IBM, Other Multinationals "Detaching" From the US 812
theodp writes "If you're brilliant, work really hard, and earn a world-class doctorate from a US university, IBM has a job for you at one of its US research sites — as a 'complementary worker' (as this 1996 piece defined the then-emerging term). But be prepared to ship out to India or China after you've soaked up knowledge for 13 months as a 'long-term supplemental worker.' Newsweek sketches some of the bigger picture, reporting that IBM, HP, Accenture, and others are finding it profitable to detach from the United States (even patenting the process). 'IBM is one of the multinationals that propelled America to the apex of its power, and it is now emblematic of the process of creative destruction pushing America to a new, less dominant, and less comfortable position.'"
And the solution...? (Score:5, Insightful)
Instead of blaming them for leaving, why don't we stop chasing them away?
Re:And the solution...? (Score:5, Insightful)
Re:And the solution...? (Score:4, Insightful)
Ummm.... what about the second highest corporate tax rate in the world [taxfoundation.org] ? It sits at about 39%. I think that just might have something to do with wanting to leave.
Corporate taxes are a joke. They just get passed on to the consumer anyway, and they make businesses less competitive internationally. But it is politically rewarding to go after the big evil corporations and for them to pay their way.
Really, and end to corporate taxes is a big reason why I strongly support the FairTax [fairtax.org] . It would no longer hide the taxes we pay, and special interests would not be able to carve out exceptions for themselves life they do all the time now.
Re:And the solution...? (Score:5, Informative)
You might want to look at the effective corporate tax rate, since no actual corporations pay 39% with our loophole-riddled tax code of exceptions, credits, and deductions. The actual rate they pay [taxanalysts.com] is about 22%, the 2nd-lowest in the developed world (after Ireland).
Re:And the solution...? (Score:5, Interesting)
That would be the sensible solution, I agree. But I suspect it in no way would benefit the corporations who whine about corporate tax: they want it to have a high headline rate (so they can whine) but lots of hidden deductions (so they don't have to pay it). In particular, if you were to pick any exception as a place to start eliminating loopholes, you'd immediately run into an army of lobbyists who care very much about that particular exception. They're all there for a reason, after all, and usually the reason is that someone with deep pockets really wanted that loophole.
Re: (Score:3, Insightful)
This also ignores the tax compliance costs built into our current system. The deductions are not automatic, they have to be carefully planned for in most cases. How much time is spent each year by corporations considering the tax implications of a particular business move? And then how much overhead is there to doing the necessary paperwork to prove tax compliance in the event of an audit? It is an astounding amount of waste, and leads to companies wanting to do business where taxes are lower and simpler to
Re:And the solution...? (Score:5, Insightful)
Corporate taxes are a joke. They just get passed on to the consumer anyway, and they make businesses less competitive internationally. But it is politically rewarding to go after the big evil corporations and for them to pay their way.
Bullshit.
Are you telling me it's taxes are just enough that Sony has to â299 for the PS3 in the EU and $299 in the US and that it has nothing to do with the euro being worth more therefore allowing them to make a bigger profit for no additional work?
Or why MS may be raising the price of the of the 360 arcade in the UK depsite the fact manufactuer costs are probably lower as is inflation? I'm sure it has nothing to do with the increase on the pound over the dollar and therefore a small rise means a larger rise in profits. http://www.edge-online.com/news/xbox-360-arcade-getting-a-price-increase [edge-online.com]
The fact is nothing will ever be good enough for corporations as long as it's cheaper elsewhere. Even if they paid no tax in the US, if the over all cost was cheaper in India they'd go there.
What they ought to do is allow companies to go where ever they want but the directors have to live where the majority of their employees live.
Re: (Score:3, Interesting)
Corporate taxes are a joke. They just get passed on to the consumer anyway . . .
Q: How do you get a laissez-faire capitalist to stop talking about market pricing, supply and demand, etc?
A: Bring up taxes or any other cost that he doesn't like and suddenly it gets passed straight through to the consumer.
achievable? (Score:5, Insightful)
Because the stuff that's "chasing them away" is the same stuff that still nominally keeps the American people from being totally subjugated and destitute like the Chinese and Indians are.
What makes you think that's achievable? Americans are competing with Chinese and Indians. What possible reason would there be for anybody to pay more to an American worker than to a Chinese or Indian worker?
Companies aren't going to stop leaving the US until we are so broken by their flight that we are forced to become fascist.
Companies don't care about fascism. We just need to become cheaper, or we need to help Chinese and Indians become rich.
Re: (Score:3, Insightful)
The only way you can become cheap enough to compete with India and China is if you completely ditch all the achievements of the labor movement throughout the last century - 8-hour workday, etc. At that point, your quality of life will pretty much match theirs as well for the majority of population. Clearly, this isn't the answer.
Re:achievable? (Score:4, Insightful)
> to an American worker than to a Chinese or Indian worker?
In terms of the manufacturing sector, if they can make the same stuff, then there's really no such motive, ultimately.
Well, to a small extent there is, to cover things like shipping costs (it's slightly better to produce widgets near to where they're going to be sold) and a bit of inertia (relocating a plant costs money, so it's worth a bit more to hire workers where the plant is as opposed to somewhere else, at least in the short term). But these factors only cover a relatively small wage differential.
Why do you think the US economy has been, for half a century or so, gradually moving away from most kinds of manufacturing?
Some kinds of services can be outsourced to the third world nearly as easily as manufacturing, but others really can't, or at least not to the same effect. Advertising, for example, needs to be handled by people who know the target market and culture. Design work requires a certain level of education, so even if you hire your engineers in India or China, they're still going to make a good deal more than the poverty-stricken masses you could hire to run manufacturing lines. (In fact, for a lot of that stuff you'd mostly be hiring the kind of people who could probably get H1B visas and work in the US if they were so inclined. That's going to drive wage expectations in a certain direction.) Medical professionals have to be hired in the places where people spend a lot of money on medical care, and the US is fairly high on the list there. And so on.
> Companies don't care about fascism.
Actually, they kind of do. On the whole, they're not generally real happy about it, although they prefer it to populism (hello, Latin America) or outright communism (Eastern Europe, I'm looking at you).
> We just need to become cheaper,
The market is sorting that out.
Granted, it would be sorted out faster if the government would stop trying to delay the inevitable (particularly, the shift away from a manufacturing-based economy). I mean, come on, do you really WANT to work in a factory? Let it go, already. There are more worthwhile (and more profitable) things you could be doing with your time.
> or we need to help Chinese and Indians become rich.
Define "become rich".
Because, if you mean "become rich compared to where they were a few decades ago", that's already happened, and continues to happen. The per capita standard of living in China today is much higher than in China fifty years ago, and the same is true in India.
Of course, it's true in the US as well: fifty years ago, the average US household had one car, one radio, one record player, one rotary phone, no camera, no computer, no shelf full of movies, very few electric kitchen appliances, and only about a 50/50 chance of having a television. Today the average household has slightly more than one car per person over age 15, 2-3 radios per person, multiple CD players, multiple cellphones, several cameras, internet access, a shelf full of DVDs, a counter (or cupboard) full of kitchen appliances, cable and/or satellite television, and a bunch of other junk we don't actually need.
(It is at this point not difficult to imagine our society reaching the point where attempting to maintain a household at the standard of living that was average in the fifties might put you in danger of having your children taken away by child services. Make it a hundred years instead of fifty and we're probably there now: the lack of indoor plumbing would just about do it, quite aside from everything else.)
