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This Article Explains Why Apple Makes iPhones In China And Why The U.S. Is Screwed
Business Insider ^ | 01/22/12 | Henry Blodget

Posted on 01/22/2012 4:49:53 AM PST by TigerLikesRooster

This Article Explains Why Apple Makes iPhones In China And Why The U.S. Is Screwed

Henry Blodget | Jan. 22, 2012, 5:30 AM | 3,191 |

The manufacturing processes of Apple and other electronics companies have come into sharp focus of late, with the revelation of more details about what life is like for the Chinese workers who make the world's gadgets.

When one reads about these working conditions--12-16 hour shifts, pay of ~$1 per hour or less, dormitories with 15 beds in 12x12 rooms--the obvious assumption is that it's all about money:

Greedy manufacturers want to make bigger profits, so they make their products in places with labor practices that would be illegal in America.

And money is certainly part of it.

But an amazing new article by Charles Duhigg and Keith Bradsher of the New York Times reveals that there's a lot more to it than that.

The article illustrates just how big a challenge the U.S. faces in trying stop the "hollowing out" process that has sent middle-class jobs overseas--and, with it, the extreme inequality that has developed in recent years.

The reason Apple makes iPhones and iPads in China, the article shows, is not just about money.

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: apple; china; economy; foxconn; freetrade; jobs; outsourcing
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1 posted on 01/22/2012 4:50:03 AM PST by TigerLikesRooster
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To: TigerLikesRooster

And in Seattle Gazelle Jones doesn’t come to work at all because he couldn’t manage to get up and drag himself in on Mondays till 9:30. He just couldn’t manage a schedule set by his job.

His half sister tamikila also no longer has a job because she couldn’t pass the drug test they gave every week


2 posted on 01/22/2012 4:58:10 AM PST by bert (K.E. N.P. +12 ..... Crucifixion is coming)
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To: TigerLikesRooster; PAR35; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; happygrl; ...

P!


3 posted on 01/22/2012 5:00:59 AM PST by TigerLikesRooster (The way to crush the bourgeois is to grind them between the millstones of taxation and inflation)
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To: TigerLikesRooster

I didn’t read the article, but I’m guessing they make iPhones in China because it’s cheaper.

On the other hand, the real reason that America is screwed is because of the terror cell occupying the White House.


4 posted on 01/22/2012 5:01:45 AM PST by HangThemHigh (Entropy's not what it used to be.)
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To: TigerLikesRooster

Americans make poor biobots (vide http://en.wikipedia.org/wiki/Nikolai_Eberhardt).


5 posted on 01/22/2012 5:03:06 AM PST by ingeborg
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To: TigerLikesRooster
This explains why China spends so much money on DemocRAT politicians.

And probably a few Republican, too, no doubt.

6 posted on 01/22/2012 5:05:20 AM PST by Texas Eagle (If it wasn't for double-standards, Liberals would have no standards at all -- Texas Eagle)
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To: TigerLikesRooster
I heard a sound bite on an NPR station as I flipped through looking for something to listen to while driving in an unknown geography;

It was asked, "How much in America is hand made?"

and the answer surprizingly is,

Almost everything ... and this article explains why that is a true statement.

7 posted on 01/22/2012 5:06:51 AM PST by knarf (I say things that are true ... I have no proof ... but they're true)
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To: TigerLikesRooster
The national security implications of the off shoring of American manufacturing base are huge. No real conservative, regardless of being anti union or anti regulation, can see moving factories to China as good and healthy thing. Yes regulations, taxes and unions are bad things. But change those things here, or work for them. Don't sell out to China for Gods sake.

Economic Libertarians are a wacky as PaulBots.....

8 posted on 01/22/2012 5:07:04 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: TigerLikesRooster
Apple doesn't build iPhones in the United States, in other words, because there is no longer an ecosystem here to support that manufacturing. There's no supply chain, there aren't enough super-low-cost workers, and there are not enough mid-level engineers. And many Americans looking for work are still hoping for a return to jobs, salaries, and lifestyles that have simply disappeared. This is a complex problem, and there's no easy solution.

