Slashdot – August 22, 2009:
“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.’”
#16 – Ah_Yea – Funny how no one here puts the blame where it belongs.
On you, me, and everyone else who buys foreign.
I fully agree with you when it comes to tangible goods, but this article seems to deal with intangible goods… such as computer software. The software industry doesn’t tend to state where the software was developed.
Yes, I think you’re right. The article is more specific to although I believe this is becoming a pattern for corporate America as a whole.
Well when the corporations move production to India or China, or anywhere else that has cheap wages, those jobs won’t be in the US any more, or for that matter, Canada. Who’s going to buy the manufactured goods that are the result of the production?
Not us–we’ll all be out of work.
# 23 Floyd, It’s so obvious, it makes you wander why the government hasn’t gotten it yet.
No jobs, No Taxes, No corporations, but; we will always have the worlds most expensive Army, unless; China bankrupts us first, and with out firing a single shot..
The poor don’t pay taxes. The rich don’t pay taxes. The middle class pay all the taxes.
The poor don’t have any money, so they can’t pay taxes. The rich can leave, and take their money with them.
So when Obama says you won’t pay any more taxes unless you make more than $250,000, what he means is, by the time he’s printed enough money to completely devalue the currency, we’ll all be making more than $250,000 a year (and paying more taxes). Unfortunately, it will cost $10,000 to buy a coffee.
iF’
I could open a Online store and markup 10% with direct purchasing from Other countries…WOW..
ECA. Good idea, too late.
Ebay. I regularly buy excellent machine tools from a distributor in Hong Kong. It costs about 1/5 – 1/2 the price to get the exact same tool from a storefront here in the US. And that includes shipping.
@ #16- – –Look in the mirror as to who is to blame? HA!! How can it be the consumers fault what they buy if they walk into a store and EVERYTHING is crap made in China? That’s how it is nowadays. The companies are to blame…..if they can make a cent more by selling something from China versus something here they’ll do it. No matter if we want American or not. Americans don’t want to buy this cheap Chinese junk anymore. It’s being shoved down our throats.
How about trying to make it worthwhile for corporations to hire here? Instead, liberals place additional burdens on them.
Ask yourself why these corporations don’t open up shop in Africa? It’s because their taxes are too high in almost all of those countries.
In order for corporations to make money, they have to balance their sales income against their expenses.
If their goods cost too much, people won’t be able to buy them.
If they are too cheap, they can’t make any money and thus go out of business.
If they keep the prices too low, they won’t be able to pay their people enough. Underpaid people leave for better paying jobs. Without workers, they go out of business. They have to find that happy medium.
You may think, “Well, Duh, LibertyLover. That’s common sense.” Yes it is. It is a very simplified explanation of what companies have to do to make money.
But, one thing people don’t consider in these equations is inflation of the money supply. When there is too much money, the dollar is worth less. If it worth less, corporations are worth less. If corporations are worth less, the stockholders aren’t happy. If the stockholders aren’t happy, CEOs and the like get fired.
CEOs want to make money. A 1/2% bonus from net income doesn’t sound like a large bonus unless the company can make billions. So CEOs try to make billions.
Back to inflation — Now, a little inflation is good. It _should_ represent an increase in production of the economy as a whole. Mostly this has been true except during times of unrest when the government went to a fiat currency system to make ends meet (settle down, see this out before you start screaming LIBERTARIAN). I am of the opinion that a fiat money system is ok in the very short term but it needs to be an emergency measure _only_. Unfortunately, these emergencies can feel like crack cocaine to those in power. If you are on a fiat money system all the time, you are in emergency mode all the time — a constant high — free money!. This has been our system since the Fed was put in charge.
If America was an island, this probably wouldn’t be all that bad. Eventually, things would balance out. But we are not an island. Other countries rely on our currency as a reserve. And their reserve is worth less and less each day. Eventually, we won’t have the ability to print all we want.
Putting EMERGENCY fiat money into the fiat money system is just plain dumb. The average family income has not increased in step with inflation. This means, people have been getting less and less for their dollar. This means they can’t afford to buy the goods corporations sell because they are paying such high prices for their houses, food, cars, insurance, education, etc. — all the things American Families need.
At this point, corporations see that nobody is buying their drills, fancy clothes, jet skis, etc. It costs too much money to produce them here in the States because the workers want a “high” wage to be able to just afford the necessities (note that by “high” I mean a wage above what a corporation can pay vs what the workers want to be able to afford the better things in life). And that damned union is knocking at the door.