So if you mean "help Chinese and Indians become rich(er) relative to Americans", then that's a different thing. But I don't see how that would create a "reason
And, of course, "richer" in th
Re: (Score:3, Insightful)
Personally I have never understood why people are so convinced the solution to everything is the "free-market".
Because it is simple and morally destitute. If an economy is formed by actors that are completely rational, free and efficient, then everyone who is poor and destitute obviously had it coming.
Also see panglossianism [wikipedia.org], and the long-standing tradition of certain [wikipedia.org] popular [wikipedia.org] philosophers [wikipedia.org] to cater to the prejudices, and salve the aching consciences, of the rich and powerful, and to let them know that, yes, everything is A-OK with you in charge.
re: Chasing them away? (Score:5, Interesting)
I recommend reading a book called "IBM and the Holocaust" (http://www.ibmandtheholocaust.com).
This is a company that happily accepted huge sums of money from the Germans during WWII to computerize the process of hunting down and exterminating Jews, and even "hardened" several of their facilities so they'd survive Allied bombings. All the while, they claimed to be an American business.
It's arguable that in a sense, they "left" the United States back then, even if they still retained a big physical presence here. Despite the law preventing IBM from being able to move their profits out of German banks during the war, they STILL happily worked on their projects for them, knowing full-well they couldn't even touch the money for years.
Re: Chasing them away? (Score:4, Informative)
I gave it a read. It's well researched, but repetitive and sensational.
The system worked like this. One punchcard per person. Take the census data, find out a person's ethnicity, parent's ethnicity, religion, occupation, education etc. Now if you need to find the Jewish people, all you do is run a sort based on ethnicity. They were able to use the census data and the card sorters to find people with as little as 1/16 Jewish ancestry.
Now you have a stack of cards for each concentration camp. If you need a thousand people to build a railway, sort on profession, age, etc. Done. Distribute the cards to the guards and find people to find the prisioners with the right numbers tattooed on their armptis.
It's no surprise that the German subsidary did this work though. It was a German company. The surprise was how Watson was able to keep his hands in the cookie jar from over a wartime border.
Re:And the solution...? (Score:5, Insightful)
Instead of blaming them for leaving, why don't we stop chasing them away?
How about instead of letting them run off, we impose heavy import tariffs that negate (and then some) any savings? That's what other countries to to keep jobs and wealth in their nation (and it's what we used to do until Ronald Reagan came along).
This is the fundamental flaw with "free market" capitalism, and this worshipping at the altar of absolute individual (as if a corporation is a human, deserving of human rights!) freedom. It worked for a short while, because there was a lot of room for domestic growth. But once that ran out, those monsters that we unleashed which served us well now must go on and find growth that they can no longer find here.
20 years ago, the Conservative mantra was "buy 'made in America'", now it's "outsource, baby. outsource".
The Democrats may not be a whole lot better on this, but at least they *are* better, and one of Obama's promises was to punish companies which move jobs overseas. Hopefully we can get the healthcare issue taken care of so we can move onto this. Although, looking at how the Republicans have gotten people to take up arms in protest of giving them healthcare, I don't think they'll have any problem convincing the peanut gallery that keeping jobs in America means slave labor camps or some such nonsense.
Re:And the solution...? (Score:5, Insightful)
The idea that "import taxes will fix everything" is bogus magical thinking, because "jobs" aren't what makes a country rich. Wealth, ultimately, is something that you have (or possibly something that you experience) and the US imports a lot of Things from overseas and there ends up being more stuff for everyone. Forcing Americans to pay top dollar (or pay penalties) for American labor and American factories for their shampoo and their cars and their Ikea furniture does not mean that people in America will end up with more cars and shampoo and Ikea furniture.
Economic studies have shown that your typical $50k/yr manufacturing job "saved" by tariffs costs the rest of the economy over $100,000-$200,000/yr. That's no way to make your country wealthy. And in the intermediate-to-long run it probably won't mean half as many jobs as it means "robots".
And in the case of IBM employees, don't try to sell me baloney that says they're being "exploited" like a sweatshop. Mmf.
Re: (Score:3, Insightful)
>>The Democrats may not be a whole lot better on this, but at least they *are* better, and one of Obama's promises was to punish companies which move jobs overseas.
Are you serial?
Obama's plan was to tax American corporations for outsourcing, which would have the effect of them moving overseas entirely. It's one of the most fucktarded ideas ever conceived.
Re: (Score:3, Insightful)
Money mobility caused this (Score:5, Interesting)
Following the Great Depression and World War II, the leaders of our society decided to start taxing the wealthy more and more, while using that money for the betterment of society as a whole. It was called the New Deal. And this policy worked quite well, propelling America into a period of rapid economic growth, while at the same time creating a profound sense of economic security for the middle class. Vacation pay became the norm (it largely didn't exist before the Great Depression), and middle class Americans had enough disposable income to spend on luxuries like vacations.
This system was made possible by several other policies that prevented the rich from quickly withdrawing their money from the country. If you were wealthy in the UK in the 1950's, it was extremely difficult to get your money out of the country. It became common in this period for rich British citizens to build huge sailing yachts, which they sailed to other countries and then sold. They used their boats as a store of their wealth (read Myles Smeeton's Once is Enough for a story of one such couple).
Then came the right wing "neo-liberal/neo-conservative" politicians. When they got into power, one of the first things they did was to remove the barriers to capital mobility. Money was able to flow almost completely freely across national borders. This has brought economic growth for some, especially in countries like China. But it has also ensured that the countries that originally used taxes on the wealthy to ensure a healthy middle class were at a huge disadvantage. Rich individuals have withdrawn their money from America, and invested it in countries like China.
What many of us don't realize is that the complete and free mobility of capital will lead to the virtual disappearance of the American middle class as we have seen it over the past four decades, because it will ensure that money will flow away from countries with high taxes towards productive countries with low taxes. The country will increasingly look like Britain in the 1800's during the beginning of the industrial revolution (i.e. the world of Oliver Twist). There will be a very wealthy class. And there will be a worker class, which will comprise the vast majority of the population. Things like vacation pay, comfortable pensions, affordable quality health care, and disposable income will slowly but surely disappear for the vast majority of the former middle class. I am not prophesizing this; I am watching it happen before my eyes. IT IS ALREADY HAPPENING! Take an honest look at America right now, and tell me that our standard of living isn't slipping. And this at a time when we have never been able to make products more efficiently!
And to those of you who reflexively demonize those like me as "liberals", ask yourself this question? Are you a Billionaire? If not, then why are you thinking like a billionaire? Why do you think that lower wages for most of society is in your interest? Why do you think that taxing billionaires and spending that money to build roads isn't in your interest?
Do you think that the $20000 you have invested in stocks will pay for your comfortable retirement? What you seem to forget is that the billionaire who owns $200 million of those same stocks will make slightly more than you. And he will use the money he makes to buy even more stocks. Meanwhile, you, with your ever decreasing salary will have less and less disposable money to invest.
Re:Money mobility caused this (Score:4, Interesting)
Following the Great Depression and World War II, the leaders of our society decided to start taxing the wealthy more and more, while using that money for the betterment of society as a whole. It was called the New Deal. And this policy worked quite well, propelling America into a period of rapid economic growth, while at the same time creating a profound sense of economic security for the middle class.
Your post presents a very important issue. I want to provide citation to reinforce your point.
