Quote:
Originally Posted by FlyWf
You're so ****ing used to traveling in the internet circle of clueless white dudes you can't even CONCEIVE that some of us actually know what the **** we're talking about.
But just to embarrass you,
1) What stagnation-related policies did Clinton propose compared to Trump to make her worse for that?
I'm guessing Thiel's thoughts are strongly informed by Margo and Goldin's work on
"the Great Compression" of relative wages caused by World War II. They initially focused on the structural effects of the war: A sharp increase in demand for unskilled labor, followed by a large increase in the relative supply of educated labor.
Later, they moved on to the factors that
kept wage growth equal across top and bottom incomes from 1945 to 1975. They identified three factors:
- The rise of unionization;
- The decline of trade;
- The decline of immigration.
Let's consider (2) and (3).
(2) In a sharp departure from the Great Compression era, the share of imports in U.S. GDP grew from 5.4% in 1970 to 16.5% in 2014. Labor embodied in the imports must be understood as a substitute for domestic labor; hence directly undermining the demand for unskilled labor that supported the Great Compression. (As a case study see
Autor, et al., who calculated that Chinese imports from 1990 and 2007 accounted for about a quarter of the decline in manufacturing employment during that period---while also lowering wages, reducing the labor force participation rate, and raising publicly financed transfer payments.)
Also note that the inroads of imports go beyond final goods, because global trade encourages both firms and countries to increasingly specialize in different stages of production. (E.g. increases of automobile parts more than doubled between 2001 and 20014, causing many U.S. parts manufacturers to move their domestic factories abroad, especially to Mexico; c.f. "
How the Vise on U.S. Wages Tightened").
Taken together, increased import penetration and outsourcing represent the combined effect of global free trade on domestic employment and wages; and this effect is
substantial.
(3) By the 1990's, immigration had accelerated to the point that it accounted for
more than half of total labor force growth in the United States between 1995 and 2005. More broadly, the share of foreign-born workers in the labor force steadily grew from 5.3 percent in 1970 to 14.7 percent by 2005.
Immigrants have a
hugely disproportionate negative effect on the wages of low-skilled workers as compared to the general work force. (Again, directly undermining the conditions of the Great Compression era.)
So in particular, if you care about broad-based domestic wage growth---as Thiel most certainly does---there is a solid, empirical case to be made that open borders and free trade are disastrously bad policy.
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[
Edit -- These comments are drawn heavily from Chapter 18 of
The Rise and Fall of American Growth, which I believe I've recommended to you before.]
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All that said, I doubt Thiel was optimistic that a President Trump would actually do something about any of this. But President Clinton would have certainly
increased free trade and open borders; so, given his values, she was not really a possible choice.
This would also be a good time to REPEAT that I am a strongly avowed globalist, and don't give a **** if American citizens suffer at the expense of Bangladeshi textile workers, Indian technologists, or Chinese industrial engineers.
I do not share Thiel's values; I simply don't think he is somehow "wrong" for that reason alone.
Last edited by Subfallen; 05-04-2017 at 01:59 AM.