Corporations have to keep the balancing act working. So, they have a choice. Stay here, pay high wages thus charge more for their products and go out of business because no one will buy said products.
Or
Go overseas where labor is cheaper so they can sell their goods at a price low enough the average American consumer can purchase them.
Note this is not an endorsement of the “going overseas” idea. It’s an explanation.
Eventually, Americans won’t be able to even afford the basic necessities, much less the luxury goods, because all the jobs will have moved. In fact, I think we are getting close to that point now. A poor and unhappy populace leaves a power vacuum ready to be filled with a dictatorship — history has shown us this time and again.
You see, the mob is stupid. It is shown financial indexes on the nightly news (which don’t really mean squat). If it goes up, they feel better while that dollar in their pocket no longer buys the bread for their kid’s lunch tomorrow. Eventually they realize that SOMEONE is doing better and those numbers on the nightly news don’t mean squat because little Tommy is hungry. They start thinking, “Why is Preston Arnaldi of American Car Makers making a $100M bonus when I can’t feed my kids?” They don’t know it is only 1/2% and that $100M is really the same as $4M in pre-Fed dollars. It just looks like a whole lot more.
Now you have a bunch of pissed off moms. Pissed off moms don’t have sex with their husbands so now the husbands are pissed, too. And if mom and dad are pissed all the time, their kids grow up being pissed. Pretty soon, the entire population is pissed off at the rich. At one time in America’s history, the rich were heroes. Now they are reviled.
A pissed off population gets you get a dictatorship because they’ll listen to anybody who comes along and promises them a better tomorrow (note this is not a jab at Obama).
This entire post can be summed up in just a few sentences — We cannot continue to inflate our money supply because the dollar will be destroyed. If it is destroyed, not only will our people be unable to afford the necessities, they will get upset (I use the term loosely).
If they get too upset, we’ll have a revolution and it won’t look like 1776.
#23 Definitively a win-win situation, don’t ya think?
#28 Now, you have a good point. Too bad you made it here.
#29 That’s not the only reason, but it sure is one. The move to china was made not only because of cheap labor, but cheap capable labor. Something you won’t find in Africa. There was a will from the Chinese to get the money and attention; there’s none from Africa. There are, of course, more reasons.
#30–Loser==I’d bet my highest rated corporate bonds that nobody here says: ““Well, Duh, LibertyLover” – what we all say is “STFU LOSER!!!”
Ok, that was a cheap shot just following the set up.
Thank you for the onion skin in depth cartoon analysis of monetary policy. Thank you for explaining the sun rises in the East. Why did you never get around to telling us it sets in the West????
So–analysis of the obvious, almost dictionary meaning of words/history is the predicate. What are your SOLUTIONS for whatever you see as a problem? Got any of those???? Yea, I know, reduce taxes to zero so that the entrepreneurial spirit of America can be release.
What a dolt.
#31–and Pedro==”The move to china was made not only because of cheap labor, but cheap capable labor.” //// Good point. Another slant on that: the Chinese Overlords were always interested in economic theory. For 1000 years, they ignored the outside world thinking they were No 1. Result was a FAIL. For 30 years, they tried Communism. Result was a FAIL. Now, for 10 years, they tried capitalism. Result is looking like a win.
Africa OTOH==never has had an economic theory. Its been all tribal. Result will continue to be a FAIL.
Question: Is thinking you are No 1 and the rest of the world is not important always a recipe for failure?
# 32 bobbo, Sunday morning cartoons,
We win, we’re #2, Yeah we’re #2, woo hoo we’re #2, woop woop we’re #2, Na-na-nah-na, Na-na-nah-na we’re #2, we almost rule we’re #2, …..
#33–noname==funny. Not funneeee, but funny.
Yep, now we just have to start recognizing the rest of the world. That will be hard to do beyond rhetoric when we spend more on our military than the rest of the world combined.
Most of our problems, are caused by ourselves.
# 34 bobbo, Sunday morning cartoons,
I know.
We will have China right where we want them when they become #1. Suckers….
My company is in the middle of laying off tons of programmers and hiring Accenture and, especially, IBM consultants…in India. They claim that they are trying to find ‘other roles’ for them in the company, but they aren’t. Instead, they are being ‘transitioned outside (insert our company name here)’…which is one of the more outrageous euphemisms for layoffs that I’ve ever heard…
The irony is that many of the ‘transitioned’ employees, are Indian programmers with H1b visas (and naturalized citizens).
American will be green once all economic activity occurs overseas…then we can turn our attention to personal methane emissions…cap & tax those, and drive that overseas also.