To those who doubt the above. Please first take a look at the calculation of "Marginal Tax Rates":
http://en.wikipedia.org/wiki/Marginal_tax_rate [wikipedia.org]
Specifically, please note:
"The marginal tax rate may increase or decrease as income or consumption increases, although in most countries the tax rate is (in principle) progressive. In such cases, the average tax rate will be lower than the marginal tax rate: an individual may have a marginal tax rate of 45%, but pay average tax of half this amount."
Now consider the marginal tax rate calculation for the labor tax code of 1954. A few months ago I added the column for GDP adjusted income. That column is misleading. The correct deflator to use when adjusting individual income is PPC (Product Per Capita, AKA: GDP Per Capita)
http://en.wikipedia.org/wiki/Internal_Revenue_Code_of_1986 [wikipedia.org]
Now consider the marginal tax rate calculation for the labor tax code of 2003 (the most recent year for which Wikipedia has the table):
http://en.wikipedia.org/wiki/Jobs_and_Growth_Tax_Relief_Reconciliation_Act_of_2003#Single [wikipedia.org]
Now, calculate the actual tax rate tables, being careful to apply marginal tax calculation.
Where do the tax lines cross? Above what level are you better under our current tax policy than during the period of greatest economic expansion in United States history? Or, conversely, below what income level are you worse under the current tax structure than during the period of greatest economic expansion in United States history?
The answer was a bit of a surprise to me. It is $251,000. That is the inflection point. Why does that surprise me? Two reasons: First, it's a bit lower than I thought (I had been mentally using GDP until tonight -- but that is not the correct deflator for income per person). Second, and more importantly, it is the number Obama has used several times when referencing the dividing line between rich and not rich. Is that intentional? Did he (or his economic advisor) reach that conclusion by doing the exact same calculation? Perhaps -- given that 250,000 is a number commonly used when pulling figures out of one's ass, it is entirely possible that it is just coincidence. Still, it makes me wonder...
But I digress. In short, people making less than $250,000 (about 95% of the population) are paying a greater percentage of their income as taxes than they were during the greatest period of economic expansion in United States history.
Said differently, people making more than $250,000 (about 5% of the population) are paying a lesser percentage of their income as taxes than they were during the greatest period of economic expansion in United States history.
Please note: This is assuming that you completely discount capital gains, the distribution and tax policy changes of which shift the inflection point much further in favor of the very few, very wealthy.
One More Time: During the greatest period of economic expansion in United States history our tax policy was enormously more progressive than it is today.
For further reading, including statistics that show the gargantuan concentration of wealth that has occurred as the tax policy shifted, see Piketty Saez 2007.
Re:And the solution...? (Score:4, Interesting)
Instead of blaming them for leaving, why don't we stop chasing them away?
I have a better idea - bar them from operating in the US altogether, and give their smaller competitors an opportunity to fill the void.
Re:And the solution...? (Score:4, Interesting)
Chasing them away? They seek lower "labor overhead" and they are getting it overseas. Taxes are far from the only and certainly not the most important reason for what we are seeing. We limit the amount of cheap labor they can import and punish them for breaking the law when they abuse the worker import programs.
It seems to me that being a bit more protectionist rather than less is an appropriate measure. Take away more than their foreign workers -- take away their government contracts and their right to operate in the U.S. entirely. Sure they might survive even under those circumstances, but the U.S. is STILL likely to be their biggest customers.
We have a horrible imbalance of wealth in the U.S. that people don't like talking about. We've heard about the disappearing middle class but no one seems to be listening or caring. The problem is that the stuff that is being sold is less and less affordable by the people in the U.S. For the past 20 years, people have failed to notice it because we've all been practicing "Reaganomics" or "debt financing" or "deficit spending" or however you prefer to phrase it. Instead of having a savings and an investment portfolio, the average American doesn't even have more than $2000 in the bank at any one time living paycheck to paycheck and trying to keep their credit cards paid. That can't work for much longer as people are making less and less money.
The free market without controls and preventative measures allows unscrupulous people to get away all sorts of evil things. Greed knows no limits and greedy people know no limits. Screaming for "more free market" is just a cry for "please look somewhere else while I pull another Enron or Madoff!" The free market forces leading to the brain drain in the U.S. has been weaking this country for a VERY long time and we're just about to hit the bottom that the few have been warning everyone about. The U.S. won't be #1 much longer and we can see why.
Re:And the solution...? (Score:5, Insightful)
Fucking idiot! This has been happening for the last decade, before Obama even came into the picture. The problem is greedy short term investors who drive companies to short term profits over long term profitability and quality. That's what unregulated capitalism does it drives towards the lowest common denominator - fastest profit with the highest cost at the lowest possible quality until a company implodes and can be sold off piece meal in order to put even more profits in the hands of the investors.
Re:And the solution...? (Score:5, Insightful)
Fucking idiot! This has been happening for the last decade, before Obama even came into the picture. The problem is greedy short term investors who drive companies to short term profits over long term profitability and quality. That's what unregulated capitalism does it drives towards the lowest common denominator - fastest profit with the highest cost at the lowest possible quality until a company implodes and can be sold off piece meal in order to put even more profits in the hands of the investors.
I differ, to do business in the US is now too legally complex and too tax expensive. INS is too meddlesome, keeping the good people out... why tolerate it any more? Just like my investments, most of my trades on the NYSE are in companies with a healthy offshore content as with even more liberalism and associate loss of freedoms and more increases in taxation promised there is no way US is going to lead a recovery.
Now if you believe the recession/depression is over, go ahead, the evidence says not with 550,000 job loss in a traditionally good month of July says different.
Americans can compete, but the environment of more bigger expensive dominating government is a load too big to do it. Get the moneys off the workers backs, and recovery will occur. That includes making corporate welfare to banks and GM a federal criminal offense as it should be. Nothing in the constitution says people coast to coast should be subsidizing banks and corporations.
Get the parasites and corruption out of the system and prosperity will return.
Solution is You and Me (Score:4, Insightful)
Obama is consistently talking about "American jobs" as if the jobs are rightfully American. His political stance is well known to be re-distributionist. Start earning, and stop whining for a handout.
Re:Solution is You and Me (Score:5, Informative)
In fact a load of it happened under Bush. Are you telling me he's a "redistributionist" who scared off companies? In fact it's usually Republicans that allow companies to import people on H1-Bs and allow them to move work over seas with no negative effect. That is probably what makes companies move.
The fact is that when it comes down to it, neither Obama or Bush really make a difference. Foreign workers definitely don't do a better job (like wise their work isn't inferior). What it's all about is someone in Manila can be paid for a year on a couple months of my salary, they have no expectations of pensions, private health care, etc. They're just happy to have a good job.
My company employs over seas staff. I know what they're paid, what they get and it's quite obvious why my company uses them. The employment laws are more lax and they 6 people for 1 of me.
It's not fucking rocket science.
Re:Solution is You and Me (Score:4, Informative)
Quit your bitching.
You knew what they were up to when Watson was still in charge. He didn't rename the company "American Business Machines". The Nazi banks ran on equipment he sold them. The Nazi rockets were modeled mathematically on equipment he sold them.
The ethnic populations were CERTAINLY tabulated by the Nazis. On equipment he sold them.
Funny. I know Jews who won't ride in a Volkswagen, but make sure iBM is in their portfolio.
So, screw Godwin, and screw INTERNATIONAL Business Mahines.
