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All due to the failure to protect domestic manufacturing.
Instead of making things, smelting and bending metals, building value, our workforce is led into low-paid service and other nonproductive occupations. All of these workers are low-paid because they are overhead, adding little if any value. They depend on other people actually producing the wealth of manufactured goods.
Eating at a restaurant once was recognized for its pretension to elegance: having servants make and serve your food, something you should do for yourself. But now, fast-food joints are the standard, an artificially created activity that adds no value to society. All of the workers in that occupation are acting out a pretense that their customers are wealthy enough to have their food served to them by liveried help.
Retail stores serve a limited function of distributing what is made elsewhere. There is no production, no value added to the goods other than the convenience of nearby storage. Imagine trying to make a society that's sole value added is to distribute cheap goods made in China.
Financial management and insurance companies also have little or no value added: there is no production in printing stocks, bonds and insurance policies, which depend on the value of goods produced somewhere else.
We do still produce some computers, software, entertainment, cheap wheat and corn, scrap metal and other raw materials. There are industries like airframe manufacturing, cars and ship-building. That's about all we still make, and one reason Mickey Mouse replaced International Harvester in the Dow 30 Industrials.
All our manufacturing is gone, gone to foreign shops that don't need to pay a living wage -- often, don't have to pay any wage AT ALL. Back to the 16 hour day, in terms of the labor that went into making the products we use.
Even the few things we make are pretty wasteful or stupid.
Boeing's big value is to build airships that carry people who don't do anything productive, and it takes imported oil to run the airlines. Cars are a waste, because no car does a single thing toward building anything. And, it takes oil that gets paid for with borrowed money and then burned, we live in the pollution. Ship-building is mostly gone, aside from military shipyards: hardly any ships are registered to U.S. any more, the operators have fled to avoid humane labor laws and to avoid paying taxes on imports paid for with borrowed money.
We do have entertainment venues, where we host rich tourists who sneer and gambol through the land, and we do send fantasy movies overseas for the delectation of the better-heeled.
Raw material export is a loser; obviously, to buy fewer manufactured goods, you have to sell a lot more raw materials like Iron ore, Aluminum, Copper, scrap steel, Nickel, cardboard, paper, plastic, etc. The foreign shops make goods out of the raw materials, which are relatively much more expensive when they sell them back to us. Once, the U.S. used to have this advantage, back when we were a productive manufacturing country that imported raw materials and exported the world's best machinery and manufactured goods.
In exchange for the flood of cheap goods made by foreign slave labor, we get lower prices. For each industry "broken" by cheaper foreign imports, perhaps the pain is countered by the pleasure of the many, and perhaps, if it's just a few industries that are destroyed, those displaced workers could find new jobs elsewhere.
But Ricardo's puerile "calculus of pleasure and pain" fails if all the industries are destroyed, from the garment factories of South Carolina to the steel plants of the midwest, from autos, refrigerators, electronics, shoes, plastics, all the way to gypsum wallboard and trains.
We are finding out the reality: the lower prices on imported goods means lower wages.
Averaging out a good U.S. wage of $30/hour ($60,000 per year, about what it takes to live at our former "first world" standard) with 30 cents per hour (the third-world standard) requires, in the end, that we eliminate the minimum wage.
Moreover, the lack of wealth produced by our now valueless workers is not sufficient to provide for a decent old age. You need about four active workers to provide for one retiree; that's a contribution of perhaps 10% for the lower retiree benefit. But if the active workers are only making $4/hour, or less, the retirees just cannot receive the kind of benefits that they are receiving now.
