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Veracity Voice > Columnists > Frosty Wooldridge > Congress Cutting Americans’ Financial Throats

Congress Cutting Americans’ Financial Throats

January 16, 2010

Immigration and Outsourcing Jobs…

Outsourcing JobsLook across the American unemployment landscape to see 15 to 20 million Americans without jobs, without hope and without a way out. Witness 35 million Americans subsisting on food stamps. Millions of U.S. teenagers cannot ‘buy’ a job. Watch accelerating home foreclosures for millions of Americans.

Then watch what the U.S. Congress continues: outsourcing of millions of jobs, insourcing of millions of jobs and offshoring of manufacturing jobs. On top of that, as we outsource millions of jobs to Asia, we import 100,000 immigrants legally every 30 days, month in and month out, year in and year out. Congress engages hundreds of thousands of H-1B and H-2B visas for foreign labor annually with no let up in sight!

Does any of that make sense to any American with an ounce of common sense?

In a column by economist Mike Folkerth, more intelligent than any you will read from Time or Newsweek Magazine, he wrote, “But, the Chinese Can Make it Cheaper; Well Duh!” You will find him at www.kingofsimple.com. I spoke with him and obtained permission to interview:

“There are certain blatant issues that seem so apparent that we often think that everyone must be fully aware of their dastardly consequences,” said Folkerth. “But on the other hand, I consider that perhaps, Alfred North Whitehead was correct when he said, “It takes an unusual mind to undertake the analysis of the obvious.”

“Our trade deficit for November was once more on the increase, a hefty 10% increase at that. In plain English, this means that we are buying considerably more of the items that we use in our daily lives from foreign nations, than foreign nations buy from us. We crossed that line of imbalance in 1970 and our government has been working on the problem every since. Hey, these things take time.


How about Americans making products for America?

“On that subject, I was just listening to a financial expert say that American exports need to pick up,” said Folkerth. “America needs to make more of what the world wants to buy.”

“I know that my solution is ridiculous, but how about this; why not have America make more of what Americans buy every day? Wow, what a breakthrough in international trade balance and I did it with 3rd grade math.

“Think about what I just said. We have purposely shipped our critical core industry to China, Japan, India, South Korea, Singapore, Sri Lanka, and a hundred other places that I’m not sure I can spell, in order that these foreign nations can then send it back for the unemployed Americans to purchase. Am I missing something here?

“And now the financial experts say that we need to increase our exports so that we can pay for our imports? “HELLO, earth to Americans, all we have to do is export to ourselves.” As in, out of the American factory and on to the American shelves. It’s an ancient tradition that was used to build America. It’s called a full circle economy.

“Isn’t it amazing what propaganda and indoctrination can do? News media to the average American citizen, “We live in a global economy you know?” American citizen to news media, “Uhhhhhh…okay.” American citizen to the next person that they meet, “We live in a global economy you know?” Next person responding, “Uhhhhhh…sure, I knew that.”

“All of this leads up to the complex burning question of, why? Why do we import more than we export when we have 27,000,000 unemployed/under employed Americans that want to go to work? Why not make these goods ourselves? I’m told that such activity creates jobs. I’ll do some research on that rumor and get back with you. Okay, I’m done and it works.

“Why would the greatest industrialized nation in the world allow their population to stagger to their unemployed knees while having a communist foreign nation provide us with our basic manufactured goods?”


The big question remains “Why?”

“Why import products from half way around the world that we have historically produced for ourselves when millions of our fellow Americans are unemployed?” said Folkerth. “Why allow such institutions as The-China-Connection-Wal-Mart to exist when America is on the brink of collapse?

“So am I an isolationist? I’d say yes, and proud of it; charity and employment start at home. I’m also a realist and I can do the revealing math in my sleep.

“There is no such thing as the Easter Bunny or the Tooth Fairy. There is no such thing as a service and information economy. There is no requirement to globalize and this is NOT a global economy outside the devious minds of government and big business.

“Through effective propaganda, we’ve been led to believe that Americans are bad people who charge too much for their labor. That’s right; the unions are at fault, not the high paid management that agreed to the union contacts.

“We’ve been conditioned to believe that we can’t make the products that we use daily, because the Communist Chinese can make them cheaper! Well duh, why do we think the Communist Chinese live in abject poverty? You don’t suppose there is a connection do you?

“If it takes higher cost goods to support our way of life, so be it. Pay more, get higher quality, and buy less. The alternative is to sink to the level of those who are currently taking our jobs and our way of life; at the behest of our government and big business leaders I might add.

