An NDD Spin-off Thread

**Roguish Lawyer** · 02-08-2004, 15:52

Let's discuss the following proposal made by NDD in the Street Gangs thread. I think it's a separate issue:

Quote:

Businesses that take their employment overseas have to be made to pay a penalty so stiff they won't do it. Businesses that stay in the US and hire US workers should get every advantage possible.

Do you agree? Why or why not? I disagree, but I'm not going to explain why until this discussion gets going.

CRad · 02-08-2004, 18:31

I disagree in part and agree in part.

There's something about punishing a co or person for making a choice about what they are going to do with their own business that bothers me a whole lot. What would ever give us the right to do that? If the owner can't have his own say then what's the point of being an owner? Why not just deed it over to the Gov't and be done with it.

Making it attractive to businesses to stick around or come to a certain area of the country is a good idea. It's good for the people - they will have jobs and money to feed their families and enjoy life. It's good for the community because the business may attract more business but it'll definately have payroll which will be spent locally. That spending will cause more jobs and more spending and more tax money for the city, county and state. Good for the community, good for the tax base, good for the people and the owners get to have control of their own business. That is good in an American Tradition sort of way.

NousDefionsDoc · 02-08-2004, 18:52

Ok, let's say you're CRad Computer Company Inc. You sell 85% of your products to US citizens. They keep you in business. You advertise being an "American Company" products are "Manufactured in the USA", but you buy Indonesian micro chips and now you want to put your Customer Service Center in Bangladesh. Why? To help the poor starving people of Bangladesh? NO! Because Bangladesh has no minimum wage, your local manager there can hire for 1/100th what it would cost in the US. Who suffers?

The other thing is I think our stupid tax laws have driven companies off shore. If we're driving them away, we need to change something. What happened in California is to me a microcosm of what will happen in the US if we keep going down this road.

Any company that puts it business in a foreign country that does not have minimal labor restrictions should be fined out the ying yang. They are truly exploiting the worker class for pure profit.

OMG! I'm a communist!

RL, what's up with quoting me? You make me sound horrible. Why didn't you include the part about the right to not be abused, etc.?

02-08-2004, 19:07

Quote:

Originally posted by NousDefionsDoc

Any company that puts it business in a foreign country that does not have minimal labor restrictions should be fined out the ying yang. They are truly exploiting the worker class for pure profit.

Hmmmm....

But Thailand, Cambodia, Vietnam, China etc, have labor restrictions, and companies are moving more and more activiities to them.

So, if Bangladesh would legislate some minimum labor restriction, you'd be OK with it?

Let's look at this from a business point of view. Companies don't move part or all of their operations overseas on a whim. They move because it is more cost effective. Between taxes and labor costs, the United States is simply failing to compete. Market forces apply, and companies will respond to them.

Penalties of any sort will simply lead to higher costs to Americans. Fine them? They build that into the cost of the their product and raise the prices. They have to. Companies do not make money out of thin air, they make money by charging for their products more than what it costs to produce them. Taxes, fines, etc. are just part of the costs.

**The Reaper** · 02-08-2004, 19:14

Socialism, globalism, or protectionism.

You raise the other country's minimum wage, lower your own, or create financial disincentives for using foreign labor or benefits for using your own, via taxes, tarriffs, or deductions.

TR

NousDefionsDoc · 02-08-2004, 19:18

I don't know if Bangladesh does or not. It was merely an example. I know what you are saying, but the US consumer will only buy his favorite brand as long as the price is competetive to the others in the same market for most items. Remember how many people started smoking generic cigarettes when the taxes went way up?

Why is it more cost effective to have a business unit thousands of miles away? Where is the savings? In the worker's wages and the exchange rates for the most part. The tax rate in Colombia, Ecuador and Venezuela is higher than the US. Ecuador doesn't have an exchange rate. But you can get a secretary for less than $1,000 a month all in. You can get workers for about $500 a month.

I think a lot of the businesses, at least the ones I have been involved in, are moving to China to go after the Chinese market - a different set of dogs altogether.

But is Michael Dell selling a lot of computers to Indians? Is that why he moved his call center there?

