The Reality of Outsourcing

Townhall.com ^ | Bruce Bartlett

[Alberta's Child]

How many gas lines did you see in Great Britain, Germany, or Canada in the 1970s?

[A. Pole]

So out of a class of 30, you might have 2 that will excel in a global marketplace, 25 that will go on to blue collar jobs or make fries, and 3 that will forever live on the incomes of the others. I suspect that in Japan and many other countries you would have a much larger percentage that will excel and a smaller number of french friers.

Not really. India and China with 2500 million people has 20 gifted for American 2. They can replace every American worker and more.

[A. Pole]

It's no coincidence that the greatest advances in the U.S. during and after World War II were only possible (at that early time, at least) because the U.S. was able to tap Germany's knowledge base in nuclear science, aeronautics, and rocket propulsion research.

Which was made possible by generations of government funding for science in Germany.

[oceanview]

Yes, but the question is whether an economy can be sustained employing environmentalists and diversity consultants. Sure, demand for those jobs exists, but you have to have an underlying tax base of productive industries so that school teachers and environmentalists can draw from that well. If an economy could magically exist in a vacuum where everyone had jobs like that, I am sure Argentina's people would all declare themselves to be environmentalists.

[SamAdams76]

For years now, in fact decades, we have been hearing the lament of jobs being shipped overseas. First it was auto factories, then sneaker factories and now IT-related work.

You would think, to hear them talk, that we'd have 50 million people living in cardboard boxes by now. But I just don't see it.

I realize that many people lost jobs but they are apparently finding new ones. And not necessarily low paid ones either. How do I know that? I just look around me. Restaurants and shopping centers are still jammed. On Friday or Saturday night, you can count on a one or two hour wait for a table at just about any restaurant in the Boston area. New, expensive cars are flying off the lots, making my car look like a junker. Houses are selling around here for $300,000 and up. If you aren't at the first Open House and you don't submit a bid close to or at the asking price, you lose out. Housing is very, very tight. Not something you'd expect to see if everybody was out of work or if everybody was working at Wal-Mart, as some would have us believe.

Can anybody explain the "disconnect" here between what I am observing and what the lamestream media and Democrats are telling us, regarding the "worst economy since the Depression"?

[lelio]

People cannot live in chaos for long. Cultures, states, communites, families and children cannot prosper in chaos. Even slaves will not tolerate chaos for long. And your money and cherished "property" would be devoured by chaos.

Bumps to that. If people are looking at their future as a programmer or a doctor and seeing jobs flying to India or hospitals bringing in foreign doctors as nurses (and eventually doctors) they're going to wonder what's in it for them? The argument of "oh you'll just get the better job as for some reason Americans are smarter than everyone else" isn't flying.

Or put it this way: one man, one vote is a cruel master.

[oceanview]

But not everyone needs to be in the technology fields, in fact, a relatively small percentage of people do. Our education system produces more then enough "smart techies" to satisfy demand, all these cries from industry about needing to import more workers through H1B programs is simply because they want lower cost workers, it has nothing to do with a shortage of US college grads.

The real reduction of those Americans grads is starting now, as parents divert their kids away from engineering and pile them into law school because they see what is going on.

[Jim Cane]

If you back and look at the history of this country, you'll find that a person's liberty was almost directly proportional to his ability to accomplish many different things on his own.

That and access to a lot of free stuff. Free frontier, free land, free lumber, no income tax, no OSHA.

One of the serious adverse affects of the industrial revolution (in all parts of the world, not just the U.S.) is that for the first time in history we had an enormous class of "free" people who relied entirely on employment by others for their livelihoods. As a result, we now have a country in which people who don't know even the most rudimentary principles of economics are casting votes for public officials based primarily on the state of the nation's economy.

Jefferson was right. Nevertheless, the horse is out of the barn.

As someone else posted on a similar thread, this is no different than asking the electorate to vote on the best method for treating pancreatic cancer.

Yes but those voters are here, nevertheless. The are not going away and neither are they Richard Burton the Orientalist.

As a business owner, to protect your own interests, you must either take away their franchise before they vote themselves a helping of your wallet, which you can only do by force (they still have guns) or by luring them with a Patriot Act style "security in exchange for freedom" trick - having "bought" some politicians (the currently preferred tactic), OR you can give up your citizenship and move to one of the many free countries in the world, OR you can buy the mob off - either via paying huge taxes, or by getting something in exchange for paying all that money - something like work.

