When I was working on a World Bank project in Sri Lanka I used to land at Colombo Bandaranayke International and drive some 17 miles to the city of Colombo. Along the I would pass numerous low one story industrial buildings in Colombo’s Free Trade Zone. Inside of these buildings were thousands of Sri Lankans engaged in the manufacturing of clothing.
One of the largest employers of textile worker was Victoria’s Secret. These folks were engaged in the manufacturing of all of those expensive little niceties women around the world want. In fact my client’s wife, a graduate mechanical engineer, was a manager at one of those plants. Textiles that were once manufactured in Massachusetts and North Carolina are now made in Sri Lanka, Bangladesh and India.
During the recent senatorial campaign in California Barbara Boxer ran a commercial accusing Carly Fiorina, the Republican nominee and former CEO of Hewlett-Packard, of outsourcing jobs at HP to India and China. While this is true Boxer’s adds neglected to mention Dell, Gateway (now Acer), Apple, Microsoft and General Electric, the largest outsourcer of them all. All of these firms were major contributors to the Democrat Party with Jeffrey Immelt, the CEO of General Electric, being a member of President Obama’s Council of Economic Advisers.
Right now our President is in India telling us how he is going to create 500,000 jobs through the Indian economy. Is this a joke? Are those 500,000 jobs going to be for the Indians? Harley-Davidson, our last manufacturer of motorcycles has recently announced they will be moving some of their operations to India. This will mean jobs for India, not the United States. One of the world’s largest manufactures is the conglomerate TATA. The Tata group has vast holdings throughout the world and the make everything from home appliances to automobiles. Very soon they will begin exporting their version of the “Smart Car” to the United States. How many jobs will this create?
Once the world’s leader in manufacturing the United States makes very little and exports less. We still export food stuffs, timber and other natural resources, but import most of our consumer products, including automobiles. We still manufacture automobiles, but many of the parts are made oversees. Ford has just opened one of the most sophisticated auto manufacturing plants in the world in its brand new factory in Camaçari in the northern State of Bahia, Brazil. Ford invested $4 billion dollars and created a unique environment that consolidates its production line with their direct suppliers' own facilities. Here the Ford Ecosport mini SUV and the Ford Fiesta are made for the Brazilian market and exported to other developing countries as well. These automobiles are not made by UAW workers.
We still do a pretty good job making airplanes, but again the competition from the Europeans, Canadians and Brazilians is cutting into our ability to export these airframes. Even in the aircraft industry Boeing has to make deals with foreign nations to manufacture major parts of the airliner if they want to sell the plane to their national airlines.
We import steel and cement, major materials in construction. If you venture to Gary, Indiana, once the home to United States Steel, you will see a dilapidated ghost town with miles of abandoned and rusted buildings along the shores of Lake Michigan that were once the home to one of the largest steel producers in the world. Even those silly, curly-cue, “green” CFS light bulbs the government is mandating us to use are made in China or Mexico.
President Obama’s pet company, Solyndra of Freemont, California announced last week that despite the infusion of $500 million in stimulus money it is closing its doors due to their inability to produce a cheap solar panel. In March of 2010 BP announced it was moving its photovoltaic manufacturing plant in Frederick, Maryland and moving the operation to India. So much for “green” jobs.
When I lived in Cleveland, Ohio, home to Republic Steel’s giant rolling mill the people of Cleveland used to argue that Republic would not just pack up and mover when the city imposed higher taxes and onerous regulations on Republic. No one ever thought they would just close the mill and we would buy our steel from Japan or Europe at cheaper prices. We want to build high-speed rail with imported steel rails, locomotives and rail cars and electrical operating systems. The only thing we will make here are the stations. See my blog post “Another Stimulus” for more information about high-speed rail.
How did all of this come about? Why did we stop making things and start selling each other services? I believe there are three reasons for this; high cooperate taxes, greedy unions and onerous government regulations.
The top corporate tax rate in the United States is 35% — the second highest in the world (38% for companies reporting a taxable income between 15,000,000 and $18, 333,333). Only Japan at 40.6% has a higher rate while Germany has a corporate rate of 26.4% Remember, corporations do not pay taxes, the monies they pay to the government the form of taxes is passed on to the consumer in the price of the goods and services they provide. This inflates the price of the goods they produce and lowers their competitive edge.
Twenty-five years ago while visiting my cousin, a general foreman at the Ford Engine Plant in Cleveland; we had a conversation regarding the future of he American automobile industry. He told me that companies like Ford did not want to take on the unions for fear of facing strikes that would cause them to close plants. In light of this decision the auto makers would just give in to the union's demands of inefficient work rules, higher wages, more pension and health and welfare benefits and earlier retirement ages, The auto makers thought they could just pass these costs on to the consumer. Eventually when the price to quality ration of their product fell out of balance the consumer began buying more and more imports, especially from Japan. Now we have a automobile market flooded with imports from Japan, Korea and Germany and soon to be India.
