vbkris,
I really didn't directly mention compensation, but now I will. What my point really was is that the price of, say a widget (or the contract price for providing call-center service) isn't entirely determined by the wage for the worker, but all the extraneous costs involved in running a business.
And it's a fact that in the U.S., we have so many laws and regulations (which I happen to agree with in concept), that drive up the final cost of our product or service to the point where we lose the sale or the contract.
For the environmental stuff, it often seems as if the U.S. is the only one who tries to keep the air on this earth clean. An analogy would be my kids: If Kid A (a radiohead fan) came home from school and cleaned up his room, which he shares with Kid B, he has less time to play--but he's required to do it and knows that in the long run, it's better. Then Kid B comes home, messes up what Kid A has just cleaned, and waltzes off and has more time to play. Is that fair, that Kid B isn't required to clean the room that they share--which in turn negates all the extra work that Kid A did to the detriment of his play time?
U.S. workers tend to be more productive, so I would argue that if a U.S. factory pays $12 per hour for a factory worker to make widgets, that company can still compete on overall value--which takes quality, reliability, and service into consideration with a widget made in, say, Mexico where the wage may be $3 per hour.
All sorts of things contribute to this difference in productivity: For example the $3 per hour worker, living in a dirt floor corrugated steel shack, will tend to have higher absenteeism, lower education, and scores of other human-related attributes that directly impact the quality and efficency of the plant which depends on him/her. Jobs that don't require any attributes that can be directly affected by a differences in human's performance are mostly automated and done by robot or some other high-technology.
--jsteph