Here are some observations from a retired Texan living in Switzerland, a land of free enterprise, and many small … and some large … manufacturers that export over half of what they make. This is a country with really solid primary and secondary schools that graduate literate young citizens; trade schools for the 80% and universities for the 20%; and a land where if you’re here illegally and you are not a true and registered refugee, you will be caught and unceremoniously deported. (Switzerland’s unfortunate decision to be coerced into the Schengen Agreement has led to complications with migrants first passing through EU countries.)
When a country like the United States signs trade deals such that most of its manufacturing is lost on the altar of “Free Trade” (i.e., that which was employing millions of skilled citizens making average incomes, and such that the R&D that heretofore went into improving the products from those now non-existent plants also was replaced), then you have what you have throughout the Midwest and Southeastern United States: many shutdown factories and towns with crumbling infrastructures; and, stagnant numbers of young American technical graduates.
The illegal immigration, especially in those areas, only made life worse for these middle-income people. (In Aiken County, SC, we had 5,000 illegals among a population of about 60,000!) Note also that today’s opioids crisis is deeply embedded in areas that have lost their manufacturing employment bases (see The Numbers Behind the Opioid Crisis of November 2017 prepared by the Senate Joint Economic Committee). What you see in this report is far beyond sad. We saw all of this and more when we lived in Aiken, SC, during the cooler months from 2001 to 2012, traveling extensively throughout the Carolinas, Tennessee, Kentucky, and West Virginia. Income inequality? You bet. And in my judgment, obviously the principal result of poor public policy.
Take a look at line 8 of the Bureau of Labor Statistics Table A-1 Employment Status of the Civilian Population by Sex and Age. There are 95 million people between 18 and 65 years old “not in labor force.” Although up to half of these people are permanently disabled and students, the US nevertheless has a grotesque number of now permanently unemployable people because their federal elected representatives of both parties did not care a damn about them over about five decades. These representatives drank the Kool-aid of “Free Trade” rather than that of “Fair Trade.” So, along comes a New York City real estate guy who says, “You’ve been screwed and I want to make America great again.” And he wins. He wins for very solid reasons.
An opinion: an American needs to live outside of the USA for a while to fully appreciate how badly the American people have been misled by their ever-expanding and ever more corrupt federal government whose executive bureaucracies (i.e., those supposedly under Art. II of the Constitution) began producing wholesale undemocratic “expert” decisions thereby subjecting The People to regulations far beyond the statutes actually passed by their elected representatives.
Let me say this to any observant person in the US: Go to Texas, as I did this past January and February, and witness what is going on in what we call “The Oil Patch.” Drive past the fabrication yards making drilling rigs, offshore platforms, large valves, pressure vessels, and all that goes into getting you transportation fuel so that you can drive. Texas is booming and reaching out to get more people to come. Income inequality? Yes, there is some. But at 2.4% unemployment in West Texas and less than 4% now in Houston, not much.
I say this: There are not many problems in the US that cannot be solved by enough jobs. Local, state, and federal governments can and should coordinate, but they also have to get the hell out of the way. And we all have to demand fair and reciprocal trade deals.