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Fixing the Economy? (US)
MindGate
United States Veteran
I'm only 15, so tell me how this works... So, I'm assuming that the reason jobs are being exported out overseas is because it cost so much here to pay workers and people would work for much less elsewhere. So, would the United States stop sending jobs to other countries if we didn't have to pay workers minimum wage? If we just allowed companies to set their payments for whatever wage they want without government regulation, and the workers agreed to said wage when applying for the job, wouldn't we all just get along then?
Whats the lesser of the two evils: no money, no job or a little money and a job.
Just something I thought of when talking with my girlfriend. Not sure if it would work. I know almost nothing about economics.
Whats the lesser of the two evils: no money, no job or a little money and a job.
Just something I thought of when talking with my girlfriend. Not sure if it would work. I know almost nothing about economics.
0
Comments
The businessmen who run companies don't just look at the cost of wages when they close down a factory or office here and move it to some third world location. With cheap and reliable world wide transportation and communication, they look for lack of regulation concerning pollution and laws concerning labor relations, lack of any social safety nets that cost them money such as health care, unemployment insurance, and social security, and lack of local and state taxes, if the right people are bribed in some cases. In other words, you could hire everyone at minimum wage and the company will still move to where it's cheaper, because of something called the "standard of living". Do you want to see the average American or European family living crammed ten to a room in an unheated shack with every member including children working dawn to dark just to make enough to eat, the water supply a communal well that some charity provided, while the factory belches smog and turns the local river into a deadly chemical stew? That's what you're competing against.
Companies are profit making machines. They have no morality and are not in the business to provide jobs or help society. The only goal is to make profit, and there is no such thing as too much profit. No CEO ever told his shareholders, "We made too much profit this quarter!" So, it's not their job to improve the lives of the workers. It's their job to keep costs down so they make more profit. The company pays what it has to, in order to get the workers it needs and be allowed to produce whatever it makes as cheaply as possible.
If society demands they pay a living wage and some minimum benefits, then that's what they do and simply factor it into the cost of doing business, unless they can figure out a way of doing it cheaper like using less people (downsizing) or replacing people with machines and computers, or moving to a place where they don't have to pay their workers near as much. It's called doing business. You can't expect the CEO to give a damn about the people he puts out of work when he moves the company. That isn't what he gets paid for. He gets paid to make profit.
Companies want to make the maximum profit possible, in a huge majority of cases nowadays at the expense of *everything* else. If that means putting Americans out of work and sending the work to China or Vietnam or India or wherever, they do it, with zero regard for the consequences. It's all about maximizing profit at any cost. The minimum wage laws in the US are not the reason. We've had minimum wage laws for decades, but we've only been shipping jobs to China in a big way for about 15 years. It's ancient history to someone your age, but it hasn't been all that long ago that China was a closed society. Contacts with the west were nonexistent, and the very idea of a consumer product "made in China" would have been laughable.
To be sure, there are a precious few companies with a social conscience. I just purchased a sleeping mat for my tent that's made in the US, and that's the main reason I bought it.
There's nothing wrong with making a healthy profit. That's what business is for. But there *is* something wrong with unbridled greed. And that's the main motivation for most of the corporate world these days. And it will be our downfall. As the gap between the rich (including corporations) and the rest of us gets wider and wider, and as the economy is devastated more and more, our social fabric will begin to unravel. It's already starting to happen in many small ways. That will only accelerate.
But, as we know from Buddhism, all things are impermanent, including the economic system and our system of government. How many empires and other forms of government have been touted to "last a thousand years"? Just about every one of them. How many of them have done so? Not one. Usually a tiny fraction of that.
But that doesn't mean the little guy shouldn't fight for a bigger piece of the pie. We get only as much as we demand from the people who have the keys, another unbroken rule through the ages.
America has borrowed from China, in order to not default payment on Chinese goods...
No.
I dunno what the hell's going on, why or how, either....
The problem we have is the "myth of the commons", otherwise known as "It's not my problem". It's not rocket science. The middle class drives the economy with our spending. To buy products, we need money. To get money, we need decent jobs. The businesses that provide the jobs have moved to places where they don't have to provide a decent wage, or cut their wages here to where people can't afford their products. So ask the CEO why he doesn't continue to provide jobs here? "Not my problem. Let some other company give them a job. If I don't cut wages, my competitors will take advantage and make more profit and I won't get my bonus."
And so it goes.
We're now on a terribly self-destructive path, and in the long-term, it will be self-destructive for the corporations, too. Because eventually, no one will be able to afford what they produce. They're cutting off their noses to spite their faces. Germany still has a strong industrial sector in spite of high wages. They've pulled this off by having their industrial sector focus on high-precision machinery for export, as well as domestic use. That's what they specialize in. Keeping jobs at home is doable with smart government. Obama wanted the US to develop a strong industrial base in renewable energy tech for export. That never got off the ground, and now with destructive budget cuts mandated by Congress, never will. But China has outmaneuvered us on that anyway, they're already exporting affordable solar panels, and so forth.
It's over for the US. Reagan and the Bushes saw to that, and the Republicans now are just dealing the final death blows. Sorry MG. Choose your career well, the US you spend your adulthood in will be full of very challenging circumstances. And keep an eye on China. They may well be the next superpower. We'll all become Tibetans when that happens.
and MG it really is a huge mess. My opinion is that there was so much focus on the short-term over and over again that now the the US economy is up against a wall. The government needs to spend to start up the economy but they are in serious debt so by adding massive debt the confidence in the US economy will fall. It is really a no way situation.
