Letters to the Editor

Corporate grab

July 13, 2010

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To the editor:

The so called “tea party” seems to have forgotten history. They are angry, but at the wrong people, or at least for the wrong reason.

It wasn’t the government, but corporate executives, who have recently outsourced millions of American jobs and downsized companies not to save them but just to make more money. Of course, their own salaries increased tremendously.

We seem to be headed back to economic conditions as they were approximately 100 years ago. This was the time of starvation wages, child labor, 16-hour work days, six-day work weeks, and great wealth in the hands of the lucky few, most of whom acquired it by unethical and even illegal means.

What did we do about it? We enforced and added antitrust laws, workers began to bargain collectively and Congress passed the 16th Amendment to the Constitution which provided for a progressive income tax, designed to keep the rich from getting richer and the poor getting poorer.

In the 1980s, we decided that the rich were taxed too heavily and reduced their taxes. It was thought that this would encourage them to invest in business. This ignored the fact that income taxes, unlike sales or property taxes, are not a cost of production, they are paid only on profits. Since 1981, according to the Treasury Department, the national debt has risen from $900 billion to over $12 trillion, over 90 percent of it since the reduction of taxes on the rich.

Dennis Stauffer,

Lawrence

Comments

Stephen Roberts 4 years, 10 months ago

Dennis - do you own and run a business?? If so, I am scared. If not, it doesn't surprise me.

cato_the_elder 4 years, 10 months ago

The letter writer appears to be unaware of the fact that the Tax Reform Act of 1986, signed into law by President Reagan, eliminated many loopholes - especially in real estate investments - that had allowed wealthy individuals to pay little or no income tax through the use of passive tax shelter investments fueled by paper losses. Concomitantly, tax rates were reduced so that the entire system would be fairer. Leftists who whine that "tax rates used to be 70% and we still survived" are oblivious to the fact that those high rates were accompanied by gaping loopholes that resulted in wealthy individuals paying little or no income tax. The reason that deficits have increased, especially in this decade, is that Congress has spent too much money - with the current bunch far outdistancing any of their predecessors.

puddleglum 4 years, 10 months ago

the damage was done in the 80's... it really doens't matter now if it were republican or democrats' ideas...they damage is done. Neither party really reflects much of what they stood for in the 80's at this point. the real problem is that Neither party wants to fix it.

Mixolydian 4 years, 10 months ago

The rich...you know....those of us representing less than 50% of the population that actually pays any income tax.

You also forgot to mention the real reason for the debt......out of control federal spending. Members of the TEA party are angry at the correct people alright.

Jimo 4 years, 10 months ago

"Members of the TEA party are angry at the correct people alright."

Really? I can't recall a Tea Party demonstration outside the Pentagon.

Military spending is the largest section of the budget. Military spending has doubled since 2000. Want to reduce the size of gov't? Cut the Pentagon.

I'll thank you to remain silent on this topic until you're serious about it.

aa469285 4 years, 10 months ago

How arrogant. But what else can I expect from a liberal. Civil discourse is allowed as long as all are in agreement.

Jimo 4 years, 10 months ago

Errr....I'm a conservative. As in, real conservative. (I know - endanger species in this century.)

And sorry but hypocritical, childlike claims do not equal "civil discourse." They are and remain pure b/s.

Besides, we all have seen that, in the Obama era, "arrogant" is just lame-brain slang for "smarter than I am".

LoveThsLife 4 years, 10 months ago

Why on earth would you demonstrate outside of the Pentagon? They do not approve their own budget, that is in the domain of Congress.

Jimo 4 years, 10 months ago

Why of course. The Pentagon never lobbies for cash. How absurd!

John Hamm 4 years, 10 months ago

And I submit NAFTA had quite a bit to do with business fleeing the country.

Richard Heckler 4 years, 10 months ago

Sam Brownback will bring on his idea of limited Government and no tax hikes which in essence = more of YOUR local and state big government tax dollars going to corporate welfare. Sam Brownback supports laissez faire government which is one player in the recent killing of the USA economy.

Public Education dollars will be in further jeopardy.

Tax breaks have never prevented a recession AND there is no substantial evidence that tax breaks promote new employment of any significance.

Tax cuts/breaks mean someone else such as you and me make up the losses. Tax breaks obviously do not keep USA jobs in the USA. USA tax breaks have supported USA corporations operations in China and abroad generally.

U.S. government policies have encouraged globalization, which translates into shipping jobs overseas.

There is indeed a tax break for US-based multinational corporations to locate operations overseas.