Re:Solution is You and Me (Score:5, Informative)
If the latter, then I'd like to point out to the people modding you that IBM was indeed the provider for the tracking software used at the concentration camps and labor camps of the Third Reich. The numbers tattooed on Jews weren't just decoration, they were tied to a punch card system IBM developed and maintained for the Third Reich. The numbers represented what "crime" you were arrested for (Jew, Gypsy, Homosexual, etc), your point of origin, and the camp you were assigned to. And this wasn't like a modern system where IBM can say they only sold it and didn't know its use. The systems which were used would've required constant on-site maintenance by IBM employees, which means there's no way they couldn't have seen what was being done to the prisoners held there. Additionally, contracts, internal memos, and other paperwork still exists showing that IBM's headquarters in the US was well aware of what was going, and what their equipment was being used for. They simply didn't care.
Re:Solution is You and Me (Score:4, Interesting)
It's been well documented for seven years now: http://www.ibmandtheholocaust.com/ [ibmandtheholocaust.com]
Re:Solution is You and Me (Score:4, Interesting)
Except for periods where I feel burnt out and need to slack a bit, if I'm not sleeping or running on the treadmill, then I'm coding for myself or my employer.
My existence, at the moment, is probably a bit pathetic to some (though I make time for some all Friday night to Saturday morning benders) but I'm am building up cash for investments through working a lot harder than my co-workers and I'm working on my own stuff which, hopefully, will turn into something I can I can either deploy and make money with or sell.
In the end I fully expect to retire early. My goal is to retire 1 year early. That doesn't sound like much but I do find if I set the bar lower, I then find I'm going to achieve that quite early on and raise the bar and keep raising it as time goes on.
It just depends what you want. Do you want small bits of work over a long period or bust your nuts for a shorter period and relax for a longer time?
You need money to make money. If I bust my balls now coding and buying up trademarks and hopefully some patents then hopefully I can spend more time doing fuck all.
Maybe this is the wrong mentality and I'll die tomorrow having busted my balls with nothing in return but this is the gambleI'm taking.
I am an American who moved to the UK and that did change me. For starters, I don't have to buy private health care.
Things have change a bit in how they work but the over all theme has stayed the same; you don't get something for nothing and smart hard work always pays off.
Re:Solution is You and Me (Score:5, Insightful)
Denmark has a program called Flexicurity which is a popular example of this. Under that system, once you lose your job, you can get unemployment benefits as long as you are actively looking for another job. Or, if you prefer, you can go back to school, get some new skills, during which time the government will also help you out. This has worked out really well for the Danes: it allows companies to easily fire people they don't need, and allows people who are out of a job to easily find another one (or retrain for another one). It is a flexible, secure workforce.
It isn't always a matter of whether it is 'earned' or 'owed.' Sometimes we can change things to make the path to productivity as easy as possible for our citizens. If we can help them out, why not?
Re: (Score:3, Insightful)
It is a flexible, secure workforce.
The flip side of a "secure" workforce is that people don't feel as much need to perform well at their current job.
If we can help them out, why not?
Because it's very difficult to isolate and help only those who need it without changing the overall incentives in the economy. A general unemployment benefit means that you're helping millionaires and poor people alike. We want the upper middle class to rely on saving for themselves and being as productive as they can; we only w
Re:Solution is You and Me (Score:4, Informative)
The security of the job market works either as a payment from the municipality or as a insurance (where the government pays for most of it, but you get a more decent monthly payment). The system hunts you down to get a new job as fast as possible (by you hating it so much to get away from useless courses and forced applications), or getting an education (either payed by the municipality or the educational state system). The companies on the other hand gets much more freedom (than other EU-countries that is) to fire and hire people as they please.
For a mixed economy, the system works pretty well, and this is probably why we haven't felt the recession yet (yes, we have had stimulus packages to banks and what not). But the price is that we pay over 50% personal taxes (+25% sales tax and "behavioral" taxation of almost every product available) with some subsidies (mainly interests; good for home owners and banks).
Re:Solution is You and Me (Score:5, Insightful)
So you are saying that jobs are fleeing from the US to China because the US is becoming "redistributionist"?
You might want to investigate the political and economic system of China before you hold them up as an alternative to Obama's "socialism".
What is driving "offshoring" is not taxes, it's pure free-market forces. Labor is more expensive here than it is there, so companies attempt to cut costs by moving the labor there. Companies don't increase presence in China because the US raises taxes 5%. They move to China because they can hire a college educated engineer there for $15k a year.
Re: (Score:3, Informative)
In spite of the presence of the communist government in China, one thing that the Chinese government has learned is that regulations and taxation kill business. Instead of taxing everything, the Chinese government is instead an investor .... and the business policies are often decided on the basis of how good it can be for Chinese business, as the sale of goods to America ends up often going straight into the pocket of the Chinese government.... more often than not the "People's Liberation Army" more dire
Re:Solution is You and Me (Score:5, Insightful)
"The fact is that Obama is a redistributionist who claims that jobs are owed and not earned."
The fact is some of America's greatest prosperity was during the 50's and 60's. Tax rates for the rich ran in the 70-90% range. That was when America was as redistributionist as it could get and America did great. So your Fox News/CNBC/Wall Street Journal propaganda rings hollow. I love it how they screen "class warfare" now that the Democrats are back in charge. They conveniently gloss over there has been class warfare for the last 30 years, but it was the rich waging it and they won, big time. They only use the term "class warfare" when the middle class is trying to claw some of it back.
The progressive tax system started getting dismantled under Reagan and George W. finished the job. The more it was dismantled the sicker America got. For example billionaire hedge fund managers now get taxed at 15%, working people its closer to 40%. By the time W. was finished America was actually redistributionist again, except it was redistributing all the wealth to the top 1%. Income inequality now is the worst its been since the roaring 20's which is is coincidentally the last time we had a crash like the current one.
So your claim America is "redistributionist" and that this is the problem is completely and utterly false.
It simply isn't healthy to have all the wealth concentrated in the hands of a small number of people. You need affluent, happy workers who buy things to have a balanced economy. Rich people don't buy stuff(other than yachts and mansions). Americans have continued on the buying binge been for the 30 years even though their wages are stagnant, but its mostly been through massive debt accumulation and now the party is over. You will see how much it really sucks to have 1% rich and 99% broke now that the housing bubble has burst.
Re:Solution is You and Me (Score:5, Insightful)
Actually the amount we're spending per student is going up. So the real question is how are we going to create a more competent populace when all we do is keep throwing money at the problem?
Re:Solution is not You. (Score:3, Insightful)
I see, so when I am the best at building widgets, and you buy one of my widgets because
it is good quality and worth the price to you, this is theft?
Oh, I get it, I should *give* you the widget just because I have many and you have none. Even If I had
to buy materials and spend time to make the widget, I am evil, mean and nasty to not just give you one.
Re:And the solution...? (Score:5, Insightful)
Honestly, it will take a /long time/. I've known conservatives to pull "but Clinton!" even in the final year of Bush's term. It's about equally retarded no matter which side is doing it... though I'm still pissed that Bush got away with what he did.
The truth isn't just relative (Score:3, Informative)
Re: (Score:3, Informative)
Obama has already spent more money then Bush has in his entire 8 years in office. Don't forget Bush, but do not give Obama a pass because of him.
Re: (Score:3, Insightful)
Yes, but it's to try to reduce the effects of previous administrations policies, namely an economic meltdown.
Or do you believe Bush would have behaved significantly different (eg, they would let GM, other banks, etc.. fail)?
