Hello, There is one thing I can´t make sense of. I think that the more middle-class a country has, the better they wealthy people will make money, for they will be able to sell their TV-sets, fridges, travels, services, products. I mean, if I were a businessman, a owner of a factory, I would like people to buy, (kind of obvious), so, if the country I live in has many middle-class people capable of buying my products, I will make more money, and this is why I don´t understand why some people claim that wealthy people are interested in making some countries poorer, the poorer, the better. Does that make sense?. I am talking for instance, about Greece, Portugal, or my own country (Spain), that I read that wealthy people, bankers, can be interested in turned them down, making them fall/tear apart. Is that so?
It's short term thinking over long term thinking. When the rich see the chance to get even richer, even if it is essentially at the expense of the middle class, historically they take that chance. They only worry about the consequences when the economy falters and/or strong political movements (especially revolutionary ones) oppose them. I personally think Marx had one thing right - the history of the world is reflected in the tensions between the overclass and the underclass of each society, but I personally feel that the "management" of that class struggle so as to maximize the benefits for society as a whole (and thus all the classes) is the proper role for the government and political structure of a nation.
Why did slavery not work. Because it makes for a poor export market. Slaves have no money. You can't sell them stuff. That was why Britain and the industrial north of the US opposed slavery. The same is true for poorly paid employees. If people can't afford to buy stuff, it's like not having money at all. Recently I read an article that car companies are worried because young people can't afford to buy cars. So they are trying to make affordable cars.
This is worrying. "Affordable cars probably means very cheap cars, like the ones being developed for the Indian "middle class". Have living standards for the next generation of Americans really fallen so low, to the level of India? (note that the Indian mother is probably not very tall, look how the picture was taken, with the woman ducking down to make sure the low height of the car is not fully apparent, and two very young little children to make the car seem bigger than it actually is. and the father who would have a larger sized body frame is conspicuously absent. that car would be way too small for a typical American male) you can see how small it really is in comparison to a man standing up here: http://3.bp.blogspot.com/-Lj8539glU-E/TZA_ytUWsgI/AAAAAAAAB6g/Hg6YbS0qsAA/s400/tata_motors_nano.jpg
But many claim that US is heading that way, to wipe out the middle class, which, to me, doesn´t make sense at all. Maybe it would be useful for the wealthiest to get rid of the middle class in a country, like Indonesia, to have low wages and "almost slaves" there, working in Nike factories, and Adidas factories, and Apple factories? As to that car, I think it is suitable for India, and they must even see it as a great achievement, since they are a poor (though emerging) country, and that car represents the achivements of a nation, I think.
Well, it certainly is better than what they had before: I just hope our Western countries are not headed in this direction.
This is a complicated thing, so I recognize it can be hard to understand. Essentially, the "middle class" only exists in large numbers in 1st world countries because they are being subsidized by the cheap labor from 3rd world countries. When a country exploits another in this way it is a form of imperialism. While capitalists exploit the middle and lower classes in their own countries, we are all essentially being subsidized to cheap labor from the exploitation of foreign workers. This relationship is unsustainable in the long term, now these exploited countries are beginning to rebel and assert their sovereignty, for example look at what's happening in Latin America lately with Venezuela etc. One of the things to take into consideration in that capitalists aren't a unified group, and ultimately this works against them. While in the long term it might be better for them to cooperate, by their nature they are only looking out for themselves. Capitalists have the profit incentive to exploit their workers as much as possible, and because of the competitive nature of capitalism no individual capitalist wants to lower their profits for the risk of being kicked out of the game. In Spain the small businessmen don't have any incentive to let their country fall, but the international bankers certainly do because the crisis in Spain and other Euro countries has the potential to spread worldwide and damage the capitalist system immensely if they don't isolate these countries quickly.
The middle classes mainly benefit from intra-industry trade (typically between similar countries with similar tastes, such that the capitalist can fully exploit economies of scale). You'd have to refer to some variation into multinational 'race to the bottom', typically borrowing from the anarchist analysis that suggests trade is used as a reaction to labour success (i.e. given capital mobility, domestic labour are disciplined by their need to avoid capital flight)
In the fifties in the US there was a very large middle class, and no industry abroad, no outsourcing, that I know.