This has happened to almost every U.S. manufacturer that has union employees. While we invented television we don’t make the TV sets of camera. We don’t make electrical appliances, bicycles, motorcycles (Harley- Davidson is moving to India), cell phones, computers, clothing, shoes and furniture anymore. All or most of these items are imported from abroad. Companies just could not provide the quality at an affordable price with the tax and union burdens imposed on them. They either went out of business or moved their operations abroad where taxes were lower or there were no unions. In some cases manufactures left populous states like California to relocate to right-to-work states like Texas or Arizona, but even these states are feeling the weight of federal regulations.
The third reason for all of these jobs going away is governmental and environmental regulations. Regulations, especially environmental, are killing American business. They are forced to spend millions on modifications to their plants to comply with state and federal EPA requirements. These requirements were put into place either by fiat or the mandate of the voters, usually through the initiative process.
A few years ago California passed and enacted one of the most onerous environmental laws in the nation — AB 32. This law mandates that the state of California reduce the pollutants that contribute to global warming. It was called Arnold Schwarzenegger’s little “Cap and Tax” bill as he threw his full support behind the bill. Everyone with any common sense knew the bill was a job killer, but the California Legislature did not care about that. They just wanted to please their green supporters, mainly progressive democrats.
In this past election an initiative, Proposition 23, was placed on the ballot. If passed Prop 23 would have suspended the requirements of AB 32 until unemployment fell to 5.5% or less for a full year. Of course this initiative was opposed by the democrats, public service unions, teachers unions and environmental groups. It failed at the polls by a margin of almost 2:1 (61.8% no and 38.8% yes.). Click here for map of counties and how they voted.
What we have in California are three classes of citizens. We have the working middle-class, we have the poor and illegal immigrants and we have the social bourgeoisie. Marx himself primarily used the term "bourgeois", with or without sarcasm, as an objective description of a social class and of a lifestyle based on ownership of private capital, not as a pejorative. He commended the industriousness of the bourgeoisie, but criticized it for its moral hypocrisy. And Hypocrisy they have in spades.
They have made the good life for themselves. They own the fine houses, drink the fine wine, shop at the best stores and vote for the Democrat Party candidate. Just compare the income levels of the California counties that carried for Brown and Boxer with the ones that went for Whitman and Fiorina. The next time you talk with a progressive liberal notice what they eat, where the shop, the house they live in and the car they drive. They majority will be driving a high-end import. They favor BMW, Mercedes, Lexus, Infinity Saab, Porsche and Jaguar. They also like SUVs while they want the working class to settle for Honda Civics or Ford Escorts. They don’t like pickup trucks and guns.
They believe they have a superior intellect, as most have a college degree, and that they know what is best for the rest of us. They will tell us we just don’t understand and that we aren’t aware of all the facts. They get their information about the environment from watching documentaries on public television or reading National Geographic Magazine and they feel satisfied when they contribute to the Sierra Club or Greenpeace. They believe the government can make our lives better; it just has to be more efficient.
Organizations like the Sierra Club, World Wildlife Fund and Greenpeace that once were concerned about protecting the environment are now liberal, progressive, political organizations that support the Democrat Party. They are no longer concerned with the bugs and butterflies; they are concerned with power — socialist power. In the United Kingdom they are called “watermelons”, green on the outside and red on the inside.
Before I retired the firm I owned was forced to install environmental-friendly lighting, special bins for storage of expended ink cartridges and hire a company to collect these ink cartridges. There were many other small things we were forces to do. Each action seemed to cause little problems or costs, but soon they began to add up. This is the way these things work.
Another set of regulations are those imposed by the Americans for Disabilities Act. The ADA has caused more jobs lost for disabled people than have been created. The imposition of the rules and regulations of the ADA has also added massive costs to business by requiring special office furniture, remodeling of restrooms, installing elevators and ramps, changing doors and the most expensive of all hiring staff to take responsibility for compliance and dealing with human resources issues.
What has this done for the disabled person? It has caused potential employers to view a disabled person applying for a job as a potential law suit and unless the person has some really great skill or knowledge the potential employer will not hire the person.
Other nations such as China, Mexico, India, Sri Lanka and Bangladesh do not have these regulations. Many of the jobs that are relocating to these countries do not require rocket science knowledge or skills. They require workers with a basic 8th grade education that can read a manual, follow instructions, show up for work on time and don’t hire lawyers.
