The American Economy Has Left the Building

[Dr Deaf]

24 November 2005
by Richard Sauder, PhD
http://www.sauderzone.com/samizdatsix.htm

The news of the 30,000 jobs that General Motors recently announced it plans to cut caught my attention like a searing brand plunged deep into my mind. It's still sizzling there like a splinter festering in the middle of my brain. There have been a lot of indications in recent years of the depth of the systemic turmoil brewing in the American economy, but this news item caught my eye in a way that a lot of other news has not. Perhaps it was the admonitions from decades past of my American history teacher in high school who repeatedly warned the class that the foundation of the American economy was based on the health and well being of the housing and automobile industries, and that as went the fortunes of those two industries, so too went the economic prospects of the nation.

Well, when I heard the news of this massive job cut by General Motors I could not help but ponder what this seismic shift in such an important sector of the American economy might portend. After all, if 30,000 manufacturing jobs disappear, myriad more thousands of jobs also disappear at the same time. What happens to the truckers and trucking lines who ship the cars to market that those 30,000 people manufacture? What happens to the sales volume of the stores and supermarkets where those 30,000 soon-to-be-unemployed people shop? What happens to the parts manufacturers who supply parts for the factories that will soon be idled? What happens to the jobs of the people who work in the parts manufacturing companies who soon will have no customers for their parts? And on and on the negative ripple effect goes, as it washes out through the economy. One more round of massive job cuts, this time at General Motors. You know, if you think about it, 30,000 workers here, and 30,000 workers there, and before you know it, you're talking real serious hard times, as the nation rapidly deindustrializes and people are thrown out of work.

This news also caused me to reflect on something else. When I was in graduate school I read quite a lot of so-called "Dependency Theory" literature for my seminars and comprehensive exams. Dependency Theory grew out of the 20th-Century work of the Argentine economist, Raúl Prebisch and the United Nations' Economic Commission for Latin America (ECLA), which Prebisch headed. At the risk of oversimplifying, Dependency Theory held that the economically deprived conditions that prevailed in much of Latin America were at root due to imbalances in the terms of trade between developed (core) nations and the economically underdeveloped (periphery) nations in Latin America. Prebisch and the Eclistas held that the poorer nations of Latin America, which marketed their raw resources and agricultural products (sugar, bananas, cotton, petroleum, mined ores, timber, beef, etc.) to the developed nations of the international economy's core, were perpetually economically disadvantaged by this arrangement, because they had then to import finished or manufactured goods from the developed core on unfavorable terms established by the developed countries. Prebisch and the Eclistas felt that the way to break this cycle of economic dependency and subordination was to develop Latin American industry, via Import Substitution Industrialization (ISI). The idea was that if Latin countries produced their own manufactured goods they would not need to import them on unfavorable terms from Europe and the United States. As it happens, for a variety of reasons ISI policies met with distinctly limited success. Without going into any more detail, suffice it to say that those are the bare bones of Dependency Theory and the attendant ISI program that it spawned. My purpose here is not to write a thesis on Dependency Theory -- those who are interested can do a key word search on the internet or go to a research library at a major university and read from now until the cows come home without coming to the end of the Dependency literature. It runs to unknown thousands of pages, and has both adherents and detractors. The debates over the pros and cons of Dependency Theory have raged for decades now and I certainly will not resolve the contention between the various camps in this short article. I had enough of that in graduate school!

No, my purpose in bringing up Raúl Prebisch and the Eclistas and Dependency Theory is rather different. Without having to decide whether what he and his fellow theorists asserted is demonstrably true or not, without having to take sides in the voluminous and prolix Dependency Theory debates, I wanted to simply observe that what we are witnessing today in the American economy is something like the reverse of the dynamic that Prebisch and the Eclistas first described decades ago in the mid-20th Century in Latin America. To wit: where they were faced with unindustrialized Latin economies that could not compete with the developed industry of the core countries such as the United States, we in the United States are today faced with a deteriorating economy that is rapidly deindustrializing, in large degree as a consequence of a whole slew of so-called Free Trade agreements and regimes such as NAFTA, CAFTA and the WTO which have made capital and entire industries very portable internationally, to the considerable detriment of workers at home and abroad. We can debate the reasons as to exactly why this is occuring, but suffice it to say that it is happening. The 30,000 jobs that have just been cut at General Motors are but the latest evidence of that.

I must say that I rather agree with the views of Geore Ure, at Urbansurvival.com, who feels that instead of laying off American workers, only to export industries and jobs to underdeveloped countries, and then pay workers there a small fraction of a living American wage to perform the same jobs that the laid-off American workers used to hold, that a saner policy would be to develop an international economic order that had as its objective to raise living standards and wage levels in poorer countries to be commensurate with those of the developed countries. Not only would this benefit the workers of underdeveloped countries, it would also benefit American workers and industry by retaining jobs at home and opening up markets abroad, as living standards increased across the globe.

Of course, in today's world this kind of vision is given short shrift, because sociopaths are running most of the major governments of the world, and most of the major industries and financial institutions, and sociopaths are not much interested in mutual uplift and global benefit for the great bulk of the human race. Oh, no. Sociopaths are primarily interested in war, plunder, destruction, cruel domination, violent subjugation, and ruthless social control. So long as this planet and the major institutions and organizations that govern so much of what happens on it are dominated by sociopaths of the ilk of George Bush and Dick Cheney and associated fellow travelers of like mind and spirit, the ideas of George Ure about fair play and mutual uplift for one and for all will never get a meaningfully fair shake.

Just think about the state of the American economy. Does anyone truly know the actual size of the American government's debt? In the mainstream news media I have seen published figures running well into the trillions of dollars, most of it owed to the Japanese and to a lesser, though rapidly increasing, degree, to the Chinese, and to a whole slew of other nations and entities. Essentially, the entire nation is in hock. We've been pawned.

Using the Eclista example and the theoretical framework of Dependency Theory what raw material, what primary resource, will the United States export to other countries, as this nation rapidly deindustrializes, as a direct consequence of a conscious and catastrophic failure of American leadership at the highest levels?

Is the answer not obvious? We are already exporting astronomical quantities of American currency, and millions of jobs to go with the big bucks. The printing presses are running madly 24/7 the year around. The American government, allied with the high finance sector of the economy, has conspired to sell us out to the highest bidders -- which apparently are the East Asians, among others. So these are the raw materials that the American economy is exporting: trillions of dollars, and millions of jobs, the very lifeblood of the nation's economy. The legal tender that we use as a medium of financial exchange and the jobs and industries that we used to have are flooding out of the country in a great tidal wave of economic transition to a new way of life that assuredly will be much different than what we have known for the preceeding century or so. Did you grow up in this country? Are you maybe 50 years old? 60 or 70 years old? Think you know what things will be like in 25 years? Well, let me tell you, we have sowed the wind, and the whirlwind will not be long in coming. Change is coming and it will be large and it may even be unpleasant.

Why do I say this? Simple. Remember the other part of the Dependency Theory model, the importation of manufactured and finished goods on unfavorable terms into Latin American economies and the negative consequences this had for Latin America's balance of trade with the more developed countries of the world? Something like that is well under way in the United States at the present time, and the trend seems only to accelerate in an unfavorable direction, from the point of view of Amnerican workers and consumers.

Stay with me as I lay out the results of my latest shopping expedition. It was a real eye opener.The reality is that the United States is positively awash in a tsunami of imported merchandise of every conceivable description. How could it be otherwise as the captains of American industry destroy the country from within, ransacking the economy, plundering entire industries and communities as they loot the productive base of the country for their own personal enrichment, without the slightest thought for the well-being of anyone else at all. Under those conditions, as the psychopaths and sociopaths in the American government and in high finance and Fortune 500 board rooms and executive suites liquidate the country from under our feet, how could it be any different? Their behavior is like that of madmen and mad women who heat the house in the cruel depths of a bone-chilling Siberian winter by stripping the insulation out of the walls and using it to stoke the furnace! As the flames leap higher they strip the shingles and plywood off the roof and fling them into the furnace!! As a death-numbing deep freeze descends on the home they fling back the blankets from the beds, rip the paneling off of the walls, tear up the floor boards and take an axe to the furniture and feed it all to the devouring flames in the furnace. In the end all that remains are their shrill, demented cries of pyromanic glee, and the roaring flames of the furnace as they demolish the last vestiges of their home and dance around the last flickering embers as the last flames gutter feebly out, and the savage darkness and deadly cold of the Arctic winter descend on the remains of the homestead gutted and destroyed by their deranged insanity.

You know what? Not so long ago, people made fun of Ross Perot because he warned of the very dangers that I am outlining in this article. They ridiculed his ears. They poked fun at his nasal Texas twang. They belittled his warning that the "sucking sound" they were about to hear would be the sound of American jobs being lost, as capital and jobs were leached out of the American economy. Political pundits made fun of him mercilessly.

Where are they now? Huh?? The truth is that Ross Perot was right about a lot of things, but the political chattering class didn't like him or his ideas and warnings and so they tossed him aside. So much to plunder; so much to loot -- and so little time!!

So let me tally up the results of my shopping expedition. I shopped in stores that millions of other Americans shop in and I bought common items that almost everyone purchases at one time or another. In other words, this is more or less a snapshot of the American economy in the fall of 2005. Let's go:

1) I bought two pillows. On the bag for the one was a label saying "Made in USA." However, when I extracted the pillow from the bag and read the tag on the pillow the pillow suddenly became somewhat less "American", because the tag on the pillow said "Shell Made in China. Filled and Closed in USA." The tag on the other pillow said "Pillow made in the U.S.A. of fabric made in China."

2) I bought two pillow protectors for the pillows. The fine print on the back of the bag said "Imported by American Textile Co." Below that it said "Product of U.S. further processed in El Salvador." The tag on the pillow protectors said "Assembled in El Salvador of fabric from the U.S."

3) Next I purchased a 100% cotton thermal blanket. The tag said "Made in Brazil." And I got a quilt set. The label said "Made in China." I bought a nice warm, long-sleeved work shirt for wear in fall weather. The label said "Made in Swaziland." And I got a pack of athletic undershirts. The label said "Made in Dominican Republic."

4) I also bought three packs of light bulbs, two different brands. The labels for both said "Made in China".

5) The fluorescent light over my stove top needed a new starter switch. I found exactly the proper switch at my local, big box home improvement store. When I got it out of the little plastic packet I saw these words stenciled on the switch: "Made in Costa Rica."

6) I got a pair of stainless steel scissors. The packaging said "Made in China." I also bought a nice, heavy duty stapler that can staple up to 60 sheets at a time -- also "Made in China."

7) I needed a little rug for the foyer area of my house, just inside the front door. I found a nice little one with an intriguing floral design and pleasant green colors. I noticed that it was "Made in Egypt." I bought two new hand towels that were "Made in Bangladesh" and four bars of hand soap "Made in Mexico".

8) For my tool kit I bought a pair of groove joint pliers and an 8" adjustable wrench -- both "Made in China."

