Constructive gadfly
Only Jobmaker in Town
Published on October 28, 2004 By stevendedalus In Politics

Ever since the decline of manufacturing jobs in the Reagan era and the increase of 17 million jobs in services and whatever, not to mention the much heralded 22 million jobs in the Clinton years, legitimate skepticism rears its head. It is not the numbers — let alone the number of lost jobs — that are open to question, but rather the quality of the jobs and that these numbers naturally flow out of population increases, particularly among legal and illegal immigrants. Perhaps it is no different from the immigrants of the 19th Century when subways, bridges, roads and tunnels were being built, except for the glaring omission of infrastructure work, which is at a standstill.

Some could argue that the Golden Arches, casinos, stadiums, and Taj Mahals are today’s infrastructure and that construction workers are doing well, except for the diggers and wheelbarrow armies. Moreover, the spinoff of these structures of affluence create millions of jobs for the those of the bottom link of the labor chain — hamburgers have to be wrapped, casinos have to be swept, concessions stands serviced, and beds made. Despite this being a practical fact of labor and life, it is hardly worth boasting about when a large share of the labor market is subsidized by earned income tax credit, food stamps, child care assistance, Medicaid, off the books employment, temp workers without benefits, escalating part-timers supplementing income — the last three of which distort employment figures.

Many small businesses — retail-service outlets, manufacturers, computer wizards, contractors, self-employed — like to take credit for being the mainstay of viable employment in the nation because of their brilliance and eighteen-hour management days, but most do not acknowledge the irresponsibility for allowing the government to subsidize those who wilfully underpay their workers. Yet all’s fair in war and business. It is the government in the end that is irresponsible for turning its back on the extremists among the capitalistic-bent flouting fair employment practices. The government, also, because it does not offer incentives and encouragement to business in rebuilding factories and modernizing the infrastructure, to meet the needs and potential of this new century, lets meaningful labor to fallow and thereby lessen the demand for skilled labor. It is no more reprehensible, however, than for the decades of CEOs downsizing and outsourcing our once inimitable productive capacity.

Currently, there is a net loss of jobs from a moderate recession, 9/11 disaster and the war in Iraq. Nevertheless there have been almost 2 million jobs now created, owing partly to reconstruction of the twin towers, the Pentagon , Iraq, but mostly from the increase in homeland security, which certainly should have been more. This is symbolic of what the government does in the way of actually creating jobs; most of the payroll springs from the Treasury Department’s borrowing and not what most would infer from individual investments. In spite of the growing deficits, and unconscionable tax cuts, the government is the only job maker in town, not only in government related employment but in spinoffs for the unskilled that contributed to the 2 million job increase for immigrants since 2000, but sadly, a decrease for the native born. Those from the commercial and ideological world, of course, would deny this.

Copyright © 2004 Richard R. Kennedy All rights reserved. Revised: October 28, 2004.

http://stevendedalus.joeuser.com


Comments (Page 1)
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on Oct 28, 2004
Good Article!

I too, can agree with your thought process.
Are we to become a Service Society? If we don't build, or manufacture any longer, what are we going to do? How are we going to be useful to the rest of the world, Or for that matter, in our own world?

Selling Hamburgers and Coca Cola in China, does me no good.
Hell, selling them here doesn't do me much good either.
on Oct 28, 2004
what are we going to do?
Especially if there's a major war--what are we going to do--rely on China manufacturing?
on Oct 29, 2004
We need to break down the walls that seperae us from the rest of the world. We need to tarrif and tax the bejesus out of the imported goods that enter this country. We need to wreak havoc on the economies of country's that refuse to import our goods at an affordable price with retalitory tarriffs. China feels no shame in price our goods out the reach of their people to slant competition in their favor. We make it too easy to outsource manufacturing and unskilled laboring jobs. We need to taxes goods and services manufactured and provided outside the US at the same level they would be taxed here in the States. If it would cost $9 an hour here to employ somone to make widgets, the tax collected on that hours wage would be about $2.47 including State, Local, Federal and Social Security taxes. Outsourcing should cost the company that much in taxes even if the labor only cost them $1. Then of course we need to raise the cost of exporting the raw materials and importing the finished goods to make it cost prohibitive to do it in the first palce.

Outsourcing is a loophole we have forced American Companies to use in order to remain competitive. We need to close the loopholes but not before we level the playing field. Outsourcing shouldn't even be permited to countrys with whom we have a trade deficit. The end result would be higher prices for sure, but also a stronger work force, and a more diverse one, lower taxes and eventally a more robust global economy and market place. We would be investing in American business by creating jobs here not abroad, and increaseing the income of the average American.
on Oct 29, 2004

Reply #3 By: Cappy1507 - 10/29/2004 12:35:03 AM
Outsourcing shouldn't even be permited to countrys with whom we have a trade deficit. The end result would be higher prices for sure, but also a stronger work force, and a more diverse one, lower taxes and eventally a more robust global economy and market place. We would be investing in American business by creating jobs here not abroad, and increaseing the income of the average American


Uninforcable! Try to shove this down their throats and they'll just close the doors. Quite effectively putting even MORE people out of work.
on Oct 29, 2004
We need to break down the walls that seperae us from the rest of the world. We need to tarrif and tax the bejesus out of the imported goods that enter this country.