I agree that the US is failing to compete. Taxes are one reason. But do we lower our worker's standard of living in order to compete with third world countries for the available jobs of our own US companies?

The decision to lower costs by moving US jobs overseas is profit driven. So you take away the profit incentive or level the profit here, at the worker's expense.

NousDefionsDoc · 02-08-2004, 19:23

Quote:

Originally posted by The Reaper
Socialism, globalism, or protectionism.

You raise the other country's minimum wage, lower your own, or create financial disincentives for using foreign labor or benefits for using your own, via taxes, tarriffs, or deductions.

TR

Right. But you can't really lower your own, especially if you're a politician who wants to be re-elected. So what would you do?

Wouldn't raising the other country's minimum wage in some cases help alleviate other problems?

**Roguish Lawyer** · 02-08-2004, 19:24

Quote:

Originally posted by NousDefionsDoc
RL, what's up with quoting me? You make me sound horrible. Why didn't you include the part about the right to not be abused, etc.?

Ok, ok, I'll take it out. I didn't think you sounded horrible. I thought it was hysterical.

02-08-2004, 19:30

Quote:

Originally posted by NousDefionsDoc
I know what you are saying, but the US consumer will only buy his favorite brand as long as the price is competetive to the others in the same market for most items.

So, you'dput companies out of business because they dared to move overseas?

That is what it sounds like you are advocating.

NousDefionsDoc · 02-08-2004, 19:35

Quote:

Originally posted by Greenhat
So, you'dput companies out of business because they dared to move overseas?

That is what it sounds like you are advocating.

Not necessarily out of business, but I'd make them have to hire US workers if they wanted to stay in business and their only reason for moving overseas was to increase their profit margin.

Sacamuelas · 02-08-2004, 19:40

Quote:

Originally posted by NousDefionsDoc
... your local manager there can hire for 1/100th what it would cost in the US. Who suffers?

I don't suffer because of the subsequent lower price.

Using your Bangladesh scenario, I would get each of my twins their own CRad brand computers at the lower price of $399 each verses getting only one unit at $600 each(if made in the USA) .

I would actually end up spending more ($798) which brings in more sales tax , and both my children get to learn on their own computer.

**Roguish Lawyer** · 02-08-2004, 19:41

Don't we also care about American consumers?

I like buying cheap TVs that work. I'm happy to buy imported ones as long as the country where they're manufactured gives us equal access to their markets.

The only exceptions I might make involve strategic industries where we can't let ours die for security reasons.

NousDefionsDoc · 02-08-2004, 19:47

Quote:

Originally posted by Sacamuelas
I don't suffer because of the subsequent lower price.

Using your Bangladesh scenario, I would get each of my twins their own CRad brand computers at the lower price of $399 each verses getting only one unit at $600 each(if made in the USA) .

I would actually end up spending more ($798) which brings in more sales tax , and both my children get to learn on their own computer.

Who does the sales tax go to?

Who pays the unemployment and welfare entitlements to the laid off worker because you spent $399 and not $600 on each and provided jobs for Bangladeshis and not Americans. Who's crime rate is going to go up becuase of increases in unemployment? Now add another $1,000 for a security system and higher taxes for more police.

Look at the cost, not the price. You don't suffer in the short term because of the subsequent lower price. You very well could in the long run.

NousDefionsDoc · 02-08-2004, 19:48

Quote:

Originally posted by Roguish Lawyer
Don't we also care about American consumers?

I like buying cheap TVs that work. I'm happy to buy imported ones as long as the country where they're manufactured gives us equal access to their markets.

The only exceptions I might make involve strategic industries where we can't let ours die for security reasons.

Sure, I care about American consumers. But they can't consume if they don't have jobs.

Where was your TV made that we have equal access to their market?

Every industry is strategic when it involves the national unemployment rate.

**Roguish Lawyer** · 02-08-2004, 19:54

Quote:

Originally posted by NousDefionsDoc
Where was your TV made that we have equal access to their market?

I believe that all of my TVs were made in Japan. I've got two JVCs and a Mitsubishi.

Whether equal access to that market is being provided today or not, I don't know.