The argument is extremely simplistic. Labor wages are lower in Mexico than in the USA, manufacturing jobs are moved from the USA to Mexico by the big corporations in order to increase their profits, American workers are laid off when the US plants shut down, and thus Mexicans are stealing jobs away from American workers. The solution: change the laws and change the tax codes in order to make it unprofitable for US corporations to move their manufacturing plants from the USA to Mexico, and thus no jobs will be lost in the USA. That is the deal Donald Trump is offering in order to gain the support and votes from those who belong to the working class who have lost jobs because of plants shutting down in the USA in order to move to Mexico to maximize profits.
The problem with the simple explanation and simple solution given by Donald Trump is that the situation is far more complex than he portrays. Perhaps he hides the truth deliberately, on purpose, or perhaps he is just simply plain ignorant because he flunked his basic introductory economics courses at his own Trump University.
For starters, it is a fact of life that Americans are not the only ones who buy brand new cars and use them on the roads. Many Mexicans also buy brand new cars and use them on the Mexican roads. As a matter of fact, so many Mexicans buy brand new cars, that a lot of the production of car manufacturers in Mexico goes to satisfy the demands of Mexicans living in Mexico, not Americans living in the USA. Ford has manufacturing plants in Mexico building cars which are sold on the Mexican market. But not only Ford has a presence in Mexico, so do other non-US manufacturers such as KIA, Nissan and Volkswagen. They also build cars that are sold in the Mexican market, against whom US companies such as Ford need to compete, and the competition is tough.
Donald Trump, as president of the USA, can very well implement a program to force companies such as Ford to pull out of Mexico altogether and move those manufacturing jobs to the USA. The problem is that, with higher wages in US soil, the price of a car manufactured by Ford and geared towards the Mexican market would be considerably higher than the current price, Ford would be unable to compete in Mexico against other companies such as the German Volkswagen and the Japanese Nissan and the South Korean KIA. Indeed, Ford would be priced out of the Mexican market, and the other competitors who are building cars and trucks in Mexico to be sold in Mexico would have no objection to Ford Mexico pulling out or declaring itself in bankruptcy, it would be very welcome news for them if Ford Mexico folds and is forced to close its operations completely. Make no mistake, those manufacturing jobs would not be going to the USA, those jobs would be simply lost for good. But that's not the end of the story. It just so happens that in order to manufacture cars and trucks in Mexico to be sold in the Mexican market, a good deal of parts and accessories manufactured in the USA have to be imported in order to build the finished product. Those parts and accessories manufactured in the USA translate into jobs for American workers, and if Ford and other US companies have to fold in Mexico, those USA jobs will be lost for good. So, rather than create jobs in the USA, the Trump proposal is almost certain to backfire, and many jobs in the USA will be lost for good, and we are not talking of just a few dozen jobs, we are talking about thousands upon thousands of jobs.
But there is even more to it than meets the eye.
It just so happens that a lot of US manufacturing jobs are being lost because of automation, because of robotics. These manufacturing plants are not being moved outside of the USA, they wholly remain inside the USA, except that instead of using human workers they use robots who can work round-the-clock without even taking a coffee break, who demand no compensations or fringe benefits nor paid vacations nor medical plans, and who do not become unionized. They don’t eat, they don’t sleep, they don’t need any toilets, they don’t need any cafeterias, they don’t need any parking spaces. Indeed, robots are the ideal slaves. Here is a small sample of a car being built entirely by robots, and there is not a single human operator in sight:
In order to create jobs for real people, Donald Trump would also have to pass laws and change the tax codes, forbidding American companies to use manufacturing robots. But this would result in a cost increase that would price American cars out of the world market. And inside the USA, if Americans are forced to buy American cars and trucks built not by robots but by real people, it is estimated that there would be a price increase hovering around 40 per cent. To put it plainly, America would have to brace itself for a massive spike in inflation, resembling inflation crisis such as those that have tormented in the past some third world countries. Living in the USA would become extremely expensive bringing together a quantifiable decrease in the standard of living, to such an extent that moving to the USA would become unattractive for many would-be undocumented workers, which by the way would fulfill the Trump promise of shutting down the borders to illegal immigration, although for all the wrong reasons.