Only because there is a Democrat Party. The party of continued privation.

9 posted on 01/22/2012 5:08:43 AM PST by denydenydeny (The more a system is all about equality in theory the more it's an aristocracy in practice.)
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To: TigerLikesRooster
The article in a nutshell: The Chinese..doing the jobs Americans don't want to do...on the cheap

Duhigg and Bradsher tell the story of Eric Saragoza, an engineer who began working in an Apple factory near Sacramento in 1995. The plant made Macs, and for a few years, Saragoza did well, earning $50,000 a year, getting married and having kids, and buying a house with a pool.

(snip)

Soon, however, Apple started shipping jobs overseas, because the costs of manufacturing in Asia were so much lower.

(snip)

Saragoza was soon asked to work 12-hour days and come in on Saturdays. But, understandably, he wanted to watch his kids play soccer on the weekends.

They go on to say Saragoza quit a job testing iPads which paid $10 an hour and is now looking for work. Meanwhile, Chinese workers work 12-16 hour shifts for a dollar an hour and Apple makes a 40% profit on each iPad.


10 posted on 01/22/2012 5:11:03 AM PST by Leroy S. Mort
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To: TigerLikesRooster

Sure, Apple will likely not bring their manufacturing firms back to America, as things stand. At least, not until China decides it doesn’t need Apple anymore and rips off its designs wholesale, like everybody else that has dealt with China.

What the author is not saying is also important. It’s not necessary for companies, like Apple, to come back to the shores of America. It’s only necessary that America creates the environment that new companies can grow and develop their products and sell them.

Who cares about one company, like Apple, if conditions made it favourable for 5,000 other companies to form and train workers in America?


11 posted on 01/22/2012 5:11:09 AM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: TigerLikesRooster

They went to China for (insert excuse here) = profits....

The start of it all was the excuse, logistics

then, skilled labor workforce

now, “hey, it is all about giving our shareholders a huge return”.

Slave labor is slave labor.... there used to be factories in the USA that produced everything you buy that now says CHINA on the back of it.

Shareholder profit by the use of slave labor, nothing more, nothing less.

See how long CHINA lasts when a tariff is placed on their goods so they equal the cost of production in the USA... yes, kill off the “free trade” rubbish..... as all it has done is totally crush this once proud nation to the point we have to wait for the boats to dock so we can eat, see, clothe ourselves.

Yes this is a rant.... but, go look at the things in your home, and the store, that you buy from, how many are MADE, GROWN, PRODUCED in the USA.

EL


12 posted on 01/22/2012 5:12:20 AM PST by Eureka_Lead (No political party has ever become a dictatorship when the citizens have firearms - Stay Vigilant)
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To: Eureka_Lead

Eliminate free trade and we turn into North Korea. Some people want to take their ball and go home when they are losing. I think Americans are better than that. I say COMPETE. In some areas we will lose and in some we will win. Overall, we will win. How can America be called a nation of liberty if it would prevent free men from selling to other nations and vice versa.


13 posted on 01/22/2012 5:16:04 AM PST by impimp
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To: Eureka_Lead

......Work Makes You Free........


14 posted on 01/22/2012 5:18:54 AM PST by spokeshave (Mitt will release his tax returns when 0bambi releases his Birth Certificate and grades)
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To: TigerLikesRooster

China has hundreds of millions of people living the bucolic life of the peasant, in amongst the ducks and pigs. Some of these people think that living and working in the conditions described as horrible and making US170/month is better than life in the organic and natural countryside.

As much as I wish life could be cushy for everyone on earth, the hard truth is that if wages where high enough to meet the author’s approval, say US 2,000/month, that there would be no jobs and these people would get to stay back on the farm. And what if some peasant in Vietnam was willing to work for only $1,700/month would the author lament the loss of jobs in China?

But then again, the author never seemed to care for what conditions are like for those peasants before now. You would think if he really cared for these people, he would care for them no matter where they lived.

