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| The Evil's of Outsourcing |
| 09.20.04 (11:36 am) |
Picked up a rather interesting factoid today. One of the campaign issues this election season is a discussion on jobs, particularly on jobs being outsourced to other countries.
The number of jobs we currently outsource to other nations is around 2.8 million, according to the Survey of Current Business.
Staggering! 2.8 million jobs! We must march on the White House immediately and stop the Evil Bush Junta from sending all of those jobs overseas....
But of course that is only if we fail to realize that in addition to America outsourcing jobs to other countries, other countries also outsource jobs to us. In fact according to this study we picked up 4.7 million jobs from other nations outsourcing work here to the United States.
So yes, we could pass a lot of silly laws and regulations to prevent our jobs from being outsourced, but when we do we could hardly expect other countries not to do the same thing to us. The net result? We would put approximately 1.9 million people who currently have jobs out of work here in America, a big net loss for us not only in numbers of jobs but also in relative income. Anybody else want to talk about outsourcing?
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posted by: flipsidedown
post date: 09.20.04 (12:13 pm)
If outsourcing is such a good idea why aren't the CEO's being outsourced?
Big business is on a big race to the bottom of the labor market. They want all American workers to accept wages that Chinese Workers do. If Americans don't accept that they send the jobs elsewhere.
posted by: flipsidedown
post date: 09.20.04 (12:14 pm)
The workers build the products, management is merely investors trying to manipulate their investment.
Power to the people, Kerry for President.
posted by: stepdad
post date: 09.20.04 (12:26 pm)
Reply to: flipsidedown
"If outsourcing is such a good idea why aren't the CEO's being outsourced?"
Umm.. they are Flip.. if you consider that other companies are outsourcing their jobs here, 4.6 million people in this country currently work for outsourced CEO's.
"They want all American workers to accept wages that Chinese Workers do. "
Smart business is always a tradeoff of cost vrs quality. While it is possible to "outsource" to reduce some initial costs, a lot of businesses (particularly those that outsource things like customer support) learned that in the long run it cost them repeat business due to inadqueate quality and other unforseen costs. The result? The market is sorting itself out, while their may have been an initial rush to outsource in certain areas a lot of those jobs are coming back.
Our options? Let the market sort itself out, which sounds like a good idea if you want to keep the surplus 1.9 million jobs were currently getting as a result, or heavy handed government regulation. If government gets involved odds are we'll loose 4.6 million jobs as other governments instutite the same sort of regulations against us that we use against them.
If we let the market sort it out odds are we'll not only keep the extra 1.9 million jobs we currently have, we'll probably get more back as companies that have outsourced learn that sometimes you have to pay a little extra for the quality they need to stay competitive.
Personally I like the idea of keeping jobs much better than throwing them away. Sorry, but the evil big business thing is tired and overwrought, and the numbers just don't support your viewpoint.
"The workers build the products, management is merely investors trying to manipulate their investment."
I'm not even certain what your trying to state with this or what point your attempting to make. Perhaps you could clarify?
"Power to the people, Kerry for President. "
Lol.. Make John Kerry President and the power will most certainly not be given back to the people, unless by "the people" you actually mean trial lawyers associations, teachers lobbies and other very powerful special interest groups.
posted by: flipsidedown
post date: 09.20.04 (12:35 pm)
Now every American is paying for George W. Bush’s wrong choices with a price tag of $200 billion and climbing. That’s $200 billion we’re not investing in health care, job creation and education.
posted by: flipsidedown
post date: 09.20.04 (12:36 pm)
George Bush didn't creat a single job, in fact he lost 2 million jobs while he was in office.
posted by: stepdad
post date: 09.20.04 (12:44 pm)
Reply to: flipsidedown
Umm.. flip.. do the math again.. how can we be loosing money to outsourcing if were actually gaining jobs?
Especially if the jobs we gain, according to this study, pay better than the ones we loose? The net effect of outsourcing on our economy is that it brings more money into our economy than it takes out.. so how can this be a bad thing?
posted by: stepdad
post date: 09.20.04 (12:46 pm)
Reply to: flipsidedown
Yikes.. ok, flip, you need to check your facts and get away from simply parroting rhetoric you find on moveon.org or the DNC website.
Hey, if you choose to vote Democrat more power to you, but if your going to do that why not base your vote on the facts and on truth rather than on ridiculous rhetoric?
Neither party is above this, the republicans often misquote and misrepresent facts too - it's part of the game. But part of being a responsible voter is to look past the rhetoric and vote accordingly.
Your claims are obviously untrue. So why continue to argue them?
posted by: flipsidedown
post date: 09.20.04 (1:08 pm)
Penn State Perspectives | Job numbers don't bode well for president
posted by: flipsidedown
post date: 09.20.04 (1:08 pm)
The recent bad news on the jobs front is that only 32,000 jobs were created in July. This means that President Bush is likely to end his term in office as the first president since Herbert Hoover to preside over a net loss of jobs during his presidency.
Today, there are 1.2 million fewer jobs in the United States than there were when Bush took office in 2001. A growing population makes the situation worse, as about 150,000 potential workers enter the labor market each month.