Re:The truth isn't just relative (Score:5, Informative)
As a public service, I have to reiterate: sumdumass is wrong. Bush increased the debt by about $7 trillion dollars in his 8 years. Obama, in the middle of a recession, has budgeted an additional $1.7T of deficit spending in his first year.
Carter is Republican scapegoat for islam hate (Score:3, Informative)
Although I do *not* support the Iranian revolutionaries, the Shah was one of those nasty idiot dictators that was a puppet of Western powers. So the revolutionaries had it in for western imperial powers, and for good reason. It
Re:And the solution...? (Score:5, Insightful)
You have to remember the higher ups are responsible for a lot and it's a risky job.
Where did this myth come from that you get to be a higher up if you can just take the risk? 99% are "higher ups" because of birth right. The other 1% are held out there as tokens of the philosophy "if only you work hard enough for us higher-ups, you can make it too".
Ask any poor guy with an inkling of sense and he'll gladly accept this "big bad risk" you speak of to make a truckload of money. I'd do it. Where is my executive position at Goldman Sachs?
Nope. They aren't handing those positions out to people just because they want to take risks. You need to *KNOW* somebody, or better yet, be related to somebody. Otherwise, they could just hit any casino in Vegas to fill their empty executive positions.
I'm not saying you can't make it in capitalist America if you try hard enough, but it sure does help if you choose your parents wisely. And the willingness to accept risk is not the reason people get to be higher ups.
Re:And the solution...? (Score:5, Interesting)
The truth is, nowadays more than ever, getting a top management position is due to effectively manipulating other people - and who is more effective at manipulating than corporate psychopaths, especially in the chaotic world of publicly traded corporations?
This is why
1) executives rarely care for the long-term viability of the company they lead, opting instead for a short-term uptick where they can cash in and then leave.
2) these people can always find another executive position, once they leave their previous company, regardless of how dire the state they caused their company to get into - they can manipulate people so well that they will find an accepting armchair immediately.
3) BODs are filled with people who just move from company to company, from one executive position to the other.
4) golf is so damn important for them - that's where they network and prepare their parachutes.
I strongly recommend you read this book. [amazon.com] It's an eye-opener.
Re: (Score:3, Insightful)
The myth of course is based in reality. There are many risks along the way to becoming successful. How many people do you know who stay in their current job because they are afraid of what might happen if they take a shot at a higher level job?
How many successes came about as the result of betting the farm (figuratively) on some idea? People that were willing to risk everything they owned because they believed in themselves?
Re: (Score:3, Interesting)
Not just that, but what risk exactly?
They're paid enough that if they reduced their own personal cost of living to that or a normal working class citizen, they could get fired after one year and easily live off the salary for 10 years without having to worry about getting a job.
Sure, if they do something insanely horrible, they might not be able to get a job as a CEO again, but that doesn't mean they can't work as unskilled labour like everybody else in need of a job.
But that never happens. When's the last
Re: (Score:3, Interesting)
I agree with all of this, and it's sad that someone has to point it out. In a globalized economy, the US is not able to compete on price. We don't have the natural resources. We don't have the cheap labor.
We can only compete on quality. We have many advantages. Low population density, decent schools, lots of infrastructure. But with free trade, even that probably isn't enough to keep us on top. Developing countries will eventually catch up.
If we import immigrants to compete with third world countries
Re:Who's chasing them? (Score:4, Informative)
I hope the "we" you are talking about isn't the US. We actually [taxfoundation.org] have one of the [taxfoundation.org] highest corporate [kpmg.com] tax rates [heritage.org] in the world. [rightsidenews.com]
Perhaps Google would have helped you a little.
Re:Who's chasing them? (Score:5, Insightful)
Re:Who's chasing them? (Score:5, Informative)
In 2007, Exxon reported paying a 44% effective tax rate in their sec filings.
Goldman sax went bankrupt in 2008 didn't they? Remember the bank bailouts? Besides, they paid a 34% effective tax the previous year and attributed the lowered tax rate to the increase in permanent benefits as a percentage of lower earnings and changes in geographic earnings mix. This means that the their profits were paid out and the tax money didn't disapear, it will be paid by those people.
You entire 0% rate is fictional to any company that is solvent. It isn't because of loopholes and it isn't because the rates set down don't have any meaning. The rates have an effective disposition because they are higher then what they should be and the government lowers them for companies who do certain things they want them to do. It's like the mortgage interest deduction, if your making over a certain amount of money, you should be owning instead of renting in order to lower your tax burden. That's by design and accurately reflects the intended rates. What doesn't accurately reflect the intended rates, is you misunderstanding of the tax system and those who participate.
Re: (Score:3, Informative)
We actually have one of the highest corporate tax rates in the world.
This is true. Please provide the names of the corporations in the Fortune 500 that actually pay that rate.
Re:Who's chasing them? (Score:5, Interesting)
Exxon, [wordpress.com] They paid about 44% in 2007 and 47% in 2008. BTW, that comes to around 35 billion per year in taxes they paid.
The rate isn't there to be actually paid. The government provided deductions and exemptions in order to steer businesses into certain directions and to get certain things accomplished that wouldn't have normally happened. The rate, just like you do no pay your actual rate, is 1: graduated progressively so it will never be the entire amount, and 2: it's there only for people and companies who do not follow the direction the government wants them to.
Re:Who's chasing them? (Score:5, Informative)
We actually have one of the highest corporate tax rates in the world.
You're quoting KPMG and right wing propaganda machines as authoritative sources on corporate tax rates? Edwin Feulner runs the Heritage Foundation, one of the groups helping organize the "Tea-Birthers". One of his own favorite quotes:
"We conduct warfare in the battle of ideas."
Yes, they do. And those ideas are almost always promoting conservative policy items including corporate welfare. The tax rate is meaningless, the US is actually a corporate tax haven. Because of exceptions, credits, deductions, depreciation and amortization, plus a little lawful and unlawful income shifting, tax deferments and shelters, the effective rate paid by corporations in the US (13.4%) was below the average (16.1%) for the 19 OECD nations in 2000-05. So, sure, lower the tax rate and close off the deductions, then watch those very sources have a collective heart attack.
You'll believe anything if it's on Fox News.
Re:Who's chasing them? (Score:5, Funny)
Re: (Score:3, Informative)
Everyone's actual effective tax rate is lower then the applicable rate. That's by design and because we have a progressive tax system. If you are in the 25% bracket, you are not paying 25% on all your earning, you are paying 25% on the amounts over the threshold that brings you to that bracket.
I do not know what you point is unless it's that you are ignorant of the tax system and want to claim having a 34% effective rate while being in a 45% bracket is somehow taking advantage of loopholes.
Re:Who's chasing them? (Score:5, Insightful)
Actually corporations owe the public a lot.
Incorporation's primary purpose is to shield those who make the profit from the consequences of their company's actions. If this legal shield is ever removed we can start talking about everybody being on their own but it's absurd under current law.
Re:Who's chasing them? (Score:5, Informative)
I'm not sure why this is a troll, unless we've got some very unschooled libertarians moderating tonight.
Corporations owe their complete existence to the government and the people. A corporation is a legal entity created out of nothing by government action, and supported by the people. Benefits include tax breaks, jurisdictional freedom, limits on officer liability, access to publicly run and regulated markets (Wall Street), and so on.
Private companies, on the other hand, are not corporations, and do not owe a certain responsibility to the public.