Programs such as NAFTA have lowered the cost of shipping jobs south of the border, and there's no economic penalty facing U.S. companies that decide to ship jobs overseas.

The State of Kansas needs none of the above that is the bottom line.

tbaker 4 years, 10 months ago

Mr. Stauffer, do you realize that no government in history has ever, or will ever produce a penny of wealth? Do you realize government seizes wealth from productive people, and redistributes it providing unearned benefits to people who did nothing; produced nothing; added nothing to society besides presenting it with their "need"? Why would a business executive decide to do business overseas? What would compel a business to do that? Profit Mr. Stauffer, that’s what. More to the point, US government intrusion into the market with policies and taxes that finally drove the cost of production to the point they were no longer competitive. I imagine you would cheer and offer lofty platitudes to the corporate executive that steadily drove his company into the ground, forsaking all profits, ruining all the value of everything the shareholders owned until the company collapsed, taking all the precious jobs with it, and countless life-savings as well. Profit is a filthy, evil word to you because you cannot grasp the fact it is the engine that has driven all of mans greatest achievement. Return on investment for the shareholders; the people who worked; who put the value of their sweat and effort (their money) into the company expecting value in return is what you scorn. A man’s pursuit of his own rational self-interest and of his own happiness is the highest moral purpose of his life, but you would see him reduced to a slave; the fruit of his labor not his property, his own skill and ability to produce being his curse, the yoke you would have him wear to serve some noble social purpose people like you judged to be a higher purpose than his own life. That brand of immoral behavior is what you promote Mr. Staufer, and it is what is rotting our country from the inside out.

jafs 4 years, 10 months ago

Your post should be on TV, with patriotic music in the background.

Content-wise, I disagree that profit has driven all of man's greatest achievements. Our country was not founded based on a profit motive, civil rights were not fought for based on a profit motive, WWII wasn't fought based on a profit motive, etc.

How on earth is a man's pursuit of self-interest and happiness the highest moral purpose? I guess that means all of those engaged in compassionate service are living lowly lives (Mother Theresa, etc.)

I believe the phrase was at some point "enlightened" self-interest, which is a bit better, and might include the understanding that we're all in this together.

The unfettered pursuit of profit, without regard for other considerations, is exactly what got us into the recent financial mess. Not exactly a good outcome, I'd say.

Those executives must be the ones at GM, etc. who ran the companies into bankruptcy, while continuing to enjoy their guaranteed benefits, and running to the government for bail-outs.

BorderRuffian 4 years, 10 months ago

so then, are you suggesting that we eschew profit and all go to a straight communist system? On paper, perhaps, this looks good, but can it work in real life?

jafs 4 years, 10 months ago

So those are the choices?

Sounds pretty black and white to me.

Unregulated profit-driven free-market capitalism or "straight communist"?

I don't know why people think in such extreme terms.

I'd suggest a regulated capitalist system that rewards companies for doing things in our own best interests, like not outsourcing jobs and/or punishes them for doing things against our interests.

My post, by the way, for those who don't understand context, was a response to tbaker's outrageous comments about profit being the "engine that has driven all of mans greatest achievement".

Do you agree with that statement?

rtwngr 4 years, 10 months ago

Big government is unsustainable. It is insatiable and can never be satisfied. The country can no longer hand out goods and services for the sake of cradle to grave care for some members of our society.

Place a temporary moratorium on capital gains taxes. Move the method of income tax to a "fair" tax. Secure the borders of our nation.

tbaker 4 years, 10 months ago

Dear Jafs: So by unfettered profit can I infer you believe limits should be placed on a man’s ability to achieve? Profit is what makes our world work. It’s why we go to work. It is the reward we receive for satisfying a demand. Without profit, why would anyone ever risk what money they had to make something new? Why would anyone work? Why would anyone open a business? Without profit, nothing happens. How it could be something we should ever hope to regulate is simply beyond the realm of rational comprehension. Would it be a reach to further assume your motive for feeling this way is your belief that money is inherently evil? I urge you to consider where money comes from. It is an instrument we use to exchange our talents and energies with one another. What use would money be unless there were goods and services produced by people, and there were both people able to produce them and able to buy them? Money is how people trade each other’s value. There is value in my labor; in what I produce and that value is only expressed by the amount of money you are willing to pay me for it. Exchanging money is the exchange of value; an exchange of recognition, that of one person for another. The existence of money is only possible in the presence of people who produce; who create the value the money is used to recognize. To brand it evil means the work we each get up and do each day is evil.

jafs 4 years, 10 months ago

I notice you fail to respond to any of the points in my comment.

funkdog1 4 years, 10 months ago

"limits placed on a man's ability to achieve"?!?!? What complete and utter BS. If "a man's ability to achieve" means working 12-year-olds for 10 hours every day in overseas sweatshops in order to reap ridiculous profits, then yes, I absolutely approve of limiting "a man's ability to achieve." (What about a woman's ability to achieve? Sheesh!)