These job losses persist despite two enormous federal tax cuts (2001 and 2003) totaling $1.7 trillion over ten years -- the largest tax reduction in the country's history. These cuts, President Bush promised, would "create more jobs" and "give our economy the boost it needs." What happened? Why have the Bush administration's record tax cuts, supported and passed by Congress, failed to stimulate the economy and to create good-paying jobs for Americans?
The economy influences the employment situation, and Bush took office in the midst of the post-dot-com recession. But that economic downturn officially ended in November 2001, and with recovery came economic expansion and strong corporate profits. Despite these trends, the recovery was largely jobless. Even with growth rates of up to 7.4 percent the economy did not begin to consistently create jobs until fall 2003. In the past year, only 109,000 jobs per month were created, 41,000 less than the number of potential workers entering the labor market. This is a major departure from past periods of recovery when a growing economy meant more jobs. By way of comparison, the economy created about 225,000 jobs a month in the 1990s.
This failure is, in part, due to fallacious assumptions employed by the supporters of tax cuts as an economic growth/jobs policy. Bush argued that his 2003 tax cut would put "money in the hands of families who need it to make purchases and to pay the bills" and "give employers greater incentives and resources to invest in new equipment." The assumption here is that families would spend their tax-relief money and thereby create demand for American goods and services. This, in turn, would create jobs and expand the economy.
Of course, if these families chose to spend their tax cuts on foreign vacations (services) or foreign-made home entertainment systems (goods), their expenditures would do little to expand jobs in the United States, particularly in view of the country's record trade deficit. Equally, if employers used their tax relief to build a new factory in China or open a new software programming center in India, they would employ few American workers. Indeed, many companies have made these kinds of investments expressly to replace Americans with cheaper foreign labor.
Instead of assuming that consumers and investors would spend their tax relief in ways that would create American economic growth and jobs, the president and Congress could have proposed and passed targeted tax cuts. A large tax cut aimed at business research and development and investment in new factories, equipment and buildings in the United States would have had a much bigger impact on economic growth and job creation than cutting taxes and letting the recipients do whatever they want with that "relief." Another alternative, out of fashion in current economic thinking, would be for the federal government to spend tax revenues to employ those without jobs as it did during the New Deal in the 1930s.
Instead, we have ended up with a very expensive and ineffective jobs-creation program whose greatest impact is yet to come. President Bush's tax cuts converted a $281 billion federal budget surplus in 2000 to a record deficit of $445 billion this year. Economists project federal budget deficits will continue to add to the federal debt, approximately $2.4 trillion over the next 10 years if the tax cuts are not reversed. This record has led many commentators -- including the conservative business papers The Wall Street Journal and the London Financial Times -- to conclude that Bush has led one of the most fiscally irresponsible administrations in American history.
Thus historic budget deficits, federal government debt and jobs losses are three of the great economic legacies of the president's first term.
posted by: whymrhymer
post date: 09.21.04 (4:36 am)
Reply to: flipsidedown
Facts, unfortunately, are meaningless to Bush-Bashers.
Great blog! Glad I found you!
posted by: whymrhymer
post date: 09.21.04 (4:38 am)
Reply to: stepdad
Sorry, meant that last reply for "Stepdad"
posted by: stepdad
post date: 09.21.04 (8:08 am)
Reply to: flipsidedown
Flip.. your ignoring the facts again. Our unemployment rate is currently no higher than it was during the Clinton years, and considering the tremendous economic fallout that the attack on the World Trade Center created combined with the recession Bush inherited when he took office I'd say that is a pretty spectacular acheivement.
But lets assume for just a moment that the economy really were in terrible shape, as you suggest. What if anything would Kerry do to fix it? Taxing the rich only hurts the poor... poor people don't give other people jobs nor do they determine the prices on the goods/services we buy. You tax the rich and its us middle class working stiffs that foot the bill.
So what else does Kerry have up his sleeve? This tiresome class warfare argument might be an easy sell but it doesn't fix the problems of a flagging economy. Does Kerry have any ideas that might?
posted by: stepdad
post date: 09.21.04 (8:09 am)
Reply to: whymrhymer
Good to have you aboard, enjoy :)
posted by: Defensor
post date: 09.21.04 (2:54 pm)
Reply to: flipsidedown
"The recent bad news on the jobs front is that only 32,000 jobs were created in July. This means that President Bush is likely to end his term in office as the first president since Herbert Hoover to preside over a net loss of jobs during his presidency."
That's not recent at all. The recent news would be the 144,000 created in August. And the 32,000 you're talking about was revised upward in September.
On the topic though, outsourcing also creates jobs.
http://money.cnn.com/2004/03/30/news/economy/outsourcing/
According to this study, these benefits "ripple" through the economy, leading to about 90,000 net new jobs through the end of 2003. This effect, the study said, should produce a total of 317,000 net new jobs through 2008.
The study also said outsourcing added some $33.6 billion to U.S. gross domestic product (GDP) in 2003 and could add a total of $124.2 billion through 2008.
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