9) Of course I picked up some food items too. This one is interesting -- I bought a big, 3-pound can of roasted peanuts. The label said "Made in USA." But on closer inspection I discovered that it also said: "PEANUTS FROM: USA and/or Argentina and/or Mexico." Suddenly, "Made in USA" morphed into "...and/or Argentina and/or Mexico." Clever, no?

10) Then I purchased a 16-ounce jar of cashew nuts. The lable said: "COUNTRY OF ORIGIN: India and/or Africa and/or Vietnam, USA." Well, that covers just about half the planet, does it not? Right in one handy little jar. I got some crushed pineapple -- "Product of Indonesia." A can of black olives - "Product of Spain." Two cans of mandarin oranges - "Product of China." Two cans of mushroom bits and pieces -- "Product of China". A can of straw mushrooms -- "Product of Vietnam." I got several cans of frozen, orange juice concentrate -- the label said "Contains concentrate from U.S.A., Brazil and Mexico." I picked up a box of low carb pasta -- "Product of Italy."

On my shopping trip I also bought 5 items that were definitely of American manufacture (I think):

a box of corn flakes

a book by comedy writer, Keith Blanchard

three cans of sweet potatoes

three cans of black eyed peas

a pack of manilla mailing envelopes

And that's it. I believe everything else was made, either in whole or in part, oustide of the United States. I did not have to go out of my way in the slightest respect to achieve these results. These items were purchased at 5 different stores that millions of other Americans also shop at. Bottom line? The American economy, like Elvis, has left the building. I don't know what comes next, but I suspect we are just about to find out and that it will displease an awful lot of people. The textile and garment industries have practically vanished in this country. Most hand tools are evidently now made in China. Appliances and electrical devices are made elsewhere. The Chinese have cornered the children's toy market. And the bleeding of jobs, money and industries just goes on and on. We are living in a country in steep and rapid decline.

Now think of this: many years ago, in centuries long past, Britain was a Roman province. For a span of about 400 years Britain was part and parcel of the Roman Empire, until one day, in approximately 400 AD, no one knows the precise day or year anymore, the Roman emperor ordered the legions to withdraw to the continent. The legions pulled back to the mainland and Britain, which at that time had been Roman for a longer period of time than the United States has presently existed as a sovereign political entity, was suddenly, effectively, no longer under Roman rule. We remember the ensuing period as the Dark Ages, a period of many centuries of deep ignorance, violence and political turmoil. The descent into darkness was swift and prolonged. The historical object lesson? Political situations can change -- sometimes radically and precipitously, and things never, but never return to the way they were before.

Think of that, and ponder it deeply, as you observe the ceaseless stream of lies from George Bush and the other sociopaths who are leading the United States, and a lot of the rest of the world, down the road to ruin. And think of that, as these sociopaths come for the very last export of all, the lives of your children to destroy in imperial warfare, as their lust for global control leads them from one military invasion to another, and the bloodshed and body count spiral on and on.

___________________


The loss of 30,000 decent paying jobs has a trickle-down effect that has the potential to do serious damage to the american economy. there are no replacement jobs for the workers accustomed to making $60,000+ a year. Their previous buying power has been incapactitated. How many of the 500,000 dispaced people from New Orleans have found new jobs?

How much manufacturing still takes place in America these days? It seems everything has been outsourced to places with dirt cheap labour costs.

Pharm giant merch announced today they're cutting (http://www.cbc.ca/cp/business/051128/b112868.html) 7000 jobs in the US. These are huge numbers.

If you're not concerned yet, you should be.

[valvano]

at one time GM could pass down the huge salary cost imposed upon them by the unions to the consumer with no problem...

today, thanks to global competition which can provide a better product at a cheaper price, GM, Ford, etc can no longer do that, yet the unions and the auto mfrs fail to wake up and smell the coffee.

unions and airlines have failed to adjust to this new economy as we now see many of the major carriers marching into bankruptcy...

unions and manufacturing base has been greatly diminished because the failed to adjust to this new economy...

now the UAW and GM, Ford, etc are heading down the same track....

its just the marketplace at work. GM, Ford, etc is no longer as competive as they once were, mainly the result of generous contracts forced upon them by the unions that guarantee above market place wages, benefits, jobs that arent needed, and GM can no longer compete with these restrictions hanging around them like shackles....

sorry about those soon to be unemployed? yes.......

should they have seen it coming? yes.......

(lb)

[STANKY808]

That made me feel warm and fuzzy!

[Dr Deaf]

http://timesofindia.indiatimes.com/articleshow/1309881.cms

NEW DELHI: America's loss is turning out to be India's gain. Within days of announcing 30,000 job-cuts in the US, automobile giant General Motors Corp will this week unveil plans to increase its workforce in India by nearly 30%.

The carmaker has decided to add 450 jobs at its existing plant in Halol (Gujarat) as part of plans to expand presence in India - the emerging low-cost automobile hub in the east.

"GM is going on a hiring spree in India, and it's add jobs both on the factory shop-floor as well in the executive cadre. GM will this week start the process to hire 450 additional people for its India venture," a senior head-hunter told The Times of India.

While it will increase its floor-worker force by 400, another 50 are being added in its executive cadre. "This is in line with the company's plans to expand its presence in India, which GM feels will drive future growth," the source said.

GM India today has close to 1,600 people on its rolls, including nearly 1,300 on the shop-floor. With GM now preparing to drive into the volume car market in January 2006, the firm is working towards expanding its workforce in the country.

The car maker plans to roll out the premium hatchback Aveo in India in January next year, followed by an entry-level mid-sized sedan version of the car. It will also introduce a hatchback version of its hot-seller Chevrolet Optra in India by mid-2006.

In addition, the firm plans to add another 4,000 jobs in India when it sets up its second greenfield car plant.

The car maker has already shortlisted Andhra Pradesh, tamil Nadu and Maharashtra as the probable sites for its second plant, which will produce the Chevrolet Spark (a rebadged Daewoo Matiz), an all-new SUV and a sedan.

...be a good american and buy amerindia.

[valvano]

http://timesofindia.indiatimes.com/articleshow/1309881.cms

NEW DELHI: America's loss is turning out to be India's gain. Within days of announcing 30,000 job-cuts in the US, automobile giant General Motors Corp will this week unveil plans to increase its workforce in India by nearly 30%.

The carmaker has decided to add 450 jobs at its existing plant in Halol (Gujarat) as part of plans to expand presence in India - the emerging low-cost automobile hub in the east.

"GM is going on a hiring spree in India, and it's add jobs both on the factory shop-floor as well in the executive cadre. GM will this week start the process to hire 450 additional people for its India venture," a senior head-hunter told The Times of India.

While it will increase its floor-worker force by 400, another 50 are being added in its executive cadre. "This is in line with the company's plans to expand its presence in India, which GM feels will drive future growth," the source said.

GM India today has close to 1,600 people on its rolls, including nearly 1,300 on the shop-floor. With GM now preparing to drive into the volume car market in January 2006, the firm is working towards expanding its workforce in the country.

The car maker plans to roll out the premium hatchback Aveo in India in January next year, followed by an entry-level mid-sized sedan version of the car. It will also introduce a hatchback version of its hot-seller Chevrolet Optra in India by mid-2006.

In addition, the firm plans to add another 4,000 jobs in India when it sets up its second greenfield car plant.

The car maker has already shortlisted Andhra Pradesh, tamil Nadu and Maharashtra as the probable sites for its second plant, which will produce the Chevrolet Spark (a rebadged Daewoo Matiz), an all-new SUV and a sedan.

...be a good american and buy amerindia.

you do know that GM sells more cars overseas than domestically???

[Ali]

you do know that GM sells more cars overseas than domestically???Is that because they have bought overseas car companies (http://www.economist.com/business/PrinterFriendly.cfm?story_id=5176103) and inflicted the same job losses and salary cuts overseas as in the US? I've seen first hand what happens when a US company buys an overseas one... it aint pretty.

Those aren't GM marques, they are SAAB's, Opels, Daewoos, etc. they were selling well before GM took them over... now the plants are understaffed and those who remain are underpaid, unhappy, unprotected by Unions and unproductive.

It's the American Way.

[valvano]

now the plants are understaffed and those who remain are underpaid, unhappy, unprotected by Unions and unproductive.

It's the American Way.

having a Union to protect you doesnt do much good when the same Union prices your employer outside of the ability to survive in the marketplace......

trucking, manufacturing, airlines....all at one time heavily unionized

trucking: only 2 major unionized carriers left (no major carriers have been unionized since the 1970s)
airlines: unionized carriers filing bankruptcy
manufacturing : unions have run them to other countries

yep, unions offer you a lot of protection
:rolleyes:

[valvano]

of course GM management is equally to blame for agreeing to these crazy union contracts in the first place

i have read that that GM spends more per car built on paying for retiree benefits than the steel that goes into each car...with a business plan like that, you are doomed to fail...

[EN[i]GMA]

This strucke me as sort of a wrong way to look at this. My response.


The news of the 30,000 jobs that General Motors recently announced it plans to cut caught my attention like a searing brand plunged deep into my mind. It's still sizzling there like a splinter festering in the middle of my brain. There have been a lot of indications in recent years of the depth of the systemic turmoil brewing in the American economy, but this news item caught my eye in a way that a lot of other news has not. Perhaps it was the admonitions from decades past of my American history teacher in high school who repeatedly warned the class that the foundation of the American economy was based on the health and well being of the housing and automobile industries, and that as went the fortunes of those two industries, so too went the economic prospects of the nation.

Why is our economy tied to our industrial production?

Industrial production is becoming less and less important to the economy as a whole.

This seems similair to our transitions from agriculture to industry, this industry to information transformation.

Was the former bad?

I mean, yeah, it costs untold millions of farmer's jobs but look what it created.

People were worried about the transition then as they are now.

An economy isn't founded on production any more so than consumption.

You can't have one without the other. 'Production', if it doesn't match up with consumption, is BAD consumption.

Why does it matter if we make cars, or make something else and trade it for cars?

Actually, one is better than the other.

Are you aware of the law of comparitive advantage?


Well, when I heard the news of this massive job cut by General Motors I could not help but ponder what this seismic shift in such an important sector of the American economy might portend. After all, if 30,000 manufacturing jobs disappear, myriad more thousands of jobs also disappear at the same time. What happens to the truckers and trucking lines who ship the cars to market that those 30,000 people manufacture? What happens to the sales volume of the stores and supermarkets where those 30,000 soon-to-be-unemployed people shop? What happens to the parts manufacturers who supply parts for the factories that will soon be idled? What happens to the jobs of the people who work in the parts manufacturing companies who soon will have no customers for their parts? And on and on the negative ripple effect goes, as it washes out through the economy. One more round of massive job cuts, this time at General Motors. You know, if you think about it, 30,000 workers here, and 30,000 workers there, and before you know it, you're talking real serious hard times, as the nation rapidly deindustrializes and people are thrown out of work.

There isn't enough demand for these jobs. We don't need them. They're not useful anymore.