There's a huge difference between reasonable profits and exploiting massive numbers of people so that a few people can become filthy, stinking rich. It's not only morally wrong, but shifting all of those jobs away from Americans is un-patriotic, plain and simple.

jafs 4 years, 10 months ago

The decision to exchange labor for wages would only be a truly free one if individuals all had a multitude of choices.

Given the lack of jobs, especially good ones, it's silly to say that people who take jobs are "voluntarily" agreeing to the wages they're paid.

So businesses want to operate without regulation, pay lower wages and taxes and so they choose to go where they can do that.

That sounds like more of a "voluntary" choice to me.

jafs 4 years, 10 months ago

Nope.

If you are desperate and need work, and there are few options, all of which pay badly, that's not a really "free" choice.

You need work (not free).

The options are unsatisfactory, but you have to pick from that group since it's all there is (not free).

jafs 4 years, 10 months ago

I disagree.

If you're hungry and you need work, you need to get a job. That means that even though nobody's putting a gun to your head, you're operating under pressure.

And if the marketplace is only offering low-paying jobs with poor benefits, you are forced to take one of them even though it isn't good enough.

It's not exactly the same thing as taking something by force, but it's not a nice free and voluntary situation either.

jafs 4 years, 10 months ago

Bush a "do-gooder" - that's a good one!

We've had this discussion before - we disagree. No need for name-calling.

I was responding, by the way, to tbakers' eulogy of the profit motive - that's the context of my comment.

Please don't exaggerate and distort my opinions beyond recognition.

jafs 4 years, 10 months ago

"Profit is ... the engine that has driven all of mans greatest achievement"

tbaker

funkdog1 4 years, 10 months ago

You're only half right, Liberty_One. Banks and the real estate industry, with the help of the reaped huge profits by gleaning off all the fun little fees from those crap mortgages and then dumping them on the government. In the case of the housing bubble, both government and private business was to blame.

jafs 4 years, 10 months ago

I don't know of any anti-trust regulations that prohibit banks from making intelligent decisions regarding mortgages, and in fact many smaller local banks did just that and weren't hurt by the meltdown.

The factor you keep ignoring is the way in which mortgages were bundled and securitized, allowing mortgage brokers and banks to make loans without caring whether they were sound or not, simply because they could sell them. And, the fact that credit rating agencies rating the securities were paid by the issuers of those securities, leading to blatantly incorrect ratings. So various people/institutions thought they were buying very good, safe securities when they were in fact buying very poor, risky ones.

Without those factors, this never would have happened. If a bank is keeping their mortgages and thus assuming the risks, they will be more careful about making bad loans.

If it were harder to sell the mortgages, mortgage brokers would be more careful.

If the ratings had been correct, the the securities would have been harder to sell.

puddleglum 4 years, 10 months ago

libby sez: "Bush and the other politicians thought it would be a good idea if everyone in America owned their own home"

you really believe this?

try this: Many people employed by the controlling lenders (wall st. banks) thought it would be a great investment (rip-off) if they made up loans that they wouldn't have to be responsible for...

jafs 4 years, 10 months ago

Well, there was quite a push at one point for more Americans to own homes.

mr_right_wing 4 years, 10 months ago

"We seem to be headed back to economic conditions as they were approximately 100 years ago."

.....and you remember what fixed our economy that time around? WWII.

Hopefully we can come up with a better solution this time around!!

Corey Williams 4 years, 10 months ago

World War 2 fixed our economy 100 years ago?

Mixolydian 4 years, 10 months ago

William Howard Taft would dispute that claim.

mr_right_wing 4 years, 10 months ago

Nope. You're information is flawed.

Economists may argue about small details, but they overall agree that as horrible as WWII was, it was a big boost to the economy of the United States.

I guess if you yourself are an economist; you're in the minority my friend.

jafs 4 years, 10 months ago

Liberty One is a hard-line Libertarian whose views of history and economics are in a very small minority - but he's absolutely convinced he's right and everyone else is wrong.

mr_right_wing 4 years, 10 months ago

The kits Acme sells to trap road-runners are all flawed, and likewise, your Acme degree in economics doesn't hold any credibility.