Re:Who's chasing them? (Score:5, Informative)
Too bad that's not stopping IBM from laying off Irish workers, too. [www.rte.ie]
So? (Score:3, Insightful)
Patriotism is a highly overrated trait in anything/anybody. If it's better to leave, why stay?
Re: (Score:3, Insightful)
Stop Running Trade Deficits (Score:3, Interesting)
Stop running trade deficits. Tariffs against lopsided trade are not the big evil that right-wing economists say they are. If other countries stopped running trade surpluses with us, they'd have to create a stronger local consumer class, which would start to even out monetary differences and even out imports. Balance balance balance.
Re: (Score:3, Insightful)
We totally shouldn't have government regulation. Except for the fact that pure capitalism tends to exploit children [unicef.org], exploit workers [economicexpert.com] or both [tcetoday.com].
I'm all for free trade and as little government intervention as possible, too. But capitalism is all about short term gain regardless of the impact on the people or the environment. It's human nature that's got us screwed.
It's the main reason the ideas of The Long Now Foundation [longnow.org] are so interesting.
Re: (Score:3, Insightful)
Good point. Their labor is often cheaper because they poorly regulate:
* Pollution
* Safety
* Child-labor
* Working hours
* Paycheck laws
* Etc.
Should our goal be to compete with slaves, or end (de-facto) slavory?
Re:So? (Score:4, Funny)
I'm pretty sure if we actually "prohibit[ed] these business from operating in the states" that they'd go bankrupt pretty quickly: IBM would not last a month if it were prohibited from selling products or services in the United States.
M*U*L*T*I*N*A*T*I*O*N*A*L*S (Score:5, Insightful)
They are multinational corporations... what kind of national loyalty are we expecting from them?
They behave exactly as legislation allows them to behave. If you don't like it, change the legislation.
Re:M*U*L*T*I*N*A*T*I*O*N*A*L*S (Score:5, Insightful)
Re:M*U*L*T*I*N*A*T*I*O*N*A*L*S (Score:4, Funny)
Attempt to change the legislation and be called an America-hating Hitler-Nazi-Communist-Socialist-Terrorist-Muslim-Paedophile.
That many hyphens, and you couldn't find room for a homophobic slur?
And to think you call yourself an American... Hmmph!
Corporations are Greedy (Score:5, Insightful)
Re:Corporations are Greedy (Score:4, Insightful)
Large corporations are not good citizens and care little about the welfare of the nations that created them. I've heard them described as sociopathic is nature,
What definition of "good citizen" would that be? Someone who turns down a high paying job abroad and works on a low paying job in his country of birth? Why is that good? Do you know anybody who actually behaves that way?
Plenty of people leave their home nations because they get a better paying job or a higher quality of life elsewhere. America has benefited tremendously from that because so many exceptionally skilled people have come to the US from other nations.
Of course, as the US becomes less attractive to individuals and US immigration becomes ever more tighter, corporations are leaving as well. It's simple, rational behavior, and both corporations and individuals behave accordingly.
Re: (Score:3, Insightful)
Um, most citizens are not good citizens then. And if a corporation shifting their focus to foreign markets is somehow unpatriotic, do you feel the same about individuals doing the same?
I have left my country of birth - the country where I I grew up and got my education - to work and live in a different country. I still like my old home, and I still "do business" there, but my work is certainly mainly
Re:Corporations are Greedy (Score:4, Insightful)
It's touching that you care so much about your brothers and sisters in the global village - as an American you can rest assured that they couldn't give a fuck less about you. The "citizen of the world" mindset is a predominantly White American/European peculiarity that I imagine is the result of both relatively long term economic prosperity, the underlying Christian ideology that America was founded on, and the rise in power of predominately left-wing philosophies that came to the forefront post 1960.
Unfortunately, take away one of these elements, and the house of cards collapses. Outside of the Western world there are essentially two things that matter: Nation and Race. When you are competing with people whose belief structures center around those concepts (and you will compete with them, as bringing up the standard of living in those nations to that of the West is impossible given the Earth's finite resources), having the "citizen of the world" mindset is effective suicide. Interestingly, every time there is an economic downturn in the developed world those nasty nationalistic ideas seem to be rediscovered: for example the recent election of members of the UK's BNP to the EU parliament and the uproar that went along with it. Why should this be so? In the developing world, every political party is a nationalist party, essentially by definition. The 21st century as I see it will hardly be a century of the fruition of the "global citizen" ideal, but because of declining resources the first element of the house of cards, economic prosperity, will start to be dismantled. The defining characteristic of the 21st century will be the rise of ethnopolitics and hypernationalism.
Re: (Score:3, Insightful)
Hmmm this is interesting, you basically called every non-western country both racist and nationalist. I'm not sure how you got modded up for that when it is such obvious flamebait. I mean, have you even met many people of a non-western ethnicity? They aren't as bad as you seem to think. Try visiting some of these other countries sometime, most people are actually really nice.
I have seen a few third world countries (heck, I'm practically from one myself). GP is spot on - nationalism is par for the course outside the West. Racism, less prominent, but still there. "Help your own before anyone else" is part of that mentality, and I've noticed that it often correlates with quality of life - the lower that is, the more likely this approach is to be practiced. A Somali proverb sums it up nicely:
Me and my clan against the world.
Me and my family against my clan.
Me and my brother against
Its the law of the jungle (Score:5, Insightful)
The Egyptians complained about the English "stealing" their cotton spinning and weaving business. The English complained about the Yankee New Englanders, who complained about the Southerners, who complained about the Mexicans, who complained about the Malaysians who are complaining about the Chinese and Indians.
When I say "complained", I mean passed laws and regulations, imposed sanctions, taxes and duties, fought wars, battled smuggling, and whined.
In the long run, the laws of econonics ALWAYS win. The US should fix the causes, not the symptoms.
US Northerners and England (Score:4, Insightful)
Re:Its the law of the jungle (Score:5, Insightful)
"The US should fix the causes, not the symptoms."
I'm pretty sure that entails:
- Reducing the wages of most workers to the vicinity of a dollar an hour, maybe $10 an hour if you are highly educated and skilled, and maybe get work weeks up to around 70 hours with no vacations and no overtime pay.
- Eliminate all taxes on corporations and reduce taxes on the wealthy below 15% which is where it already is on capital gains and billionaire hedge fund managers. They also don't want to pay any payroll taxes or health insurance. Taxing workers making a subsistence wage in to the ground is still OK as long as they don't pay any of it.
- They want their taxes eliminated but they still want the government and tax payers to give them billions of dollars in government contracts, bail outs, low interest loans, free money from the Fed, subsidies, etc.
- They want schools that drill their workers intensively for about 16 years in math, science, computers and obedience. Don't bother with arts, independent thinking or creativity... kind of like "No Child Left Behind" on steroids.
- They would probably favor a totalitarian regime as long as its pro multinational, basically Fascist leaning as long as the party is their friend and makes them lots of money. Two ideal examples of perfect governments for multinationals are the new China and 1930's Germany. And yes IBM did love the Nazi's in the 1930's too. They want their workers thoroughly cowed, subservient, afraid and most definitely not organized.
