It's not that amazing, it's just that American investors wanted to cut labor costs in the late 1990s and China was offering dollar-a-day workers. The claim that opening up trade with China would have a 'liberalizing influence on the country' was one of the key selling points back in 2000-2001, pushed by both Clinton and GW Bush:
> "By joining the W.T.O., China is not simply agreeing to import more of our products; it is agreeing to import one of democracy's most cherished values: economic freedom. The more China liberalizes its economy, the more fully it will liberate the potential of its people — their initiative, their imagination, their remarkable spirit of enterprise. And when individuals have the power, not just to dream but to realize their dreams, they will demand a greater say."
Of course it was all nonsense, Clinton and Bush were just listening to Wall Street interests who saw massive profits in moving US manufacturing overseas to cheap labor zones. (Importing cheap labor to do jobs that couldn't be outsourced, in agriculture, construction, etc. was the other side of that coin).
> Of course it was all nonsense, Clinton and Bush were just listening to Wall Street interests
I'm not a fan of either Clinton or Bush, but this is unfair. There was far more going on.
At the time, there was a strong sense that democracy had won, and that it was inevitable. That empowering people economically would eventually, without fail, lead to democratic reform. Fukuyama's "The End of History and the Last Man" is one of the most influential books of the period.
But, Fukuyama and people like him (Reagan, necons, Bush, Clinton, etc.) turned out to be fatally wrong. They created an incredibly unequal world that has eroded democracy to the point where we can seriously discuss a US that isn't a democracy anymore in our lifetimes.
You should read the book. It's an interesting case of someone who originally set out to help people, but who created a hellscape instead.
I'm afraid my view is a bit more jaded - I think those storylines were manufactured for ulterior motives as part of an effort to sell a program to the American public that would significantly reduce the average standard of living while concentrating wealth in the hands of billionaires. They'd already seen the effects of NAFTA and with China, they were hungry for more of the same.
I don't believe the conversion of the industrial manufacturing heartland of the United States to a region now called 'The Rust Belt' was accidental or unplanned. Nor was the destruction of much of the West Coast garment and electronics manufacturing industries.
This has been a deliberately planned policy with a known outcome by its architects, and it's been going on for about four decades. See for example:
> "By any measure, NAFTA and its sequels has been a major contributor to the rising inequality of incomes and wealth that Barack Obama bemoans in his speeches. Yet today—channeling Reagan, the Bushes and Clinton—the president proposes two more such trade deals: the Trans-Pacific Partnership with eleven Pacific Rim countries and a free trade agreement with Europe."
Lots of relatively rich countries are in the TPP, including my country, NZ. It has significant rules protecting labour and environmental conditions. It's fine.
From your link:
> The surplus with Mexico turned into a chronic deficit. And the economic dislocation in Mexico increased the the flow of undocumented workers into the United States.
So they're saying that jobs moving from the USA to Mexico increased the flow of Mexican workers to the USA? That makes no sense at all.
The other side of the NAFTA coin was that it allowed US agribusiness to dump products like corn in Mexico at below-market prices, driving many small-scale Mexican farmers into poverty. At that point, they could either work as low-paid maquiladores (the border factories etc.) in Mexico or become Mexican expats at significantly better wages in the US agriculture, construction, restaurant, hotel & golf course etc. sectors.
The neoliberal project in a nutshell involved the outsourcing of unionized well-paid domestic manufacturing jobs overseas, on one hand, and the import of cheap expat labor to fill jobs that couldn't be moved offshore, driving down labor costs and creating hundreds of new billionaires, who used their money to buy more politicians to lock in the programs and prevent any change.
> They created an incredibly unequal world that has eroded democracy to the point where we can seriously discuss a US that isn't a democracy anymore in our lifetimes.
Could you elaborate? I find this too much of a stretch to think about and am not knowledgeable enough on the topic
Executives and shareholders captured all of the increased profit margins from outsourcing, workers little or none of it. Additionally, the replacement service jobs those workers transitioned to provided lower total compensation. All that on top of increased costs for health care and other necessities.
Net result was drastically increasing inequality, and a political system with cradle-to-grave capture of politicians by the 1% (or 10% or whatever), using their increased wealth to fund political campaigns, lobbying of those politicians while in office, and to provide cushy revolving door jobs and board memberships when politicians leave office.
> Could you elaborate? I find this too much of a stretch to think about and am not knowledgeable enough on the topic
Many politicans of one of the two major parties are denying the result of an election. Prominent members are calling for "Democrats" to be forbidden to vote when moving state (without protest from others). An let's not even talk about the whole constitutional convention movement. There are many politicians in the US who only pay lipservice to democracy.
>> They created an incredibly unequal world that has eroded democracy to the point where we can seriously discuss a US that isn't a democracy anymore in our lifetimes.
> Could you elaborate? I find this too much of a stretch to think about and am not knowledgeable enough on the topic
Until the 1970s and 1980s we lived in a totally different world. Taxes on the rich were high. Productivity gains were shared with workers whose wages went up. After the 1980s (Nixon, Reagan, Thatcher, Fukuyama, and more broadly neocons) everything changed.
It's incredibly striking, you can see it even is basic graphs.
The share of wages as percentage of GDP https://fred.stlouisfed.org/graph/?g=2KkM Until the 1970s it was pretty stable, then you have a steep downward trend. The capital class who owns things, now that they had many fewer regulations and didn't need to pay taxes, they decided to keep far more of the wealth for themselves.
Companies in 2022 spent nearly $1 trillion in stock buybacks. Those were illegal until 1982! That money would have gone to workers, instead, it's going to owners.
There's also been a huge shift in competition. Instead of competing with one another, companies now consolidate. This used to be a very rare event, now, in most industries we have only a few big players that absorb everyone else. That's a direct consequence of deregulation, not enforcing antitrust laws, and giving money to capital instead of people.
https://2.bp.blogspot.com/-wyvntk8Krq0/WQdL-4X-WjI/AAAAAAAAI...
Guess why Trump talks about Making America Great Again? People have a collective memory of a time when wages were going up and when there was optimism about the American Dream.
The crisis we're seeing in the US today is all about these charts and this timing; it's really striking how the 80s are the focal point for all of the problems that people talk about today. People are hurting now, their wealth is sapped, their wages aren't going anywhere, they have little security left. They feel like they have no future and that their children't won't have a future. Not to mention that large parts of the country are deindustrialized.
It's really sad that instead of turning to organized labor, like we saw in the 19th century, these people are mostly turning to the exact people who marginalized them in the first place (conservatives, Republicans and large businesses).
> The claim that opening up trade with China would have a 'liberalizing influence on the country'
I mean that did happen. It's just that it wasnt for seen that it could be snapped back so violently.
China is still definitely more liberalized than it was in, say, 1980, even if it apexed in 2016 (with a long way to go) and retrenched itself since then.
https://edition.cnn.com/2001/WORLD/asiapcf/east/09/18/china....
See Clinton's Mar 2000 speech:
> "By joining the W.T.O., China is not simply agreeing to import more of our products; it is agreeing to import one of democracy's most cherished values: economic freedom. The more China liberalizes its economy, the more fully it will liberate the potential of its people — their initiative, their imagination, their remarkable spirit of enterprise. And when individuals have the power, not just to dream but to realize their dreams, they will demand a greater say."
Of course it was all nonsense, Clinton and Bush were just listening to Wall Street interests who saw massive profits in moving US manufacturing overseas to cheap labor zones. (Importing cheap labor to do jobs that couldn't be outsourced, in agriculture, construction, etc. was the other side of that coin).