Give Wile E. Coyote my best.

George Lippencott 4 years, 10 months ago

“It wasn’t the government, but corporate executives, who have recently outsourced millions of American jobs and downsized companies”

Well my version of the problem cited is that both political parties voted to open our markets to low wage countries/products. Business simply followed the government initiative and moved to locations where they could price their product at a competitive level. They could not compete if they continued to pay natives the prevailing wages here - and they would have gone out of business and we would have lost the jobs anyway. A lot of the mess of high unemployment is the loss in absolute terms of relatively well paying jobs as a matter of public policy – not the melt down which I also believe was a failure of public policy – both parties. Despite a lot of comment here, government is not always our friend.

funkdog1 4 years, 10 months ago

I think you're wrong that they wouldn't have been able to compete. We'd have a completely different way of life here had those jobs stayed --- actually, it'd be the same life we had through the 50s, 60s and 70s. Merchandise would be priced as it's really worth, rather than our market being completely flooded with watered-down, cheap crap that now has to conveniently break every 9 months so that we all have to run out and constantly replace our stuff. Had we not opened the markets, we'd probably alll own much less, but much better made, stuff.

jafs 4 years, 10 months ago

Good point.

In the 50's many were able to support a family on one income, and many worked at the same job for 30 years, with good wages/benefits and a retirement plan.

This led to stable, committed long-term employees and a good relationship between employer/employee, which both sides benefited from.

We had many more manufacturing jobs in this country and were doing just fine.

It seems to me that it is the greed at the top that decided to scrap the factors above and simply look for short-term profits instead.

George Lippencott 4 years, 10 months ago

funkdog and jafs

Maybe. But back then there were tariffs on foreign products that protected our own higher priced products. When the government chose to reduce/eliminate those tariffs the problem began. If the tariffs were still there our business would not import products they could produce cheaper here. The tariffs made certain that our locally produced products were cheaper.

Elected leaders love to blame everybody else. Regardless of your personal political philosophy you need to make sure you are not focused on the wrong source of a problem by those trying to avoid the consequence of their action. If we were to raise tariffs some of those jobs might return.

By the by, the argument at the time was that many other jobs would accrue if we allowed the world to trade openly. Unfortunately, that really hasn’t happened. Foreign countries have built infrastructure to compete successful in the markets we were told we would gain. Middle income salaried and hourly employees lost all around. There was also to have been meaningful retraining for those who lost their jobs to the trade issue. Did not really happen. Losing an assembly line job at $20+/hr and being retrained to be a telephone solicitor at $7.00/hr does not seem like a good trade to me.

Our business leaders could care less about how much you despise them. They have reaped fortunes from the government decisions to compete you with low cost labor in China. They also live in enclaves that are completely untouched by the job losses and the economic melt down. Were the rest of us so fortunate?

independant1 4 years, 10 months ago

Don't know what you all are all so upset about. Corporations provide some of the better livings/jobs. Like Microsoft, Cisco, GE, IBM, Apple, Dell, HP etc.

They are in business to return a profit to the owner/shareholders. In pursuit of profit there are business decisions made. There appears to be an obsession (protectionism) by experts here that want all jobs to remain in USA. That's not realistic if one wants to take part in an open/free market. The free market (with minimal gov't regulation) is preferred to planned/controlled economies and profit (call it greed if you wish) is not a bad thing.

I work with overseas technical (outsourced jobs) people. Training and technical support for those hard working folks in India/Phillipines/Brazil/Hong Kong. True they do not make as much as the job paid stateside. That's why the jobs went offshore. Are they being exploited? For those job markets they make a good (corporate) living. Those folks are a pleasure to work with. I can travel the globe, providing support for arcane technologies, at my keyboard. They are as fun to work with as the folks I support stateside. Of course the stateside support is leading edge technology. The corps. I provide tech support to only outsources the old crap too expensive to continue to support stateside.

I think people in other countries deserve good jobs too (according to their fair wages, not ours). They fill a niche market for our obsolete applications that are not economical to support here stateside. I never hear them whining about the disparity between US wages and prevailing wages in their country.

An economist like Friedman might say, pursuit of profit is not bad, offshoring jobs can help the corporate bottom line and makes sense. As opposed to what? Lose money, go out of business?

