“An economic theory called “The Law of One Price” is in action today in regards to the reversal of the Seaway Oil Pipeline running from Louisiana to Cushing Oklahoma thereby land-locking oil form the global market. With the reversal of this pipeline what was a local commodity (WTIC oil priced at 102/bbl) now becomes a global commodity which seeks to trend towards the price of Brent Crude ($111/bbl). This example is the same example that can be used regarding the labor value crisis now underway in the economies of Europe, Japan, and the US. Labor, once mostly local, has become global and therefore the law of one price looks to kick in. This explains Ross Perot’s words that in a globalized trade people would hear “a giant sucking sound” as jobs moved offshore to lower cost of labor (labor -US safety costs – US pollution costs + additional transportation). What was once a small labor pool is now huge. This means that 100% of the jobs needed is now divided by the number of labor participants trending from 500M to now 2.5 Billion. All our debt has been built up on the idea that we would have a high labor value forever combined with growth of the labor pool”
By agstacker | Published November 17, 2011
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