How to fix the problem of off shoring

3-12-04 | F. Kelly

[international american]

"Leaving the effects of regulations and lawsuits aside for now, If we want to have a stable society again, what we need to do is reduce personal and corporate income taxes and add the equivalent in commodity taxes. The net tax burden on US citizens and residents would not change, so it will be a tax shift and not a tax cut. But for the first time people who bring imports to the market will contribute to the cost of having that market there. The products and services made in this country will be more competitive, economic stability will return and costs will go down, and EVERYONE will be PAYING THEIR FARE SHARE!

Man, you are smart!! I guess you and I will be raped for saying so:)

[AreaMan]

Actually, I heard that India will be petitioning for admission into the Union as the 51st state.

[rudypoot]

Actually your first mistake is that you are calling outsourcing a problem. It isn't. Flame away.

[The Duke]

How about if we score each nation based on it's political and religious freedom, as well as the degree of corruption extant in in the system. Then, based on that score, we look up a tarrif that is applied to every item imported from the respective nations(?)

The scoring itself could be done by a panel of 100 regular Americans selected randomly on a periodic basis.

[ItisaReligionofPeace]

I find it laughable that some Americans insist that we pay more for their product, yet they are the same ones who bargain shop everything they buy. Free trade benefits all.

[GeekDejure]

Go here to permanently fix the income tax problem.

http://futurepointe.com/income-tax/marie/order_tb.html

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[XBob]

1 - " none of these costs are born on products and services that are sold here as long as those things are NOT made by any US citizens or residents. This is outrageous! "

So succinct and so true. And the free traitors don't begin to understand this.

[XBob]

6 - So, where do the imports contribute to the upkeep of the 'store'?

[GeekDejure]

Are you an American citizen??? Go here to read about how you can permanently delete your income tax problem.

http://futurepointe.com/income-tax

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[BfloGuy]

..........TAX PRODUCTS ........... NOT PEOPLE!!!

Only people can pay taxes. You can change the basis for the tax assessment, but it will still be people who pay it.

And yes, people (American people) will still pay for the tariffs. They'll pay because the price of the product is higher after the tariff has been levied.

I am certainly no fan of the current income tax system, but I just don't see what this would accomplish.

[A. Pole]

An analogy may make it easier to see. Suppose you have a big department store in a town that was very popular. This store offered a place for the local clothing and goods suppliers to sell their products, and in return asked for a 30% cut for the store. Now this system worked fine for many years, then one day some suppliers came in from out of town and, because of a quirk in the contracts, didn’t have to pay the store their 30% cut. At first these out-of-towners only made a few lower quality, inexpensive products and nobody was very concerned about them. After a while though, these out-of-towners started to improve. They slowly got into the higher priced and higher quality products and because they didn’t have to give the store a cut, they could beat everyone on price. The local suppliers worked feverishly to compete by cutting costs, then wages, then staffs, then products, but they couldn’t overcome the advantage the out-of-towners had on pricing. Then the store told the remaining local suppliers that they had to increase their cut to the store to 40% to keep it open. Soon the local suppliers were so financially weak that the out-of-towners could get any business they went after and the local suppliers started to disappear. In the end, the out-of-town suppliers had nearly all the business, and the store went bankrupt.

Free trade bump.

[neutrino]

Thanks for the ping! Also, take a look at what Warren Buffet said - here

[Shermy]

Taxes, regulations, tastes, etc. are each irrelevant to the outsoucing issue.

IE, if taxes were 0% or 50%, it doesn't matter.

Modern outsourcing is due to differential wage rates - just one cost of business. To decrease that cost jobs are outsourced to lower wage areas, or illegals and mass immigration is insourced to depress wages at home for jobs that can't be imported.

It's a reality, it's govt. policy.

[TaxRelief]

Isn't "offshoring" a compound word?

http://www.yourdictionary.com/ahd/o/o0042200.html

[det dweller too]

6 - So, where do the imports contribute to the upkeep of the 'store'?

The analogy ends before that, but to continue it: The out-of-towners then buy the store and bring all the rest of their goods over. They set up a system for every supplier to pay a fee, but then give their suppliers a secret rebate with bank transfers back in their home town. They may be unscrutable but they are not stupid.

[det dweller too]

I am certainly no fan of the current income tax system, but I just don't see what this would accomplish.

Perhaps you missed the dynamics. First the income tax is removed for the domestics, then a tax on the product is added for everyone. That makes the cost basis for the products either the same or much closer to equal. now the imports can't undercut the domestics into bankruptcy.

If I make a widget for $10 and the domestic can't make it for less than $13 then I can sell it for $12.50 and watch him starve to death trying to compete while I thrive. If it costs both of us $13 then we have the basis for real free trade.

[det dweller too]

Did you read the post or just skim the title?

[Shermy]

Yes, I read it.

I think it's very good.

Except I don't think it's the cure for outsourcing IT and service industry jobs.