The truth is that outsourcing continues to offset far more jobs than automation does. Hicks suggests that we shouldn’t believe our lying eyes when we see all the closed and severely downsized factories in our region. But again it wasn’t automation that drove these jobs to China, Mexico, India and elsewhere, it was the ever present quest to seek out the cheapest labor and laxest regulation to increase the bottom line, or companies driven out of business by the mercantilist practices of currency manipulators, I.P. thieves, product dumpers and illegal subsidizers.
U.S. manufacturing has never fully recovered from the 2001 recession, only to be hammered again in 2008. Look at the charts and you can easily see when manufacturing began its long decline in the U.S. The first was after NAFTA was passed, and the second when China was granted permanent normal trade relations. Contrary to Hicks’ “lying eyes” theory, these events have had a devastating effect on the closing and downsizing of U.S. industry: 70,000 closed factories, 3 million lost jobs. This is reality, not some academic exercise.
The trade deficit is the true deficit we should be very concerned about. Each billion dollars of trade deficit is 6,000 lost direct manufacturing jobs and a number three times that of indirectly negatively impacted jobs. The trade deficit is the gauge of wealth, jobs and technology leaving our country.