The best fix for these American idiot CEO's, out to make a quick bug with no regard to long term consequences, is to strip them of their citizenship, and deport to them to their new corporate headquarters in China and India. I think once they get to live in China full time, with no ticket home to the U.S., and get to endure the repression, censorship, corruption like a real Chinese citizen, they will change their tune. They will especially realize their mistake when they get on the wrong side of a party boss or a company owned by powerful party members. Right now China is nice to them and is kissing their asses while they turn over all their capital, jobs, IP and market access. Chances are once they have all those and have their own version of IBM, owned by powerful party bosses, like Lenovo, they will completely destroy IBM and every other western corporation who sold their long term survival down the river for a few years of cheap labor, illusory access to China's markets and short term profit.
Re:Its the law of the jungle (Score:5, Insightful)
"my Chinese friends have never thought it's as bad as you seem to believe"
Most people living in Fascist states don't mind them until they fall on them like a ton of bricks, and at that point you aren't likely to be chit chatting with them. Fascist states are usually very good at producing jobs and economic progress so as long as you aren't on the wrong side of the party most people are fine with them. Most people don't care if they are free as long as they are making a good living, I do... Most Germans loved the Nazi's in the 30's using the same rationale.
You couldn't pay me enough to live in China. As flawed as the U.S. is, at least its not a Fascist police state yet.
"if our workforce is capable then they'll be hired for those sorts of jobs instead."
Not by CEO's looking for the cheapest labor they can get that can more or less do the work. They are looking to maximize their bottom lines to make good numbers for quarters, and one of the easiest ways to do that is to slash labor expenses. The quality of the work may suffer some, but you can throw more bodies at things so the cheap labor market always wins with bean counters. With the cost of living in Western Europe and the U.S. workers there simply can't compete until places like China stop manipulating their currency and their cost of living achieves parity with the West.
Tariffs and trade barriers have been used by countries for centuries to compensate for the fact that other countries have lower cost of living and cheaper labor. It took some rocket scientist free traders in the U.S. to completely dismantle them, while all the countries they are competing against still have them in spades. Markets in Japan, China, Korea and India are still not free, they erect all kinds of barriers to prevent Western corporations from competing on a level field there. The U.S. is practicing unilateral economic disarmament and our economy is going down in flames as a result. I might be OK with free trade if every country we compete with was as free as we are, they aren't.
Isn't Chinese Law (Score:3, Insightful)
that any factory or venture in China must be at least 51% domestically owned, such that they always will have the power?
Can't help but think that all these companies are building up their own competition... when China decides the dollar isn't that great anymore and that they've sucked out all the knowledge needed of the US and other 1st world countries to be on par with them.
Not that US companies alone can be blamed, the US consumer, with their rush to the cheapest priced options, by and large, contributed to this cycle.
Re: (Score:3, Insightful)
China is a fool's bet right now. Unless a person has lived there or worked directly with a Chinese company for more than a year, they are simply not qualified to assess the benefits of Chinese economics. It's many many years behind where most people think it is. And that deception is intentional. It's amazing how many get repeatedly burned looking for the magic billion-man market.
Re:Isn't Chinese Law (Score:5, Insightful)
I don't blame the consumer. I blame the people who wrote the trade laws that allow for slave labor to have equal playing field. Those trade laws completely destroy the fundamental American principle of freedom.
I blame the trade laws which basically guarantee that if you build a product in a responsible manner, it's not going to succeed, because the people who ignore environmental and safety standards can build it cheaper.
The big problem is our immigration system (Score:4, Insightful)
The best thing we could do if we don't want IBM and other companies going abroad is what John Doerr and Thomas Friedman have suggested [nytimes.com]:
Because it's often difficult or impossible to import international engineers and scientists with valuable or unusual skills to the United States, the logical alternative is to go to where they are. Want this kind of behavior on the part of IBM and others to, if not stop altogether, then at least to slow? Implement Friedman's suggestion. Otherwise, don't implicitly (or, in the case of many commenters on this thread, explicitly) complain when companies react to the conditions that politicians, and by extension voters, have placed on them.
Re:The big problem is our immigration system (Score:5, Insightful)
I think this idea of a lack of engineers with "valuable and unusual skills" in the US is more myth than reality.
The primary value that the H-1B program has for companies is economic. If you convert these workers to citizens, you'll have to pay them competitive wages and they'll be free to change jobs. Not much economic value there.
It's funny how people complain that illegal immigrants are cutting to the front of the immigration line but there's always a place for athletes, actors, and celebrities to go to the front. Of course, there really isn't a line anyway.
Re:The big problem is our immigration system (Score:4, Insightful)
"Because it's often difficult or impossible to import international engineers and scientists with valuable or unusual skills to the United States, the logical alternative is to go to where they are."
Do you really seriously believe this? Can you give even one example of such a case?
You don't set up shop in India because you want a couple of great Indian workers. You set up there because you can get lots of engineers-in-a-box CHEAPLY. You may also want to do business in the region (or already do).
There are no shortage of qualified people (or those willing to be trained) in the US. There is a shortage of qualified people who will work cheaply. In general, large companies don't hire great people, they hire cogs in a machine.
It's about the money.
Do what Canada did in 1965. (Score:3, Insightful)
In 1965 Canada brought into law the "Auto Pact" ahref=http://www.canadianeconomy.gc.ca/english/economy/1965canada_us_auto_pact.htmlrel=url2html-14781 [slashdot.org]http://www.canadianeconomy.gc.ca/english/economy/1965canada_us_auto_pact.html>
It basically states that for every car bought in Canada, one car must be built in Canada.
(In 2001 it was abolished because it infringed on NAFTA.)
This policy works for everybody except the greedy CEO's. Any manufacturing industry could be converted to this setup.
Re:Do what Canada did in 1965. (Score:4, Insightful)
This policy works for everybody except the greedy CEO's. Any manufacturing industry could be converted to this setup.
No, such a policy works for no-one other than greedy auto workers; everyone else has to pay higher prices for lower-quality cars, since without competition the auto companies will just sell expensive crap.
Re:Do what Canada did in 1965. (Score:4, Interesting)
That policy works until other nations start retaliating against your primary export.
Canada managed to get away with it for a while because Canada isn't that significant in international trade and primarily trades in raw materials. But, in the end, even Canada preferred free trade over protectionism, which is why it joined NAFTA.
You get what you pay for. (Score:5, Informative)
This is what our factories have to compete with. Plants which poison children.
http://news.yahoo.com/s/ap/20090820/ap_on_re_as/as_china_lead_poisoning [yahoo.com]
Laws that protect us from this kind of behavior add costs that push companies to these countries.
Democracy isn't cheap.
Re:You get what you pay for. (Score:5, Insightful)
Laws that protect us from this kind of behavior add costs that push companies to these countries.
And here we find the weakness in capitalism — the tyranny of the masses, who want cheaper and cheaper DVD players and disposable razors, and don't care how many twelve year olds have to work in sweatshops to deliver them. (Me too. I'm trying to be better, but my habits are very bad. Like most of us.)
Re: (Score:3, Insightful)
Isn't the real fix... (Score:4, Insightful)
Isn't the real fix that we improve the countries they are outsourcing to until the economy there demands the same as US salaries? At that point geography becomes the benefit instead of dollars and they want to hire the guy closer to "home."
Whats Next? - Multinationals Use Us (Score:3, Insightful)
So after they move out what will keep them doing to the US what they do to other countries - exploit countries resources for profit. As we were the home to these greedy groups we have been pretty much insulated as they didn't rock their own boat. But if they are based outside of the US, kinda cleans off that slate and opens us up as a whole new market to exploit, don't you think?
