Originally posted by: kage69
Fixed your statement. You benefit from outsourcing when you can buy a nice computer for $1200, and not $4000. You benefit when you can buy the latest DVD player for $99, and not $700.
PCs sold for $4000 back in 94 largely because certain memory components were only manufactured at a single solitary plant in Northern Japan, which later was destroyed by fire during an earthquake. Demand far exceed supply, hence the prices. Once that facility (and other newer ones in Taiwan and South Korea) came back into production prices came down dramatically, and all this happened long before the outsourcing trend that started during Bush's term.
That is so wrong. When I was in college in the mid-90's, we learned so much about the pros and cons of outsourcing. Michael Moore made "Roger & Me" in 1989 about GM's outsourcing to Mexico. This is not some new trend that Bush has started, despite what you've heard on Air America. I know Intel has been outsourcing labor since the 90's. You can't tell me that if all their chips were manufactured in the US, with 4X the labor costs, PCs wouldn't be more expensive.
The latest DVD players at $99? You're on crack, not to mention painting exaggerated pictures to further your argument.
This is my DVD player. I bought it for $99 to replace my old Sony DVD player that I bought in '99 (for $450!), because this one has progressive scan, plays DVRs, and plays MP3 discs. Know your facts before you begin to argue. It makes you not look so dumb.
There is a certain amount of outsourcing to be expected, and it does benefit consumers but mostly companies. Where these companies get into hot water is when they try to relocate a facility overseas purely to maintain CEO payrolls. I read awhile ago about a town in Georgia that re-wrote laws, gave tax credits, and the employees even accepted pay cuts if the company would just stay put and not take away 400-some jobs. The projected loss for the company were it to stay local would have been a paltry $1million. Company packed up and left anyway. :frown: Crap like that is what makes people mad, myself included.
First of all, companies don't outsource to pay for CEOs' salaries. My company has 80,000 employees worldwide, and there are enough checks and balances to override any decision made that merely pads the CEO's wallet. Contrary to what you may think, CEO's do not always have dictatorship authority over how their company runs. Your example of a company that saved $1 million by outsourcing labor is one example. I guarantee their decision to outsource based on a $1 million ROI means their revenue is relatively small. Say their revenue is $2.5 million, and their operating expenses are $1.5 million, yeah, I would say a $1 million savings would justify outsourcing. Regardless of the $50,000 in tax savings the town offered. And I guarantee their CEO isn't getting the majority of that savings. But most large corporations that are outsourcing, which are capable of employing many people, are saving alot more than $1 million by doing so.
Companies structure their CEO's pay so that he is compensated for increasing profit. Sometimes that is done by reducing costs. It's done to motivate them to make the company succeed. So yes, a result of outsourcing is always going to be an increase in pay for the CEO. But that is not why the company and shareholders decide to do it. It also makes money for all the employees, and all the shareholders. If my company didn't outsource, they might not be able to pay me enough to buy a home, or to provide health insurance for me. No, I'm not willing to give that up, just to bring low-paying jobs back to the US.