I for one think the world of geekdom I work in is much more robust/interesting now than the 70's/80's. Used to be we had to travel incessantly to negotiate with our foreign partners/customer/suppliers. Now we are a worldwide community of geeks. Makes me wonder if colleges and universities are not lagging behind the commercial world when it comes to expanding everyday touches with other countries and cultures. Outsourcing/off shoring has enriched my little world. I see it as a positive thing, that Corporate Grab at survival.

gatekeeper 4 years, 10 months ago

As you are stating it, it's ok that we take work from Americans and send it overseas because the owners and shareholders need bigger profits. Profits can be made by keeping the work in the USA. The problem is greed. Have to have bigger profits. Not good enough for the owner to be a multi-millionaire, got to have more. I know this first hand. I work for one of these uber rich, ship everything off to Asia so he can make more and more money. Every few years he buys a bigger house. His teenage kids drive cars worth as much as my house. He would make a very, very, very nice living if he had kept the manufacturing in the US. He chose to oursource it all to Asia because instead of making quality product here and selling it for a reasonable price, he realized he could buy crp from Asia, still sell it at the price for US made goods and make himself richer in the process. There was no thought put into what it would do the US workers. It's all about becoming richer and richer. Greed is what's wrong with this country. Greed corrupts. Greed causes us to not pay attn to the needs of everyone. Do these rich business owners care that they have caused hard working Americans to lose their jobs? No. Do they care that overseas workers are exploited, abused and treated like total crp? No. It's just like how Thomas Jefferson lived. He made sure that he couldn't see the slaves at Monticello - everything was built to keep them from his view so he didn't have to see how terrible their living & working conditions were. Today's rich business owners live in their gated communities, don't interract with their workers. Out of site, out of mind.

You deal only with outsourced technical jobs. Until the job market turns around and I can relocate and change companies, I have to deal with factories that do abuse workers. Hell, in China right now there are actually labor shortages. Workers in many areas decided they'd had enough in the cities and have been returning to the family farms because they'd rather live off what they can grow and be total peasants instead of being totally abused in the factories. Things will change in China and as prices go up there, the factories will be moved to poorer nations where they can easily abuse and rip off the people.

You have a very limited grasp of outsourcing. You are dealing with educated, foreign workers. Go visit Chinese factories where they literally lock the workers in rooms for 12-14 hours a day and pay them $0.25 per hour. That's how you're able to buy all the unneeded, cheap, breaks easily crp at Walmart that you don't really need. Next time you pick up some piece of crp of Walmart that says made in China, think about whether you really need it.

George Lippencott 4 years, 10 months ago

Put tariffs back do not rant at business that simply responded to the tariff reduction.!!! Others still have tariffs on some things that benefit them. We dropped them too much too fast and now have a real mess. Business is not at fault your government is!!! You can not compete a widget made here at the cost of $5.00 with a widget made in Singapore and shipped here at a total cost of at $1.00. Don't get taken in by politicians of either party.

jafs 4 years, 10 months ago

Tariffs may be part of the problem, but you don't think that greed is?

independant1 4 years, 10 months ago

Not "take" and not "bigger profits" and if greed = strive for profit that my friend is what drives the market place.

So take profit out of picture and move to planned economy. Yeah right.

When certain jobs leave they are for the most part the worst jobs. Taking your example about those poor China workers earning $.25/hour? That raised their standard of living $.20 per hour. There is no way in he11 we can keep everything here for us when we do business in a global economy else it ain't global. And we cannot project all things american into third world countries.

Today's rich business owners are us, shareholders. That's what funds your retirement fund(s) my friend. If you have one.

As for your uber rich guy, he's creating jobs and seems to have found a good formula for success. I wish I could start up some business in India with my old KU alum chums and be just like him but I don't want to risk the little bit of capital I've accumulated thus far. Made some good $$$ in the international funds in my annuity. It can make the difference between Alpo versus Old Pal in my retirement since it appears SSA will not be funded when it comes my turn.

independant1 4 years, 10 months ago

Nope been working with, training and providing technical support for the last 20 years - I don't manage people or make decisions. I'm a geek in that gigantic bit bucket you call the www. I am expert at installing/configuing/interfacing/adminstering machines. Rotated through hands on, R&D, Sys Admin and now back where I started, hands on technical support while sliding to retirement.

And yes, I am selfish. In my retirement I only want the bestest dog food.

Have been sent packing off payroll three times in 30 years, each time it resulted in an opportunity but that's just my stinking little attitude on worklife.

