The Demographic Underpinnings of Having to Choose American-made or Low Prices

The loss of American jobs to workers in developing countries has been a major theme in this year's Presidential campaign. It is high on the agenda of both Donald Trump and Bernie Sanders. Why did those jobs go offshore? The easy answer is that rich business owners saw workers willing to work for less money and so the jobs went to them. But where did those workers come from? The answer is, of course, that in the aftermath of WWII the rich countries spread newly discovered methods of death control all over the world, which helped to lower infant and child death rates in a short time. Since birth rates did not immediately decline in step with the drop in mortality we had a population explosion. Of course, it took a bit of time for those newly surviving children to grow to maturity and become a viable labor market. It also required that the developing countries have invested in education sufficiently to create a pool of readily trained laborers. Enter countries such as Mexico, China, both of which have been excoriated by Donald Trump for having stolen US jobs. 

Unfortunately, the demographic timing was very bad for American labor, because these "offshore" labor pools were coming into place just as labor unions in the US were consolidating their gains for American workers, increasing pay and benefits. Naturally, higher pay and benefits for workers are passed along to consumers. In the absence of competition, consumers pay the price and don't give it another thought. But when the same goods are manufactured elsewhere by people with low wages and few or no benefits, the prices are lower and people pay attention.

This came to the fore yesterday in the results of a nationwide poll in which it was found that a majority of Americans prefer low prices to buying products just because they were made in the USA. CBS News reports the story:

Nearly three in four say they would like to buy goods manufactured inside the United States, but those items are often too costly or difficult to find, according to the survey released Thursday. A mere 9 percent say they only buy American.

Asked about a real world example of choosing between $50 pants made in another country or an $85 pair made in the United States - one retailer sells two such pairs made with the same fabric and design - 67 percent say they'd buy the cheaper pair. Only 30 percent would pony up for the more expensive American-made one. People in higher earning households earning more than $100,000 a year are no less likely than lower-income Americans to say they'd go for the lower price.

Keep in mind that workers in the USA were routinely exploited in the US prior to the formation of labor unions and the passage of various forms of protective legislation. Think, for example, of the passage of laws requiring that children attend school in this country, which helped to end the exploitation of child labor. We have to encourage the rest of the world to stop exploiting people as well, but we also have to recognize that as this happens the prices will rise again. There's no such thing as a free lunch (TNSTAAFL is the acronym for this famous phrase). We live in the time of demographic (and many other) transitions and we have to understand that fact. The past was a foreign place and so is the future.

The World's Stateless Population--New Map from HIU at State Dept.

The Humanitarian Information Unit at the US State Department has done it again--putting together a map that synthesizes a lot of information that most of us knew nothing about. This time it is about the estimated 10-15 million stateless people in the world (about as many people as live in the Los Angeles metropolitan area). These are people who are not recognized as being the citizen of any specific country. Pretty scary in a world of nation-states. The map is copied below, and some of the stats are tough to swallow:

* A new stateless child is born every 10 minutes
* Syria's nationality law does not allow women to confer citizenship on their children (what???)

More Migration Messiness in Europe

Migrants are coming into Europe, are being deported from Europe, and are now thinking about returning to the old dangerous routes from Libya to Italy. But that's not all that is going on in Europe. The historic pattern of East to West migration within Europe continues, as the Eurozone crisis continues to push migrants to the UK. As the BBC notes, some of this is economic and some of it is demographic (and the two, of course, go together). The story comes from a new report by the Migration Observatory team at the University of Oxford.

Over the past five years the number of EU nationals living in the UK has gone up by almost 700,000 to 3.3 million.

The report said 49% of the 700,000 were from Poland and Romania, but Spain, Italy and Portugal accounted for 24%. 

 Another long-term factor that could influence the rate of migration to the UK is the birth rate in Europe.

The population of 20 to 34-year-olds in the six top nations has fallen by more than six million - or 15% since 2006.

