And the typical result is a reduction in operations and the laying off of laborers. The reason often given is that foreign competition has taken customers by offering prod-ucts for lower prices. On the other hand, the business firm that successfully sells much of its output abroad is likely to show profits higher than average for that industry. The fact that some business firms are losing money because of inability to compete in foreign markets, while others with above average profits can compete, suggests that high Profits are not the basic cause of the inability to meet foreign competition. Since business profits are what is left over after meeting business costs, high profits in themselves mean only that the business is efficiently operated and competing successfully.
Low profits mean the opposite.
Wage Levels Wages in the United States have been higher for many decades than those in most countries. High-wage industries are our major exporters. This was true even before the United States had widespread unionization or minimum wage laws. The parents and grandparents of millions of us migrated here in the late nineteenth and early twentieth centuries partly because of attractive wages plus the fact that work was available for all at going wage rates. Let us hope f or still higher wages in the future, because this is a major indication of our level of productivity.