THis speach reminds me of people decrying the demise of the blacksmith as a trade and bemoaning this new fangled 'industrialization' because it took away blacksmith jobs.

This is a GOOD thing.

We clearly don't need this many people in this particular industry. Prices convey this signal.

The nation isn't de-industrializing, it's reached the peak of industrialization.


This news also caused me to reflect on something else. When I was in graduate school I read quite a lot of so-called "Dependency Theory" literature for my seminars and comprehensive exams. Dependency Theory grew out of the 20th-Century work of the Argentine economist, Raúl Prebisch and the United Nations' Economic Commission for Latin America (ECLA), which Prebisch headed. At the risk of oversimplifying, Dependency Theory held that the economically deprived conditions that prevailed in much of Latin America were at root due to imbalances in the terms of trade between developed (core) nations and the economically underdeveloped (periphery) nations in Latin America. Prebisch and the Eclistas held that the poorer nations of Latin America, which marketed their raw resources and agricultural products (sugar, bananas, cotton, petroleum, mined ores, timber, beef, etc.) to the developed nations of the international economy's core, were perpetually economically disadvantaged by this arrangement, because they had then to import finished or manufactured goods from the developed core on unfavorable terms established by the developed countries. Prebisch and the Eclistas felt that the way to break this cycle of economic dependency and subordination was to develop Latin American industry, via Import Substitution Industrialization (ISI). The idea was that if Latin countries produced their own manufactured goods they would not need to import them on unfavorable terms from Europe and the United States. As it happens, for a variety of reasons ISI policies met with distinctly limited success. Without going into any more detail, suffice it to say that those are the bare bones of Dependency Theory and the attendant ISI program that it spawned. My purpose here is not to write a thesis on Dependency Theory -- those who are interested can do a key word search on the internet or go to a research library at a major university and read from now until the cows come home without coming to the end of the Dependency literature. It runs to unknown thousands of pages, and has both adherents and detractors. The debates over the pros and cons of Dependency Theory have raged for decades now and I certainly will not resolve the contention between the various camps in this short article. I had enough of that in graduate school!

No, my purpose in bringing up Raúl Prebisch and the Eclistas and Dependency Theory is rather different. Without having to decide whether what he and his fellow theorists asserted is demonstrably true or not, without having to take sides in the voluminous and prolix Dependency Theory debates, I wanted to simply observe that what we are witnessing today in the American economy is something like the reverse of the dynamic that Prebisch and the Eclistas first described decades ago in the mid-20th Century in Latin America. To wit: where they were faced with unindustrialized Latin economies that could not compete with the developed industry of the core countries such as the United States, we in the United States are today faced with a deteriorating economy that is rapidly deindustrializing, in large degree as a consequence of a whole slew of so-called Free Trade agreements and regimes such as NAFTA, CAFTA and the WTO which have made capital and entire industries very portable internationally, to the considerable detriment of workers at home and abroad. We can debate the reasons as to exactly why this is occuring, but suffice it to say that it is happening. The 30,000 jobs that have just been cut at General Motors are but the latest evidence of that.

The problem is, Dependendy Theory was WRONG. Look at Latin economic performance when they followed the theory and look at when they opened their trade up.

Night and day.

THere's a reason the 80's were called the 'lost decade' in Latin America: Dependency Theory.


I must say that I rather agree with the views of Geore Ure, at Urbansurvival.com, who feels that instead of laying off American workers, only to export industries and jobs to underdeveloped countries, and then pay workers there a small fraction of a living American wage to perform the same jobs that the laid-off American workers used to hold, that a saner policy would be to develop an international economic order that had as its objective to raise living standards and wage levels in poorer countries to be commensurate with those of the developed countries. Not only would this benefit the workers of underdeveloped countries, it would also benefit American workers and industry by retaining jobs at home and opening up markets abroad, as living standards increased across the globe.

That's because their economically ignorant.

These people ARE making more, and the Americans are finding new jobs.

Unemployment is low.

This is how the economy works. Wages and standards of living are rising, accross the board. Everything he wants to happen IS HAPPENING.


Of course, in today's world this kind of vision is given short shrift, because sociopaths are running most of the major governments of the world, and most of the major industries and financial institutions, and sociopaths are not much interested in mutual uplift and global benefit for the great bulk of the human race. Oh, no. Sociopaths are primarily interested in war, plunder, destruction, cruel domination, violent subjugation, and ruthless social control. So long as this planet and the major institutions and organizations that govern so much of what happens on it are dominated by sociopaths of the ilk of George Bush and Dick Cheney and associated fellow travelers of like mind and spirit, the ideas of George Ure about fair play and mutual uplift for one and for all will never get a meaningfully fair shake.

And I don't think we're going to get much better leaders, ever.

It's a pipe-dream.

Yeah, IF we had these great leaders we could do all sorts of cool shit. Well, we don't, and well, we won't.

Call me a pessimist, but I don't hold out hope for the Demos.


Just think about the state of the American economy. Does anyone truly know the actual size of the American government's debt? In the mainstream news media I have seen published figures running well into the trillions of dollars, most of it owed to the Japanese and to a lesser, though rapidly increasing, degree, to the Chinese, and to a whole slew of other nations and entities. Essentially, the entire nation is in hock. We've been pawned.

We've been pawned?

I think there's a reason this guy isn't an economist.


Using the Eclista example and the theoretical framework of Dependency Theory what raw material, what primary resource, will the United States export to other countries, as this nation rapidly deindustrializes, as a direct consequence of a conscious and catastrophic failure of American leadership at the highest levels?

I'll agree with this, actually.

Leadership has made it impossible to run a competive company.

Imagine how many fewer companies would be leaving if taxes were lower.


Is the answer not obvious? We are already exporting astronomical quantities of American currency, and millions of jobs to go with the big bucks. The printing presses are running madly 24/7 the year around. The American government, allied with the high finance sector of the economy, has conspired to sell us out to the highest bidders -- which apparently are the East Asians, among others. So these are the raw materials that the American economy is exporting: trillions of dollars, and millions of jobs, the very lifeblood of the nation's economy. The legal tender that we use as a medium of financial exchange and the jobs and industries that we used to have are flooding out of the country in a great tidal wave of economic transition to a new way of life that assuredly will be much different than what we have known for the preceeding century or so. Did you grow up in this country? Are you maybe 50 years old? 60 or 70 years old? Think you know what things will be like in 25 years? Well, let me tell you, we have sowed the wind, and the whirlwind will not be long in coming. Change is coming and it will be large and it may even be unpleasant.

It WILL be large, and it probably won't be more unpleasant than any other economic transition.

The world economy will be better for it.

Think about it, think what we're headed for: A WORLD economy. I'd love to see the day when 'national economies' are mere formalities and the world economy is ONE.


Why do I say this? Simple. Remember the other part of the Dependency Theory model, the importation of manufactured and finished goods on unfavorable terms into Latin American economies and the negative consequences this had for Latin America's balance of trade with the more developed countries of the world? Something like that is well under way in the United States at the present time, and the trend seems only to accelerate in an unfavorable direction, from the point of view of Amnerican workers and consumers.

You really think the US economy is losing footing in the world?

Nope.

And so what if it is? Is it right for us to 'keep all the wealth'?

Why is that liberals, those who want to help the poor, want to close our borders to trade and HURT the poor?

I never got that.


Stay with me as I lay out the results of my latest shopping expedition. It was a real eye opener.The reality is that the United States is positively awash in a tsunami of imported merchandise of every conceivable description. How could it be otherwise as the captains of American industry destroy the country from within, ransacking the economy, plundering entire industries and communities as they loot the productive base of the country for their own personal enrichment, without the slightest thought for the well-being of anyone else at all. Under those conditions, as the psychopaths and sociopaths in the American government and in high finance and Fortune 500 board rooms and executive suites liquidate the country from under our feet, how could it be any different? Their behavior is like that of madmen and mad women who heat the house in the cruel depths of a bone-chilling Siberian winter by stripping the insulation out of the walls and using it to stoke the furnace! As the flames leap higher they strip the shingles and plywood off the roof and fling them into the furnace!! As a death-numbing deep freeze descends on the home they fling back the blankets from the beds, rip the paneling off of the walls, tear up the floor boards and take an axe to the furniture and feed it all to the devouring flames in the furnace. In the end all that remains are their shrill, demented cries of pyromanic glee, and the roaring flames of the furnace as they demolish the last vestiges of their home and dance around the last flickering embers as the last flames gutter feebly out, and the savage darkness and deadly cold of the Arctic winter descend on the remains of the homestead gutted and destroyed by their deranged insanity.

You know what? Not so long ago, people made fun of Ross Perot because he warned of the very dangers that I am outlining in this article. They ridiculed his ears. They poked fun at his nasal Texas twang. They belittled his warning that the "sucking sound" they were about to hear would be the sound of American jobs being lost, as capital and jobs were leached out of the American economy. Political pundits made fun of him mercilessly.

Where are they now? Huh?? The truth is that Ross Perot was right about a lot of things, but the political chattering class didn't like him or his ideas and warnings and so they tossed him aside. So much to plunder; so much to loot -- and so little time!!

So let me tally up the results of my shopping expedition. I shopped in stores that millions of other Americans shop in and I bought common items that almost everyone purchases at one time or another. In other words, this is more or less a snapshot of the American economy in the fall of 2005. Let's go:

1) I bought two pillows. On the bag for the one was a label saying "Made in USA." However, when I extracted the pillow from the bag and read the tag on the pillow the pillow suddenly became somewhat less "American", because the tag on the pillow said "Shell Made in China. Filled and Closed in USA." The tag on the other pillow said "Pillow made in the U.S.A. of fabric made in China."

2) I bought two pillow protectors for the pillows. The fine print on the back of the bag said "Imported by American Textile Co." Below that it said "Product of U.S. further processed in El Salvador." The tag on the pillow protectors said "Assembled in El Salvador of fabric from the U.S."

3) Next I purchased a 100% cotton thermal blanket. The tag said "Made in Brazil." And I got a quilt set. The label said "Made in China." I bought a nice warm, long-sleeved work shirt for wear in fall weather. The label said "Made in Swaziland." And I got a pack of athletic undershirts. The label said "Made in Dominican Republic."

4) I also bought three packs of light bulbs, two different brands. The labels for both said "Made in China".

5) The fluorescent light over my stove top needed a new starter switch. I found exactly the proper switch at my local, big box home improvement store. When I got it out of the little plastic packet I saw these words stenciled on the switch: "Made in Costa Rica."

6) I got a pair of stainless steel scissors. The packaging said "Made in China." I also bought a nice, heavy duty stapler that can staple up to 60 sheets at a time -- also "Made in China."

7) I needed a little rug for the foyer area of my house, just inside the front door. I found a nice little one with an intriguing floral design and pleasant green colors. I noticed that it was "Made in Egypt." I bought two new hand towels that were "Made in Bangladesh" and four bars of hand soap "Made in Mexico".

8) For my tool kit I bought a pair of groove joint pliers and an 8" adjustable wrench -- both "Made in China."

