And to Its Fabled Economy

Goodbye to the City on the Hill

By PAUL CRAIG ROBERTS
Counterpunch
June 25, 2007

"We shall be as a city upon a hill. The eyes of all people are upon us." -- John Winthrop

America is being destroyed. Many Americans are unaware, others are indifferent, and some intend it.

The destruction is across the board: the political and constitutional system, the economy, social institutions including the family itself, citizenship, and the character and morality of the American people.

Those who rely on the Internet for information are aware that the Bush regime has successfully assaulted the separation of powers and civil liberty. Both Bush and Cheney claim that they are not bound by laws that impinge on their freedom of action or that interfere with their ideas of the power of their offices. Bush has issued presidential directives that permit him to make himself a dictator by declaring a national emergency. Cheney asserts that his handling of secret documents is not subject to oversight or investigation or bound by a presidential order governing the protection of classified information.

The foundation of social organization--marriage, family, and parental control over children--is disintegrating.

Mass unassimilated and illegal immigration has destroyed the meaning of American citizenship and forced large numbers of Americans into unemployment. For example, Steve Camarota at the Center for Immigration Studies reported on June 20 that state employment data show that in the first six years of the 21st century 218,000 high school graduates in the state of Georgia have been employment-displaced by immigrants. Moreover, wages have stagnated, putting the lie to the claim that there is a shortage of workers. If there were a labor shortage, wages would be bid up and rising.

Many Americans are unconcerned that the US government in behalf of an undeclared agenda has invaded two countries, killed hundreds of thousands of foreign civilians, produced 4 million Iraqi refugees, rejected the Geneva Conventions and reverted to medieval torture dungeons. It does not trouble them that their government blocked ceasefires and UN resolutions so that Israel could bomb and murder Lebanese civilians and destroy the country's infrastructure.

Americans, whose ethical behavior toward others was once reinforced by having to look oneself in the mirror, now have a different ethos.
Many cannot look themselves in the mirror unless they have pulled a fast one and advanced themselves at someone else's expense. It is not only crooked prosecutors, such as Michael Nifong, who get their jollies from destroying their fellow citizens.

A google search will call up enough information to make the case for these points many times over. However, the destruction of the US economy, though far advanced, is still largely unknown. It is to this subject that we turn.

For a number of years Charles McMillion of MBG Information Services and I have documented from BLS nonfarm payroll jobs data that the US economy in the 21st century no longer creates net new jobs in tradable goods and services. In the 21st century, job growth in "the world's only superpower" has a definite third world flavor. US job growth has been limited to domestic services that cannot be moved offshore, such as waitresses and bartenders and health and social services.

These are not jobs that comprise ladders of upward mobility. Income inequality is worsening, and education is no longer the answer.

The problem is that middle class jobs, both in manufacturing and in professional occupations such as engineering, are being offshored as corporations replace their American workforces with foreigners. I have called jobs offshoring "virtual immigration."

The latest bombshell is that even those professional jobs that remain located in America are not safe. There is a vast industry of immigration law firms that enable American corporations to replace their American workers with foreigners brought in on work visas.

For years Americans have been told that work visas are only issued in cases where there are no Americans with the necessary skills to fill the jobs. Americans have been reassured that safeguards are in place to prevent US companies from using the work visas to replace their American employees with foreigners paid below the prevailing US wage. Now, thanks to a video placed on "YouTube" by a US law firm, Cohen & Grigsby, marketing its services, we now know that it is easy for US companies to legally evade the "safeguards" and to replace their American employees with lower paid foreigners.

The video shows Lawrence Lebowitz, Vice President for Marketing for the law firm of Cohen & Grigsby, together with a panel of the law firm's attorneys, explaining to an audience of employers how to use loopholes in the laws governing the work visas to hire foreign workers in place of Americans. Lebowitz says, "our goal is clearly, not to find a qualified and interested US worker."

Cohen & Grigsby's legal experts describe the strategy for ensuring that no American firm has to hire an American. The advertising requirements can be met by advertising the job in obscure or ethnic newspapers in locations where there are no likely job candidates. If a qualified American candidate turns up, "have the manager of that specific position step in and . . . go through the whole process to find a legal basis to disqualify them for this position--in most cases there doesn't seem to be a problem."

The "prevailing wage" requirement is evaded, for example, by making the offered salary and raises contingent on receipt of the green card, usually 3 or 4 years away, or by disguising the job by understating the job requirements. For example, a job requiring an advanced degree can be listed as requiring a bachelor's degree, but filled with a foreigner with a higher degree. As the higher degree is not listed as a job requirement, the employer is able to secure the foreign employee below the prevailing wage.

University of California computer science professor Norman Matloff has an excellent presentation available at his online site about the lack of impediments to the ability of US firms to replace their American employees with foreigners. Matloff says to keep in mind that Cohen & Grigsby "is NOT a rogue law firm." The advice provided by Cohen & Grigsby is the standard advice given by the hoards of immigration attorneys who are personally cleaning up by putting Americans out of work.

Except for Lou Dobbs on CNN, the US TV and print media have so far ignored the astounding story. Where are the headlines: "US Jobs: No American Need Apply"?

Chances are high that economists will ignore the story also.
Economists have made fools of themselves with their hyped claims that jobs offshoring is a great benefit to America and that any attempt to stop it would bring hardship, failed companies, and lost American jobs. When a profession gets egg all over its face, it closes ranks and goes into denial.

Unlike the post-depression generation of US economists, recent generations of economists have been indoctrinated with confidence in business. They believe that business knows best and that the free market will prevent or correct any mistakes. Many economists today are well paid shills for special interests. Others, simply careless, have assumed that statistical measures of high rates of US productivity and GDP growth were indications of the benefits that offshoring was bringing to Americans.

Only a few economists, such as myself and Charles McMillion, noticed the inconsistency between alleged high rates of productivity and GDP growth on one hand and stagnant real median incomes and rising income inequality on the other. Somehow the US economy was having GDP and productivity growth that was not showing up in growth in the incomes of Americans.

Thanks to economist Susan N. Houseman and the March 22 issue of Business Week, we now know, as I reported in the print edition of CounterPunch (June 1-15, 2007) and on online at vdare.com, that much of the growth in US productivity and GDP was an illusion created by statistics that mistakenly attributed productivity gains achieved abroad to the US economy.

With the ladders of upward mobility for Americans dismantled by offshoring and work visas, with the very real problems in mortgage and housing markets, with the very real stress put on the US dollar's reserve currency role by Bush's trillion dollar war that is financed by foreigners, with the downward revisions in US GDP and productivity growth that are now mandatory, and with a variety of other problems that I haven't the space to deal with, the fabled US economy is a thing of the past.

Just like America's prestige. Just like the world's goodwill toward America. Just like American liberty.

The eyes of all peoples are still upon us, only for different reasons. Whom will we attack next? When will we be bankrupt? What good is the American consumer market when the mass of the people are employed in third world jobs? How much longer will those trillions of dollars held by foreign governments be worth anything? How long before Americans will be knocking on European doors claiming political asylum.

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Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions. He can be reached at: PaulCraigRoberts@yahoo.com