Also, the business of making money make money has really eaten up the financial industry. They tricked themselves right into a hole and they took most of the western world with them. The US went from a manufacturing economy to a virtual economy where the only thing being created are bets on top of bets. Pretty silly.
I highly recommend Lee Iacocca's book, "Where Have All The Leaders Gone?" He's a Republican, but disagrees with his party on economic policy. He was an industrialist, and made fame by saving Chrysler Corp. from collapse in the 1990's. His book is full of great policy ideas, wry comments, anger at self-destructive policies, and lots of humor. He'll have you ROFL as you learn a lot. Sneak preview: he says about the Reagan and Bush tax cuts for the rich: "Thanks, but I don't need the money". He says the country (Fed gov't) desperately needs that tax money for a healthy infrastructure, investment in industry, social support, etc. His heart is in the right place, and he's brilliant. : ) A fun and informative read.
I agree with all your points, those are steps I would take if I was in charge. But I think they are small fish compared to the overall problem right now. I think its pretty clear that the US has both a chronic spending and revenue problem. So in order to take care of it you would have to tackle both of this things. This would get the trend to start reducing the deficit but the problem of a lagging economy would continue.
The private sector is just holding onto money, nobody wants to spend. Consumers are holding on to their money and many of them dont even have money to spend. So ALL you have now is government spending which was horribly done in the first try and although it helped it also added a large chunk to the deficit.
So I see it as a catch 22. You tackle the deficit at the expense of the economy or you tackle the economy at the expense of the deficit. None of these are win/win. AND now add in the political climate....interesting times indeed : D
So much has already been cut from the domestic budget since Obama came into the presidency, that there's nothing left to cut. State gov'ts have had to lay off lots of workers due to cuts in Federal support. Welfare and unemployment insurance have been cut. Any further cuts anywhere will turn us into a 3rd world country overnight. (We already have one foot in that door.) More unemployment will result. This is a destructive road to go down.
But yes, in the current circumstances, thanks to Bush Jr., it's a Catch 22. (Remember, Clinton left us with a budget surplus.)
As a country there should be a VERY good reason to go into debt. Our government should always strive to operate within its means.
What caused this radical change? There must have been some legislation that got passed at some point to encourage this. Can anyone here shed some light on that?
(Hey, that MindGate sure can pick the questions, can't he?
If americans buy things that are made in USA,
there would be no more problems.
Americans want to keep jobs in USA but they buy
Japanese cars and Taiwanese laptops.
Americans buy Japanese cars because Japanese cars last twice as long as US cars. (This is a fact. I own an old Toyota, and I did a lot of research before I bought it.) Back in the 1960's or 70's, the US car industry came up with (for them) a brilliant idea: they decided to design all their cars to break down after 150,000 miles. Every brand would have the engine or the transmission blow out when the car had been driven approx. 150,000 miles. This was called "planned obsolescence". The auto industry did this in order to force people to buy new cars more often. The policy backfired miserably. The media found out about it, publicized it, and people ran to Japanese car dealerships in droves. And many have never looked back. So it's the US auto industry's own fault. As tmottes observed earlier: corporate greed.
Speaking of foreign cars, nearly all Hyundai and Kia vehicles are made in the USA. BMW has a plant in South Carolina and Nissan has a large factory in Tennessee. Much of the profit may be going to other nations, but they are providing valuable jobs for US citizens.
This provides Mexico with valuable jobs, the US plant workers with jobs, and me with a job. Everybody makes money when it's done correctly.
Welcome to the forum, James109! Always good to hear the perspective from the trenches, as it were. Still, most textile worker jobs have gone overseas, and the overseas workers are being exploited horribly in the textile/clothing sweatshops. And look at Detroit: a virtual ghost town. And all those bank and business call-center jobs that have gone to India. It's been very good for India, that's worth something. Well, Clinton managed to create a lot of jobs in spite of all this, so I guess that shows it's do-able....
Seriously though, I don't feel like there is anything wrong with outsourcing so long as there remain a good number of jobs for the outsourcing nation and the the outsourced workers are treated ethically.
China spends 100 billion on defense, the US almost 700 billion. Talk about killing yourself. Then of course social security and medicare. Medicare is so full of corruption....
Time to reform all these 3.
As far as the Republicans and Democrats are concerned- to quote Shakespeare-
"A plague o' both your houses!"
the issues you have raised are those of 'globalisation', which, in hindsight, seems to have mostly served corporate profits
'globalisation' is contrary to Buddhist principles
a most basic Buddhist principle is that of 'self-reliance'. this extends to communities & nations
other basic Buddhist principles are profit sharing, paying adequate wages and making provisions in society for the poor
so in the USA, historically, the gap between the income of the employers and employees has always been greater than most other nations
now, with 'globalisation', this gap is even greater, as the profits of managers & shareholders of multinationals grow at the expense of workers
the debates in the USA about universal healthcare & banking regulations only happen in the USA. even 2nd world countries such as Thailand have been able to provide some level of univeral health care
'globalisation' has caused the economic crisis the world is now in and returning to the old system regulating banking, employing import/export tariffs, reducing management salaries and raising taxes, etc, may be the only solution
but dropping the minimum wage is not the solution because in the USA the minimum wage is very low
my opinion
regards DD
Consider all citizens of the world, not just Americans.
Namaste
Yes, the system is broken. Very broken. But 'globalisation' is not the problem per se.
power in the world. It still is.
But it will not stay no 1. Anicca.
Can americans deal with this reality?
At some point. americans may have to go to other countries
to find jobs. its not the end of the world.
It is not likely to happen soon though.
held by illegal immigrants from central america.