9) Of course I picked up some food items too. This one is interesting -- I bought a big, 3-pound can of roasted peanuts. The label said "Made in USA." But on closer inspection I discovered that it also said: "PEANUTS FROM: USA and/or Argentina and/or Mexico." Suddenly, "Made in USA" morphed into "...and/or Argentina and/or Mexico." Clever, no?

10) Then I purchased a 16-ounce jar of cashew nuts. The lable said: "COUNTRY OF ORIGIN: India and/or Africa and/or Vietnam, USA." Well, that covers just about half the planet, does it not? Right in one handy little jar. I got some crushed pineapple -- "Product of Indonesia." A can of black olives - "Product of Spain." Two cans of mandarin oranges - "Product of China." Two cans of mushroom bits and pieces -- "Product of China". A can of straw mushrooms -- "Product of Vietnam." I got several cans of frozen, orange juice concentrate -- the label said "Contains concentrate from U.S.A., Brazil and Mexico." I picked up a box of low carb pasta -- "Product of Italy."

On my shopping trip I also bought 5 items that were definitely of American manufacture (I think):

a box of corn flakes

a book by comedy writer, Keith Blanchard

three cans of sweet potatoes

three cans of black eyed peas

a pack of manilla mailing envelopes

And that's it. I believe everything else was made, either in whole or in part, oustide of the United States. I did not have to go out of my way in the slightest respect to achieve these results. These items were purchased at 5 different stores that millions of other Americans also shop at. Bottom line? The American economy, like Elvis, has left the building. I don't know what comes next, but I suspect we are just about to find out and that it will displease an awful lot of people. The textile and garment industries have practically vanished in this country. Most hand tools are evidently now made in China. Appliances and electrical devices are made elsewhere. The Chinese have cornered the children's toy market. And the bleeding of jobs, money and industries just goes on and on. We are living in a country in steep and rapid decline.

We don't have the people to produce all that.

It's utterly impossible.

Anything we produce is something we don't produce. Scarcity.

Time spent building those things, making things, resources spent, are all things NOT spent on other things, more valuable things.

Is it a good use of our time to make flags when we could be making computer software?

No, no it isn't.

Imagine how expensive those things WOULD be if they were made here. It would be insane.

THese are low-paying jobs, by the way. Assembling those tchotcke's does not pay well.

We would have a low-payed workforce trying to buy EXPENSIVE items, with low economic growth, all while China and it's brethren languish in poverty.

That's what he's proposing,he just doesn't realize it.

America SHOULDN'T MAKE THAT CRAP. It's BAD for the economy. It's not GOOD to produce that shit.

Our economic power is better spent elsewhere.


Now think of this: many years ago, in centuries long past, Britain was a Roman province. For a span of about 400 years Britain was part and parcel of the Roman Empire, until one day, in approximately 400 AD, no one knows the precise day or year anymore, the Roman emperor ordered the legions to withdraw to the continent. The legions pulled back to the mainland and Britain, which at that time had been Roman for a longer period of time than the United States has presently existed as a sovereign political entity, was suddenly, effectively, no longer under Roman rule. We remember the ensuing period as the Dark Ages, a period of many centuries of deep ignorance, violence and political turmoil. The descent into darkness was swift and prolonged. The historical object lesson? Political situations can change -- sometimes radically and precipitously, and things never, but never return to the way they were before.

Good. We don't want what we had, we want BETTER.


Think of that, and ponder it deeply, as you observe the ceaseless stream of lies from George Bush and the other sociopaths who are leading the United States, and a lot of the rest of the world, down the road to ruin. And think of that, as these sociopaths come for the very last export of all, the lives of your children to destroy in imperial warfare, as their lust for global control leads them from one military invasion to another, and the bloodshed and body count spiral on and on.

Yawn.


The loss of 30,000 decent paying jobs has a trickle-down effect that has the potential to do serious damage to the american economy. there are no replacement jobs for the workers accustomed to making $60,000+ a year. Their previous buying power has been incapactitated. How many of the 500,000 dispaced people from New Orleans have found new jobs?

THose 'decent paying' jobs came at the expense of consuemers on higher priced cars.

'The American economy' didn't gain shit from those higher paying jobs.

That higher pay was $300 out of your pocket on the last car you bought. Great deal huh?

THose jobs should have been cut a long time ago. They are wasteful.

The only jobs we're losing are jobs we can afford to lose and SHOULD lose.

What's so good about 'manufacturing jobs'? WHy the attachment?

BUild cars or import cars, it makes no difference.


How much manufacturing still takes place in America these days? It seems everything has been outsourced to places with dirt cheap labour costs.

Good.


If you're not concerned yet, you should be.

Why?

[Ali]

i have read that that GM spends more per car built on paying for retiree benefits than the steel that goes into each car...with a business plan like that, you are doomed to fail...I assume you have a Private Pension Plan, Mr Smug?

[paulb]

cutting 30'000 jobs is ridiculous! somehow this will all be blamed on Bush.

[Qdrop]

excellent response, Enigma.


can't wait for Ace's tireless rebuttal....







and even if what Enigma is stating is wrong...
hell, every empire falls eventually....what makes us think we never will?

[valvano]

I assume you have a Private Pension Plan, Mr Smug?

i have a pension plan through my employer, as well as 401K, etc...
however, i do have investments totally on my own...

i do not include social security with my retirement plans...



and what does this have to do with anything, BTW?
:confused:

[EN[i]GMA]

and even if what Enigma is stating is wrong...
hell, every empire falls eventually....what makes us think we never will?

Excellent point.

Why is that the same people who decry us as in Imperialist Power bemoan our supposed economic weakening?

If we truly are in Imperialist Power, and we truly are losing econmic influence, isn't this a GOOD thing?

[Schmeltz]

a) When empires fall, they inevitably take a lot of regular people down with them.

b) That's a shortsighted, superficial view of the future. Perhaps instead of interpreting the contemporary situation in the same terms as the failures of the past, we could try to find a way forward that involves a peaceful transition to a more understanding and cooperative global society. No, it is not a good thing when any nation's economy weakens and regular people are left without work. No, it is not a good thing when one imperialist power's influence wanes and another imperialist power's influence waxes. Maybe we could dispene with the notion of imperialist power altogether and figure out how to deal with our problems productively. That way we could avoid repeating the hardship of the past. The cycle will only perpetuate itself if we do nothing to stop it.

[ChrisLove]

While I generaly agree with Enigma's post, I think a lot of the points raise assume that markets for goods and labour in the US are rather more efficient than they are in practise.

Sudden bouts of unemployment are not nessecarily a sign that an economy is substituting towards high tech/service based industries, I would suggest that unemployment of this nature could just as easily be the result of some market distortion such as the recent oil price rises. Or it could be a side effect of all the interest rate rises there have been in the US

I think in this case hwever, /enigma is on the right track and that article is full of shit...

http://news.bbc.co.uk/1/hi/business/4485314.stm

[EN[i]GMA]

a) When empires fall, they inevitably take a lot of regular people down with them.

And when they dont fall, they subjugate regular people.


b) That's a shortsighted, superficial view of the future. Perhaps instead of interpreting the contemporary situation in the same terms as the failures of the past, we could try to find a way forward that involves a peaceful transition to a more understanding and cooperative global society. No, it is not a good thing when any nation's economy weakens and regular people are left without work. No, it is not a good thing when one imperialist power's influence wanes and another imperialist power's influence waxes. Maybe we could dispene with the notion of imperialist power altogether and figure out how to deal with our problems productively. That way we could avoid repeating the hardship of the past. The cycle will only perpetuate itself if we do nothing to stop it.

I don't think that's an accurate assessment though.

I don't think we're 'repeating the hardships of the past'. I think this is a GOOD thing.

[EN[i]GMA]

While I generaly agree with Enigma's post, I think a lot of the points raise assume that markets for goods and labour in the US are rather more efficient than they are in practise.

Perhaps.

I forget our exact efficiency in comparison with other countries, but it's still pretty good. Best I believe.

I think our efficiency per worker per hour is lower than some other country's, but since we have more hours total, it doesn't really effect things.

And remember, jobs being cut, like this, help efficiency.

China has 6 times as many manufacturing workers and still produce less than half what we do.


Sudden bouts of unemployment are not nessecarily a sign that an economy is substituting towards high tech/service based industries, I would suggest that unemployment of this nature could just as easily be the result of some market distortion such as the recent oil price rises. Or it could be a side effect of all the interest rate rises there have been in the US

I would say that's likely that those things contribute, but I think it is indicitive of an economic shift.

The Economist had an article on this very topic recently.


And a particular thing I would like to note: A lot of currenty third world poverty is caused by things like farming tarrifs and subsidies.

REmove those and third world poverty would go down considerably.


From the Economist: eindustrialisation—the shrinkage of industrial jobs—is popularly perceived as a symptom of economic decline. On the contrary, it is a natural stage of economic development. As a country gets richer, it is inevitable that a smaller proportion of workers will be needed in manufacturing. The first reason is that households need only so many cars, fridges or microwaves, so as they become richer they tend to spend a bigger chunk of their income on services, such as holidays, health and education, rather than on goods.

Second, it is much easier to automate manufacturing than services, replacing men by machines. Faster productivity growth than in services means that manufacturing needs fewer workers. In turn, as workers move into more productive areas, this gives a boost to overall productivity and hence living standards.

From this point of view, the fact that manufacturing is still such a high share of jobs and output in Germany and Italy could be a symptom of economic weakness. Not only have both countries tried to protect manufacturing jobs with employment-protection laws, but a tangle of red tape also discourages the creation of new jobs in services. These two countries will therefore be more challenged by growing competition from emerging economies in years to come.

Compare the US economy with the German or Italian.

If it were true that manufacturing jobs aided economic growth, why is Italy doing so poorly?

[Ace42X]

GMA']Perhaps.

I forget our exact efficiency in comparison with other countries, but it's still pretty good. Best I believe.

Actually, the US reliance on the less precise imperial measurement system means that production efficiency is roughly 7% lower than in European countries.

I believe the study was comparing Europeans manufacturing US weapons systems under license, and how their wastage was way down and precision was way up.

[EN[i]GMA]

Actually, the US reliance on the less precise imperial measurement system means that production efficiency is roughly 7% lower than in European countries.

But this is made up by the fact that Americans work more hours.

And yes, the imperial measurement system is problematic, to say the least.

I believe the study was comparing Europeans manufacturing US weapons systems under license, and how their wastage was way down and precision was way up.

I believe it.

But yet this begs the question of why European economies are performing so poorly if indeed they are superiour?

[ChrisLove]

also relevant to the original artcle

car sales hit by oil prices (http://news.bbc.co.uk/1/hi/business/4490258.stm)

[ChrisLove]

GMA']Perhaps.

I forget our exact efficiency in comparison with other countries, but it's still pretty good. Best I believe.

I think our efficiency per worker per hour is lower than some other country's, but since we have more hours total, it doesn't really effect things.

