Posted on 02/15/2005 6:44:11 AM PST by dennisw
"The Great American Job Sellout By Paul Craig Roberts
Americans are being sold out on the jobs front. Americans' employment opportunities are declining as a result of corporate outsourcing of US jobs, H-1B visas that import foreigners to displace Americans in their own country, and federal guest worker programs
President Bush and his Republican majority intend to legalize the aliens who hold down wages for construction companies and cleaning services. In order to stretch budgets, state and local governments bring in lower paid foreign nurses and school teachers. To reduce costs, US corporations outsource jobs abroad and use work visa programs to import foreign engineers and programmers. The American job give away is explained by a "shortage" of Americans to take the jobs.
There are not too many Americans willing to accept the pay and working conditions of migrant farm workers. However, the US is bursting at the seams with unemployed computer engineers and well-educated professionals who are displaced by outsourcing and H-1B visas. During Bush's entire first term, there was a net loss of American private sector jobs. Today there are 760,000 fewer private sector jobs in the US economy than when Bush was first inaugurated in January 2001.
For years the hallmark of the European economy was its inability to create any jobs other than government jobs. America has caught up with Europe. During Bush's first term, state and local government created 879,000 new government jobs. Offsetting these government jobs against the net loss in private sector jobs gives Bush a four-year jobs growth of 119,000 government jobs. Comparing this pathetic result to normal performance produces a shortage of 8 million US jobs. What happened to these jobs?
Over these same four years the composition of US jobs has changed from higher-paid manufacturing and information technology jobs to lower-paid domestic services. Why?
During this extraordinary breakdown in the American employment machine, politicians, government officials, corporate spokespersons, and "free trade" economists gave assurances that America was benefitting greatly from the work visa programs and outsourcing.
The mindless chatter continues. Just the other day Ambassador David Gross, US Coordinator for International Communications and Information Policy in the State Department, declared outsourcing to be an economic efficiency that works to America's benefit. There is no sign of this alleged benefit in US jobs statistics or the US balance of trade.
Repeatedly and incorrectly, US corporations state that outsourcing creates more US jobs. They even convinced a New York Times columnist that this was the case.
The problem is, no one can identify where the US jobs are that outsourcing allegedly creates. They are certainly not to be found in the BLS jobs statistics. However, the Indian and Chinese jobs created by US outsourcing are highly visible.
On February 13, the Dayton (Ohio) Daily News reported that jobs outsourcing is transforming Indian "cities like Bangalore from sleepy little backwaters into the New York Cities of Asia." In a very short period outsourcing has helped to raise India from one of the world's poorest countries to its seventh largest economy.
Outsourcing proponents claim that US job loss is being exaggerated, that outsourcing is really just a small thing involving a few call centers. If that is the case, how is it transforming sleepy Indian cities into "the New York Cities of Asia"? If outsourcing is no big deal, why are Bangalore hotel rooms "packed with foreigners paying rates higher than in Tokyo or London," as the Dayton Daily News reports?
If outsourcing is of no real consequence, why are American lawyers or their clients paying $2,900 in fees plus hotel and travel expenses and two days' billings to attend the Fourth National Conference on Outsourcing in Financial Services in Washington DC (April 20-21)?
On the jobs front, as on the war front, the social security front and every other front, Americans are not being given the truth. Americans' news comes from people allied with the Bush administration or dependent on revenues from corporate advertisers. Displease the government or advertisers and your media empire is in trouble. The news most Americans get is filtered. It is the permitted news. Many "free trade" advocates also are dependent on the corporate money that funds their salaries, research and think tanks.
Another clear indication that outsourcing of US jobs is no small thing comes from the reported earnings of the leading Indian corporations that provide American firms with outsourced IT employees and engineers. During the recent quarter, Infosys' revenues increased by 53%, TCS grew by 38%, and Wipro was up 34%.
On January 1, 2001, Cincinnati-based Convergys Corp had one Indian employee. Today it has 10,000. Why? Because it can hire Indian university graduates for $240 a month, a sum that is a small fraction of the US poverty level income.
Many Americans think that an outsourced job is an existing job that is moved offshore. But many outsourced jobs are created offshore in the first place. On February 11, USA Today told the story of OfficeTiger, "the sort of young technology company that once created thousands of high-paying jobs in the USA, fueling sizzling economic growth." The five-year old startup business employs 200 Americans and ten times that number of Indians. The company has plans for hiring many more Indians to perform "tech-heavy financial services."
Under pressure from venture capitalists who fund new companies, American startup firms are starting up abroad. Thus, the new ventures, which "free trade" economists assured us would create new jobs to take the place of the ones moved offshore by mature firms, are in fact creating jobs for foreigners.
As a consequence, tech jobs in the US are falling as a percentage of the total. Clearly, tax breaks for venture capitalists are self-defeating when the result is to create jobs for foreigners, not for Americans. Why should the American taxpayer subsidize employment in India and China?
These developments have obvious adverse implications for engineering and professional education in America. The BLS jobs forecast for the next ten years says the vast majority of US jobs will not require a college education. University enrollments will decline and so will the production of PhDs as fewer professors are needed.
As India and China rise to first world status, the US falls to third world status where the only jobs are in domestic services.