And have lived out of country, have relatives in Korea, Russia, Costa Rica, Mexico, Puerto Rico, Argentina. They are Conservatives with caps, they think I'm a bleeding heart liberal. I resent that.

independant1 4 years, 10 months ago

about 10 months from retirement (early, SS won't kick in for awhile)

going back to my roots for the remainder of my time = farmer, hobby not occupation

jafs 4 years, 10 months ago

Well of course Friedman would say that, being a strong advocate of free-market economic theory.

And yes, it helps those in other countries get jobs, and increases profits.

But, it increases unemployment and hurts American workers.

I'd rather that we took care of our own country first - when unemployment is down to a minimum, and we are paying down our debt, and are on a sustainable economic path, maybe that would be the time to think about helping other countries.

remember_username 4 years, 10 months ago

Why do Americans keep ignoring the fact that Americans themselves are most to blame for the current outsourcing of jobs. Try looking at most everything the American consumer buys these days.

How can you be angry at the loss of the family farm, yet buy your food from the massive conglomerates that helped drive those family farms under? Look at your appliances and don't just assume because it has the name of an American manufacturer on it that it was made by Americans. How about your clothes? When was the last time you bought a clothing item made in America? Or a toy? A tool?

Why don't American's buy primarily American made products? Because foreign made, bulk made, mass produced products are cheaper. Bottom line. It's all about the money. How can anyone justifiably complain about businesses moving operations overseas because it's cost effective to do so.

jafs 4 years, 10 months ago

There is demand for less expensive items, partly due to greed but also to the fact that many people can't afford to buy the more expensive ones.

The Merc offers a variety of locally produced food, all of which is more expensive than the food at Dillon's.

And, it's not that it's "cost-effective" for businesses, it's that they can make higher and higher profits - they could do fine in this country if they weren't so greedy - see gatekeeper's post above.

Steve Miller 4 years, 10 months ago

It all calculates into that we have priced ourselves out of our standard of living, we have prostituted it out to the japs and chineese.

tbaker 4 years, 10 months ago

American businesses do not “send” jobs overseas. The accurate verb to use is here is “flee.” Jobs leave for a variety of reasons, but economically speaking, those reasons aren’t bad, or good for that matter. Where a company decides the best labor market for them happens to be is a function of profit. Some companies, like Dell for example, discovered the best labor market for their tech support happened to be (back) in the United States. After trying to use the cheaper Asian labor, they discovered the language skills and technical ability / education level of these employees was hurting profits because it is was frustrating and upsetting customers, so the jobs left that labor market, and came back to the one best-suited for the company. I urge the Bush-Blamers to educate themselves about the housing bubble and the subsequent financial market melt-down. The briefest reading of history will clearly illustrate how this fiasco was the work of many presidents and congresses over the last 30 years, each bent on more and more government interference with the housing and financial markets. Had it been consulted, the remedy for this entire problem was plainly written in our constitution: it’s called bankruptcy. This is the natural consequence of the behavior that caused some of this problem. Government stepped in, rigged the game, and prevented this consequence from doing its work and correcting the market. It provided borrowed, unearned, unconstitutional benefits for select people that should all rightfully be unemployed right now. The fact is the current administration (just like it’s predecessors) has implemented “fixes” to the supposed “problems” that has guaranteed we will have another similar financial meltdown for the same reasons we had the last one.
And Jafs, I couldn’t agree with you more. Save stalwart allies in parts of the world where our national interests are at stake, I believe foreign aid programs should be drastically cut. As it is, we are borrowing money and giving it to other countries that provide zero return on this investment. This is insanity.

remember_username 4 years, 10 months ago

Madison Ave and Hollywood tells Americans that they must have the latest gadget, and they respond as if they have been trained to do so. The availability of cheap goods encourages the replacement or upgrade of an old or broken item, even by those Americans that cannot afford it. No money down, delayed interest rates have most Americans spending money they don't have. Then they complain when their own government does the same thing.

The Merc also offers a good deal of food not grown locally that is more expensive than Dillion's. Yet, the locally grown food at the farmers market is often cheaper than either. This has more to do with American consumers desire for exotic foods or foods out-of-season locally. I like apples too, but it isn't going to kill me not to eat them year around.

Are businesses really greedy, or just competing for shareholders? The more profits you can get the more you can grow and the more shares you can sell. There are few Americans that aren't shareholders in some way. If business stopped competing for more profits then Americans would start to scream about not getting a large return on their pension funds.

When Americans begin to start buying products made in the US then manufacturing jobs will begin to return, it's trade deficits will begin to shrink, and the money the government owes will be to its own citizens not to anyone else. The Federal Government cannot do this, that's how wars start, its why there is a WTO. However, Americans themselves can do this, simply by exorcising their rights as consumers. It will take time, and it should take time, so the world economy can adapt without chaos, but until they do so they shouldn't keep pointing their fingers at anyone but themselves.

