Will Corporations Write Off US Workers?

[thriftyandboringinohio]

Re: US as world cop

I'm not so convinced the huge US military is doing the world a lot of good. There is a huge concentration in the middle east, literally encircling Iran. Could we not try to befriend the people of those regions and hope they will reciprocate? Instead, we use drones on Pakistan, and hope they will not reciprocate.

We are still occupying Okinawa. Could Japan not defend itself?

The US "military Hegemony" has done nothing to stop genocides in Africa, arms race between India and Pakistan, etc.

Regarding pharmaceuticals, we are paying through the nose, but is it really going for research?
These companies report marketing and research expenses in the same line, the only industry to do that. You should see their sales reps--like super models. I have to wonder if vacation trips are the only incentives they hand out to doctors. The market lacks competition. No to mention the PHarma companies under write the physicians "catch up" classes.

I see your point, PS.
Still I would not like to do entirely without either my US military or my pharmaceutical companies.

But I would like to spend much less on both. Much, much less.
Especially in the US, we seem to take a good thing WAY too far, and these two might be a poster child for taking things too far.

[Polish_Silver]

Re: US as world cop

I see your point, PS.
Still I would not like to do entirely without either my US military or my pharmaceutical companies.

But I would like to spend much less on both. Much, much less.
Especially in the US, we seem to take a good thing WAY too far, and these two might be a poster child for taking things too far.

If the US military budget were reduced to 25% of what it is, it would be on a par with what other nations spend, I think.

[dcarrigg]

Re: US as world cop

I'm not so convinced the huge US military is doing the world a lot of good. There is a huge concentration in the middle east, literally encircling Iran. Could we not try to befriend the people of those regions and hope they will reciprocate? Instead, we use drones on Pakistan, and hope they will not reciprocate.

We are still occupying Okinawa. Could Japan not defend itself?

The US "military Hegemony" has done nothing to stop genocides in Africa, arms race between India and Pakistan, etc.

Regarding pharmaceuticals, we are paying through the nose, but is it really going for research?
These companies report marketing and research expenses in the same line, the only industry to do that. You should see their sales reps--like super models. I have to wonder if vacation trips are the only incentives they hand out to doctors. The market lacks competition. No to mention the PHarma companies under write the physicians "catch up" classes.

Can't do global shipping and outsourcing without protected sea lanes. There's more than $2 trillion crossing the Pacific every year. You don’t get trade with Asia without open sea lanes. And the whole damn project grinds to a halt without oil. We got a small taste of that in '73. Like it or not, it's the price we pay for globalization. Your iPhone doesn't have batteries without strip mining Afghan hills for lithium and rare earths in inland China. And it doesn't get built for $2 per hour in a Foxconn factory and shipped overseas without a carrier group keeping it safe along the way. And the capemax ship carrying it charges too much for the trip if oil hits $300 per barrel at the WTI or Brent spot. The US already has extremely unfavorable terms with the WTO judging by its trade deficit. And that's just to get other countries to agree to the globalization scheme. How do you think these deals would be renegotiated without overwhelming military force?

How many countries would be willing to do this to themselves just to build a globalized economy?




How many countries would bother to play international cop to keep the whole project chugging along?

How many countries would sacrifice half their budget to defense?

The US is for all intents and purposes the only country keeping worldwide oceans clear for trade. You can't just compare her to any other country. Someone has to do that job.

If not us, who?

Then there are the practical considerations. What happens to American unemployment without protectionism in the defense sector? That's 3.5 million jobs just in defense/aerospace manufacturing contractors alone. Never mind military and civilian personnel actually doing the grunt work. We're talking probably 5% of all employed persons in the states here. And they're generally middle class jobs. Without defense as a jobs program, poof, the American labor sector begins to look pretty bad.

I think it's fair to argue for a smaller defense budget. But not without acknowledging the consequences. You won't get all this "peaceful" international trading without it. Multi-national firms will lose access to lots of markets they can get into now. And consumer goods will get more expensive. We'll have to find domestic or allied sources of raw materials. And we'll have to do something about the abysmal jobs situation that would result in the short term.

This idea that if you just pull the American military out of the picture, everyone would get in a circle and sing kumbaya and let multinational firms go wherever they wanted and trade with each other all day long without piracy, protectionism, nationalization, and the worldwide expansion of state-owned enterprises is just foolish.

