Posted on 03/01/2007 8:09:17 AM PST by lowbuck
Do you believe in capitalism?
Or are you a nationalistic socialist?
The "China Price" is the best price for manufacturing. The "India Price" is the best price for engineering and programming and tech stuff.
Companies today are not "American" or "European". They are global. Shareholders from around the globe own shares.
Capitalism is about maximizing economic return to shareholders. In manufacturing, that means finding the cheapest inputs to the manufacturing process and selling the finished goods at the highest price. Labor is a commodity, an input to production. The cheapest labor is in China and India. Ergo, the profit maximizing strategy is to transfer all manufacturing to China and India. Truth is, if one combines industrial America with industrial Western Europe, one still only comes up with a bit over a half-billion people TOTAL. China and India, between them, have almost two billion peasants in utter poverty. So, even if the whole manufacturing base of Europe and America are transferred to India and China, there is such a huge glut of cheap human labor that the price of labor will not be significantly driven up over there. There is that much excess. That makes it easy to discipline labor in those countries as well, because there is no labor protection, and any laborer who causes the slightest bit of trouble (like wanting to take a day off work to tend to his sick children, for instance, or any laborer who gets cancer, stuff like that) can be thrown away and three others will take his place. This is a manufacturers paradise, because labor is cheap and utterly replaceable, so labor CAN'T start to force up costs, especially in China, where the government will systematically prevent the formation of any organized body of people. China's Communist government acts as a clamp on top of the aspirations of labor, preventing unionization and offering the promise of a century or more of "The China Price". The profits from dirt cheap, or free!, labor, are substantial enough to build a very wealthy capitalist society! (For proof, look at how gorgeous Charleston, Savannah, Monticello and Mount Vernon are!)
Why should shareholders from around the world have their profits reduced in the companies they invest in because a bunch of American or European laborers, who contribute nothing but an utterly replaceable commodity, want to keep grossly overpaid jobs? It is bad business!
Now, of course, if one is a nationalist and believes that Americans (or Frenchmen) are somehow MORE IMPORTANT than Chinese or Indians, then one can start making economically foolish decisions like choosing to protect American (or French) laborers from the foreign competition. An American costs five times as much as a Chinese to do the same manufacturing job, and he doesn't do it any better, but some folks have these emotional attachments to what they know, their own countries. It's all misty eyed and sweet, but it's pure socialism to use the law to prevent capitalists - the ones with the capital to invest with the express purpose of maximizing profit - from investing in lean, cheap Chinese and Indian labor in order to keep fat, lazy Americans working at jobs that by all economic reasoning OUGHT to be done by Chinese and Indians.
What are you, some sort of SOCIALIST?
Protectionism is socialism. It's nationalistic socialism.
So, that's what we come down to: efficient, clean, aggressive profit-maximizing capitalism - the good old fashioned American kind that built America up from its roots in the Virginia plantations - versus this national socialism of yours that wants to protect a mere commodity (American labor) from its more efficient competitor abroad (I assume you don't give a damn about French labor, that you resent the FRENCH protecting their labor as socialism, and that you take delight in seeing "socialist" French labor get laid off, so I am just focusing on expensive American manufacturing labor, which, thanks to globalization, has lost its economic right to continue to exist.)
Capitalism is survival of the fittest. The fittest companies get the hell out of America and Europe and manufacture or net-engineer everything where labor is dirt cheap.
You want to protect "the American manufacturing base", you national socialist you.
Fortunately for the shareholders of international companies, there are enough hard-driving MBA's out there who understand that profit maximization is found in using Chinese and Indian labor. The companies that get all of their manufacturing out of America and Europe first are the ones that will rule the 21st Century. Quaint old national socialism can only fight a rearguard action against intelligent capitalism.
Glad you appreciated it.
Nope. There are far too many Chinese, and the government there will tamp down any unionism that threatens to stop the import of manufacturing into China. One group of workers starts agitating for more (things like a day off, or 15 hour workdays, or permission to attend family funerals...things like that), and they are tossed out and more peasants imported.
Quality control is a matter of coupling Western management oversight with the whip of Communist supervisors.
The Chinese manufacture warplanes which work just fine. If Airbus or Boeing needs greater quality control, they can always send over American or French inspectors and pay them a premium. The world is full of willing expats.
"French and German workers...the high costs of its inefficient structure."
article - nutshell"
French, German and American workers: fat, overpaid, rebellious.
Indian and Chinese workers: lean, harder working, docile, cost one fifth the price.
Capitalist no-brainer: replace all of the former with the latter.
I've got news for you, China's Communism will be eradicated one way or the other. Communism has a far shorter lifespan than Democracy.