George Lippencott 4 years, 10 months ago

This is poppycock. Demanding that people who are already in financial straits increase their costs in the hope some jobs will return here is itself greedy. Watch out for domestic production laws. The product will carry an American label and be 80% produced elsewhere yielding few American jobs and more profit to overseas producers

You have been fed the greed thing and either misunderstands the reality or chose to go for ideology. Most things we buy cost much much more than elsewhere. The prices of many of those purchases are built into our economy. Car, houses, rent, TVs, travel, food (mostly domestically produced and reasonably competitive on the world markets (using undocumented slave labor to produce here)) are pretty much fixed. You need a certain income to survive. At that income level many manufactured goods produced here are simply not competitive in the world market. We can not buy cars, homes, pay rent, eat at lower costs no matter what we do in the short haul - maybe over generations we can bring that cost down - but the pain is now and we were sold a bill of goods. The seller is as always trying to point the finger elsewhere. Where is "Toto"?

jafs 4 years, 10 months ago

Well, it's kind of a chicken/egg thing, isn't it?

And, it's not fair to ask people to spend more if they don't have the luxury of doing so.

And, that extra profit is also going towards lining the pockets of those at the top.

There's a company in North Carolina (a software company) that has been around for about 25 years - the CEO takes home about $400,000year - less than many, treats the employees quite well, with excellent benefits. They've had the same CEO for a long time, very high employee retention rates and satisfaction, and very good market share for their product.

That's a win-win situation in my book and, if more companies were run that way, we'd all be better off.

And, the government can certainly institute policies, tax and otherwise, that reward companies that keep jobs here, and/or punish ones that outsource them. Also, they can close the loophole that allows companies to operate here, locate a little office in some other country, and "offshore" the profits so they don't have to pay taxes on them.

George Lippencott 4 years, 10 months ago

Amen!

But the jobs problem is different. It is not corporate greed. As you point out some things we can still do here in limited markets - software being one. The real problem is things we once did here and now don't because we simply can not make a profit. The incomes of the workers were protected by our laws - now they are not.

JAFS I know you are into corporate greed and I agree total remuneration for the top is obscene but it is not the problem on keeping business here. The problem is the salaries we pay to the hordes. There are many hordes and the cost of all of them dwarfs the cost of the CEO (and others). We protected the hordes once and stopped doing so. We could protect them again – that would be called protectionism

Our system does not provide for limiting CEO incomes. I don't know whether our constitution will allow us to try. I have repeatedly argued for taxing them more - probably leading to an increase in income for them and little gain (except tax money). Many of these companies are publically held. You would think the stock holders would limit remuneration - or do the stock holders have any real say anymore? Large institutional investors are not motivated the way a small stock holder is.

This is not a trivial problem. Greed is a gross oversimplification of what is happening and hides the real problem.

jafs 4 years, 10 months ago

I disagree, George.

Productivity has increased, and CEO/top level compensation has increased while average wages have not risen proportionally. So people are working harder and more effectively but not being compensated for that adequately.

In the 50's, one could support a family on one income, including owning a home and having children. These days, many people are having trouble making ends meet with two salaries. Something changed.

It is absolutely the greed of those who want to make more and more profit that prevents them from keeping jobs here and/or making a bit less, like the CEO in NC I mentioned.

According to some, stock holders have very little say in company decisions, and these are mostly made by Boards of Directors (made up of CEO's and friends who sit on each other's boards).

That's how the guys up there get these ridiculous guaranteed severance packages, etc. that aren't tied to performance.

And, an interesting article I read concluded that the better CEO's actually do less and simply let the companies run well more or less on their own. CEO's who try to do more most often have a negative impact on the company.

So they're getting paid more to do less, in the best case scenario. How does that make any sense?

George Lippencott 4 years, 10 months ago

JAFS,

Obviously, you hold your position strongly. I think we are writing about two different groups. Let us parse this issue. I am addressing the small skilled and semi-skilled worker pool making widgets. I maintain that if we fired all of the top executives the current situation in the world market would preclude many of the jobs we lost from this group returning despite productivity difference.

Now, I am not addressing professionals and those in the service industry. The former will remain competitive until the world market expands to compete wit them – some are already in trouble.

The latter group, the group I think you are addressing, will have jobs here. Jobs in service industry are very hard to export. I believe you may be right with respect to this latter group. How would you fix it for that group? I believe that protectionism or retraining is the only way to address the group about whom I am writing.

jafs 4 years, 10 months ago

I do.

