North Texas Daily

The weakness of the free market

The weakness of the free market

October 06
21:40 2009

F09-MUG-JamieKhooAnderson arrives in New Jersey with his wife and a 9-month-old daughter only to discover his tech job offer is not going to last him more than four months.

It is merely another assignment given to him by a consulting firm that also promised him proper immigration documents and travel compensation.

He soon discovers the promise of travel compensation and sponsored-immigration documents is hocus-pocus. To top it off, instead of being paid between assignments, Anderson is required to live off his savings during times when he does not have an assignment.

If the time period between assignments stretches for too long, Anderson is forced to take on temporary odd jobs.

Of course his stated immigration document does not allow him to work for other companies, so he runs his paycheck through the consulting firm. The firm accepts the check, takes a cut and runs it through their system to make it “legal.”

This short story is not an extract from our county’s history of immigrant workers. It is a story told by millions of immigrant tech workers today.

The business world has a new term for such a phenomenon. They call it “high-tech sweatshops.”

These cheated immigrants cannot go anywhere. After investing their life savings to get here and get a place to live and a car, there is really nothing left in the bank to take them home.

They are forced to sit out their situation and take whatever their firm offers them. In essence, these individuals are as good as captive slaves.

But should we be surprised?

This was the case of clothiers off-shoring their manufacturing work to other countries with lax labor laws and lower wages. The exposés written by investigating journalists drew shaking heads and these companies were eventually forced to improve the working conditions overseas.

After all the drama, one thing remains for certain: These jobs are never coming back to our shores.

What is happening here is not “aliens” stealing Americans’ jobs. It is Adam Smith’s invisible hand at work. The principle is simple — with so much red tape and a rising minimum wage, it makes more sense (and money) to ship off these jobs to those who are willing to work for much less.

And the disturbing fact is that we like that, don’t we? We like getting cheaper goods from listed American companies whose balance sheets still stay healthy thanks to lowered costs.

The ugly truth is that someone has to pay the price for lowered costs.

Be it the enslaved tech workers, the underpaid factory workers in China or the uninsured workers in Vietnam, someone has to pay the price for America’s mass consumption and constant demand for lower prices.

At present, the system reveals a disturbing fact: It is now our turn to pay the price.

With the loss of such jobs, we are forced to attain higher education with hopes of joining America’s service industry. But there are only so many positions available in the service industry.

The result is a rising unemployment rate. However, we cannot blame anyone.

We cannot blame the factory workers for taking jobs we do not want. We cannot blame U.S. companies for cashing in on such methods, since we, the shareholders and customers, love it. And we certainly cannot blame our government for not taking action in giving us jobs.

This issue is systematic. It is the inherent weakness in a free market economy.

Jamie Chin Han Khoo is a psychology senior. He can be reached at jch.khoo@yahoo.com.

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