Maybe he is just projecting his revulsion at how prosperous the US has become, like so many media professionals like to do in recent times.


15 posted on 01/22/2012 5:20:37 AM PST by theBuckwheat
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To: TigerLikesRooster

The left scream about oil companies making 7 cents on the dollar from a gallon of gas and moan about Wall-mart workers not making a livable wage despite Walt-marts employee low turn over rate(must not be that bad) yet are curiously quiet about Apple or Microsoft very high profits, their favorite high end restaurants commonly using illegals in the kitchen or the the non-union people working at their favorite wine bottling plants.

Hypocrites, but we all knew that anyway.


16 posted on 01/22/2012 5:21:15 AM PST by Le Chien Rouge
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To: Eureka_Lead
"when a tariff is placed on their goods so they equal the cost of production in the USA"

You COULD install reasonable tariffs, and have manufacturing back in the USA; IF it's done in Right-to-Work states, where you don't have $30+/hr. Union Rates + benefits extorted.

The cost of shipping and labor would STILL result in profits, IF it wasn't for Union Labor rules (same with auto-making).

17 posted on 01/22/2012 5:32:30 AM PST by traditional1 (Free speech for me.....not for thee)
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To: TigerLikesRooster

There are two types of “free trade” supporters:

The first type, is like Mitt Romney: amoral (I did not say immoral) about trade and business - Gordon Gecko-ish about jobs. It’s just business, and those who lose their jobs don’t matter. If employees or America suffer, that’s just the way it is.

To those, I can only express my respectful disagreement, and say that amorality about the effects of “free trade” is the reason I support import tariffs - because import tariffs are also amoral. They benefit America without making any decisions about business.

There’s a second type of “free trade” supporter though, and I think it’s time to explain something to the second type.

The second type of “free trade” supporter believes that “free trade” will create freedom and democracy in places like China.

There seems to be a lot of this belief, right here on this board.

Let me attempt to disavow FReepers of that naive belief. China in it’s 5000 years of history, has been consistently ruled (not governed) by a central, omnipotent government of one type or another.

Chinese do not yearn for democracy. Chinese believe in clarity, of control relationships. The boss is clearly defined, and the boss is powerful.

The government is the same way. Before there was the CCP, there was the Emperor. Always there has been the central authority, more powerful than Americans can imagine.

If Chinese were yearning for Democracy and freedom, somewhere in those 5000 years, they would have happened upon democracy themselves. It has not happened, because that’s not what Chinese seek.

For Americans to believe that sending our jobs, money, technology and factories to China will somehow create a democratic, free society in China is WRONG.

Once one realizes that basic assumption of “free trade”, as a policy of engaging China is flawed, and incorrect - one inescapable conclusion only, becomes inevitable:

“Free trade” will not benefit America.

“Free trade” will not create freedom around the world.

“Free trade” will only make China, controlled from the central government, with no desire or possibility of becoming a democracy - a global superpower which will inevitably challenge America.

“Free trade” is not a good thing. It is national suicide.


18 posted on 01/22/2012 5:33:38 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: impimp; Eureka_Lead

“Eliminate free trade and we turn into North Korea”

BWHAHAAHAHAAA

Direct labor costs are only part of the reason China is so much cheaper. The bigger reason is regulation. China doesn’t have to worry about the EPA, OSHA, EOC or a host of other agencies.

Free trade has nothing to do with it except make it easier for companies to ship American jobs to those regulation free zones.


19 posted on 01/22/2012 5:41:57 AM PST by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Cringing Negativism Network

Its also important to note that these countries spend major $$ lobbying Congress for laws friendly to off shoring those jobs.


20 posted on 01/22/2012 5:44:35 AM PST by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Cringing Negativism Network

So you support domestic production content laws as a condition of access to US markets?


21 posted on 01/22/2012 5:48:08 AM PST by mission9 (It ain't bragging if you can do it.)
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To: impimp
Eliminate free trade and we turn into North Korea. Some people want to take their ball and go home when they are losing. I think Americans are better than that. I say COMPETE. In some areas we will lose and in some we will win. Overall, we will win. How can America be called a nation of liberty if it would prevent free men from selling to other nations and vice versa.