1.Not so difficult to understand the first paragraph, easy actually. Nevertheless, I don´t agree because when a company goes offshore (outsourcing) they are creating wealth in the destination countries, aren´t they? . I mean, a Taiwanese person, working in a US company, earns 100 dollars per month, too little for me and you, good enough for them, the average salary there is , say, 120 dollars, and the minimum is, let´s say, 75 per month, so, in an important way, that US company settled in Taiwan, is creating walth, jobs, employment, am I wrong about this?. So, why do people argue that outsourcing is bad?. For whom? For the US economy or for Taiwanese economy?. In my opinion, for neither. THEN, WHAT IS THE DRAWBACK ABOUT THE OUTSOURCING, A.K.A GLOBALIZATION? Anyway, I heard a person in a documentary saying: When a US or European country settles in Laos and the people in these countries begin to be less poor, maybe no middle-class but much less poor, they begin to develop as a country, and then, THE FACTORY MOVES AWAY TO ANOTHER POORER COUNTRY WITH LOWER WAGES (TO MAXIMIZE PROFITS BUT ALSO TO CREATE WEALTH). Of course, these huge companies don´t go offshore thinking: let´s develop those poor countries; it is just a consequence. But something came to my mind: If that US company is creating wealth in Taiwan and then, after three years, they move away to Indonesia because the salaries are lower, what happens in Taiwan?. My point, I think, is clear: Outsourcing creates wealth in the poor country, it creates jobs, therefore, the people can consume, they can´t consume expensive cars of course, but still they can get better. IN THIS CASE, I DON´T SEE "THE UGLY FACE OF CAPITALISM". Maybe I fail to understand it?
The problem is that the American componies don't create wealth for the poor countries, the poor countries create the wealth and the American componies funnel a large amount of the wealth out of the country thereby slowing its development and trapping the country in a situation of dependance on the other country. What really aids an undeveloped country is allowing it to develop its own national capitalist class.
We can refer to the negative influence of the likes of the Washington Consensus, where trade liberalisation can lead to a welfare damaging focus on resource exploitation. But let's not kid ourselves: American companies do create wealth for poor countries. Wage increases occur because of the impact on labour demand.
All the same, it is better for the people of underdeveloped countries to have their own local small businesses and national ownership over large componies. I mean look at Venezuela, since they nationalized their oil industry they've halved illiteracy and made a significant impact on poverty, the rise of cooperatives and small businesses has undoubtedly helped too. You can't help wondering why this wouldn't be a good thing for countries like Guatemala too.
That was great RedRepublic, I see it like that too, I couldn´t agree more, but it seems that whenever a country tries to nationalize the oil, the CIA from the US steps into the country and overthrow the government: Iran, Iraq (before Sadam), Congo, and the list of the countries goes and on and on. As a result, US takes over the oil, privatize the main resource of the country. I am reading too that the recipe for the FMI to "solve" poor countries economic problem is: I lend them money, but they don´t use it for what is needed, so, they fall into debt, and then, they are trapped in ths huge debt, and the FMI says: Okay, I´ll help you with your debt but you have to privatize the main industries. So, by doing so, again, American or European countries go into the country to run the oil industry with cheap labor. Is all of this true? if so, it seems like the FMI and The US through the CIA aren´t that good-hearted as I thought. SO, THE KEY WORD FOR A POOR COUNTRY WITH OIL OR SILVER OR ANY OTHER VALUABLE RESOURCE IS TO NATIONALIZE? SO, THAT IS WHY ALL THAT PROPAGANDA AGAINST CHAVEZ?
The focus should be maintained on the inappropriate nature of multilateralism. As shown by how the development round for WTO reform has struggled, we've still got arrangements skewed in favour of the 'rich north'. Makes the western whinge about free trade look morally bankrupt