Time to detach from china and india (Score:5, Insightful)
I find the fact that corporations such as this, especially in a time of economic hardship, are basically harming american workers and showing such contempt for the USA, to be greatly offensive and angers me to no end. i think its time that we detach from china and india which has basically decimated Americas economy and who have stolen our jobs. I think its clearly time that we need to stop allowing these companies to abuse the USA looking at it as only a market to sell their overpriced chinese crap, and start creating jobs here again. Globalisation is such a big scam its ridiculous, its destroying this countyr and allows these greedy companies to basically exploit slave labor in china. The US should and can, and must for its survival, implement a tariff on imports of cars, textiles, furniture, IT services, customer service calls to India and China, etc, and so on. When we have 15% unemployment in reality and people struggling to find work the notion of any company moving jobs somewhere else really should cause a revolt from americans and demands to implement tariffs. Its time to get past this irrational hysteria about tariffs. Tariffs are good and can help this countries economy rebound. There is nothing wrong with it since it simply allows americans to make products for other americans. Think about it, why cant the chinese make things for other chinese, and americans make things for other americans. it would be better for the chinese of the products that chinese workers stayed in china to benefit to the people there. It would be better for americans to create more jobs in the US making products for use by americans. The only people that globalisation benefits is the wealthy rich elite corporations who important products made by employees in slave labor camps in china making a few cents an hour, living in filthy dormitories, who are treated in the most inhumane way, beaten, and even not allowed to use the restroom, with litany of human rights abuses, the products these slaves make are then sold off at a 100% markup in the US and the wealthy elite take the profit. Both the american and the chinese worker are the losers. Globalisation is what has allowed as well corporations to basically dictate to countries basically how they will treat workers and the environment and rewards countries which allow their environment and workers to be ruthlessly exploited by massive global corporations. This is a system where massive global corporations get their way and make the laws through making countries compete against each other to see who can allow their employees to be treated in the most inhumane way. Through the global consolidation and globalisation the corporations are able to control markets resources, jobs, and so on in many different countries and operate as sort of transnational governments. Through this we are seeing a new world order emerge where the governments of countries are simply puppets of a powerful fascist global corporate order who controls wealth, resources, jobs, markets, capital, etc.
If we value our freedom, we need to implement tariffs which would give our own worker welfare laws, our own democratic state, some force and allow us to implement unions without the corporations threatening to move jobs to other countries. If you want to be treated like a decently like a human being, to have a good life and to be paid decently for decent work, we desperately need to implement broader democratic unions which allow employees a democratic vioce where they can act as a safeguard against mistreatment and slave wages. Unions are essential to our economic recovery and for stopping the destruction of the middle class. The unions built the middle class in the USA and ironically created a middle class that had the spending power which made companies like IBM so successful. Unions are essential for workers to have decent wage since it more often than not is the tendancy of corporations to pay workers as little as they can, leading to a vast impoverished state in the economy. Its just shocking and disgusting tha
Some Perspective (Score:5, Interesting)
Look I am an Indian, and I think that there are a few things all of you need to know.
America is not going anywhere for now. The fundamentals of your future lie in the hands of your people, especially the select few who have a vision and can buck the status quo. As long as you have plenty of such individuals you are going to weather any geo-political storm.
Whereas in my nation life is so linear that it is a goddamn joke.
Almost every kid is expected to be an engineer and most of these engineers hardly even know what the hell they are talking about. As Feynman would say their knowledge is fragile.
Our educational system itself is a joke. Trust me on this.
At the same time entrepeneurs are discouraged and looked down upon. They are sorta treated with ice, as everyone wants a *son* in an MNC with a prestigous MBA. So, basically our society is choking itself. Sure, these people are awesome paper pushers, but despite the fact that some of them do have a decent brain they all seem to fail to do anything different.
No revolutions are put into motion. No brilliant new synthesis are formulated. No groundbreaking patents are filed. In short, the truly important stuff is in stasis.
Your society whereas pushes its outliers and that is why, as Kay once put it, most software is written on one side of the atlantic. I think that you should stop looking at IBM and start looking at MIT. That is where your future lies.
And seriously drop all of that economics mumbo-jumbo. As the foundations of society are the ability to create things, transport those things and dessiminate them. I think that those earning a living by making a killing in stocks are living a sham.
Oh and Thomas Jefferson would kill himself if he saw Bush in action. Despite his failings Obama is, at least, a breath of fresh air. So, value him for that. At least he had the courage (unlike me) to step up to the plate.
P.S. - /.s javascript is screwed, haven't they heard of simplicity?
Re: (Score:3, Informative)
It is the next step in Internation Corp Evolution (Score:3, Interesting)
You've heard of offshoring labor to a foreign nation for a lower cost in labor?
International Corporate Evolution is the new trend. When in a nation with a bad economy offshore the entire company to a richer nation like in the EU that has a lower corporation tax and a lower tax on the wealthy.
You see labor needs to be offshored to the lowest cost third world nation like China, India, Thailand, Russia, where the cost of labor is low. That is the first step in International Corporate Evolution.
The second step is to expand your business to a foreign nation to compete with other corporations in foreign nations. If a company does not do that, foreign companies might move to their nation and buy them out (ala Anhiesier Busch Beer) or expand and build a company right next to yours and try to shut yours down. It is like a game of corporate chess, you need to move a piece to their location before they move a piece to your location and checkmate you.
The third step is to offshore highly talented employees (like with PHDs and tons of experience) and management to a nation that is wealthy and has a good economy but has lower corporation taxes and lower wealthy taxes. Move the bulk of your local company to that nation and downsize any employees that aren't as valuable.
The fourth step is closing down buildings in the local nation that has the bad economy and high taxes.
The fifth step is moving back to that nation after the bad economy has recovered and tax rates have been cut again and bringing the talent back with you. But if the economy does not recover and the tax rates are not cut, this is like a strike against the government to offshore the entire company to punish them for higher taxes and ruining the economy.
They never really 'detach' ... (Score:4, Insightful)
These companies never 'detach' from the capital and credit markets that they need to stay in business. They enjoy access to free and fair markets supported by the U. S. Constitution. Investors and lenders to such companies depend on financial and accounting standards along with required public disclosures of financial information. When someone threatens to steal their IP or violate a contract they are a party to, they expect access to a fair and impartial court system backed by a stable political system. Let's see them 'detach' from those things...not likely. Being located in the United States is an enormous advantage for these companies and they know it. They just don't want us to know it.
This has EVERYTHING to do with money (Score:3, Insightful)
Better Idea: (Score:3, Insightful)
Reduce the tax rate but eliminate loopholes.
Or, we could close up all those expensive shit-stirring military bases, stop the failed wars (oh Korea and Vietnam, I wish we had learned from you..) and cancel social security, medicare and medicaid.
Re:they're not stupid! (Score:5, Interesting)
Well, let them all move to India/China/etc, then.
Let them move to countries that rely more on rote memorization of facts, and little in the way of independent thinking. Let them move to countries where the employees could feed themselves for a year by stealing a few pieces of their product. Let them move to countries where the government could very well decide that the company isn't pious or nationalistic enough, and take over their assets.
America has many great and successful companies for a reason.
It's hard to put a dollar amount on how much money will be lost by them moving overseas, but I guarantee it'll be a net loss. I look forward to hearing some CEO's say, "Well, we had record profits this year, but no one can seem to actually find any of this money, and we can't even pay rent on some of our offices anymore!" Metrics aren't perfect, and no one with a marketing degree or above the level of middle management seems to know that.