“The immediate solution to unemployment is simple; we need to revert back to supporting ourselves and our local communities rather than supporting multi-national corporations whose total goal is profit at any cost. That cost was Middle America.

“But then, that’s not what we are doing at all; instead, we also import 1.2 MILLION foreign workers annually to compete with the unemployed Americans. Truth is far stranger than fiction.”

After talking with Folkerth, my burning question remains this: why do we suffer a $700 billion trade deficit annually, with 15 to 20 million unemployed Americans while and 35 million Americans on food stamps? Why do our Congress critters think cheap Chinese products remain a ‘good thing’ with so many of our citizens unable to buy them because they do not enjoy jobs?

Mark Twain said, “Suppose you were an idiot; and suppose you were a member of Congress…ah, but I repeat myself.”


Frosty Wooldridge has bicycled across six continents – from the Arctic to the South Pole – as well as six times across the USA, coast to coast and border to border. In 2005, he bicycled from the Arctic Circle, Norway to Athens, Greece.

He presents “The Coming Population Crisis in America: and what you can do about it” to civic clubs, church groups, high schools and colleges. He works to bring about sensible world population balance at his website: www.frostywooldridge.com

Frosty Wooldridge is a regular columnist for Novakeo.com


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  • http://PeteMurphy.wordpress.com Pete Murphy

    Our enormous trade deficit is rightly of growing concern to Americans. Since leading the global drive toward trade liberalization by signing the Global Agreement on Tariffs and Trade in 1947, America has been transformed from the wealthiest nation on earth – its preeminent industrial power – into a skid row bum, literally begging the rest of the world for cash to keep us afloat. It’s a disgusting spectacle. Our cumulative trade deficit since 1976, financed by a sell-off of American assets, exceeds $9.5 trillion. What will happen when those assets are depleted? Today’s recession is the answer.

    Why? The American work force is the most productive on earth. Our product quality, though it may have fallen short at one time, is now on a par with the Japanese. Our workers have labored tirelessly to improve our competitiveness. Yet our deficit continues to grow. Our median wages and net worth have declined for decades. Our debt has soared.

    Clearly, there is something amiss with “free trade.” The concept of free trade is rooted in Ricardo’s principle of comparative advantage. In 1817 Ricardo hypothesized that every nation benefits when it trades what it makes best for products made best by other nations. On the surface, it seems to make sense. But is it possible that this theory is flawed in some way? Is there something that Ricardo didn’t consider?

    At this point, I should introduce myself. I am author of a book titled “Five Short Blasts: A New Economic Theory Exposes The Fatal Flaw in Globalization and Its Consequences for America.” My theory is that, as population density rises beyond some optimum level, per capita consumption begins to decline. This occurs because, as people are forced to crowd together and conserve space, it becomes ever more impractical to own many products. Falling per capita consumption, in the face of rising productivity (per capita output, which always rises), inevitably yields rising unemployment and poverty.

    This theory has huge ramifications for U.S. policy toward population management (especially immigration policy) and trade. The implications for population policy may be obvious, but why trade? It’s because these effects of an excessive population density – rising unemployment and poverty – are actually imported when we attempt to engage in free trade in manufactured goods with a nation that is much more densely populated. Our economies combine. The work of manufacturing is spread evenly across the combined labor force. But, while the more densely populated nation gets free access to a healthy market, all we get in return is access to a market emaciated by over-crowding and low per capita consumption. The result is an automatic, irreversible trade deficit and loss of jobs, tantamount to economic suicide.

    One need look no further than the U.S.’s trade data for proof of this effect. Using 2006 data, an in-depth analysis reveals that, of our top twenty per capita trade deficits in manufactured goods (the trade deficit divided by the population of the country in question), eighteen are with nations much more densely populated than our own. Even more revealing, if the nations of the world are divided equally around the median population density, the U.S. had a trade surplus in manufactured goods of $17 billion with the half of nations below the median population density. With the half above the median, we had a $480 billion deficit!

    Our trade deficit with China is getting all of the attention these days. But, when expressed in per capita terms, our deficit with China in manufactured goods is rather unremarkable – nineteenth on the list. Our per capita deficit with other nations such as Japan, Germany, Mexico, Korea and others (all much more densely populated than the U.S.) is worse. My point is not that our deficit with China isn’t a problem, but rather that it’s exactly what we should have expected when we suddenly applied a trade policy that was a proven failure around the world to a country with one fifth of the world’s population.