And remember, jobs being cut, like this, help efficiency.

China has 6 times as many manufacturing workers and still produce less than half what we do.



I would say that's likely that those things contribute, but I think it is indicitive of an economic shift.

The Economist had an article on this very topic recently.


And a particular thing I would like to note: A lot of currenty third world poverty is caused by things like farming tarrifs and subsidies.

REmove those and third world poverty would go down considerably.


From the Economist:

Compare the US economy with the German or Italian.

If it were true that manufacturing jobs aided economic growth, why is Italy doing so poorly?

When I was referring to efficiency I wasn’t thinking so much of productive efficiency but more the efficiency of capital markets in the US… i.e. your idea that the loss of jobs can be viewed as a sign of an efficient economy reallocating its limited resources in order to maximise marginal benefit relies on certain things being in place – a high degree of information symmetry, perfect competition, a flexible labour market and a low degree of inertia. I'm not saying that the US is particularly bad in these areas ( I don’t know I have not looked into it) but I'm pretty sure that even the most free market economies find themselves riddled with imperfections that prevent the smooth flow of resource to the areas where returns are maximised.

I think that an isolated incident such as that underpinning the article cant be regarded as evidence for a national trend away from manufacturing and is probably more likely to reflect poor performance due to bad management in the company involved or economic shocks (such as the rising oil price – see bbc article). Of course it may well be that a national trend does exist and no doubt this is due to the reasons that you outlined.

I also whole heartedly agree with the observations about Italy and Germany – one of the things Britain has done well over that last couple of decades is fully embrace the transition towards being a service based economy, this is a very deep topic and I good go on about Thatcher and miners but I don’t have time sadly! Maybe later

[Ali]

i have a pension plan through my employer, as well as 401K, etc...
however, i do have investments totally on my own...

i do not include social security with my retirement plans...



and what does this have to do with anything, BTW?
:confused:Unions, workers rights, salary increases, pensions... what we were talking about.

[valvano]

Unions, workers rights, salary increases, pensions... what we were talking about.

I thought we were talking about GM being asleep at the switch while they are getting their clock cleaned by the competition?

and, more to the point, do you have any working knowledge of being employed in a unionized industry or is your knowledge limited to what your college econ professor spouted out to you?


:rolleyes:

[EN[i]GMA]

When I was referring to efficiency I wasn’t thinking so much of productive efficiency but more the efficiency of capital markets in the US… i.e. your idea that the loss of jobs can be viewed as a sign of an efficient economy reallocating its limited resources in order to maximise marginal benefit relies on certain things being in place – a high degree of information symmetry, perfect competition, a flexible labour market and a low degree of inertia. I'm not saying that the US is particularly bad in these areas ( I don’t know I have not looked into it) but I'm pretty sure that even the most free market economies find themselves riddled with imperfections that prevent the smooth flow of resource to the areas where returns are maximised.

Quite true.

Certainly there are significant flaws, overall it seems to be working just fine and significantly better than other countries, such as the aforementioned Germany and Italy.


I think that an isolated incident such as that underpinning the article cant be regarded as evidence for a national trend away from manufacturing and is probably more likely to reflect poor performance due to bad management in the company involved or economic shocks (such as the rising oil price – see bbc article). Of course it may well be that a national trend does exist and no doubt this is due to the reasons that you outlined.

One significant factor left out is unionization.

It's entirely possible that all or some of these jobs could have been kept if the union were not in place.

Though it's supposed to help GM workers, this union will only end up costing many of them jobs and all of them pensions.

If the jobs weren't tied to union contracts, who knows how things could have played out differently?


I also whole heartedly agree with the observations about Italy and Germany – one of the things Britain has done well over that last couple of decades is fully embrace the transition towards being a service based economy, this is a very deep topic and I good go on about Thatcher and miners but I don’t have time sadly! Maybe later

Agreed

[Ali]

I thought we were talking about GM being asleep at the switch while they are getting their clock cleaned by the competition?

and, more to the point, do you have any working knowledge of being employed in a unionized industry or is your knowledge limited to what your college econ professor spouted out to you?


:rolleyes:I've worked in HR IS consulting for the past six years, dickhead. I know far more about this than you ever will, so STFU... or carry on making yourself look even more stupid.

[Ali]

GMA']One significant factor left out is unionization.

It's entirely possible that all or some of these jobs could have been kept if the union were not in place.

Though it's supposed to help GM workers, this union will only end up costing many of them jobs and all of them pensions.

If the jobs weren't tied to union contracts, who knows how things could have played out differently?
You certainly don't.

They would have lost their jobs anyway, union or no union. You know that perfectly well. The only difference would have been that they'd have lost their jobs quicker without the Union.

Why are you trying to demonise unions and make it sound as if it's their fault (but not actually saying that it is)?

The reason for GM's demise is that foreign competitors make better cars for less, end of story.

Same thing happened to the textiles industry in the UK. They made it better and cheaper overseas, next thing you know, "trouble at 't' mill"!

The fact that unions can sometimes get out of hand and shoot themselves in the foot by squeezing Management too hard does not mean that they are always a bad thing. Workers need
protection. They need representation and bargaining power. Otherwise capitalism just reverts to slavery. Unions do need to be kept in check, so that they don't Kill the Goose(stepping management) but they are absolutely essential.

I'd rather lose my job because my employer couldn't meet Union demands, than work in dangerous, unhealthy conditions for terrible wages and be fired anyway, simply because the company wants to make more money.

Wouldn't you, Enigma?

Or don't you need union protection? Are you some sort of white-collar middle-management type who looks down on the Workers as worthless, lazy bums with nothing better to do than go on strike?

[EN[i]GMA]

You certainly don't.

They would have lost their jobs anyway, union or no union. You know that perfectly well. The only difference would have been that they'd have lost their jobs quicker without the Union.

No they wouldn't have.

If their wages could have been lowered per what was necessary to stay solvent, it's entirely possible that at least some of them could have kept their jobs.

THe union kept the wages ARTIFICALLY high and this is the result.


Why are you trying to demonise unions and make it sound as if it's their fault (but not actually saying that it is)?

Because in this particular case, the unions drove the wages higher than what GM could actually pay and refused to take a pay cut. This is the inevietable result.


The reason for GM's demise is that foreign competitors make better cars for less, end of story.

Yes it is.

Because of this fact, GM needed to significantly cut costs to stay at all competitive.

This could be achieved by lowering wages and benefits or by getting rid of workers, or some combination thereof.

But the union, in this case, was truculent and would not accept lower wages or benefits meaning that layoffs were the only option.

They made the problem worse by increasing GMs cost when it could least afford it.


Same thing happened to the textiles industry in the UK. They made it better and cheaper overseas, next thing you know, "trouble at 't' mill"!

I'm not saying it was the union's fault entirely or even mostly. But when a company has to reduce costs, a few options are generally available.

In this case, some weren't.


The fact that unions can sometimes get out of hand and shoot themselves in the foot by squeezing Management too hard does not mean that they are always a bad thing. Workers need
protection. They need representation and bargaining power. Otherwise capitalism just reverts to slavery. Unions do need to be kept in check, so that they don't Kill the Goose(stepping management) but they are absolutely essential.

But of course fewer than a 3rd of American workers are unionized.

I don't see this 'slavery' in the other areas.

There are many plants and factories that are non-union and good. They pay their workers above-average wages and benefits simply to keep unions out, because unions are a large drain on efficiency.


I'd rather lose my job because my employer couldn't meet Union demands, than work in dangerous, unhealthy conditions for terrible wages and be fired anyway, simply because the company wants to make more money.

Wouldn't you, Enigma?

I would rather you didn't ask uselessly loaded questions.

Unions certainly played a role, but their time has passed.

Unions were important at the beggining of industrialization because production was dangerous and low paying. But as machinery advance and efficiency increased, work became more skilled and wages increased.

Unions helped, I'm not denying that, but it was increased technology and efficiency that ultimately allowed wages to be raised and workplace safetly to be instituted.

I don't think unions are relevent anymore.


Or don't you need union protection? Are you some sort of white-collar middle-management type who looks down on the Workers as worthless, lazy bums with nothing better to do than go on strike?

I'm some sort of guy who doesn't like answering pointless, loaded questions.

[Ali]

GMA']No they wouldn't have.

If their wages could have been lowered per what was necessary to stay solvent, it's entirely possible that at least some of them could have kept their jobs.

THe union kept the wages ARTIFICALLY high and this is the result.So, the Union is partially to blame for not recognising the fact that GM had to reduce labour costs to compete with overseas competitors. Agreed. Perhaps they could have been more flexible, maybe they were and they reached a point beyond which it was pointless to continue. I don't have time to look it all up, but it would be interesting to see how much ground they did give.
Because in this particular case, the unions drove the wages higher than what GM could actually pay and refused to take a pay cut. This is the inevietable result.AND there's the fact that GM couldn't compete with overseas competitors, not just the unions being obstinate. Please tell both sides of the story.

You know perfectly well that GM could never pay workers in the US as little as their foreign competitors, because of the higher cost of living in the US than overseas. GM's competitors can pay employees less because they need less to live. Maybe when the cost (and the standard) of living drops in the US, you'll be able to compete, but not until then.
Because of this fact, GM needed to significantly cut costs to stay at all competitive.

This could be achieved by lowering wages and benefits or by getting rid of workers, or some combination thereof.

But the union, in this case, was truculent and would not accept lower wages or benefits meaning that layoffs were the only option.

They made the problem worse by increasing GMs cost when it could least afford it.Um, "getting rid of workers" and "layoffs" are the same thing...

And how truculent was the union in this case? Did they negotiate in any way, or did they flat refuse to speak to Management?

GM was fucked anyway. Either the unions accepted layoffs and pay cuts and the company folded later, or it folded now. Both ways, the workers were going to get screwed. At least now GM can go into Chapter 11 and continue to operate at a loss (like the US airlines) and probably keep more staff than if the unions had let them lay people off or cut their salaries. We'll see. I doubt that GM will be allowed to go under, it's too huge and has a significant role in producing military hardware (http://www.gmfleet.com/gmfleetjsp/government/product/military.jsp), so it's likely that the unions are gambling on this. I would. I'm not too clued up on Chapter 11, but as far as I understand, it's declaring bankruptcy, except that you can continue to operate. It's what your airlines are doing... it's what GM are going to do (http://www.businessweek.com/magazine/content/05_50/b3963114.htm), even if they deny it. After weeks of listening to analysts and pundits beat the drum about the possibility of a General Motors Corp. () bankruptcy, Chairman and Chief Executive G. Richard Wagoner Jr. decided he had heard enough. On Nov. 16 he declared in an internal memo to his 325,000 employees that bankruptcy is "unnecessary." There is no plan to file for Chapter 11 protection, Wagoner said flatly, calling such an action "contrary to the interests of our employees, stock- and bondholders, dealers, and our suppliers and customers."

