One of the consistent assertions being made by protectionists in both major parties is that recent changes in the global economy has increasingly cost Americans jobs as companies outsource production or are unable to compete with low-wage foreign firms. The call has been for the government to intervene to protect American jobs and wages from the new danger of "globalization."
Well, Senators Schumer and Webb asked the CBO to take a systematic look at the problem, hoping to find something that Democrats could use in the next round of elections. What they found, though, is that the threat of job loss is more a matter of perception than reality. Neither wages nor jobs are more volatile today than they were ten or twenty years ago. It's just that we pay more attention to them now than we did in the past.
Give Chuck Shumer credit -- he is willing to recognize that his assumptions were wrong.
“Intuitively, you would think volatility is increasing,” said Senator Charles E. Schumer, Democrat of New York, who along with Senator Jim Webb of Virginia requested that the study be done. “But it isn’t, which I guess shows that the American economy has always been very flexible.”Read the New York Times article from which I quote here [ignore the crap about the costs of inequality which is just plain silly].
The CBO report is here.
