"What is Inelastic Demand? For 500 Alex.
And this relies on there being a local alternative."
There will be entrepreneurs bringing an alternative, (not to mention companies returning the jobs in the US) always happens sooner or later, it just has to be profitable. You encourage that with less regulations and lower taxes.
What you're worried about is merely a temporary inconvenience, but that always happens with large scale changes. Transition from communism to democracy in Eastern European countries also rocked the boat but it had to be done.
"So competing with third-world sweat-shops by creating your own?"
Please don't put words in my mouth.
Also, sweat-shops (poor conditions, shit pay) aren't that easy to create in a proper free market because people can start their own business easier. They can also just all decide to strike and the government won't tear gas them all. The worst that can happen is they all get fired, but that might not be in the interest of the employer. He might just decide that it's too much of a hassle to find an entire new team of 50 or whatever number of people and train them.
Most of the problems in the third world are caused by government corruption and rampant authoritarianism. They're not much of a welfare state, but they are too big. Takes ages just to get a shitty permit for minor things. Nepotism is rampant too. How do you think that will encourage business innovation?
"Australia's min wage is $16.87 an hour. The US $7.25. Aus GPD per capita USD67,458. The US USD54,269. Aus budget deficit 3.4% GDP. US budget deficit 6.8% GDP. Economic Freedom (Heritage definition) Aus - 82.6/100 US - 76/100. Export GDP Aus - 20.1%, US - 13.5%"
Australia's GDP per capita is a mere 51k, US 54k. I took me 30 seconds of google search to find those numbers so you're just outright lying here.
Also please notice the youth unemployment rate, it's a little higher in Australia:
In Europe it's even worse.
The explanation is pretty simple. If your work isn't worth 15$ and you have no/little job experience, you just won't get hired, employers will look for other ways to handle their problems, like automate things or just hire part time.
Also keep in mind the parasitical relation between these 1st world welfare states (Australia, Canada, western EU countries) and the US.
Most medical innovations get made in the US due to the freer market, despite Europe having double the population. Sanders' universal healthcare would kill that and make the US mediocre. (Keep in mind that new antibiotics will be needed and even now there's not much incentive for companies to find new ones, it's way too expensive)
Welfare states can't afford a strong military so they rely on the US too much for defense. If you take US out of the equation, NATO isn't that strong really.
"Increasing that countries consumption and demand for imports, creating a larger market to be taken advantage of, driving up labour prices due to local firms having to compete with US ones, further increasing demand for goods. The solution isn't to reduce the US to third-world labour conditions, it's to drive third-world conditions up. "
The only way third-world countries will rise up to the levels of the US is if they copy traditional US values: small government and individual rights. Not gonna happen until the people realize government is the problem not the solution and revolt (mainly to limit its size and scope).
Google LA 1870. Looks a bit a like a third world town doesn't it?
Now google Los Angeles 2010. How did that happen? Government magic? Nah, for the most part, free people built shit.