So my question is; How, Mr. President, will you create 500,000 jobs by going to India?
One of the largest employers of textile worker was Victoria’s Secret. These folks were engaged in the manufacturing of all of those expensive little niceties women around the world want. In fact my client’s wife, a graduate mechanical engineer, was a manager at one of those plants. Textiles that were once manufactured in Massachusetts and North Carolina are now made in Sri Lanka, Bangladesh and India.
During the recent senatorial campaign in California Barbara Boxer ran a commercial accusing Carly Fiorina, the Republican nominee and former CEO of Hewlett-Packard, of outsourcing jobs at HP to India and China. While this is true Boxer’s adds neglected to mention Dell, Gateway (now Acer), Apple, Microsoft and General Electric, the largest outsourcer of them all. All of these firms were major contributors to the Democrat Party with Jeffrey Immelt, the CEO of General Electric, being a member of President Obama’s Council of Economic Advisers.
Right now our President is in India telling us how he is going to create 500,000 jobs through the Indian economy. Is this a joke? Are those 500,000 jobs going to be for the Indians? Harley-Davidson, our last manufacturer of motorcycles has recently announced they will be moving some of their operations to India. This will mean jobs for India, not the United States. One of the world’s largest manufactures is the conglomerate TATA. The Tata group has vast holdings throughout the world and the make everything from home appliances to automobiles. Very soon they will begin exporting their version of the “Smart Car” to the United States. How many jobs will this create?
Once the world’s leader in manufacturing the United States makes very little and exports less. We still export food stuffs, timber and other natural resources, but import most of our consumer products, including automobiles. We still manufacture automobiles, but many of the parts are made oversees. Ford has just opened one of the most sophisticated auto manufacturing plants in the world in its brand new factory in Camaçari in the northern State of Bahia, Brazil. Ford invested $4 billion dollars and created a unique environment that consolidates its production line with their direct suppliers' own facilities. Here the Ford Ecosport mini SUV and the Ford Fiesta are made for the Brazilian market and exported to other developing countries as well. These automobiles are not made by UAW workers.
We still do a pretty good job making airplanes, but again the competition from the Europeans, Canadians and Brazilians is cutting into our ability to export these airframes. Even in the aircraft industry Boeing has to make deals with foreign nations to manufacture major parts of the airliner if they want to sell the plane to their national airlines.
We import steel and cement, major materials in construction. If you venture to Gary, Indiana, once the home to United States Steel, you will see a dilapidated ghost town with miles of abandoned and rusted buildings along the shores of Lake Michigan that were once the home to one of the largest steel producers in the world. Even those silly, curly-cue, “green” CFS light bulbs the government is mandating us to use are made in China or Mexico.
President Obama’s pet company, Solyndra of Freemont, California announced last week that despite the infusion of $500 million in stimulus money it is closing its doors due to their inability to produce a cheap solar panel. In March of 2010 BP announced it was moving its photovoltaic manufacturing plant in Frederick, Maryland and moving the operation to India. So much for “green” jobs.
When I lived in Cleveland, Ohio, home to Republic Steel’s giant rolling mill the people of Cleveland used to argue that Republic would not just pack up and mover when the city imposed higher taxes and onerous regulations on Republic. No one ever thought they would just close the mill and we would buy our steel from Japan or Europe at cheaper prices. We want to build high-speed rail with imported steel rails, locomotives and rail cars and electrical operating systems. The only thing we will make here are the stations. See my blog post “Another Stimulus” for more information about high-speed rail.
How did all of this come about? Why did we stop making things and start selling each other services? I believe there are three reasons for this; high cooperate taxes, greedy unions and onerous government regulations.
The top corporate tax rate in the United States is 35% — the second highest in the world (38% for companies reporting a taxable income between 15,000,000 and $18, 333,333). Only Japan at 40.6% has a higher rate while Germany has a corporate rate of 26.4% Remember, corporations do not pay taxes, the monies they pay to the government the form of taxes is passed on to the consumer in the price of the goods and services they provide. This inflates the price of the goods they produce and lowers their competitive edge.
Twenty-five years ago while visiting my cousin, a general foreman at the Ford Engine Plant in Cleveland; we had a conversation regarding the future of he American automobile industry. He told me that companies like Ford did not want to take on the unions for fear of facing strikes that would cause them to close plants. In light of this decision the auto makers would just give in to the union's demands of inefficient work rules, higher wages, more pension and health and welfare benefits and earlier retirement ages, The auto makers thought they could just pass these costs on to the consumer. Eventually when the price to quality ration of their product fell out of balance the consumer began buying more and more imports, especially from Japan. Now we have a automobile market flooded with imports from Japan, Korea and Germany and soon to be India.
