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The difference is there would be tremendous hue and cry over such subsidies in the US. Joel Send a noteboard - 25/01/2012 11:39:04 AM
A government that can and does imprison people for decades in labor camps for atrocities like holding church services in their home changes the dynamic.
I am unsure what that has to do with the outsourcers contention they go overseas because America no longer produces workers with the education and skills for the demanding jobs they need done. Yet when I did manufacturing work before leaving the States all it required was a HS diploma or GED. The company was, however, in the process of building a Indonesian plant to take over a major product line our plant had been producing for years: Because the labor cost was lower.


I think it depends on the product being manufactured. The iPhone, for instance, has a huge profit margin. Snowblowers, lawnmowers, etc likely don't.

For items with a lower profit margin, the labor savings can be the difference between success or being forced to shut down entirely - especially when many/most/all of your competitors have shifted production overseas, leaving a company little choice but to follow suit just to remain competitive.

The kicker, though, is that China's competitive advantage is completely illusory since they manipulate their currency. If they stopped or even slowed their unnecessarily high rate of inflation, domestic manufacturing would have a tremendous advantage since they don't have to deal with nearly the same logistical issues (namely, having to ship across the Pacific Ocean). For that matter, the continual increase in cost of transportation (since ships run on oil) may yet make all the difference in the long run.

That makes sense; it always seemed odd that simply removing tariffs would make it cheaper to assemble products in another country, then spend months shipping them across an ocean BACK to their intended markets, rather than simply assemble them IN those markets. In general, what it boils down to is that production cost, in supplies, labor and shipping, are lower in places like China because the playing field is severely tilted in their favor, "free trade," notwithstanding. In the case of pivotal federal subsidies to material suppliers, however, if China can do it in compliance with the WTO treaty, so can the US, and if its impact on outsourcing is as great as the article claims, the US certainly should. How to sell it to the public remains to be seen.

Part of what infuriates me about this whole phenomenon is that it amounts to US businesses insisting for years that minimal environmental, labor and consumer standards would destroy US industry, failing to convince the public, and retaliating by moving their businesses overseas to "prove" their arguments. It is a bit like a bank robber saying laws against stealing from banks should be repealed because they cause shootings, then unloading a clip into a teller when those laws are not promptly repealed. The difference is that 1) does not threaten the entire US economy and 2) is already illegal. It is odd that America can and does prosecute Americans for pedophilia in Thailand, but an American business can employ slave labor in China then dump their toxic waste in the local water supply with complete impunity.

Regarding the education and skills argument, an American factory would have to be heavily automated to be able to compete with de facto slave labor - and that requires more advanced skills. To use an example from the article, the foreman roused 8000 workers at midnight for an unscheduled 12-hour shift. If that were in the US, they'd have to call in an automation engineering team of only several people to reprogram the assembly robots. But finding enough automation engineers to replace the millions of un-/barely-skilled Asian laborers would be... difficult, to say the least.

According to the article, the managers of the plant said that not only never happened, but COULD not happen. Just like hundreds of workers going to its roof and threatening to jump off because of their appalling work conditions never happened, just like individual employees have not repeatedly gone up there and jumped to their deaths for that reason in the past. As the former Apple exec quoted in the article approvingly put it, "What U.S. plant can find 3,000 people overnight and convince them to live in dorms?" Of course, the South used to do it all the time, but since 1865 it has been illegal for a US business to do that--IN THE US....

We have 3000 engineers who could retool robots for that job. The problems are 1) that retooling is not a 40 hour/week job and 2) it only takes a handful of those engineers to retool robots for work formerly done by 3000 and 3) an engineer in China will still do it for far less money. Hence the former Apple engineer cited in the article wound up earning $12/hr at a call center in his old office, because someone in China was doing his former engineering job--and STILL earning a lot less money.
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Yup. BS, isn't it? *NM* - 22/01/2012 02:43:32 AM 289 Views
The sad fact is... - 22/01/2012 02:56:46 AM 606 Views
This *NM* - 22/01/2012 08:07:58 AM 237 Views
I am SO sick of hearing this false rhetoric. - 22/01/2012 06:39:07 PM 676 Views
I don't believe its false. I believe its true. As seen, daily, by myself. - 25/01/2012 07:11:00 PM 556 Views
I do not deny it happens, but I do not believe it the norm. - 25/01/2012 07:29:54 PM 598 Views
Nice strawman you got there. - 22/01/2012 10:19:17 PM 670 Views
You probably aren't aware that even though it is a crime in China... - 23/01/2012 04:59:27 AM 665 Views
It will be acceptable as long as the US remains a market for products made that way. - 22/01/2012 06:10:20 PM 638 Views
It always kind of cracks me up when people bitch about China when... - 23/01/2012 05:04:36 AM 655 Views
That really is the bottom line. - 23/01/2012 05:24:57 AM 758 Views
That's a little unfair. - 23/01/2012 02:07:17 PM 565 Views
People really should read the rest of the article and not just the first page. - 23/01/2012 11:21:39 PM 521 Views
Yes. - 24/01/2012 10:19:57 AM 481 Views
Are you saying the US should heavily subsidize its supplies like the Chinese government does? - 24/01/2012 11:15:37 AM 519 Views
Re: Are you saying the US should heavily subsidize its supplies like the Chinese government does? - 24/01/2012 01:06:51 PM 552 Views
The difference is there would be tremendous hue and cry over such subsidies in the US. - 25/01/2012 11:39:04 AM 450 Views
Of course not. Where did I even say anything about that? - 24/01/2012 08:10:29 PM 615 Views
You didn't say that. I'll explain the way Joel posts. - 25/01/2012 07:16:05 PM 625 Views
What a bunch of shit. - 24/01/2012 01:33:19 AM 718 Views
Huh. I would not have expected to hear that from you. - 24/01/2012 09:35:56 PM 521 Views
Really? - 24/01/2012 11:23:26 PM 577 Views

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