Don't forget that this is the second globalization. It arose along with the supremacy of the US and the decline of the USSR. The first one ended along with the supremacy of the British Empire in WWI.

Among the top 10 lessons I have learned from history is this: Never underestimate the effect of naval power on trade.

[don]

Re: US as world cop

Well said, dcarrigg. Athens would agree

(How about if every 'multi-national' (gotta love that term) that chooses foreign tax evasion be left to the mercies of international pirates?)

[Polish_Silver]

The Military and Trade

You mentioned oil and sea lanes as justifications for the military. Slap tarifs on imports and exports to cover the cost of the navy protecting those ships. And that could certainly be done in cooperation with other nations.

Regarding the oil, I don't think the voters will accept that as a reason for the large military. The public was told it was about terrorism, and WMD.

As for employment, that is a temporary adjustment. The military is a huge overhead keeping the nation less competitive in every other area.

Regarding nationalization, the military has not halted nationalization of oil fields, plantations, and lots of other stuff. When it has been used, for example, in Latin America, it mostly seems like an embarrassment in retrospect. That would be interfering in the internal affairs of sovereign nations, which most Americans do not want.

Companies that invest in a country are taking a risk . They should not be bailed out by taxpayers.

The military should be about protecting US territory. Period.

[dcarrigg]

Re: US as world cop

Aye. If a small band of Somalis can jack a tanker with no resources but a couple AKs and a speedboat, imagine what an actual organized, well-funded pirate group could accomplish with a group of trained and equipped marines and a couple Soviet surplus Frigates...

[dcarrigg]

Re: The Military and Trade

I think you might be wrong about what most Americans want. That all changes in time. Americans are war weary now. 13 years ago, they were chomping at the bit, even to get into ill-advised wars.

The public was lied to about WMD. But do you think the Saudis get shipped a bunch of new F-15s every year for nothing? The game is the game.

The military has indeed been used to halt nationalization for at least the last century. And how many more times would nationalization have occurred had foreign leaders not feared the consequences?

What benefit is it to a foreign nation if Exxon Mobil comes in, sucks up all its oil, then makes the profit on it? Not much. You think they'd all just happily agree to this arrangement in the absence of force?

Look what happened to Nasser. Whether it was a smart move or not, who knows?

Companies are inherently risk-averse. You may think they shouldn't be bailed out by taxpayers, but their shareholders will probably disagree.

Isolationism was an option while the British kept the world order. Believe me, you don't want to see what your 401(k) or your energy bills would look like if we went back to it now. The genie's out of the bottle. The cat's out of the bag.

Competitiveness isn't just going to spring up out of nowhere when you cut defense to the bone. No sir. Competitiveness will cease to matter.

You may have raw faith that trans-oceanic trade will continue just fine without a world naval power enforcing it.

But history tells another story.

A small navy protecting container ships can be destroyed by another small navy. And small navies are cheap compared to the $2T per year in goods crossing the pacific and the amounts crossing the Atlantic and Indian to boot.

How quickly America forgets her history.

If there's profit in it, and the force on the water isn't overwhelming, somebody's coming to try and take it. It happens every time.

Start slapping tariffs back and forth, and now we probably need to produce raw materials domestically that we just don't produce.

Like I said, it's not necessarily impossible.

But it's not an automatic boon.

And international relations isn't a hippie drum circle. It's a blood sport.

There's a ton of risk there. An absolute ton.

[rjwjr]

Re: The Military and Trade

My 2 cents is a little different than the popular view of the comments thus far.

As for American workers becoming less competitive, it's a fact that the world is becoming a smaller place. I don't believe that American workers will "go backwards" volunteerily, but global workers are anxious to "move forward". Put another way, American workers will likely stagnate until such time that global workers catch up in wages and benefits.

As an aside on benefits, after 40 years in business, we open our first non-US based manufacturing facility later this year in Mexico. Obamacare wasn't the deciding factor, merely the tipping point in economics of the decision.