You can pay Americans to work for you and to not kill you at the same time.

It's blackmail. If you want to stay, pay. Otherwise leave and take your chances with China's gerontocracy.

Whachyagonnado?

[Alberta's Child]

I'll do what I've always done -- take it one day at a time, and just do my best based on whatever resources I have at my disposal.

Your post is right on target -- and it actually goes a long way toward explaining why democratic rule is very "unnatural" system of government. It eventually gives way to a more totalitarian type of rule.

[phil_will1]

"I agree with removing Federal corp income taxes,..."

Going to a consumption tax would certainly help level the playing field with respect to the handicap that our producers operate under in many of the world's largest markets - including our own. It is unconscienable that we handicap our own producers in our own market vs their international counterparts, but thats a gripe for another thread.

Although switching to a consumption tax system would help make US labor more competitive by removing the tax burden, I don't see that as being enough to offset the huge labor cost differential. Therefore, as much as I support the need for Fundamental Tax Reform (FTR), I don't see it helping out in the area of outsourcing to any significant extent.

[looscnnn]

A lot of similarities of what has been/is going on here in the US.

[phil_will1]

"You are right. Tariffs should replace income/wage/payroll tax."

As a matter of fact, a National Retail Sales Tax would operate like a tariff (at least relative to the current system)because it would raise the after-tax prices of imports. However, because US produced goods would go down in price because of the removal of the current system, they would be approximately the same after-tax.

This would accomplish what tariffs would, but would be much more defensible, since we could point out that we would be taxing imports exactly the same as domestic production.

[Cronos]

democratic rule is very "unnatural" system of government. It eventually gives way to a more totalitarian type of rule.

I would disagree. The less threatened a society feels, the more likely it will go in for democracy. Democracy works best in countries that don't have an overwhelming sense of fear -- Western Europe, the US, Canada, India, Japan, Australia, New Zealand. All of these have had continuous democracy since WWII. Totalitarianism is an aberration only needed in times of war. Otherwise it eats up it's people. Like what Samuel said to the people of Israel when they wanted a King.

[looscnnn]

Alberta's Child wrote:"In order to maintain an export-based economy, the nation doing the exporting must always have a lower standard of living than its trading partners."

A. Pole wrote:"But running trade deficit does not mean that the standard of living will be higher (in the long term)."


So the answers are to trash our standard of living, the value of the dollar and/or get rid of descent paying jobs in favor of mostly low paying service jobs?

[looscnnn]

"The better stuff: R&D and design remains here in the States."

Give it time, they will also be sent out of the country.

[Sender]

I'm sure the bell curve is universal, but don't you think at least some other countries have a much higher percentage at the top of the curve than the graduates our public schools are turning out?

[Taliesan]

Can anybody explain the "disconnect" here between what I am observing and what the lamestream media and Democrats are telling us, regarding the "worst economy since the Depression"?

I can. One is reality, the other is ficion. The fiction falls into two subsets.

What you are observing is the real world.

"Worst economy" etc. was intentional fiction, written by Democrats to get votes. The people who wrote the phrase were sitting in a $800,000 house when they wrote it.

The "conservatives" on this board who think the sky is falling are a different story. They are sincere; they are extrapolating one trend into the whole field of vision. Unintentional fiction.

[phil_will1]

"The less threatened a society feels, the more likely it will go in for democracy."

Some noted philosopher said something about the life cycle of a democracy and his belief that it can't last indefinitely. This was a couple of hundred years or so. His argument was that, once the lower class realizes that they can vote themselves into prosperity, the proverbial jig is up. Some say we are approaching that point, since many are suffering under the delusion that they don't pay any taxes and that, therefore, government services are free (at least to them).

[bvw]

An NRST plus a low tariff (10% and under, in addition to the NRST) would be like magic. There would once again be a demand for money to use for production. Currently there is no demand for such money, just give-aways that fuel consumption which given cost (including regulation, taxes, tariffs) structures are ONLY effective at moving that moeny offshore extremely rapidly.

[A. Pole]

Some say we are approaching that point, since many are suffering under the delusion that they don't pay any taxes and that, therefore, government services are free (at least to them).

This delusion and lost of concept of common good affects both the poor and rich alike. But those on top should lead and give example.