I'm guessing you don't realize that the entire Federal government was originally funded by ... tariffs. We are under no obligation to provide a market for goods produced outside our nation that throw our own citizens into poverty, it's self-defeating. "Free men" respect and protect the source of their freedom, not compare it to a failed totalitarian state.

The Founding Fathers as just a bunch of Kim Jong Il forerunners ... really. Listen to yourself, you've gone completely 'round the bend.

22 posted on 01/22/2012 5:50:44 AM PST by RegulatorCountry
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To: mission9

Nope.

I support (significant) across-the-board import tariffs.

100% on everything imported. No other rules, regulations or government.

Let the market decide. Just remove the incentive to destroy American jobs, and the problem will solve itself, simply by the decisions American consumers make.

Remove the incentive to outsource US jobs.

Then let the market fix things.


23 posted on 01/22/2012 5:52:23 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: TigerLikesRooster

I’ve worked plenty of 12-16 hour days, plus weekends, without compensation, so I’m not afraid of long, hard work.

But there is something wrong when employees work 12-16 our days at $1 an hour, & the CEO earns billions of dollars. In some ways, this is taking advantage of desperately poor people who will work for pennies to feed their families because they have no other options.

There is another aspect to this. What kind of life does one have when all they do is work?

Years ago, I took a job with IBM in sales & support. The work load quickly became enormous. I became concerned that I could not do so many things properly, & that all would suffer as a result.

I went to talk to my boss, whom I greatly respected & admired as a boss & family man. He told me he began working during his morning shower & didn’t stop until his head hit the pillow at night. He suggested I put more time in the job.

I was single at the time, but looking, & I had been divorced a few years earlier. I told him the last time I worked like he did, all it got me was a divorce. In my zeal to advance my career, I had neglected my wife, with predictable results.

Well, I didn’t care much for working at IBM. Too much sales & not enough support. So I found another job & moved on.

A year or so later, I attended a seminar at IBM, & I asked about my former boss. I was told he was promoted to Atlanta, but was back in town attending to business related to the terrible divorce he was going through.

I guess the money was more important than the family. Sad.


24 posted on 01/22/2012 5:55:42 AM PST by Mister Da (The mark of a wise man is not what he knows, but what he knows he doesn't know!)
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To: HangThemHigh
I didn’t read the article, but I’m guessing they make iPhones in China because it’s cheaper.

No. It's because they have a bigger and better factories and a bigger and better supply chain.

25 posted on 01/22/2012 5:58:22 AM PST by Tribune7 (GAS WAS $1.85 per gallon on the day Obama was Inaugurated! - - freeper Gaffer)
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To: Tribune7

“No. It’s because they have a bigger and better factories and...”

-

Those factories were American once.

Bring them back.


26 posted on 01/22/2012 6:00:40 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: RegulatorCountry

Actually I know that it was funded entirely by tariffs. These tariffs were not large. I would think that the governmental barriers to trade are higher now than they were back then.


27 posted on 01/22/2012 6:01:14 AM PST by impimp
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To: Cringing Negativism Network
Bring them back.

And they can be. That was actually part of Rick Perry's message and he was right.

28 posted on 01/22/2012 6:03:13 AM PST by Tribune7 (GAS WAS $1.85 per gallon on the day Obama was Inaugurated! - - freeper Gaffer)
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To: impimp

Oh, you do? What’s with the overwrought North Korea crap, then? Do you really think or do you just emote? Sounds like your ox is being gored, so I suppose that explains it, but answer this, is impoverishing your primary market any sort of recipe for success? No, it’s not. You’re selling the rope with which you’re going to be hanged. Wake up. Find another way to make a buck.


29 posted on 01/22/2012 6:09:24 AM PST by RegulatorCountry
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To: TigerLikesRooster

We just have to accept Chinese-labor living standards...so the CEO can have 5 vacation homes instead of just 3. That’s what the American dream is all about, eh?