As for gaining "skills" via the US K-12 system, I read the original post as talking more about unskilled American laborers. As the owner of a manufacturing company myself, the only "skills" we need are reliability, attitude, and a minimum level of discipline/maturity. Most of our work force is hispanic-American as a result. The stereotypical American worker sadly feels more entitled in my experience. They want a shortcut. No longer willing to pay their dues, they want a management job, a salary, full benefits, and they want it now because they deserve it. In my experience, the hispanic-American workers are working to provide themselves and their children better opportunities and are driven by that grand motivation. The American dream is still alive although it has become the hispanic-American dream for now.

As an aside, my "American" workers don't respond with inclusiveness or attempting to better themselves and their performance. They respond by asking me why we don't hire more "Americans" (all of our workers are certified American citizens). Sad reality.

I'm not anti-American, racist, sexist, etc. I am simply an open-minded, observant realist reporting from the trenches.

[Polish_Silver]

Obama care and off Shoring

. . .

. . .I don't believe that American workers will "go backwards" volunteerily, but global workers are anxious to "move forward". Put another way, American workers will likely stagnate until such time that global workers catch up in wages and benefits.

I definitely agree with that.

As an aside on benefits, after 40 years in business, we open our first non-US based manufacturing facility later this year in Mexico. Obamacare wasn't the deciding factor, merely the tipping point in economics of the decision.

As a business owner, what is the downside to you of Obamacare?
I have several beefs with it, but how does it affect your business?

Based on personal conversations, it seems that young workers are simultaneously expecting much more from employers, and dismayed that they are not hired.

[rjwjr]

Re: Obama care and off Shoring

As a business owner, what is the downside to you of Obamacare?
I have several beefs with it, but how does it affect your business?

The economic negative is additional administrative work for our HR dept.

The psychological negative is the moving target; deadlines delayed, program changes, constitutionality questioned. Our executive team has had Obamacare as a permanent agenda item for quite a while now. Unproductive distraction.

The emotional negative is stealing the good feeling I received personally from providing a nice benefit voluntarily to effectively making it mandatory. Although early indications are that eliminating our health plan and paying the fines would be much less costly to our business than paying for our current plan.

Again, let me reiterate and emphasize that Obamacare was simply the proverbial straw that broke the camel's back. There is a shit ton of other factors that finally motivated us to the action of creating new jobs in Mexico rather than the US.

[Polish_Silver]

Re: Obama care and off Shoring

The economic negative is additional administrative work for our HR dept.

The psychological negative is the moving target; deadlines delayed, program changes, constitutionality questioned. Our executive team has had Obamacare as a permanent agenda item for quite a while now. Unproductive distraction.

The emotional negative is stealing the good feeling I received personally from providing a nice benefit voluntarily to effectively making it mandatory. Although early indications are that eliminating our health plan and paying the fines would be much less costly to our business than paying for our current plan.

Again, let me reiterate and emphasize that Obamacare was simply the proverbial straw that broke the camel's back. There is a shit ton of other factors that finally motivated us to the action of creating new jobs in Mexico rather than the US.

That makes sense. The law is so large and complex, and items still have not been finished. They should all be ashamed for creating it and voting for it.

[LazyBoy]

Re: The Military and Trade

As for gaining "skills" via the US K-12 system, I read the original post as talking more about unskilled American laborers. As the owner of a manufacturing company myself, the only "skills" we need are reliability, attitude, and a minimum level of discipline/maturity. Most of our work force is hispanic-American as a result. The stereotypical American worker sadly feels more entitled in my experience. They want a shortcut. No longer willing to pay their dues, they want a management job, a salary, full benefits, and they want it now because they deserve it. In my experience, the hispanic-American workers are working to provide themselves and their children better opportunities and are driven by that grand motivation. The American dream is still alive although it has become the hispanic-American dream for now.

As an aside, my "American" workers don't respond with inclusiveness or attempting to better themselves and their performance. They respond by asking me why we don't hire more "Americans" (all of our workers are certified American citizens). Sad reality.

Do you mind saying what part of the country your US factory is in? (Is there a strong history of factory work there?) Do you think you'd see the same thing in, say, Detroit? I'm wondering if this is regional or universal.

[santafe2]

Re: The Military and Trade

Do you mind saying what part of the country your US factory is in? (Is there a strong history of factory work there?) Do you think you'd see the same thing in, say, Detroit? I'm wondering if this is regional or universal.