In other words, Wagoner was calling bankruptcy unthinkable. And for a long time, that's exactly the way it seemed. GM has $34 billion in cash and could free up roughly $15 billion more selling various businesses. That alone should be enough to keep the company running for a few years. But they'd much rather lay employees off and cut salaries and take away benefits than dig into those reserves :rolleyes: this is why we

And have you given a thought to all those people who get laid off? What happens to them? What happens to their mortgages and debts and family life? HUGE disruption. Welfare drain, misery, etc. Either way, they are a burden on the taxpayer, be it Chapter 11 or welfare. Given a coice, workers would rather keep their jobs than go on welfare, even if it meant that the company had to be subsidised. Workers pay tax and spend their salaries, workers have pride, Welfare Dependants are far less happy and productive members of society.

It's all very well seeing the bigger picture and saying "it has to be done for the good of the economy" but it's a little harder to see the benefits when it's YOU getting laid off, with mouths to feed and bills to pay... hence my 'loaded' question. I doubt that you'd be quite so gung ho if it was your job that was on the line and you that would be looking for work with mouths to feed.
I'm not saying it was the union's fault entirely or even mostly. But when a company has to reduce costs, a few options are generally available.

In this case, some weren't.Hmm Executive pay cuts certainly weren't an option, were they? :rolleyes: GM's reaction to declining market share, falling profits and ballooning debt has been conventional. Plants will be closed. Workers will be given early retirement packages or laid off.

Some of this decision-making has been questionable and short-term.

Closing high-quality plants seems strange when quality control is one of the keys to success in a highly competitive business. Cutting workers' wages and benefits does not seem to have been matched by similar reductions in executive salaries and bonuses. Thestar (http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1133262800990&call_pageid=968256290204&col=968350116795)

It's always the same. We need to cut costs. Biggest overhead is salaries, easiest thing to do is start fucking with the guys at the bottom, even though they cost a tiny fraction of what the Fatcats at the top cost.

If there's a Union, Management are more likely to look for other ways to reduce costs than just to fire people or cut salaries. Yes or no?
There are many plants and factories that are non-union and good. They pay their workers above-average wages and benefits simply to keep unions out, because unions are a large drain on efficiency.Such as?

I would rather you didn't ask uselessly loaded questions.Sorry, I was making a point and was perhaps a little rude.

Unions certainly played a role, but their time has passed.

Unions were important at the beggining of industrialization because production was dangerous and low paying. But as machinery advance and efficiency increased, work became more skilled and wages increased.

Unions helped, I'm not denying that, but it was increased technology and efficiency that ultimately allowed wages to be raised and workplace safetly to be instituted.

I don't think unions are relevent anymore.Maybe. How now to protect the workers? Not every industry is safe and clean and spending money on employee health and safety costs money, which eats into profits. Who is going to make sure that standards are met, that the inspectors are not bribed, etc. and that the workers get a decent wage. I know that there are rules and regulations which do curb such practices and perhaps the role of unions is less fundamental than before, but they do still play a role in protecting workers from employers and it's not fair to blame the unions for changes in macroeconomic forces.

I'm some sort of guy who doesn't like answering pointless, loaded questions.There was a point to the weighting of that question (see above). OK, I'll ask a less loaded question: What type of work do you do? Yes, for the purposes of this discussion, it does matter.

[valvano]

I've worked in HR IS consulting .

ah, consulting..........

when you can't cut it in the normal work world but still think you have something to offfer, you become a consultant.....


and you never answered if you have any experience in a unionized industry...
like truckin' ??????

:D

[Ali]

ah, consulting..........

when you can't cut it in the normal work world but still think you have something to offfer, you become a consultant.....


and you never answered if you have any experience in a unionized industry...
like truckin' ??????

:DSigh... yes, I have experience in the auto services, brewery and oil indistries, in South Africa and in France. All highly unionised.

Strange how desperate the "normal work world" is for the services of consultants, they pay through the nose and won't let you go.

[valvano]

Sigh... yes, I have experience in the auto services, brewery and oil indistries, in South Africa and in France. All highly unionised.

Strange how desperate the "normal work world" is for the services of consultants, they pay through the nose and won't let you go.


how about in America?

[sam i am]

ali....

Just wanted to say briefly how much I respect your responses on the previous page to Enigma's postings.

The two of you are arguing well and cogently.

As for the actual debate....

Well, I'll admit to being mostly anti-union in today's economy. I tend to agree with Enigma that unions are counterproductive in a post-industrial society. Unionization in places like China and India and Africa COULD go a long way towards raising the standards of living for those who work in poor conditions.

As for productivity...I believe Enigma won the point with the fact that the US has longer work hours (weeks) than Europeans do, in general. 40+ hours of work a week vs. 36 hours a week adds up to 208 additional hours PER worker per year in productivity. That's a large reason why the US economy is the largest in the world and why our productivity is so large.

Of course, there's a price to pay for those extra hours, lack of universal health care, and shorter vacation times, but Americans have a social compact that makes those sacrifices in exchange for being more productive AND being the world's remaining superpower, able to project power and capital worldwide.

As the usual caveat to my pro-American drumbeat, however, I will note again the emerging challenges of China and India....their models of "engineered" capitalism MAY be the next great focal point for productivity and capital and goods over the next century...especially by dint of the sheer manpower inherent in nations with 1.6 and 1.3 billion people, respectively (I think thsoe population figures are correct, although I may be overinflating a bit - if so, I'll take a mea culpa right now).

[EN[i]GMA]

So, the Union is partially to blame for not recognising the fact that GM had to reduce labour costs to compete with overseas competitors. Agreed. Perhaps they could have been more flexible, maybe they were and they reached a point beyond which it was pointless to continue. I don't have time to look it all up, but it would be interesting to see how much ground they did give.

Indeed it would.

Don't get me wrong, I'm not entirely blaming the union for these problems.


AND there's the fact that GM couldn't compete with overseas competitors, not just the unions being obstinate. Please tell both sides of the story.

I think they might be related.


You know perfectly well that GM could never pay workers in the US as little as their foreign competitors, because of the higher cost of living in the US than overseas. GM's competitors can pay employees less because they need less to live. Maybe when the cost (and the standard) of living drops in the US, you'll be able to compete, but not until then.
Um, "getting rid of workers" and "layoffs" are the same thing...

We don't pay our workers much more than in Japan, so it isn't an issue there. Ditto with Germany.

And the problem is with US companies, not foreign companies with plants in the US. They are doing fine. Toyota is even opening up new plants over here. Unionless, I do believe.


And how truculent was the union in this case? Did they negotiate in any way, or did they flat refuse to speak to Management?

What's the unions job? It's real job?


GM was fucked anyway. Either the unions accepted layoffs and pay cuts and the company folded later, or it folded now. Both ways, the workers were going to get screwed. At least now GM can go into Chapter 11 and continue to operate at a loss (like the US airlines) and probably keep more staff than if the unions had let them lay people off or cut their salaries. We'll see. I doubt that GM will be allowed to go under, it's too huge and has a significant role in producing military hardware (http://www.gmfleet.com/gmfleetjsp/government/product/military.jsp), so it's likely that the unions are gambling on this. I would. I'm not too clued up on Chapter 11, but as far as I understand, it's declaring bankruptcy, except that you can continue to operate. It's what your airlines are doing... it's what GM are going to do (http://www.businessweek.com/magazine/content/05_50/b3963114.htm), even if they deny it. But they'd much rather lay employees off and cut salaries and take away benefits than dig into those reserves :rolleyes: this is why we

Oh, I agree.

GM is, ultimately, fucked. Their total collapse is nearly ineveitable, I believe.

But again, did the unions play into this at all? SOmewhat, but most of the blame does lie with management. GM made some shitty cars and was bad at recognizing trends.


And have you given a thought to all those people who get laid off? What happens to them? What happens to their mortgages and debts and family life? HUGE disruption. Welfare drain, misery, etc. Either way, they are a burden on the taxpayer, be it Chapter 11 or welfare. Given a coice, workers would rather keep their jobs than go on welfare, even if it meant that the company had to be subsidised. Workers pay tax and spend their salaries, workers have pride, Welfare Dependants are far less happy and productive members of society.

Or maybe they'll get new jobs. The US economy is doing surprisingly well.


It's all very well seeing the bigger picture and saying "it has to be done for the good of the economy" but it's a little harder to see the benefits when it's YOU getting laid off, with mouths to feed and bills to pay... hence my 'loaded' question. I doubt that you'd be quite so gung ho if it was your job that was on the line and you that would be looking for work with mouths to feed.
Hmm Executive pay cuts certainly weren't an option, were they? :rolleyes:

I agree with you.

But bringing in this 'little picture' doesn't change any of the facts.

Again, how is this more valid than bemoaning the loss of farming or of blacksmithing jobs?

Should they have been subsidized (Actually, farming is, pointlessly)? What effect would that have ahd?


It's always the same. We need to cut costs. Biggest overhead is salaries, easiest thing to do is start fucking with the guys at the bottom, even though they cost a tiny fraction of what the Fatcats at the top cost.

I agree here. Both should be take paycuts.

This never makes sense to me. The job of the guys up-top is to help shareholders, to serve them. Taking multi-million dollar profit really doesn't aid shareholders. Why do they put up with it?

I wouldn't.


If there's a Union, Management are more likely to look for other ways to reduce costs than just to fire people or cut salaries. Yes or no?
Such as?

Well, in some cases, there aren't other ways to cut cost.


Maybe. How now to protect the workers? Not every industry is safe and clean and spending money on employee health and safety costs money, which eats into profits. Who is going to make sure that standards are met, that the inspectors are not bribed, etc. and that the workers get a decent wage. I know that there are rules and regulations which do curb such practices and perhaps the role of unions is less fundamental than before, but they do still play a role in protecting workers from employers and it's not fair to blame the unions for changes in macroeconomic forces.

I have no problems with unions existing. They do play a beneficial role in some areas, but they play a detrimental effort in others. Portraying them as all good, or inherently good, is wrong.


There was a point to the weighting of that question (see above). OK, I'll ask a less loaded question: What type of work do you do? Yes, for the purposes of this discussion, it does matter.

None. Still in school.

[sam i am]

BTW...GM is not NECESSARILY fucked.

IF they can innovate some good ideas and get rid of a sizeable portion of their pension obligations by foisiting it onto the taxpayers, they can probably morph into a reinvigorated company...albeit with overseas production accounting for much more of their ongoing financial capabilities...

[Ali]

GMA']But again, did the unions play into this at all? SOmewhat, but most of the blame does lie with management. GM made some shitty cars and was bad at recognizing trends.The blame comes from both sides, but only one is getting nailed... in fact, I would say that MOST of the blame lies squarely at the feet of Management. THEY are the ones who are supposed to keep the ship on course, they are the ones who didn't see this iceberg coming and now it's the guys on the shop floor losing their jobs while the real culprits get enormous severance packages!!!