    Ricardo’s principle of comparative advantage is overly simplistic and flawed because it does not take into consideration this population density effect and what happens when two nations grossly disparate in population density attempt to trade freely in manufactured goods. While free trade in natural resources and free trade in manufactured goods between nations of roughly equal population density is indeed beneficial, just as Ricardo predicts, it’s a sure-fire loser when attempting to trade freely in manufactured goods with a nation with an excessive population density.

    If you‘re interested in learning more about this important new economic theory, then I invite you to visit my web site at http://PeteMurphy.wordpress.com.

    Pete Murphy
    Author, “Five Short Blasts”

  • http://PeteMurphy.wordpress.com Pete Murphy

    Our enormous trade deficit is rightly of growing concern to Americans. Since leading the global drive toward trade liberalization by signing the Global Agreement on Tariffs and Trade in 1947, America has been transformed from the wealthiest nation on earth – its preeminent industrial power – into a skid row bum, literally begging the rest of the world for cash to keep us afloat. It’s a disgusting spectacle. Our cumulative trade deficit since 1976, financed by a sell-off of American assets, exceeds $9.5 trillion. What will happen when those assets are depleted? Today’s recession is the answer.

    Why? The American work force is the most productive on earth. Our product quality, though it may have fallen short at one time, is now on a par with the Japanese. Our workers have labored tirelessly to improve our competitiveness. Yet our deficit continues to grow. Our median wages and net worth have declined for decades. Our debt has soared.

    Clearly, there is something amiss with “free trade.” The concept of free trade is rooted in Ricardo’s principle of comparative advantage. In 1817 Ricardo hypothesized that every nation benefits when it trades what it makes best for products made best by other nations. On the surface, it seems to make sense. But is it possible that this theory is flawed in some way? Is there something that Ricardo didn’t consider?

    At this point, I should introduce myself. I am author of a book titled “Five Short Blasts: A New Economic Theory Exposes The Fatal Flaw in Globalization and Its Consequences for America.” My theory is that, as population density rises beyond some optimum level, per capita consumption begins to decline. This occurs because, as people are forced to crowd together and conserve space, it becomes ever more impractical to own many products. Falling per capita consumption, in the face of rising productivity (per capita output, which always rises), inevitably yields rising unemployment and poverty.

    This theory has huge ramifications for U.S. policy toward population management (especially immigration policy) and trade. The implications for population policy may be obvious, but why trade? It’s because these effects of an excessive population density – rising unemployment and poverty – are actually imported when we attempt to engage in free trade in manufactured goods with a nation that is much more densely populated. Our economies combine. The work of manufacturing is spread evenly across the combined labor force. But, while the more densely populated nation gets free access to a healthy market, all we get in return is access to a market emaciated by over-crowding and low per capita consumption. The result is an automatic, irreversible trade deficit and loss of jobs, tantamount to economic suicide.

    One need look no further than the U.S.’s trade data for proof of this effect. Using 2006 data, an in-depth analysis reveals that, of our top twenty per capita trade deficits in manufactured goods (the trade deficit divided by the population of the country in question), eighteen are with nations much more densely populated than our own. Even more revealing, if the nations of the world are divided equally around the median population density, the U.S. had a trade surplus in manufactured goods of $17 billion with the half of nations below the median population density. With the half above the median, we had a $480 billion deficit!

    Our trade deficit with China is getting all of the attention these days. But, when expressed in per capita terms, our deficit with China in manufactured goods is rather unremarkable – nineteenth on the list. Our per capita deficit with other nations such as Japan, Germany, Mexico, Korea and others (all much more densely populated than the U.S.) is worse. My point is not that our deficit with China isn’t a problem, but rather that it’s exactly what we should have expected when we suddenly applied a trade policy that was a proven failure around the world to a country with one fifth of the world’s population.

    Ricardo’s principle of comparative advantage is overly simplistic and flawed because it does not take into consideration this population density effect and what happens when two nations grossly disparate in population density attempt to trade freely in manufactured goods. While free trade in natural resources and free trade in manufactured goods between nations of roughly equal population density is indeed beneficial, just as Ricardo predicts, it’s a sure-fire loser when attempting to trade freely in manufactured goods with a nation with an excessive population density.

    If you‘re interested in learning more about this important new economic theory, then I invite you to visit my web site at http://PeteMurphy.wordpress.com.

    Pete Murphy
    Author, “Five Short Blasts”

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