US Corporate Executives to Workers: Drop Dead

[marmar]

US Corporate Executives to Workers: Drop Dead
Posted on September 16, 2014 by Yves Smith


The Washington Post has a story that blandly supports the continued strip mining of the American economy. Of course, in Versailles that the nation’s capitol has become, this lobbyist-and-big-ticket-political-donor supporting point of view no doubt seems entirely logical.

The guts of the article:

Three years ago, Harvard Business School asked thousands of its graduates, many of whom are leaders of America’s top companies, where their firms had decided to locate jobs in the previous year. The responses led the researchers to declare a “competitiveness problem” at home: HBS Alumni reported 56 separate instances where they moved 1,000 or more U.S. jobs to foreign countries, zero cases of moving that many jobs in one block to America from abroad, and just four cases of creating that many new jobs in the United States. Three in four respondents said American competitiveness was falling.

Harvard released a similar survey this week, which suggested executives aren’t as glum about American competitiveness as they once were…

Companies don’t appear any more keen on American workers today, though. The Harvard grads are down on American education and on workers’ skill sets, but they admit they’re just not really engaged in improving either area. Three-quarters said their firms would rather invest in new technology than hire new employees. More than two-thirds said they’d rather rely on vendors for work that can be outsourced, as opposed to adding their own staff. A plurality said they expected to be less able to pay high wages and benefits to American workers.

The researchers who conducted the study call that a failure on the part of big American business. They say the market will eventually force companies to correct course and invest in what they call the “commons” of America’s workforce. “We think this mismatch is, at some fundamental sense, unsustainable,” Michael Porter, one of the professors behind the studies, said in an interview this week.

But what if it’s not?

Why, if you were a multinational corporation, would you feel a need to correct that mismatch? Why would you invest in American workers? Why would you create a job here?

At what point does it become a rational business decision for American companies to write off most Americans?

It’s hard to know where to begin with this. First, Harvard Business School is hardly a bastion of socialist thinking. Porter and his colleagues are correct to call out short-sightedness in the incumbents of C-suites. And there’s nary a mention of the role of the long-overvalued dollar, thanks to the lessons that China and the Asian tigers learned in the wake of the 1997 Asian crisis: keep your currency pegged low, run a big trade surplus so you have such a large foreign exchange warchest as to never again be subject to the tender ministrations of the IMF.

But second, and more worrisome, is a vastly larger intellectual failure on the part of the Washington Post and even the Harvard investigators. They’ve completely lost sight of whose interests are at work. The HBS grads are looting the American economy for their own personal profit. Making better products and developing new markets is hard and it takes time for that effort to pay off. Cutting costs is easy. Getting a pop in the price of your stock due to investors’ belief that offshoring and outsourcing will lower costs is even easier. .......................(more)

The complete piece is at: http://www.nakedcapitalism.com/2014/09/us-corporate-executives-workers-drop-dead.html

[LakeVermilion]

1. Hear me out! Its time to drop their taxes to zero.

If I use an ambulance, I am billed for the service. Maybe my insurance picks up part of it.

I think that we should bill corporations for the services local, state and national governments provide. Locally, they can pay for fire protection, police protection, education and utilities. States should bill them for transportation and any legal services that are provided. Nationally, they should be billed for defense spending, copyright services, intelligence services, the court system, Congress and the Executive branch of the government.

Corporations use a lot more of the government than the people do. No more getting to write off depreciation, and getting special legislation to cut their taxes. Taxes will be zero, but its time to have them pay their way.

[enlightenment]

3. I don't really think you've thought that idea through

sufficiently.

Perhaps a Gilded Age refresher course would help?

[Sunlei]

2. some of the big businesses even get life insurance on their workers, so if they die- they 'win'.

The only answer is OUR, 'the peoples' Federal Gov. raise the minimum wage.

And there needs to be no loopholes for businesses to hire foreigners or prisoners at a cheaper rate or they will.

[BrotherIvan]

4. The most important point

The HBS grads are looting the American economy for their own personal profit. Making better products and developing new markets is hard and it takes time for that effort to pay off. Cutting costs is easy. Getting a pop in the price of your stock due to investors’ belief that offshoring and outsourcing will lower costs is even easier.

And if it takes $1Billion to win your position, these are the people that own you. That is why we have free trade deal after trade deal, with no help for the small businesses who actually hire American workers and pay their taxes.

[Initech]

5. This is why I'm afraid of a republican takeover of the Senate.

Think things are bad now? Expect them to get much worse if the republicans take back the Senate. If Rand Paul is the majority leader, labor relations will head back to the dark ages.