I'm not advocating firing CEO's - I'm advocating for them to make less and for workers at lower levels to make more, and for their compensation to be tied to performance.

The productivity difference I'm referring to is the average productivity of American workers, which has risen - I maintain that a comparable raise in pay would be appropriate.

The way to retain/get jobs here would be to set up reward/punishment systems - tax and otherwise - that encourage companies to hire American workers, and discourage them from outsourcing jobs.

One way would be to simply require that any company that does business here hire American workers, or that companies that do a certain percentage of business here hire a comparable percentage of American workers.

I'm not sure if it matters which segment of the labor force we're looking at, but yes, it's hard to outsource waiters, etc. If it weren't, I bet we'd see the corporations doing it if they could.

If we don't stop them, the economy will get even worse - it's surprising to me that more right-wing folks who seem to care about this country don't see this problem.

bearded_gnome 4 years, 10 months ago

reference to "tea party" is gratuitous.

reference to growing deficit since 1981 fails to account for one very basic problem: along with the tax cuts, the democrat congress then promised to do actual budget cuts. they lied, of course.

also, if Denny got his info from a reputable source he'd know that decreasing taxes in that way actually does increase tax revenues because of increased economic activity, plus the evil wealthy hide less of their assets in tax shelters.

which provided for a progressive income tax, designed to keep the rich from getting richer and the poor getting poorer.

---sadly, this says it all. Denny, the letter writer is clearly a socialist. the jobs wouldn't be going offshore so fast if government bureaucracy were cut and odious regulation stopped. and, if taxes were structured in such a way that encouraged domestic employment.

Denny's president, Mr. Obama, has just dramatically increased the cost of employing each employee. does Denny not know that this will kick more jobs overseas? if not, then he is completely ignorant of even basic economics and should be totally ignored as a source of useful insight.

independant1 4 years, 10 months ago

Deficit is a problem - other countries take advantage of our mixed economy but but but

Get your head out of the sand for gosh sakes!

USA ain't the center of the (market) universe.

Doing business outside the USA (outsourcing) is not a bad thing. India, the largest democracy in the world? has more scientists and engineers than any other country (unless China has eclipsed them.)

For the most part the jobs that get outsourced are the older/arcane stuff that are way too expensive to support stateside. At least that is the tech market niche I support. I support stateside high tech jobs too.

Middle level manager moi? Nope pure technical support geek. But did get to travel to eastern block countries to get contract scientists and engineers on board with a couple programs.

The difference in the stateside versus foreign folks I support? The stateside people work harder/longer/produce more than those on the other side of the ponds. They are fun to work with too.

NOt enough time but gotta throw out or throw up (take your pick) the auto industry in 70's didn't get it. When Toyota ate their lunch in the marketplace. They do produce good products but never came close to producing a fuel efficient car. I guess they are just near sighted. Evidently

LadyJ 4 years, 10 months ago

Mazda was a good car till Ford took over it. ♣→

George Lippencott 4 years, 10 months ago

Independence 1 and JAFS

This time I see a need to address the simplistic notions of free markets.

I would argue that our market was large, free and unfettered before we opened it up to the world. It had adjusted to accommodate a living wage for most of us, amazing production and a broad and comfortable middle class. By world standards, it was very expensive – as you would expect when wealth is relatively broadly shared.

We chose to open our market to the world economy – not quite a free market because of state interference. Our market just could not compete in that market. Wages are low, wealth is sparsely shared, and expectations are much lower. The only outcome possible was the loss of many jobs in our market to foreign markets because we were just not competitive. Free market principals – but not applied thoughtfully

My argument is that in the long term we probably need to be in the world market place. However, I question the moral basis for a precipitous opening of our markets to such competition. We must find ways of using our human capital that does not grossly affect their standards of living. Over time, we can get there. In the immediate, we have done a horrible disservice to many many people who did nothing to warrant our actions. Now some people call them greedy. What a cop-out. It reflects a complete lack of understanding of human nature and our world economic system. Now the real greed was on the part of those who argued for the precipitous opening of our markets. They for the most part have profited –sometimes obscenely – from that action. Unfortunately both political parties supported that action.

jafs 4 years, 10 months ago

Agreed.

If we're going to be in the world marketplace, though, we need to be more careful about trade agreements, etc. so we don't get the short end of the stick.

George Lippencott 4 years, 10 months ago

Yes, JAFS that has been my apparently poorly explained position all along.

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