(Or we could just tell Apple that if they’re not going to make it here, then they’re going to have to pay to get their products to the American market. You know, the way things were done in the good old days before the income tax).


30 posted on 01/22/2012 6:12:15 AM PST by Wolfie
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To: RegulatorCountry

I think you are the one who is “overwrought.” It is correct to observe that the Founding Fathers (and the Constitution) intended tariffs to provide revenue to the Federal Government. Not all of the Founding Fathers (and not the Constitution) provide for tariffs to “bring jobs back to the U.S.,” or whatever populist garbage your typical protectionist uses to argue in favor of a larger, and more intrusive industrial policy. And at the extreme end of that industrial policy, you have the example of N. Korea.


31 posted on 01/22/2012 6:21:18 AM PST by 1rudeboy
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To: impimp
Eliminate free trade and we turn into North Korea. Some people want to take their ball and go home when they are losing. I think Americans are better than that. I say COMPETE. In some areas we will lose and in some we will win. Overall, we will win. How can America be called a nation of liberty if it would prevent free men from selling to other nations and vice versa.

Anyone that believes this BS is either stupid, mentally ill or Chinese.

32 posted on 01/22/2012 6:22:17 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: HangThemHigh

Indeed, the situation of the ploy of the Chinese worker and the maintenance of bad investment into greedy short sighted death cult communists in China is not going to improve with America so long that Zero in chief without a head is in power.


33 posted on 01/22/2012 6:25:41 AM PST by JudgemAll (Democrats Fed. job-security Whorocracy & hate:hypocrites must be gay like us or be tested/crucified)
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To: Cringing Negativism Network
100% on everything imported.

We agree except I would start import tariffs low, say at 5%, then slowly raise them say 5% a year. I would like the Free Traitors squirm a little first rather than burn them alive.

34 posted on 01/22/2012 6:29:15 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: central_va

Higher taxes will make the economy grow. People are simply too stupid to see it, so we must increase taxes slowly.


35 posted on 01/22/2012 6:31:56 AM PST by 1rudeboy
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To: impimp
I would think that the governmental barriers to trade are higher now than they were back then.

You should really do some research, the only thing that the Chinese pay import duties on is on flat screen TV's. And it is a tiny little duty.

36 posted on 01/22/2012 6:33:07 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: 1rudeboy

Respectfully pointing out in response to your choice of emotionally-laden words that the root, of the word “protectionism”, is the wonderful word: “protect”.

Same thing America’s brave, selfless military service people do.

Protect ... America; protect America.

You got a problem wit’ dat “free trade” punk??

:D


37 posted on 01/22/2012 6:34:10 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: 1rudeboy

Nobody listens to your Free Trade crap anymore. Traitors can GTH.


38 posted on 01/22/2012 6:35:31 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: Cringing Negativism Network

Word games, huh? “Free,” as in “free market,” means liberty.


39 posted on 01/22/2012 6:37:48 AM PST by 1rudeboy
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To: Cringing Negativism Network
You see CNN, Free Traitors have a brain wiring problem. They connect tariffs with being pro union. These simpletons are clueless.

Tariffs are, like you said, amoral and protect the 94% of manufacturing workers that are non union as well as the 6% union types.

40 posted on 01/22/2012 6:41:12 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: Cringing Negativism Network

China no longer publishes the figures for how many riots take place each year, but most people put the figure at around 80,000 and the vast majority go totally unnoticed.
http://blogs.telegraph.co.uk/news/malcolmmoore/10122566/Tens_of_thousands_of_Chinese_fight_the_police_in_Shishou/

