Thursday, March 15, 2007

Like Frogs Trapped in a Coconut Shell

So how does one sell freedom of movement?

Freedom of movement would, in my opinion decimate much of the poverty in the world. However free movement would also slash western living standards in the short term as the poor compete with westerners for jobs. Despite their rhetoric, western governments therefore have little or no incentive to open up their job markets and really help the needy.

Tossing this conundrum back and forth in my head, led to a rather dangerous idea (coincidentally a few days later I read this illuminating article).

Could Western governments open up particular industries to foreigners, while ensuring that new influxes wouldn't adversely affect the indiginous workforce?

For example, Ireland has little or no textile industry, it evaporated years ago due to expensive labour costs in comparison to the Far East. Ireland could import Indonesian or Chinese workers to help resuscitate the Irish textile industry.

The "imported" workers would receive much higher wages and working conditions than they could ever dream of at home (but still a fraction of Irish wages). Ireland would have a new textile industry which would employ locals in IT, finance, management etc. The Irish government would pick up 12.5% tax on all profits made (China's tax rate is 25%).

Overnight a re-emergent Irish textile industry could then compete somewhat with the Far East. Supply lines to markets in Europe would be much shorter, meaning quicker turnaround times and lower transportation costs. There'd be fewer communication and cultural barriers and most importantly /rock/ /solid/ legal certainty for investors.

There are many other advantages and possible beneficial side effects of such a partial freeing of movement.

I can't see any downsides (although am sure there are some). Can anyone point out major holes in the idea?

1 comment:

Denica said...

social costs. racism. protests. inequalities. smaller slice of the cake for irish.

australia tried this before as a response for its ageing population back in the 90s. undeniable critics and protests deprived them from implementing it further, and they had to close their door for immigrants until now.