Nothing like taxes and tariffs to bring us closer together with other countries!

There is a statutory requirement (Berry Ammendment I think) that US military uniforms be made in the US.

One of the reasons to have a large powerful military is so we don't have to scramble to build one in times of war.

Manufacturing jobs does not equal manufacturing output. Since 1960, the percentage of employment that was in manufacturing has dropped steadily. Since 1960, the manufacturing output as a percentage of GDP has stayed about the same. We can still make stuff, it just requires fewer people.
on Oct 29, 2004
Since 1960, the manufacturing output as a percentage of GDP has stayed about the same. We can still make stuff, it just requires fewer people.
Not that simple; the percentage would be much lower if all the products made overseas and only assembled here were accounted for.
Outsourcing should cost the company that much in taxes even if the labor only cost them $1.
Bold and very good!
on Oct 29, 2004
Why not just ban all foreign made goods altogether?
on Oct 29, 2004
Why not just ban all foreign made goods altogether?


Because there is nothing wrong with a global economy if the playing field is equal.

Reply #5 By: Citizen Madine - 10/29/2004 8:36:03 AM
We need to break down the walls that seperae us from the rest of the world. We need to tarrif and tax the bejesus out of the imported goods that enter this country. Nothing like taxes and tariffs to bring us closer together with other countries!


All too true but it's the best way to get their attention. I think it takes a bold move such as this to make them realize a.) we mean busines; b.) we aren't afraid of a little isolationism to prove it. But most importantly, they need our business more than we need their products.



Reply #4 By: Citizen drmiler - 10/29/2004 1:55:03 AM

Reply #3 By: Cappy1507 - 10/29/2004 12:35:03 AM
Outsourcing shouldn't even be permited to countrys with whom we have a trade deficit. The end result would be higher prices for sure, but also a stronger work force, and a more diverse one, lower taxes and eventally a more robust global economy and market place. We would be investing in American business by creating jobs here not abroad, and increaseing the income of the average American


Uninforcable! Try to shove this down their throats and they'll just close the doors. Quite effectively putting even MORE people out of work.


Maybe, but I'm not sure there is a major or concrete correlation between our workforce and a country that we are unable to balance trade with. But It's a very good point, and one that definately makes me realize that it couldn't be across the board, and that we have to exhaust all negotiations to balance that trade deficit before we shut down the outsourcing. It would definatly create one of three scenerios:

Scenerio 1 - Relocation of the outsourced jobs to another country with a more friendly trade market. Companies would help strengthen relationships with our foreign trade partners which would help bolster support economically and politically. It would enrich the economies of both countries, and create econimic allies that generally leads to stronger political ties. Prices on the goods in America may rise a bit, or even fall as the relationship between the two countries grows.

Scenerio 2 - The outsourced jobs become American jobs again. While this would definately make the goods here in America more expensive, because the additional manufacturing and/or service cost would have to be passed on to the customer, adjustments to the tax code could eleviate the additional costs somewhat, certainly not entirely, however the additional jobs would create a stronger workforce. Outsourcing is a relitively new phenomenom in the American Workplace, at least foriegn outsourcing. Previously most outsourcing was done here. I know I worked in the industry until the late 90's working for Payco and later OSI after the merger. But since it is new, it is important to snuff out this trend early before it becomes too difficult.

Scenerio 3 - The country providing the outsourced workers closes the trade gap enough to legitimize the outsourcing, this means more jobs in america a stronger eport market and expanded econimy here in the states, and this is the ultimate solution. If we can't stop outsourcing, which I'm not convinced we can't, we can at least use it as a bargining tool in the world economy.

There are two problems with outsourcing, besides the los of jobs. I'm talking from a business sense here, not politics. Good managers are generally built piece by piece by experience. There are two types of managers, the kind that specialize in a certain type of management, for instance project managers, people whose skill is managing. And Managers who have broad skills based on knowledge of the company. They are two totally different types of managers, however outsourcing manufacturing jobs or even service jobs creates a vacuume inside the company that's hard to replace. The second type of manager will have holes in their development, and might not have hands on knowledge of
of the manufacturing process and therefore be ineffectual as managers.

The second problem is the lack of involvement when outsourcing, I see it now at my company. We have outsourced manufacturing to other countries, China and Mexico in particular. While we have had no layoffs because of it we have not hired american workers to handle the increase demand in our production. While the product lines we produce here have a certain flow between manufacturing and management that flow is totally lacking with the product lines produced abroad.

If a factory worker here notices that the drawing he is working from has a flaw in it, lets say a wire is supposed to be 2 inches long on the drawing, but it cutting it that short actually causes it to rub against a bolt and fray creating a dangerous situation he will walk into an engineers office and mention it to him, before proceding to build a thousand units. The problem will be worked out and redesigned, total cost is 2000 pieces of wire (The piece that has already been cut too short and the replacement) but when the same problem arises abroad they build the units and if we are lucky they might mention it to us in their report, usually they don't because their job is to build what is on the drawing and deliver it. Total cost is stagering, least expensive is the rework and scrap but the lack of commincation can result in thousands of units reaching market with out any knowledge on our part that the potential of failure exists.