As for Pensions... If GM went belly-up, retirees, workers, and taxpayers could all take a hit. Right now, its $90 billion pension fund is fully funded on an accounting basis. But the government-backed Pension Benefit Guaranty Corp., which acts as a safety net for corporate pension plans, says GM is underfunded by $31 billion (http://www.businessweek.com/magazine/content/05_50/b3963114.htm).WHAT HAS HAPPENED TO THAT MONEY? Pension funds get deducted from people's salaries and is supposed to be used to pay them out when they leave... but a third of it's missing. WHERE DID IT GO?!?!?!

Another accounting disaster looming (al la ENRON, WorldCom, etc.)?

I see that Delphi are still employing the services of Deloitte & Touche, even though said accounting firm is being investigated for accounting irregularities (http://www.cfo.com/article.cfm/5275012/c_5269895?f=home_todayinfinance) - at Delphi!

I appreciate that Unions do make it more difficult for the company to make a profit, but there is still a good reason to have them and it is the real culprits, Management, who make it look as if the Unions are to blame for their mistakes.

GMA']I have no problems with unions existing. They do play a beneficial role in some areas, but they play a detrimental effort in others. Portraying them as all good, or inherently good, is wrong.And so is protraying them as all bad, or inherently bad.

When I was on the receiving end of Union Negotiations, as an employer in South Africa, I hated unions to the core. But now that I've seen how large corporations work, how bad management decisions get covered up, how annual reports get skewed and shareholders get lied to and the fucking bastards who caused all the mess get gloden handshakes and parachutes while loyal employees get kicked out onto the street with NOTHING, not even the fucking Pensions which they paid into while working at the company... I have changed my tune. The workers NEED to be represented. They need protecting from the fucking bastards on the Upper Floors with their Executive Washrooms and endless meetings.

Yes, Unions can and do make mistakes and egos can sometimes take over, BUT it is Management who are to blame this time and the Unions are there to make sure that the culprits take a hit as well as the guys on the Shop Floor.

[Ali]

how about in America?I have consulted at an American Multinational, but I am not American, so I cannot work in the US.

[sam i am]

I have consulted at an American Multinational, but I am not American, so I cannot work in the US.

As a consultant...are you rich? Do you pay above what the tax rates are so that you can give more to the poorer than you? Or.....do you keep what you can to support your own family?

[valvano]

I have consulted at an American Multinational, but I am not American, so I cannot work in the US.

Well, let me give you some real world examples of how unions have totally fucked themselves.

I am going to assume you have a basic knowledge of motor cargo transportation aka trucking. LTL is trucking in which shipments from multiple shippers are consolidated onto a single truck and usually move within a hub network. LTL is extremely cut throat. Companies will operated at a 100+ OR on the hope of sometime breaking even. Just making a profit at a 99.9 OR is an accomplishment to be prowd of. Cut throat.

Up until the early 80s trucking here in the US of A was regulated by the ICC. You could only operated on certain lanes as permitted and at the rates as published. No discounting, etc. No competition. Trucking companies got fat and lazy. Trucking was heavily unionized because without competition, you could easily pass those cost on to the shippers, who passed them along to the ultimate consumer.

In the 1980s, under Reagan, they deregulated trucking. Wide open competition. No more limited marketing, competitive pricing hit, and the shit started hitting the fan.

Of the 100 largest trucking companies in America at the time of deregulation, only 4 remained in business as of last year. And that is mainly due to unions and their stranglehold upon workrules and out of whack labor costs and contracts.

In trucking, flexibility is a key to be competitive. The ability to meet certain timeschedules is crictical (this is referred to as service standards). If you are running a 4 day lane and your competition is doing it in 3, and at a competitive price, you are fucked.

Now, the union companies forced upon the unionized trucking companies some crazy rules. One guy runs the forklift, one guy drives the truck, period. You cant use the same guy to load his own truck and then hit the streets under most union contracts. And once a guy had worked say, 3 hours, he had to get paid for a full day even if he was sent home due to lack of work. And add to that infamous Central States Fund, the teamsters pension fund which currently is losing more money than it is taking in because of the absorbed cost of the trucking companies previously gone out of business.

And what is management to do? They are fucked. Pro-labor Labor Boards, wildcat strikes, Teamster violence. A strike can kill a trucking companybecause national shippers have no problem diverting freight to your competitors. THats how UPS lost LL Bean to Fed Ex in the parcel field about 10 years ago, the threat of a strike by the Teamster combined with Fed Ex's competitve pricing cost the Teamsters jobs.

So what do we have today? Only 2 of the national trucking companies are unionized. The teamsters have not organized a regional nor nationals trucking company in nearly 30 years. AF, CF, USF D, you make a big bowl of alphabet soup from the SCAC codes of all the unionized trucking companies the fell under as a result of their unions. The inability to be price competive and offer the flexibility that non union companies can offer have fucked them over.

And when a teamster comes up to a driver to get them to join the union, all a driver has to do is look at all the companies shut down as a result of the union to realize hell no. A union contract means shit when the companies goes under.

And the winner of this derugulation? The shipping public.

There was a time and place for unions. Its no wonder that the percentage of workers in the PRIVATE sector that are members of a union decreases and decreases every year. They force crazy work rules, strangle competive edges of companies, and demand above-market place wages and benefits, and they protest when companies have no choice but to move overseas.

Its is a fucking comedy.

[Ali]

Up until the early 80s trucking here in the US of A was regulated by the ICC. You could only operated on certain lanes as permitted and at the rates as published. No discounting, etc. No competition. Trucking companies got fat and lazy. Trucking was heavily unionized because without competition, you could easily pass those cost on to the shippers, who passed them along to the ultimate consumer.

In the 1980s, under Reagan, they deregulated trucking. Wide open competition. No more limited marketing, competitive pricing hit, and the shit started hitting the fan.

Of the 100 largest trucking companies in America at the time of deregulation, only 4 remained in business as of last year. And that is mainly due to unions and their stranglehold upon workrules and out of whack labor costs and contracts.

In trucking, flexibility is a key to be competitive. The ability to meet certain timeschedules is crictical (this is referred to as service standards). OK, point taken, Unions can and do fuck themselves by being inflexible when flexibility is required, agreed. However, in the example you gave, the problems began when Reagan deregulated trucking. The industry was already unionised and doing fine. You can't blame the unions for this, and their reaction, although it contributed to the demise of the trucking companies, was not the only problem. Poor management is as detrimental a factor as union inflexibility and the blame lays squarely on both their shoulders, as well as on the government for suddenly pulling the rug from under everybody's feet... this is a key factor here. Yes, shippers and consumers paid less for their goods to be delivered, but that cost was transferred somewhere else, wasn't it? Overworked truckers taking more risks than before, driving overloaded trucks for exteme lengths of time, etc. Cut throat, as you say. The consumers paid less for their goods and then got killed on their way home from the store by a truck whose driver had fallen asleep at the wheel or was speeding in an overloaded truck.

No, Unions are not blameless and have made mistakes in the past, you are correct and I have said this before, but I believe that they are still necessary in any industry with a large, wage-earning, hourly-paid workforce. The guys and gals working in warehouses, factory floors, assembly lines, tills, etc. are not generally aware of all the nuances of labour law, nor can they individually afford the services of one who is. They need to be protected and represented, in order not to be exploited and generally fucked in the ass by management, whenever they make a mistake or don't react quickly enough to some new development, like deregulation, overseas competition or whatever.

Were you in the Industry in the 80's, before deregulation, before it got so cut-throat? Were things better or worse then than they are now?

Seems to me that those regulations served a purpose... am I wrong?

BTW it's nice to debate intelligently with you rather than winding each other up... altough that's also fun, sometimes :D

[Ali]

As a consultant...are you rich? Do you pay above what the tax rates are so that you can give more to the poorer than you? Or.....do you keep what you can to support your own family?Filthy stinking rich, sam, beyond your wildest dreams.

I pay an accountant to look for tax loopholes and exploit them fully.

I don't give to the poor, it only encourages poverty.

Why do you ask? ;)

[valvano]

OK, point taken, Unions can and do fuck themselves by being inflexible when flexibility is required, agreed. However, in the example you gave, the problems began when Reagan deregulated trucking. The industry was already unionised and doing fine.

You have missed the big picture, totally.

In the formula for any business, management is not the most important variable, nor are the unions, or other labor.......its the customer, without the customer, nothing else exists....

So you support the customer paying more for their transportation costs as a result of regulation even though there's another company willing and able to do it cheaper but are forbidden from doing so because of regulation?

So you dont' support a company offering its shipping customers expanded services such as expedite, A&D, cross dock, cross border, etc in order to grow their business (because during regulation, that wasnt possible)?

So you don't support market forces that would make a company work as competitively as possible, you prefer they get fat and lazy (which is what regulation created)?

I guess then that would have prefer to pay $420 for that new iPod instead of $399 because under regulation, the cost of transported material, finished product, etc would definitely be higher.

Who the heck do you think pays for the labor, fuel, taxes, regulatory cost, etc that hit trucking companys? We pass it right on down to the shippers, who pass it down to their vendors, and so on, right down to the consumer.

:)

Finally, if you were a traffic manager for a company, would you prefer to have to deal with numerous trucking companies serving each of your market or just a handful? Which scenario do you think would be more costly and less headaches?

:confused:

[Ali]

You have missed the big picture, totally.

In the formula for any business, management is not the most important variable, nor are the unions, or other labor.......its the customer, without the customer, nothing else exists....

So you support the customer paying more for their transportation costs as a result of regulation even though there's another company willing and able to do it cheaper but are forbidden from doing so because of regulation?

So you dont' support a company offering its shipping customers expanded services such as expedite, A&D, cross dock, cross border, etc in order to grow their business (because during regulation, that wasnt possible)?

So you don't support market forces that would make a company work as competitively as possible, you prefer they get fat and lazy (which is what regulation created)?

I guess then that would have prefer to pay $420 for that new iPod instead of $399 because under regulation, the cost of transported material, finished product, etc would definitely be higher.

Who the heck do you think pays for the labor, fuel, taxes, regulatory cost, etc that hit trucking companys? We pass it right on down to the shippers, who pass it down to their vendors, and so on, right down to the consumer.

:)

Finally, if you were a traffic manager for a company, would you prefer to have to deal with numerous trucking companies serving each of your market or just a handful? Which scenario do you think would be more costly and less headaches?

:confused:So, why have things become so "cut throat", as you put it?

[valvano]

So, why have things become so "cut throat", as you put it?

The entry to market is so easy it has driving discounting of rates. Any fool can buy a cab, get their license, lease equipment, and start up a trucking out fit.

On guy has this rate structure, another may say "i'll give you an x % discount" , and so on. its good for the consumer but beats the market to hell. of course, you have as many companies shutting down as you do entering, in america its the national and regional trucking companies that have weathered these storms through the years, and continue to improve yield and effeciences. having a unionized work force on you is just one more cost that you have to incur that your competition doesnt (along with the associated work rules that kill flexibility, etc)....

as i mentioned earlier, if you have the choose of a 3 day lane vs 4 days and the 3 day lane is cheaper than the 4 day, which one are you going to put your freight on?