This has happened to almost every U.S. manufacturer that has union employees. While we invented television we don’t make the TV sets of camera. We don’t make electrical appliances, bicycles, motorcycles (Harley- Davidson is moving to India), cell phones, computers, clothing, shoes and furniture anymore. All or most of these items are imported from abroad. Companies just could not provide the quality at an affordable price with the tax and union burdens imposed on them. They either went out of business or moved their operations abroad where taxes were lower or there were no unions. In some cases manufactures left populous states like California to relocate to right-to-work states like Texas or Arizona, but even these states are feeling the weight of federal regulations.
The third reason for all of these jobs going away is governmental and environmental regulations. Regulations, especially environmental, are killing American business. They are forced to spend millions on modifications to their plants to comply with state and federal EPA requirements. These requirements were put into place either by fiat or the mandate of the voters, usually through the initiative process.
A few years ago California passed and enacted one of the most onerous environmental laws in the nation — AB 32. This law mandates that the state of California reduce the pollutants that contribute to global warming. It was called Arnold Schwarzenegger’s little “Cap and Tax” bill as he threw his full support behind the bill. Everyone with any common sense knew the bill was a job killer, but the California Legislature did not care about that. They just wanted to please their green supporters, mainly progressive democrats.
In this past election an initiative, Proposition 23, was placed on the ballot. If passed Prop 23 would have suspended the requirements of AB 32 until unemployment fell to 5.5% or less for a full year. Of course this initiative was opposed by the democrats, public service unions, teachers unions and environmental groups. It failed at the polls by a margin of almost 2:1 (61.8% no and 38.8% yes.). Click here for map of counties and how they voted.
What we have in California are three classes of citizens. We have the working middle-class, we have the poor and illegal immigrants and we have the social bourgeoisie. Marx himself primarily used the term "bourgeois", with or without sarcasm, as an objective description of a social class and of a lifestyle based on ownership of private capital, not as a pejorative. He commended the industriousness of the bourgeoisie, but criticized it for its moral hypocrisy. And Hypocrisy they have in spades.
They have made the good life for themselves. They own the fine houses, drink the fine wine, shop at the best stores and vote for the Democrat Party candidate. Just compare the income levels of the California counties that carried for Brown and Boxer with the ones that went for Whitman and Fiorina. The next time you talk with a progressive liberal notice what they eat, where the shop, the house they live in and the car they drive. They majority will be driving a high-end import. They favor BMW, Mercedes, Lexus, Infinity Saab, Porsche and Jaguar. They also like SUVs while they want the working class to settle for Honda Civics or Ford Escorts. They don’t like pickup trucks and guns.
They believe they have a superior intellect, as most have a college degree, and that they know what is best for the rest of us. They will tell us we just don’t understand and that we aren’t aware of all the facts. They get their information about the environment from watching documentaries on public television or reading National Geographic Magazine and they feel satisfied when they contribute to the Sierra Club or Greenpeace. They believe the government can make our lives better; it just has to be more efficient.
Organizations like the Sierra Club, World Wildlife Fund and Greenpeace that once were concerned about protecting the environment are now liberal, progressive, political organizations that support the Democrat Party. They are no longer concerned with the bugs and butterflies; they are concerned with power — socialist power. In the United Kingdom they are called “watermelons”, green on the outside and red on the inside.
Before I retired the firm I owned was forced to install environmental-friendly lighting, special bins for storage of expended ink cartridges and hire a company to collect these ink cartridges. There were many other small things we were forces to do. Each action seemed to cause little problems or costs, but soon they began to add up. This is the way these things work.
Another set of regulations are those imposed by the Americans for Disabilities Act. The ADA has caused more jobs lost for disabled people than have been created. The imposition of the rules and regulations of the ADA has also added massive costs to business by requiring special office furniture, remodeling of restrooms, installing elevators and ramps, changing doors and the most expensive of all hiring staff to take responsibility for compliance and dealing with human resources issues.
What has this done for the disabled person? It has caused potential employers to view a disabled person applying for a job as a potential law suit and unless the person has some really great skill or knowledge the potential employer will not hire the person.
Other nations such as China, Mexico, India, Sri Lanka and Bangladesh do not have these regulations. Many of the jobs that are relocating to these countries do not require rocket science knowledge or skills. They require workers with a basic 8th grade education that can read a manual, follow instructions, show up for work on time and don’t hire lawyers.
So my question is; How, Mr. President, will you create 500,000 jobs by going to India?
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