I'll admit my bias against outsourcing, my wife lost a job to outsourcing in April whenher company outsourced its IT department to India. I lost my job at OSi when the company I was outsourcing for switched to international outsourcing, despite the fact that we (the outsourced division) consistantly out scored their internal divisions in quality assurance and customer satisfaction and cost almost 50% less. International outsourcing saved them an additional 8%. I am one of the people that proponents of outsourcing point to when the talk about transitioning workers to better paying jobs. I re-educated myself and went from the service industry to IT, I managed to make it through the bubble burst because I was certified, educated and brand new ie. inexpensive.

BUT a lot of the folks I worked with have bounced around from one dead end job to another, waiting tables, bartending, consession sales, temping and the like. And me... well reeducating myself put me on the brink of bankruptcy. In fact I might have been better off fling for chapter 11. The two years of "transitioning" and then 4 years of holding my breath during the turbulent era that the IT industry reinvented Itself was easily the hardest period of my life. I'm lucky and thankful, but I don't wish it on anyone, and I don't think it's as easy as they make it out to be in their sound bites.

geeze if you actually read all of this I salute you. Two tangents in one post. Sorry I'll try to keep it more focused.
on Oct 29, 2004
It may be difficult for some to objectively take a side on outsourcing of jobs, but I like to use this example to explain both sides. I'm going to leave it vague intentionally...

Let's say there were an item that you needed, and there were two versions that you can buy...
Choice A costs $2 and Choice B costs $15, but they both do exactly the same thing, but A was exported, and B was local. At this point, are you more likely to take the bargain price, or show your loyalty by paying the extra $13. $13 isn't that much really, so I can beleive that many of you may actually go with it, but a lot more is in stake running a business. I'm against outsourcing, but if I were a business owner, I have to admit that exporting jobs is a very tempting thing to do! Yes, keeping jobs here is right, but it's not easy, since the impovershed here are middle class in many other countries. Americas high standards of living might actually be backfiring in this way. Yes, America is a great place to live, but one unfortunate consiquence of that is that is makes this outsourcing feasable, which unfortunately make it near impossible to stop. I'm in the middle though on what to do about it though, there doesn't seem to be an obvious right solution that helps everyone...
on Oct 29, 2004

Outsourcing is a loophole we have forced American Companies to use in order to remain competitive. We need to close the loopholes but not before we level the playing field. Outsourcing shouldn't even be permited to countrys with whom we have a trade deficit. The end result would be higher prices for sure, but also a stronger work force, and a more diverse one, lower taxes and eventally a more robust global economy and market place. We would be investing in American business by creating jobs here not abroad, and increaseing the income of the average American.


This is actually the portion I was refering to. And I stand behind my statement!

BUT a lot of the folks I worked with have bounced around from one dead end job to another, waiting tables, bartending, consession sales, temping and the like. And me... well reeducating myself put me on the brink of bankruptcy. In fact I might have been better off fling for chapter 11. The two years of "transitioning" and then 4 years of holding my breath during the turbulent era that the IT industry reinvented Itself was easily the hardest period of my life. I'm lucky and thankful, but I don't wish it on anyone, and I don't think it's as easy as they make it out to be in their sound bites


I did the same thing and made it all the way to Asst National IT Manager before I came down sick.
on Oct 29, 2004
To Drmiler

I Enjoy debating you, it seems we have run into each other on several posts. You make me think twice as hard, and your a hell of a sport about it, plus you get under my skin... all good qualities in my book.
on Oct 29, 2004
Link to article 'Kerry's Position(s) on Corporate Welfare' from the Cato Institute, has alot to do with outsourcing.

Did you know in the state of Indiana (money though comes from the Federal Govt.), the state pays employees who have their job outsourced to go to school (2 year College) to change their career, oh WAIT THE GOVERNMENT WAS DOING NOTHING FOR OUTSOURCING, right?

Next topic please.
Sidenote: If you want companies to stop outsourcing give them a tax cut instead of a tax raise!

PLINKO!!
on Oct 29, 2004

Reply #11 By: Cappy1507 - 10/29/2004 8:12:17 PM
To Drmiler

I Enjoy debating you, it seems we have run into each other on several posts. You make me think twice as hard, and your a hell of a sport about it, plus you get under my skin... all good qualities in my book.


Good! Me too on all counts.
on Oct 30, 2004
Because there is nothing wrong with a global economy if the playing field is equal.
Agreed, and your response in its entirety is great.
If you want companies to stop outsourcing give them a tax cut instead of a tax raise!
Precisely what Kerry wants to do.
Why not just ban all foreign made goods altogether?
Even French wine?
on Oct 30, 2004

Reply #14 By: stevendedalus - 10/30/2004 1:14:25 AM
BR>Even French wine?


MOST especially french whine,errr I mean wine.

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