(lb)

at some point, when you cut price to the lowest you can, you have to sell on service , and again, when you have work rules that take away your flexibilty, your competitive edge, you cant compete there

[sam i am]

Filthy stinking rich, sam, beyond your wildest dreams.

I pay an accountant to look for tax loopholes and exploit them fully.

I don't give to the poor, it only encourages poverty.

Why do you ask? ;)

Because I worry about your ability to support your family if the changes to economies you advocate are ever fully enacted.

Tell you what...cuz I like you and would hate to see your family ever suffer, I'll volunteer now to take you in here in the US and sponsor your trip so that you are taken care of.

Deal? :cool:

[Ali]

Because I worry about your ability to support your family if the changes to economies you advocate are ever fully enacted.

Tell you what...cuz I like you and would hate to see your family ever suffer, I'll volunteer now to take you in here in the US and sponsor your trip so that you are taken care of.

Deal? :cool:Thanks, sam, that's very kind of you to offer :)

Um, what, pray are the "changes to economies" that I advocate? Socialism? Communism? The fact is that my family is far more likely to be looked after in a socialist or communist society than in the US or UK or any other capitalist state. I wouldn't have to pay into a private pension fund, buy property and invest my savings in diverse market sectors, if I knew for sure that the State or my neighbours or the community I lived in would help us out in Difficult times. But I have to, because if I don't, nobody else will. I have to be selfish, because Capitalism demands this.

[Ali]

The entry to market is so easy it has driving discounting of rates. Any fool can buy a cab, get their license, lease equipment, and start up a trucking out fit. Could this happen before deregulation?

at some point, when you cut price to the lowest you can, you have to sell on service , and again, when you have work rules that take away your flexibilty, your competitive edge, you cant compete thereOK, so the unions are no longer necessary in the Trucking Industry. How do the people working in the warehouses, loading yards, etc. make sure that they don't get made to work in unsafe conditions for dangerously long hours for less pay and get fired at any minute, for no reason? Work rules are there to protect employees. Yes, they take away your flexibilty, your competitive edge, but don't they apply to your competitors, too?

[valvano]

Could this happen before deregulation?

OK, so the unions are no longer necessary in the Trucking Industry. How do the people working in the warehouses, loading yards, etc. make sure that they don't get made to work in unsafe conditions for dangerously long hours for less pay and get fired at any minute, for no reason? Work rules are there to protect employees. Yes, they take away your flexibilty, your competitive edge, but don't they apply to your competitors, too?


No, because as I earlier stated, under Regulation you were allowed only to operate within certain lanes, markets, etc. ABC Trucking could move freight from point A to point B, but not Point B to Point C. XYZ Trucking could not come along and also move from A to B because they did not have the Regulatory approval to do so. And you had to charge based on your public tariffs.

Second question, there is such a labor shortage right now for drivers that the market place has created pretty much a bidding war for labor. Just listen to XM Radio for how many trucking companies are currently advertising for drivers.

You see, the open market does work.
(y)

[Ali]

No, because as I earlier stated, under Regulation you were allowed only to operate within certain lanes, markets, etc. ABC Trucking could move freight from point A to point B, but not Point B to Point C. XYZ Trucking could not come along and also move from A to B because they did not have the Regulatory approval to do so. And you had to charge based on your public tariffs. what does this have to do with Unions and employee protection?

Second question, there is such a labor shortage right now for drivers that the market place has created pretty much a bidding war for labor. Just listen to XM Radio for how many trucking companies are currently advertising for drivers.

You see, the open market does work.Drivers, maybe, what about loading bay, warehouse, etc?

You're up early...

[valvano]

what does this have to do with Unions and employee protection?

Drivers, maybe, what about loading bay, warehouse, etc?

You're up early...

i get to my office about 7:30 EST

what does dergulation have to do with unions and employee protection? everything. with regulation, they could afford to be fat and lazy because they were protected from competition. some thing that was going on with GM except they were protect by a lack of foreign competition. the consumer be damned, we are going to get whatever we want, and the consumer paid.

free market competition starts, and the unions fail to adopt to the scenario. the fat and lazy days are over with, and they kill themselves...

as i stated before, you want to pay $420 for your new ipod or $399?

:confused:

[sam i am]

Thanks, sam, that's very kind of you to offer :)

Um, what, pray are the "changes to economies" that I advocate? Socialism? Communism? The fact is that my family is far more likely to be looked after in a socialist or communist society than in the US or UK or any other capitalist state. I wouldn't have to pay into a private pension fund, buy property and invest my savings in diverse market sectors, if I knew for sure that the State or my neighbours or the community I lived in would help us out in Difficult times. But I have to, because if I don't, nobody else will. I have to be selfish, because Capitalism demands this.

I guess maybe the biggest difference between you and I on this subject is that I believe much more in self-determination and my own ability to make my own way in life. I'd HATE to be reliant on others except in extremis. It's an American cultural thing, in many respects (see previous posts of mine on Americans' love affair with their cars).

[Ace42X]

You see, the open market does work.
(y)

Which is why the US imports its crap from forced labour camps in the third world...

Nice try, asshat.

[valvano]

Which is why the US imports its crap from forced labour camps in the third world...

Nice try, asshat.

well, maybe if we lowered taxes, got rid of some govt regulations, had some tort reform, maybe some of those business would move back to the USA...

dumbfuck, shouldnt you be studying for exams? mommy and daddy are paying your tuition so you can fuck off on an internet message board

:D

[Ace42X]

well, maybe if we lowered taxes, got rid of some govt regulations, had some tort reform, maybe some of those business would move back to the USA...

Yeah, if you paid your workers as little as the people in a forced labour camp got, starved them to death, removed all free education, and made them live in slums - then maybe the US could compete.

Who cares if it pushes up infant mortality rate, violent crime, the spread of disease, civil discontent, etc?

dumbfuck, shouldnt you be studying for exams? mommy and daddy are paying your tuition so you can fuck off on an internet message board


Nice try, but I am currently in full time employment working for a national publication. And here in the UK, we have a student loans system. I have to repay my university debts out of my wages.

But don't let you complete and total ignorance get in the way of your posturing, most of the other uneducated boobs here don't, so why should you be any exception?

[valvano]

Yeah, if you paid your workers as little as the people in a forced labour camp got, starved them to death, removed all free education, and made them live in slums - then maybe the US could compete.


I would think that if you kept your works in a forced labour camp, you wouldnt have to pay them?

:D

And if you had a forced labour camp, why would you starve them to death? That doesnt make sense, put them in labor camp and then starve them to death, that defeats the purpose?

:D

And I know of no employers in the US who force their workers to live in slums, most people get jobs so they can move out of the slums...

:D

[Ace42X]

I would think that if you kept your works in a forced labour camp, you wouldnt have to pay them?

So you are advocating forced labour camps in America then? That is the Zenith of your conservative ideology? They work so you don't have to?

And if you had a forced labour camp, why would you starve them to death? That doesnt make sense, put them in labor camp and then starve them to death, that defeats the purpose?

I thought your argument was based on economics... Why feed people, costing you money, when you can just get new ones? You conservatives don't like immigration, right? There's a solution for you.

And I know of no employers in the US who force their workers to live in slums,

Yes, those pesky regulations... Still, when you are competing with those countries toe to toe due to deregulation, they'll have to.

[Ali]

as i stated before, you want to pay $420 for your new ipod or $399?
:confused:I'll end up paying the extra $21 elsewhere, in the form of taxes to support unemployed workers who've lost their jobs to make my ipod cheaper.

[valvano]

I'll end up paying the extra $21 elsewhere, in the form of taxes to support unemployed workers who've lost their jobs to make my ipod cheaper.

maybe if they lowered taxes, it may spur economic development and get those unemployed some new jobs...

(y)

[Ace42X]

maybe if they lowered taxes, it may spur economic development and get those unemployed some new jobs...

And with the loss of revenue you can make a lot of teachers, firemen, policemen (and in the UK, healthcare proffesionals too) redundant!

Great idea shit for brains! What's your next idea, smashing the fingers of every male child entering adolescence to give the nurses someone to care for?

[valvano]

And with the loss of revenue you can make a lot of teachers, firemen, policemen (and in the UK, healthcare proffesionals too) redundant!

Great idea shit for brains! What's your next idea, smashing the fingers of every male child entering adolescence to give the nurses someone to care for?

no, buy lowering taxes and expanding the economy, it will add MORE people to the tax rolls and thereby increasing govt revenues,

i believe it worked for your neighbors there in ireland, you idiot

http://www.ica.bc.ca/kb.php3?pageid=710

"The reforms that launched the Irish recovery included significant tax cuts – corporate taxes in Ireland are now the lowest in Europe – and reductions in government spending. The Irish strategy has also encompassed large-scale investments in education and other key aspects of the national infrastructure. Such investments have been made possible, Harney said, by the increases in government revenues produced by economic growth"

why dont you go eat some fish and chips while you bow to your queen?
:D

[Ace42X]

no, buy lowering taxes and expanding the economy, it will add MORE people to the tax rolls and thereby increasing govt revenues,

i believe it worked for your neighbors there in ireland, you idiot

Hah, you are such a dolt. Because lowering taxes in Ireland helped their economy, lowering taxes everywhere must be good? Poppycock.

Once again you demonstrate your complete inability to understand the topic in hand.

Assuming we believe the "chartered accountants of British Columbia" and their 3 year old analysis (I for one do not really care), that still only shows that the tax rates IN IRELAND were above the optimum tax level. It says nothing about the tax-rate anywhere else in the world.

If, hypothetically, the tax rate were lowered to 0%, according to your gross simplification, that would guarantee maximum economic growth. How, precisely, do you expect a nation to function with no liquid assets?

And, of course, you are incorrectly simplifying twenty years worth of geo-politics into "they cut taxes." You might as well say "Well, the Irish started by praying to the pink elephant God, and now their fortunes have turned around, so the pink elephant God MUST exist."

Plus, you failed to highlight the important part of the text you cited: "They cut spending" - your government is spending money like water on guns and ammo. Hardly "following the Irish model."

Likewise, since then they have (and I quote) "increased [...] spending on health care by 50 per cent and its spending on education by 40 per cent."

Now, are you proposing that the US government institute a nationalised health service, doing away with all that private medical insurance nonsense?

Thought not...

Really, even a child could spot the logic errors in your argument. You're going to have to try harder.

why dont you go eat some fish and chips while you bow to your queen?

"bow to my queen"?

What on earth are you prattling about? You idiotic yanks hero-worship your stunted president with greater reverance than most English people hold the entire royal family.

The UK has a constitutional monarchy, the Queen is afforded some superficial and customary privlidges. The US is supposedly a republic, and you a republican. What's your excuse for instituting your own aristocracy to bow and scrape before?

Oh, don't bother answering. I already know.

YOU'RE A FUCKING MORON, AND AS SUCH CAN'T BE HELD ACCOUNTABLE FOR ANY OF THE BACKWARDS HORSESHIT THAT SPEWS OUT OF YOUR FAT JOWLY BURGER-HOLE.