Maybe for large ticket/gov. purchase. Who will be the market when the middle class in America is to broke to
buy? Those wealthy 2% at the top can't sustain 3rd
world production forever.
Yada yada...protectionism is not painless and besides I think if you have to turn to protectionism you've already lost. I think America is a long way from losing.
Should a war occur between China and the US who do you propose that we hire to build our military aircraft? Should we also have China build our nuclear submarines, warships and military aircraft?
Seriously, what country are you a citizen of?
What is industrial action?
Excellent, pure capitalist, post!
"I've got news for you, China's Communism will be eradicated one way or the other. Communism has a far shorter lifespan than Democracy."
I've got news for YOU. China's not Communist. It's Fascist. Sure, it CALLS itself Communist, but it's a corporatist military state. Don't let the name fool you. We're not looking at a Chinese USSR. We're watching the rise of a Chinese Third Reich. Communism is an economic loser. But Fascism: a capitalistic production system with no worker's collective rights fused with a military state - THAT was not an economic loser. It boomed. It flourished. In its first incarnation, it outproduced the British and the French of the comparable time frame (both Britain and France were free-market capitalist societies then). It took the USSR AND the British Empire AND the remnants of the French Empire, AND the United States to bring the Third Reich to heel. If Germany had had a billion people, they would have certainly conquered the world in the 1940s.
If you're waiting for the "inevitable" Chinese implosion because they call themselves "Communist", you're going to be bitterly disappointed I'm afraid. China is far more dangerous than any mere Communist country. Unlike Communism, Fascism is an EFFECTIVE system of economic organization. That's the problem.
"Who will be the market when the middle class in America is to broke to buy?"
Who cares? That's government's problem. Capitalists' goal is to maximize wealth generation. TODAY, that is to be done by exploiting Chinese and Indian labor. If that leads, down the road, to a change in the market, the greater wealth the capitalists generate by exploiting cheap labor in India and China will allow the capitalists to purchase whatever capital is needed in the new, reshaped economy. If everybody is poor and there's no consumer market, then land is the most valuable resource. Capital raised exploiting the Chinese and Indian labor premium can easily be shifted, if the market for consumer goods collapses, into buying up land at rock-bottom prices.
If you have the MONEY, you can set the rules for whatever form of society you live in. Only armed force can supersede money power.
THEREFORE, obviously, you put you cheap factories in China and India and EXPLOIT the labor there, but you LIVE in Manhattan or London or Paris, obviously.
America IS protectionist! You think the Japanese built Toyota plants here because they WANTED to? Because it was CHEAPER?
No!
They built them here because the choice was to employ some Americans making cars, or have the Americans slap on punitive tarriffs and strict quotas on Japanese cars.
If it weren't for strong American protectionism in the 1970s and 1980s, there would be no Japanese auto plants in America, and the Japanese car companies, producing cars in Japan, would have put the US automakers out of business.
Chrysler went bankrupt because it could not compete, and was saved directly by the US Federal Government.
America has always been protectionist to a significant degree. The issue is that currently we haven't ratcheted up our protectionist barriers to prevent the Chinese labor costs from doing to us what the Japanese method would have done to us in the 1980s, or the British industrial lead would have done to us in the 1800s had we not had the barriers we had at the time.
I will answer your questions if you will answer mine:
Understanding that it is a socialist thing to do you think we should erect an equalization tarriff (or perhaps an outright import quota) against cheap manufactured goods coming in from overseas?
Yes or no?
It is twice as strong as the "family size."
You are incorrect, and your writings have a tone of paranoia. Don't turn China into the dragon it cannot be. Furthermore our Military Industrial Complex is licking its chops at the prospect of a new cold-war with China. China lacks the vision, the freedom of ingenuity, and the cultural stamina to keep up when push comes to shove. 5000 years of history and they have expanded to nowhere. They have over a dozen angry geographical neighbors, including India. I would not want to be a Chinese strategist or a banker as we've seen with the markets the last few days. The odds on them in reality are long to do anything of substance in the near future. They are the west's servants - always have been and always will be.
Now if you will excuse me I'm off to Walmart to buy cheap chinese crap.
Well if that's the case Pat Buchanan and the socialist workers party should be happy.
Yes. Ayn Rand would be so proud of me.
No, because America is not PROPERLY protectionist, against TODAY'S threats.
We stole patents and slapped tarriffs on goods in the 19th Century in order to become the first world economic power. That protectionism was effective.
We forced the Japanese to build factories here in order to sell Toyotas and Hondas here. Effective protectionism once more.
But today, we're NOT protecting against the shipment of the whole manufacturing sector out of the country. We have no counter to the "China Price".
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