Indeed, we'd be much better off if our plastic keychains were Made In America and cost $10 apiece. Actually, maybe if there were not such high minimum wage regulations, our non-working poor could actually build such things here. Hmm...
You're only looking at the front end costs and completely ignoring the back-end costs.
How is it that the United States manged to survive in the 40's, 50's, 60's, and 70's before foreign outsourcing? (Amazingly, people were able to own a home and raise a family on a single income back then.)
What good is a 25% price decrease as a result of having goods and services produced in China if people's wages and benefits decrease by 30%? If the net effect is decreased purchasing power and a decreased standard of living then what good is the foreign outsourcing?
Do you think that Americans can consume more wealth than what they produce and that by having China produce the wealth that we can magically consume more wealth than we produce?
What we are actually doing is impoverishing ourselves by trading hard assets--land, real estate, and business ownership--for short-term ephemeral goods and services. (Do a Google search for Warren Buffet's essay, Squanderville.) Do you think China is sending all of that stuff to us for free?
Sure, the prices of goods and services might decrease on the front end--but at what cost? What about the invisible back-end costs?
Are the front-end price savings greater than the invisible back-end costs such as increased unemployment and underemployment, increased poverty, increased criminal justice costs, increased social costs, and increased government welfare costs? The money people might save on widgets will be lost when they have to pay higher taxes (to cover those back-end costs) or when they lose their jobs themselves.
If anyone benefits it will be the wealthy class that can now keep a larger portion of a worker's contribution to the act of wealth production as profit. If anything, Global Labor Arbitrage is ultimately a transfer of wealth from the lower classes to the wealthy. In the meantime the American standard of living will sink to third world levels as a result of supply-and-demand and the merging of the U.S. economy and labor market with third world economies and labor markets.
I guess it's easy to tout the values of foreign outsourcing, H-1B and L-1 visas, and mass immigration until someone offers to do your job for 1/4 of your wage.
First they came for the manufacturing and construction jobs, but I was not a blue collar laborer. Then they came for the computer programmer jobs, but I was not a computer programmer. Then they came for the engineering jobs, but I was not an engineer. Then they came for the accounting and financial analyst jobs, but I was not an account nor a financial analyst. Then they came for the science jobs, but I was not a scientist. When the supply of and demand for labor finally caught up with my job, there was no one left to speak for me, there was only third world poverty.
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