nationalism v. neoliberalism, co-ops v. neoliberalism

Prof. Wolff, The president suggests that he will impose tariffs on companies that ship their jobs overseas as a method to preserve jobs in the US. I presume if this works, the jobs will be saved but the price of product will go up, thus necessitating higher wages (my guess highly unlikely). To my understanding the alternative is, within a capitalist system, to continue on the neoliberal path to globalization maintaining the status quo of outsourcing jobs overseas. Playing devils advocate, let's say these tariffs are indeed implemented, jobs saved and wages increased...could nationalist type economics be a better alternative to neoliberal economics?

I am in favor for a democratized workplace and fully support co-ops. I am conflicted however in understanding how a co-operative system would deal with capitalist foreign enterprises making cheaper products. Would the co-operative economy be forced to impose tariffs and other protections or are there alternative methods that can make co-operatives successful in dealing with cheaper goods and services abroad?

Official response from submitted

The historical record is clear, if perhaps not what you might have expected. Sometimes neoliberal policies happen together wit rising wages and sometimes with falling wages; sometimes protectionist policies occur together with lower unemployment and sometimes with higher unemployment. In other words, it is simply wrong to debate neoliberalism vs economic nationalism as if one or the other is better for wages, jobs or anything else. No one to one correlation like that exists now (or ever has). Bill Clinton said NAFTA would be a boon for US workers; it wasn't. Trump says ending NAFTA and levying tariffs will be a boon to workers: no reason to believe that either. Free- trade vs protection is a struggle between groups of capitalists who think one or the other will be better for their profits. Workers/employees have no skin in that struggle; they will be fleeced by employers in either case because that is how capitalism works. If tariffs make US producers produce in the US, not Mexico, their labor costs will rise and so will the incentive to replace higher cost workers with machines and robots, thereby worsening workers' positions. The problem for working people is capitalism not this or that kind of capitalism (neoliberal or protectionist).

A worker-coop based economy would evaluate international trade differently because its "bottom line" (i.e. top priority) would not be profits. If imports are cheaper than producing it yourself, then workers would gain more free time and thus welcome cheaper imports etc. Its a different system and thus has altogether different attitudes toward and responses to international trade conditions.

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  • Bobbi Wings
    commented 2017-01-31 00:09:43 -0500
    I would like to respond as well with my opinion because I see this very often. That is Capitalism being constantly painted with the most optimistic scenarios (jobs saved and wages increased, etc.) while most of Capitalism’s failures being suggested as reasons why cooperatives will not work.

    As already mentioned, Capitalist enterprises are under much greater duress from capitalist foreign enterprises making cheaper products than cooperatives. Because profit is not the main driving factor, and because the workers are themselves invested in the enterprise, the enterprise has a much better chance of surviving adversity. Generally speaking a cooperative also has more potential, and more incentive, to come up with creative ideas to manage such adversity.

    @kevin G please dont take this as an attack because I enjoyed your question and the conversation. Also I must acknowledge that you did mention the best scenario being highly unlikely. So again please dont take the above as personal. Its just something to consider maybe.
  • Richard Wolff
    responded with submitted 2017-01-30 15:34:47 -0500
  • Kevin Gopaul
    published this page in Ask Prof. Wolff 2017-01-30 13:38:49 -0500