If you’re feeling adventurous, you can now hop on a train in Yiwu, on China’s Pacific coast, and arrive in London 15 days later, after passing through Kazakhstan, Moscow, continental Europe and the Chunnel.
You’ll need to be very adventurous, because you’ll have to find an open freight car or ride the rails, hobo style. It’s a freight train.
Last year, 1,702 trains made this trip, more than double the 2015 number. The service is a lot faster than ocean freight, though somewhat more costly, but far cheaper than air freight and much more environmentally friendly.
Globalization. It’s here to stay.
China is not going be sending trains here anytime soon, but if this venture is any indication, neither is it going to abandon its aggressive manufacturing and export policies. Campaign promises to return American jobs are going to be very tough to keep.
It started with Trump’s simplistic explanation and solution for manufacturing job losses, and, because his message was gaining traction, Hillary’s adoption of essentially the same rhetoric. She even reversed course on her support of the Trans Pacific Partnership, which she originally supported as “the gold standard.” Politics does indeed make strange (metaphorical) bedfellows.
Trade and related tariffs are hugely important subjects, not just limited to our election, but key to the global economy. You need look no further than North Carolina to understand how foreign imports have decimated the furniture and textile industries, to say nothing of the heavy manufacturing of the upper Midwest.
But it’s not that simple. First, the American consumer likes cheap stuff. Trade makes possible inexpensive Chinese furniture, inferior though it may be, textiles from Indonesia, television sets and all manner of electronic gadgetry from Asia and Mexico. You have to search conscientiously for American-made consumer goods.
Then there are exports. We export lot of stuff. Boeing is our biggest single exporter, along with heavy machinery, food, and raw materials. If we begin slapping tariffs on imports, what do you suppose our foreign customers will do? A trade war only raises prices for everyone as governments collect tariffs.
The politicians make it all about jobs, and certainly moving manufacturing offshore has eliminated a lot of jobs, most of which will never return. They have been replaced with fewer, very different jobs, requiring different skills and more education. The tech surge in Durham and the Research Triangle offers evidence of this change. This does little good for the middle-aged, laid-off factory worker, which is the constituency driving the current trade message.
Manufacturing jobs are being replaced by robots all over the world, and bringing back manufacturing would not bring back anything like the number of jobs lost. Booming tech companies produce far greater sales and profits with fewer employees than did their industrial predecessors.
The developed world, at least, seems to be heading to a place where there are simply more people than jobs as presently configured. How can we deal with this?
Solutions so far include welfare, retraining, homelessness and simply not counting the millions who have given up looking for work. These are costly and often unproductive solutions.
There is a radical alternative — one which we may begin to see as life becomes more automated and leisure time, wanted or not, piles up.
Suppose the normal work week were 30 hours, or even 20. It would require more people to accomplish the same work. The catch is that pay would have to remain constant so that people could maintain their standards of living.
This is not a crazy idea; it was predicted by John Maynard Keynes in the 1930s. The same thing happened during the industrial revolution as work weeks shrank from 60-70 hours to the now-standard 40 and standards of living actually improved, the result of a huge improvement in productivity.
If man’s historical imperative has been to work less and play more, we in the industrialized world have come a long way toward realizing it. The problem is, we have to be able to afford the play component, including retirement. That is going to be the challenge going forward.