What are we going to do about outsourcing jobs?

[boobiemiles]

I am an independent voters.  I don't care who wins to be honest.  I see the horrors of the unemployment market like most of you do.  After the elections last Tuesday I didn't hear one word about outsourcing jobs.  I figure since the GoP won, there would be more funding for the military.  Possibly military action against ISIS, and Syria, in turn opening up the ports in N.C., and Colorado.  That could help with the job market.  Plus more weapons means more manufacturing jobs.  (Honestly I didn't see that happen from 2001 to 2008 when we were heavily involved in the second Iraq war, and Afghanistan.) My question is simple:  has any heard anything from either party about outsourcing jobs?  I know we can use some of the positions companies are sending to India, etc. I know the GoP is going to ask for smaller taxes on corporations.  Is that enough?

[Destino]

Wall street likes it so, nothing at all.  If you don't like it, take out a loan and get some more education so that you can have a job that they haven't outsourced.  Yet. 

[twa]

we've certainly addressed it here in Texas, we are in-sourcing from everywhere

[zoony]

Wall street likes it so, nothing at all.  If you don't like it, take out a loan and get some more education so that you can have a job that they haven't outsourced.  Yet.

 

Not true, dummy. You can also create vast amounts of oil deposits, deep water ports, and a tsunami of cheap foreign labor in your state. Then elect a republican and constantly tell everyone how awesome you and your republican friends make things

That works too

 

we've certainly addressed it here in Texas, we are in-sourcing from everywhere

[The Evil Genius]

we've certainly addressed it here in Texas, we are in-sourcing from everywhere

 

"Everywhere" being the other 56 states, right?

[twa]

go hug a hunk of coal  , just wait till the widening of the canal is done and keep on the same paths

 

 

"Everywhere" being the other 56 states, right?

 

as ZZTOP says   ...Worldwide 

add

http://www.forbes.com/sites/joelkotkin/2014/06/19/americas-new-industrial-boomtowns/

America's New Industrial Boomtowns

“In the sixties you had to go to Chicago, Cleveland and Detroit. Now Houston is the place for new industry.”

[PeterMP]

Keep the value of the dollar low.

 

Won't happen, but that's a big part of the solution.

 

Do something about China pegging their currency to the dollar would help too.

[PeterMP]

This is from the last election, but I think it is pretty good:

 

http://www.motherjones.com/politics/2012/07/romney-obama-bain-outsourcing

[twa]

This is from the last election, but I think it is pretty good:

 

http://www.motherjones.com/politics/2012/07/romney-obama-bain-outsourcing

 

pretty good overview, but it lacks a solution and instead simply acknowledges it is necessary in global economy.

 

green credits or lifting the tax are band-aids when stitches are in order to stop the bleeding

[Larry]

I've been wondering for some time if maybe what's needed here is some good old-fashioned protectionism.

If people who wanted to sell things in the USA, had to make them here.

Yeah, China will retaliate. People who want to sell things in China, will have to make them in China. But they're already doing that, anyway.

[twa]

some common sense would help,but aggressive protectionism harms more than helps

[PeterMP]

pretty good overview, but it lacks a solution and instead simply acknowledges it is necessary in global economy.

 

green credits or lifting the tax are band-aids when stitches are in order to stop the bleeding

 

The solution is to bring wages of US workers in line with workers in other countries like China, at least to the point that it doesn't make sense to build things there and then ship them here.

 

(Or even in some cases, "make" them here, ship them there for "processing"/"finishing" and then ship back a finished product.)

 

Now, there are a few ways to this, but one way is to keep the value of the dollar low so US workers are in reality being paid less.  This is essentially what happened during the economic down turn.  The value of the US dollar shrunk.  Manufacturing jobs actually increased in the US (from your link in the other thread it was the first 6 consecutive year increase in US manufacturing jobs in what had been a multi-decade down turn.)

 

Now, there are different ways to do that, some of which being more painful than others.

 

The only other real long term solution is to some how make US workers much more productive than worker in other countries, which is becoming less likely as our infrastructure ages and essentially becomes a sunk/lost expense.

 

(i.e. other countries that will skip directly to high quality wireless don't have the sunk expense of laying all of the wire we have or even investing in lower quality wireless networks.)

 

There really is no inherent reason that US workers should be more productive than Chinese workers to the point that it makes sense to pay us much more, but we want to make much more.

 

So jobs get outsourced.

I've been wondering for some time if maybe what's needed here is some good old-fashioned protectionism.

If people who wanted to sell things in the USA, had to make them here.

Yeah, China will retaliate. People who want to sell things in China, will have to make them in China. But they're already doing that, anyway.

 

There's limits to what can be done because of the WTO, even if you are talking about specifically with respect to China (not general protectionism, but even actions with respect to China specifically) because somewhere along the line US politicians thought it would be a good idea to allow China into the WTO (I think that was a Clinton era decision).

 

Even cash for clunkers was essentially a pay off for the US industry.  A year two tarriff on foreign cars would have been more effective and probably actually made the US government money, but you can't go that route without running into issues with the WTO.

 

Unless you are willing to tell the WTO to go jump in a lake (which I wouldn't really be against, but there isn't a major politician out there that talks that way currently).

[Wrong Direction]

First, and inconvenient truth for America: world poverty has declined by billions because of trade and spurred by American outsourcing. Our outsourcing is bad for the textile worker from South Carolina, but it's great for countless of the world's poor. Humanity is MUCH better because of outsourcing.

 

This sucks for the American who lost their job, but it's true. It's also true for the average American, who can buy an iPad, clothes, pretty much everything, for much cheaper than we otherwise could. The American standard of living is much higher because of trade, and trade drives outsourcing.