Chinese authorities use the term “mass incident” to describe a riots, demonstrations and group protests, petitions, and strikes, both peaceful and violent. The term appears to cover group actions ranging from minor work stoppages to serious riots. Sometimes the term is used to describe a group protest involving more than 100 people. Once regarded as taboo and still illegal, they occur surprisingly often. There were about 180,000 in 2010, according to Sun Liping, a Tsinghua University sociologist. That was up from 87,000 in 2005, according to the Ministry of Public Security. According to the New York Times authorities recorded 127,000 so-called mass incidents in 2010 but most were too small to gain wide notice. According to figures from the China Academy of Social Sciences fights over land account for 65 percent of rural “mass conflicts” and is also a serious problem in cities

http://factsanddetails.com/china.php?itemid=305&catid=8&subcatid=49

Sitting in her Nanjing hotel reading anti-government posts on her Blackberry and laptop, Ying Chan, the dean of Cheung Kong School of Journalism and Communication at Shantou University said: “In totalitarian states in the past, meetings among dissidents happened under a veil of secrecy. But here I was following the actions of these free-thinking strangers in real time without ever setting foot outside. In the age of the microblog, every mobile handset and computer is a news broadcast station, a node in a vast information network.

“The traditional one-way flow of information — from official media to the audience — is being altered by the multi-way flow of information online because of social media,” says Bu Zhong, assistant professor at Penn State University. “The compromises that we’ve seen lately show how officials are learning to handle crises in the age of social media — suppression does not always work anymore. What’s happening today was not conceivable in China 10 or 20 years ago.”


41 posted on 01/22/2012 6:41:42 AM PST by listenhillary (Look your representatives in the eye and ask if they intend to pay off the debt. They will look away)
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To: central_va
So you propose gradually raising the cost of gasoline 5% at a time. How will that affect the price of nearly everything you pay for, American-made or not? And will it create enough high-paying American jobs to compensate?

If pointing out that "crap" makes me a "enemy of the state" [pun intended], then you might as well send me to the Gulag, comrade.

42 posted on 01/22/2012 6:41:59 AM PST by 1rudeboy
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To: 1rudeboy

We have no “free market” for our goods.

We only give away a “free market” to our adversaries.

Do you leave your front door open at night?

You you leave your car doors open in your driveway?

Do you leave your stereo in your front yard?

Do you leave money laying around at work?

Do you?

Why are we as a nation, doing things that foolish?

I’m all for “free markets”.

We don’t have any “free markets” for our goods.

It is beyond STUPID for us to keep ours open, to any nation which does not reciprocate 100%.

Tariffs. Now.

Or perhaps even total blockade.

Then, and only then, (begin) negotiating for reciprocal access.

We are doing nothing now, except giving away our nation.


43 posted on 01/22/2012 6:42:08 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: 1rudeboy
If pointing out that "crap" makes me a "enemy of the state" [pun intended], then you might as well send me to the Gulag, comrade.

Just go see your Chinese handlers, they are your comrades.

44 posted on 01/22/2012 6:43:41 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: 1rudeboy

Frankly, you’re full of it. Really.

I mean that in the nicest possible way.


45 posted on 01/22/2012 6:43:57 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: TigerLikesRooster
Note labor unions are illegal in China so workers won't see their wages pushed to $40/hour for putting screws in some sub assembly or be guaranteed their current salary and benefits for life if their plant closes.
46 posted on 01/22/2012 6:44:43 AM PST by The Great RJ ("The problem with socialism is that pretty soon you run out of other people's money" M. Thatcher)
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To: central_va
Tariffs are, like you said, amoral and protect the 94% of manufacturing workers that are non union as well as the 6% union types.

Unless, you work for a manufacturer such as Caterpillar, or Lockheed. But who needs them?

47 posted on 01/22/2012 6:44:57 AM PST by 1rudeboy
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To: Cringing Negativism Network

It is not possible to have welfare state and open borders and free trade. They cannot co-exist.


48 posted on 01/22/2012 6:45:51 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: 1rudeboy

Only a matter of time, and they’ll be outsourced also.

Then what?


49 posted on 01/22/2012 6:45:51 AM PST by Cringing Negativism Network (ROMNEY / ALINSKY 2012 (sarcasm))
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To: Cringing Negativism Network

Hey, I’m not the guy who wants to double the cost of oil overnight, and thinks it will stimulate the economy.


50 posted on 01/22/2012 6:47:00 AM PST by 1rudeboy
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