The negative impact of automation upon manufacturing jobs is something that was foreseen a long time ago. Some people much more intelligent than Donald Trump had the vision and wisdom to see it coming. One of them was Rod Serling, creator of the TV series The Twilight Zone. In a specially significant episode entitled The Brain Center at Whipple’s, a profit-hungry entrepreneur pretty much like Donald Trump himself, owner of a big manufacturing corporation, decides to upgrade his plant to increase output by purchasing and installing a series of robots named “X109B14 modified transistorized totally automated machine”. As expected, this leads to huge layoffs, unrelated to the moving of any of the plants owned by WallaceV. Whipple from the USA to Mexico. As a matter of fact, Whipple does not move a single plant from the USA to Mexico, all his plants remain in the USA, although fully automated with an army of X109B14 automated machines. After losing their jobs to the robots, some former employees try to convince Whipple that the value of a man outweighs the value of a machine, but their protests fall on the deaf ears of Mister Whipple who only has eyes for the profit dividends. Eventually, the board of directors find him neurotically obsessed with machines and decides to retire him. Whipple joins his former plant manager (whom Whipple had replaced with a machine) at the bar opposite his factory and expresses deep sorrow at his misfortune (“It isn’t fair, Hanley! It isn’t fair the way they...diminish us”). A robot named Robby now runs his office, the same robot whose photo is at the top of this article.
So, why should we Mexicans take the Trump blame upon us for the loss of jobs in America, considering the big automation craze in the USA that has translated in the layoffs of tens of thousands of American workers?
Strictly speaking, even if it is true that robots take away manufacturing jobs from real people, the situation is not as bleak for the American worker as it seems. Programming these robots requires real people. Maintaining these robots and keeping them in top performance requires skilled technicians. The layout of production lines employing robots requires industrial engineers who are crafty in robotics and who are up to the job. Contrary to what some might say, robots are poised to become the biggest job creators in world history. But these jobs will require brains, these jobs will not be for the unskilled workers. Outside the USA, countries such as Japan and Mexico are investing heavily in education regarding the curricula in their universities about robotics. Competing against workers who are competent in digital logic electronics, industrial software development and automation is not for the faint of heart. Instead of shooting up drugs and wasting time at rock concerts, American kids should be started off as early as possible on the market demands of a new millennium. If jobs are lost in the USA because the American youth as a whole is unfit to learn and adapt to the Third Wave predicted by Alvin Toffler, the Japanese will not be to blame, neither will the Germans nor the Mexicans nor the South Koreans. Americans can either whine and complain about it, just as Trump is teaching many of his dazzled followers to do, or can roll up their sleeves and get their hands dirty while they keep their science and technology books close at hand. There is no royal road to learning, and there are no easy alternatives such as the ones Trump suggests.
It is a matter of historical interest that, way back even before the XX century when the episode “The Brain Center at Whipple’s” was being broadcast to black and white TV sets, in Old England there were workers who were already extremely worried about the jobs they were losing in England in the wake of the Industrial Revolution. Those laid-off workers were known as the Luddites, misguided by ultraconservatives such as Trump who opposed change. They did their best to keep the Industrial Revolution from depriving them of their jobs. And as history shows us, they lost their bid. Nowadays, England is more threatened by its pullout from the European Economic Community thanks to the Brexit than to industrial automation itself.
Shouldn’t a man who aspires to become the next president of the USA know about all these things? Well, in 2016, not really. Nowadays, from the looks of it, in order to run for the US presidency it only takes a rabble-rouser buffoon with a foul mouth who can compensate his ignorance by cleverly striking the chords of anger of those middle-class workers in America who have lost their manufacturing jobs, putting the blame entirely upon NAFTA even though the forces at play that have been described above have nothing to do with NAFTA. Those are things that were bound to happen due to human progress and ingenuity in the development of new science and technologies, something in which, this should be said, the USA has played a major role.
And, by the way Mister Trump, just as Mister Wallace V. Whipple, you may very well be next in line to be replaced by an Internet based brain of casinos which no longer needs a manager such as you to run them. If such a thing ever happens, you could very well end up at a bar inside one of you hotels expressing deep sorrow at your misfortune of no longer being needed to run things on the gambling business, wailing something like “It isn’t fair, Pedro! It isn’t fair the way they... take our jobs away from us”). And you will be talking not about Mexicans, but about robots.
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