This is a generational issue more than a regional issue. Gen Y, 20 somethings, have been raised with constant feedback and praise for their accomplishments. They get bored easily. They don't like working a "desk" job. To those of us raised to be glad to have a job and to do the job as well as possible, to be a team player, this attitude can come off as entitled, self centered, not loyal. This is an awfully broad brush with which to paint the Millennial generation but this attitude especially with the well educated in the Gen Y group is not uncommon.

Since selling my last company I've been working as a business process consultant. But building a sensible process within which people can succeed is only the first half of the job. The other half is training C level management to hire directors, managers and staff with similar cultural outlooks. While it really isn't fair to Gen Y because many of them have been raised this way, I train management to interview specifically to filter out people with these traits.

I don't want to sound like I'm anti-Gen Y, this is my kid's generation and many of them are awesome, hard working, energetic and skilled beyond their years. But we did manage to convince quite a few of these people that they're special and that attitude is a non-starter in the workplace.

[dcarrigg]

Re: The Military and Trade

This is a generational issue more than a regional issue. Gen Y, 20 somethings, have been raised with constant feedback and praise for their accomplishments. They get bored easily. They don't like working a "desk" job. To those of us raised to be glad to have a job and to do the job as well as possible, to be a team player, this attitude can come off as entitled, self centered, not loyal. This is an awfully broad brush with which to paint the Millennial generation but this attitude especially with the well educated in the Gen Y group is not uncommon.

Well, to be fair, the broad brush paints both ways. You don't have to go far on the internet to see gen Y complain that boomers had better job prospects, position ladders / raises, pensions, and all sorts of benefits that gen Y will never know/get.

There's a lot of hate in gen Y for their parent's generation. And it looks like it goes both ways.

I think the stereotypes are like this:

Boomer stereotype about gen Y:
- selfish
- lazy
- entitled
- 'special snowflakes' who don't realize just how replaceable they are
- disloyal and manipulative, just in situations for themselves.
- job hop too quickly and recklessly

Gen y stereotype about boomers:
- selfish
- ignorant
- entitled
- grant themselves special benefits that neither their parents nor their children will ever receive
- destroyed the prosperity they inherited from the greatest generation and left gen Y with a mess
- stay in one job because of two-tier benefit structure where older workers are grandfathered into better benefits than younger ones.

It's funny how many of the stereotypes are the same in the end of the day.

Especially the selfish and entitled thing. I see those two slung from both sides all the time.

One says, "You should be happy to have a job, any job. I was always appreciative of my jobs." And the other responds, "You had good jobs with good benefits right out of high school and your generation sent them all overseas for a quick buck."

One says, "Why do you want to move back to grandpa's old crime-ridden neighborhood for that much money? It's just to hang out at those bars, isn't it? You waste too much money on that and eating out." And the other responds, "You built giant McMansions in boring culture-less suburbs with giant SUVs that suck up oil and giant lawns that suck up water for no reason."

One says, "I had student loans, and I paid them off just fine!" And the other responds, "Yeah, well the state covered tuition back then, but you wanted a tax break more than you wanted to keep that up!"

One says, "You've got to stay in your job for at least 5 years, work hard, and you'll be rewarded! Job hopping makes you look flakey on your resume." And the other responds, "It doesn't work that way anymore. There are no promotions except lateral moves. Benefits and pay only get cut with time. Companies show us no loyalty anyways. Why should we be loyal to them?"

One says, "Look how self-centered you are, with all this nonsense social media and pictures and blogs about yourself! Who wants to read all that?" And the other responds, "Self-centered? We're not the ones with the 72" television and a private swimming pool in our back yard because we look down at the Y!"

I think there's a bit of truth in all of these made-up remarks that each side makes to the other. And I think they all go overboard too.

There's definitely some generational tension brewing there, though.

There's a meme floating around the internet these days that shows a picture of a 20 year old kid from the 70s where the caption is "He's got it better than his parents AND his kids!"

I've also seen one that shows a bunch of millenials on their smartphones and it says, "I'm trying to get a job dad! I'm Networking! Spends 8 hours playing on facebook."

The truth is probably in between. Gen Y was dealt a crap hand. And odds are good they will be poorer than their parents.

But at some point they've got to step up and own it; quit whining, and do something about it.

[don]

Re: The Military and Trade

With the level of ignorance of most Americans - how many know what the financialization of our economy even means - generational antagonism is a given. And who benefits from that Mom, Pop and Kiddies heat?