieved November 15, 2012, from http://www.opednews.com/articles/Why-the-Minimum-Wage-Shrin-by-Steve-Breyman-120921-436.html

Hartmann, T., & Sacks, S. (2012). How America Is Turning into a 3rd World Nation in 4 Easy Steps. AlterNet. Retrieved from http://www.alternet.org/economy/how-america-turning-3rd-world-nation-4-easy-steps?page=0%2C3&akid=9674.29753.lrx_-y&rd=1&src=newsletter742846&t=9