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This was in March of 2004. Long story short, this bitch-ass wrote an article about "The Flip-side of Outsourcing", detailing what we call Direct Foreign Investment, which is where say Toyota opens a plant here and employs Americans for the purpose of selling their product here to avoid shipping costs. This practice is generally a win-win for both economies, but at the same time, it's not the same as offshoring. In context, Steve Koff is a Bushbot reporter of the utmost shamelessness. Since outsourcing was the hot-button topic of the moment (remember N Greg Mankiw's comments stating offshoring "is good for the economy", pissing off just about every worker in America), he decided to equate offshoring with DFI to show that offshoring is not that bad . . . but that's totally apples-to-oranges. You know, like Republicans do with just about every damned thing. Anyway, this letter should explain things, and also give figures on both sides of the fence as of 2004 (I imagine the numbers are greater on both sides of the fence since the letter . . . naturally, it didn't get published). Note: OFII means Organization for International Investment, which tracks insourcing numbers. Informative article about "insourcing", yet there's a few exceptions I have to take on it, particularly based on the opinions given by the Honda workers interviewed.
There seems to be a confusion of issues here between the agenda relating to the curbing of offshoring that John Kerry is trying to bring to the American people and what is happening with companies such as Honda and Nissan building plants here.
INsourcing is the result of a foreign company seeking to EXPAND it's market. In other words, these companies are creating work here to market their product IN AMERICA. Yes, they're creating jobs for Americans, but at the same time, these companies are not taking away jobs from Japan, Germany, England, etc. In turn, they're probably creating more jobs for their home countries since they have capital to expand and reinvest in their businesses. It's money that's going into TWO economies. Unlike American CEOs, who just pocket the cash and not expand or create new jobs/products to replace the outgoing ones (studies show that the new jobs being created lately pay 21 percent LESS than those of ten years ago), these foreign companies know that, labor costs be damned, expansion will only HELP their business in the long run. Small wonder why they're gaining the lion's share of the automotive market here.
When an American company OUTsources or OFFshores, what results is a displacement, not an expansion; solely for short-term, quarterly-profit gain. American jobs are TAKEN AWAY and given to cheaper overseas labor. When core competencies are shifted by already profitable "US-based" corporations like Microsoft, HP, Cisco, Lehman Brothers, Intel, etc; when manufacturing work by Ford, GE, Marconi, Pillowtex, Dow, DuPont, etc is shifted offshore; these companies aren't looking to create a market for their products in foreign countries. I seriously doubt that Indians, who make about $5000 a year on average, and Chinese, who make even less, could afford $10,000 Oracle software, HP Printers, SUVs and such. Multi-National corporations would have to sell their product at Indian-level wages - hardly an economic gain compared to the way they soak Americans with their inflated prices. In reality, American MNCs are offshoring to escape paying liveable wages to Americans, to escape paying health care costs, to escape paying benefits, to escape complying to American workplace safety standards and to generally escape paying taxes (incorporating in Bermuda also helps in that regard, but that's another story). While foreign corporations INVEST, American companies and their executives EXPLOIT for their own personal gain. They remain crooked and callous, only looking out for themselves and their lottery-esque pay in today's dollars rather than the long-term health of the American infrastructure.
Are you going to tell these people that offshoring is good for the economy?
http://www.fastcompany.com/magazine/81/offshore_profiles.html
And are jobs being created HERE as a result of this offshoring? Are new products being made? Are new killer apps/industries evolving to replace those technologies leaving? March notwithstanding, we're still down 2 million jobs not counting people who have given up completely. The unemployment rate ROSE last month. The number of part-time workers also increased. The growth of the labor force has surpassed the economy's ability to accomodate it through jobs. Without anything to move to and with no net jobs being created, the overpriced American worker remains the loser in a ZERO SUM GAME. What I find disgusting about it all is that the same people who decry how "expensive" American labor is see NO problem with CEOs earning three lotteries a year, sealed and approved by board members (who are, not coincidentally, OTHER CEOs and execs).
http://proliberty.com/observer/20031110.htm
http://www.the7thfire.com/Politics%20and%20History/Norma_Sherry/out_sourcing_america-job%20loss%20and%20unemployment.htm
According to those two articles, since 1986, we've LOST over 15 million manufacturing/steel/automotive/textile jobs to offshore plants. I think that kind of absorbs the OFII's little 6.4 million number more than two-fold. Also, according to the Bureau of Labor Statistics, manufacturing overall hasn't hired a single new worker IN 44 STRAIGHT MONTHS.
(Incidentally, if I were Mr. Spangler, Mr. Gilliland and the other several million employed in these auto/mfg plants, I wouldn't be laying false praises on GWB just yet. Automation is going to be hitting these places in the next decade, something good-ol pro-corporate OFII doesn't tell you, and the possible reason why these places have no retiree benefits or pension plans (according to the union representative quoted in your article).)
Let's not jump to the conclusion that just because foreign companies invest here, that means it's the same thing as an American MNC offshoring manufacturing, or even worse, core competency IT jobs. These American businesses aren't using cost savings for the purpose of penetrating foreign markets and jobs here are lost as a result. Yes, offshoring has only cost America 5% of our tech jobs today, but offshoring is estimated by its proponents to be growing at around 25% or so a year. A UC Berkeley study estimates it will take 14 million or more jobs by 2015*. (The New Wave of Outsourcing, Fisher Center for Real Estate and Urban Economics.) Is going to college for four to eight years only to come out to a career that followed it's predecessor offshore an ideal society to live in?
Let's not confuse INsourcing and OFFshoring. Just because one happens doesn't make the other right or any less deadly to progress of the middle class.
Just wanted to clear up a few things - thank you for reading. |
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