If those fall continue, it could lead to a corresponding decline in the number of workers willing to travel to the UK as demand for them at home, and wages, increase.

Of course, the latter issue may well be altered by the continued immigration from the Middle East and North Africa. Hang on, it's going to be a rough ride.

Battling the Zika Virus Is More Important Than Partisan Politics

No matter how much progress we humans make in preventing disease and keeping ourselves alive longer, nature seems always to be inventing new threats. Ebola has quieted down--for now--but the Zika virus is alive and spreading, as U.S. officials warned us yesterday, hoping to put pressure on Congress to appropriate more money to stop the spread of the disease.

"Everything we look at with this virus seems to be a bit scarier than we initially thought," said Dr. Anne Schuchat, a deputy director at the U.S. Centers for Disease Control and Prevention.

Schuchat said Aedes aegypti, the mosquito species that primarily transmits the virus, is present in about 30 states, rather than 12 as previously thought. In the U.S. territory Puerto Rico, there may be hundreds of thousands of Zika infections and perhaps hundreds of affected babies, she added.

The World Health Organization has said there is a strong scientific consensus that Zika can cause microcephaly, a condition in which babies are born with small heads that can result in developmental problems, as well as Guillain-Barre syndrome, a rare neurological disorder that can result in paralysis, though proof may take months or years.
Brazil said last week it has confirmed more than 1,046 cases of microcephaly, and considers most to be related to Zika infections in the mothers.

It is very unfortunate that Congress has somehow decided that partisan politics are more important than public health.  

If Your Are Poor in the US, Your Life Depends on Where You Live

It is well-known that death rates vary geographically within the United States, with the usual explanation focusing on higher death rates among African-Americans, especially in southern states. Since those also tend to be among the poorer states, there is an obvious geographic association between mortality and where you live. But a group of researchers from Stanford and Harvard have just published a paper in the Journal of the American Medical Association that controls for race and ethnicity and comes up with the fascinating conclusion that "The Rich Live Longer Everywhere. For the Poor, Geography Matters." Now, to be fair, that headline is from the Upshot at the NYTimes. The journal article is more sedately titled "The Association Between Income and Life Expectancy in the United States, 2001-2014."

For poor Americans, the place they call home can be a matter of life or death. The poor in some cities — big ones like New York and Los Angeles, and also quite a few smaller ones like Birmingham, Ala. — live nearly as long as their middle-class neighbors or have seen rising life expectancy in the 21st century. But in some other parts of the country, adults with the lowest incomes die on average as young as people in much poorer nations like Rwanda, and their life spans are getting shorter.

One conclusion from this work, published on Monday in The Journal of the American Medical Association, is that the gap in life spans between rich and poor widened from 2001 to 2014. The top 1 percent in income among American men live 15 years longer than the poorest 1 percent; for women, the gap is 10 years. These rich Americans have gained three years of longevity just in this century. They live longer almost without regard to where they live. Poor Americans had very little gain as a whole, with big differences among different places.

As the article notes, these results are in line with the highly publicized findings of Deaton and Case regarding the increasing mortality among less well-educated whites in the U.S.  Indeed, one of the lead authors on this research--David Cutler of Harvard--has published health research with Angus Deaton in the past. 

Life expectancy for the poor is lowest in a large swath that cuts through the middle of the country, and it appears in pockets in the rest of the country, in places like Nevada. David M. Cutler, a Harvard economist and an author of the paper, calls it the “drug overdose belt,” because the area matches in part a map of where the nation’s opioid epidemic is concentrated.

The new findings dovetail with a much-discussed paper by Anne Case and Angus Deaton published last year. That research showed rising death rates among middle-age white Americans, especially those with low education. It also showed a sharp increase in drug and alcohol poisonings, suicides and accidents in the first years of this century. Research from the Brookings Institution published in February also found a growing gap in life span between the rich and the poor.

The map below illustrates this swath of low life expectancy among the poor in the U.S. Go here for the interactive map to check the data for your area.