 

The truth is that our dollar is nowhere near weak enough to make anywhere near financial sense to insource your average manufacturing jobs, and productivity cannot take enough of a sustainable jump for old-school manufacturing jobs to come home. 

 

So what's the solution for an economy that's far more advanced than the world's labor pool? Transform our economy.

 

First, you stop importing labor for jobs that poor Americans can do. I've seen the economic studies on illegal immigration, and I think they all have a massive flaw insofar that they don't account for the cost of subsidizing able bodied Americans. 

 

Second, you lower the cost of hiring in America. Major corporate tax reform, which is often seen as a give away to special interests, is absolutely necessary. The reality is that more than "stupid" labor jobs will be outsourced. We need to incent hiring of Americans in America, or it will become cheaper to train computer programmers in other countries than it is to hire them here. Heck, I know a company that's hiring in Peru for this very reason.

 

Third, you have to educate people better in traditional or vocational schools. Reality is hitting this country in the face. We'll either stay ahead of the world or the markets will pull us back, and that will be painful. It may be inevitable. 

 

/debbiedowner

[DCSaints_fan]

Bottom line is the US can't make stuff cheaper (usually, some agricultural and commodities products are an exception here) ... so we have to make stuff better.  

[PeterMP]

Illegal immigration actually helps prevent out sourcing, which then has a ripple effect of employing Americans.

 

Essentially, instead of having the factory move to Mexico, you move the Mexicans to the US.

 

Where it is true, they don't make much money, but the money they do make stays here vs. if you moved the factory to the US, they'd spend none of the money here and you'd lose the jobs from the factory (where management is still pretty highly paid US citizens if it is here so if the factory goes those jobs go too) and the "trickle down" of the illegal immigrants (where things really do trickle for the poor because they spend the vast majority of their money and locally.)

 

That's why studies that look at illegal immigration end up concluding that is good even taking into account subsidizing able bodied Americans (because realistically, there are even fewer of them).

 

(Not that this is really an argument for illegal immigration.  There are social/moral issues there as well, but from an economic stand point at least at some level (like all things there is a point where there is too much) it is a no brainer).

[Slateman]

Wait, isn't unemployment at the lowest its been in 20 years?

[Wrong Direction]

Illegal immigration actually helps prevent out sourcing, which then has a ripple effect of employing Americans.

 

Essentially, instead of having the factory move to Mexico, you move the Mexicans to the US.

 

Where it is true, they don't make much money, but the money they do make stays here vs. if you moved the factory to the US, they'd spend none of the money here and you'd lose the jobs from the factory (where management is still pretty highly paid US citizens if it is here so if the factory goes those jobs go too) and the "trickle down" of the illegal immigrants (where things really do trickle for the poor because they spend the vast majority of their money and locally.)

 

That's why studies that look at illegal immigration end up concluding that is good even taking into account subsidizing able bodied Americans (because realistically, there are even fewer of them).

 

(Not that this is really an argument for illegal immigration.  There are social/moral issues there as well, but from an economic stand point at least at some level (like all things there is a point where there is too much) it is a no brainer).

 

I don't buy this as a net positive.  There aren't American sweat shops hiring illegals for $2/hour, and many illegals here send a lot of their money home. I understand that illegal employees do lower costs, but I don't think they're keeping a ton of jobs here that would otherwise be outsourced. I could be wrong, but I don't buy it on the surface.

Wait, isn't unemployment at the lowest its been in 20 years?

 

#1. No. It's the lowest it's been since about mid 2008.

http://data.bls.gov/timeseries/LNS14000000

 

#2. It's an incomplete statistic anyway. Labor force participation is very very low. 

http://data.bls.gov/timeseries/LNS11300000

[Kosher Ham]

Labor force is perhaps lower because less homes are being built.

[skinsmarydu]

Our newest U.S. Senator got taken to task over it, after he'd done it, and bragged about it. Everyone knew Michelle would never do it, Georgia is her cause, not her latest "battle ground" for corporate raiding.

Yet she is not our newest U.S. Senator.

[twa]

Labor force is perhaps lower because less homes are being built.

 

plenty being built here, surely construction jobs are not the problem after all that stimulus money

[PeterMP]

#1. No. It's the lowest it's been since about mid 2008.

http://data.bls.gov/timeseries/LNS14000000

 

#2. It's an incomplete statistic anyway. Labor force participation is very very low. 

http://data.bls.gov/timeseries/LNS11300000

The U6, which includes anybody that even says they'd like to work, even if they aren't applying for jobs, and people that work part time that say they'd like a full time job, even if they aren't looking for a new job, is also at its lowest point since 2008.

[PeterMP]

I don't buy this as a net positive.  There aren't American sweat shops hiring illegals for $2/hour, and many illegals here send a lot of their money home. I understand that illegal employees do lower costs, but I don't think they're keeping a ton of jobs here that would otherwise be outsourced. I could be wrong, but I don't buy it on the surface.

They aren't making $2.00/hour, but there are lot's of places where there are people making below the minimum wage.

http://latimesblogs.latimes.com/lanow/2012/12/federal-sweep-of-downtown-garment-businesses-finds-widespread-violations.html

I don't know of any case where the conclusion isn't that illegal immigration affects are small with respect to our economy, but most conclude that the affect is positive.

[skinsmarydu]

after all that stimulus money

...that should be employing people fixing bridges, roads, overpasses, etc. for the greater common good.

Yet it is not so. I wonder who's been blocking that bill?

[Riggo-toni]

I remember reading an article in the Economist back in the late 80s or early 90s predicting that the precipitous decline in American math skills relative to Asia would eventually lead to a loss of tech sector jobs that would be worse than the decline of manufacturing jobs people were screaming about at the time. As always, their material was eerily prescient.

[zoony]

plenty being built here, surely construction jobs are not the problem after all that stimulus money

They are the problem.