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Comment by projectramo | Hacker News Reader

There have been many studies on this.

Conservatives usually use the phrase "at best, the impact is nil"

Liberals usually use the phrase "at worst, the impact is nil"

Because the study shows there is negligible impact. Every laborer is also a spender. If the person saves, then every laborer is also an investor.

If you believe in the mainstream economic theory, more jobs are produced for the ones that are "taken."

You might ask where are those jobs, and then people will say they are in new fields and require training etc.

The debate goes on: why aren't tech jobs in short supply? A: They are. Q: I don't see that, where? A: there isn't one "tech", there are many different fields and they are in short supply in the important ones etc.

It is not as straightforward as you make it out to be.

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Every job taken from Americans is another American taking from the system. Taking tax money. So its not as easy as you would think either.

Oh, that is true.

The unhired foreigner would not end up taking taxes.

I wonder how the math works.

If the company has to pay the extra tax hit when laying off the American, that might let the company decide if it is worth it.

> Because the study shows there is negligible impact. Every laborer is also a spender. If the person saves, then every laborer is also an investor. See the sweatshops, guess they are just "another spender": http://www.dailymail.co.uk/news/article-2103798/Revealed-Ins...

I said immigration may not cost jobs.

And you responded with poverty is bad.

If that was a response to what I said, I don't see how.

Your point was that the impact of using non-American labor was essentially nil in every study ever done. My point was that replacing a $25 / hr union factory worker who has healthcare and PTO, with a $2/hr factory worker in a "suicide sweatshop" is not nil. You said that in general, the replacement workers are just economic spenders too, and I provided a counter example (don't seem like these Chinese workers are likely to buy $800 iphones anytime soon).

Okay, I now see what you are saying. So let's take apart those two points.

You might be asking how could replacing a $25 worker with a $2 worker -- foreign, domestic, etc doesn't matter -- have no economic impact on jobs and wages?

So one might argue the following: The company paying the $25 to the first worker, now has $23 in profit/savings. What happens to that money?

They might reinvest it, they might pay it out as dividends, or they might use it for an acquisition, or they might reduce the cost of the good sold (passing it to the consumer). And so on.

Whatever they choose to do will end up creating more jobs and boosting wages in something else.

Now, you might say -- and I won't disagree -- that if they pay them out as dividends then the kinds of jobs they will produce is ship building for yachts, and massages for rich people and perhaps you don't agree with that kind of redistribution.

That may be, but purely from an economic perspective the net impact of jobs and wages has not been significant.

"from an economic perspective the net impact of jobs and wages has not been significant."

I suppose you mean "from a global financial economic perspective". And you are right, of course: income equals expenditure.

From a economic local perspective, you have now a worker that before won 25$ and now doesn't. He is pissed off, and it's going to vote somebody that looks angry too.

You have 23$ in profit that will go (with a short stop in Ireland first) to buy an empty condo-mine in London or will be invested in places with 2$ waves in order to repeat the operation.

But, yes, the USA commercial deficit is totally the fault of the Chinese.

No, I did not mean from a "global" perspective.

Most of that money is likely to be re-invested or spent in the United States.

You make a whole host of claims in your 4th sentence about the London condo mines etc. which I don't understand.

Just to be clear: the price of commodities don't get magically untaxed by Ireland. The transfer pricing only applies in cases where the value-add is not objective such as IP.

If the $23 were re-invested it would increase jobs and increase wages too.

> Whatever they choose to do will end up creating more jobs and boosting wages in something else.

not if they stash it in an offshore tax-haven in the Cayman Islands.

If Walmart replaces it's american made bikes with chinese bikes, and saves every family in america that shops there $10 on their bike purchases, that savings gets spent elsewhere in america.

The dollars that go to china get either spent or reinvested here. And Chinese purchases of iPhones has exploded over the last few years.

> Every laborer is also a spender. If the person saves, then every laborer is also an investor.

What about laborers who send most of their earnings back to family in their home country?

How will a laborers family spend US Dollars in a foreign country? Hint: the money always gets spent back in the US by someone.

Good point. I am not sure how that would work. (Any economists reading HN?)

There are two things to be said from the studies:

1. So far that doesn't seem to be significant, although I don't know if, in theory, it could get worse.

2. I wonder if that country consumes a lot of US goods, it might still end up netting a positive. (Not sure about this).

"The impact is nil" is impressive distillation of each side's philosophical endpoints :)

But, since we are talking about political ends, the words 'should be' probably belongs after 'impact'.

Do you have a link for the studies?

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