This has enormous implications for the US balance of payments. Americans' consumption of manufactured goods is heavily dependent on foreign manufacture, whether that of foreign firms or that of US multinational firms that supply their American customers from offshore. How does an economy in which employment growth is concentrated in nontradable domestic services pay for its imports with exports?
Since 1990 the US has been paying for its imports by giving foreigners ownership of its assets. In the last 15 years foreigners have accumulated $3.6 trillion of America's wealth.
America has been able to pay for its consumption by giving up its wealth because the dollar is the world's reserve currency. As America's high-tech and manufacturing capabilities decline and its red ink rises, the dollar's role as reserve currency must end.
When the dollar loses its reserve currency role, America will not be able to pay for the imports on which it has become dependent. Shopping in Wal-Mart will be like shopping at Neiman Marcus.
Until recent years, US companies employed Americans to produce the goods that Americans consumed. Employment supported sales, and sales supported employment. No more. By their shortsighted policy of moving US jobs abroad, our corporations are destroying their American markets.
Economists give assurances that the dollar's decline and fall will bring jobs and industry back to the US. Once Americans are as poor as Indians and Chinese are today, the process will reverse. Multinational corporations will locate in America to take advantage of cheap labor and unserved markets. By becoming poor, the US can become rich again.
You might want to ask the economists and our "leaders" in Washington why we should put ourselves and our descendants through such a wrenching process."
--Jerry Leslie Note: les...@jrlvax.houston.rr.com is invalid for email
Oh pulease.. I offered my address and the presence of the authorities, what more do you want.. someone to hold your hand while they cart you off for assault?
Treason is treason whether your "pals" have the ethical guts to tell you the truth or not. If yours don't tell you the truth when it hurts, they may be something, but friends ain't the proper term to apply. Like I said, I demonstrably defended the usage clinically. If it fits you apply it. If it doesn't, you don't apply it. Period. It fits and it is appropriately applied. If that's offensive to you, perhaps you should change your thinking instead of trying to pretend that how you feel about it should matter. When we executed the Rosenbergs, I can assure you, nobody much cared what they thought about being called traitors. Will you next tell us we shouldn't call Manson a murderer cause he might not like it?
But I know what your scam is, It's to get the mods to wipe out this whole thread so no one will see what you have done here.
ROFL. Yeah, that's it. Do you think before speaking. Has it ocurred to you that nobody really cares if you act like a butt. Everyone gets a little out of hand now and then, that's to be expected. But you're the type that goes out of the way to be insulting - that is abusive. Nobody has to put up with it and it reflects poorly on this site. But, I wouldn't dream of having the thread pulled because of it. You showing your butt offends decent people and diminishes your credibility and your argument to the extent that you even have one of worth. And I'm not convinced by what you've presented whether you know if you do or not.
Flame wars are against posting guidelines, And by you coming onto this thread and calling people who disagree with you traitors and accusing them of treason is precisely what causes them.
I didn't call people that disagree with me traitors. I posted example, noted it, and drew parallel to illustrate that what others are doing is the textbook definition in action. I don't much care if you don't like it. The point is to define what is going on and frame it so that others understand fully why the term is applied. I've not used the word as an epithet or an empty charge. I defined it, gave example and applied it per example with illustration, allusion, etc.
Flame wars start when people who don't have a leg to stand on can't admit it and can't compell themselves to act like adults. If you can't govern your tongue, that's what mods are here for. Constrain yourself, and you won't have to worry about someone else having to do it for you. If you can't understand that being said to enlighten you, then what ever happens to you when you let your mouth run isn't going to be an example for you that you'll learn from and you'll probably go off and tell the world how you were wronged (because you couldn't behave and act like an adult). Maybe I'm wrongly assuming you aren't a child; but, then, if you come to play with adults, you should understand the expectation that you act like one.
Quote: You supporting the redistribution of wealth as well?
It's a disgrace to this site.
No, only fair and reasonable wages and not having to worry about having to compete with a chinese person making 30 cents an hour. I have no problem with somone making a product or service better than I can just as long as the playing sides are not tilted.
BTW: The redistribution of wealth from the few robber barrons to the "unwashed masses" created the most prosperous and greatest nation on earth.
If that makes me a liberal or commie so be it(in your terms).
Funding a military that is bigger and badder than our adversaries is not anti-Constitutional Big Guv'ment like all the Income Redistribution is...MUD
Get real, redistribution of wealth is a fact of life. A husband give the wife money to buy food, redistribuuting the wealth. I suppose she could do it the Protagoras way and charge him for services rendered instead. Donations to charity are redistributes too.
One difference is this:
The producers in China lower their wage basis tremendously, in fact, even the costs of transcontinental shipping do not completely eat up these costs--or the moving of production to China would not be done.
But these producers do not lower their prices to the end consumer correspondingly, or even proportionately-- what is the wage differential between someone in China and a comparable US worker, and what is the difference in price for the finished good at the checkout stand? In one case, the cost of labor is down by (say) a factor of 75 (30 cents an hour vs. 25 dollars an hour); in the other, the price of the goods is only cut in half.
Even with the differential in productivity, and shipping, it is the manufacturer (and say the Chinese govt?) who is winning--most of the improvements are not passed on to the US worker who is now out of a job...
/soapbox mode OFF
You did not say this but a person with mediocre common sense knows this is what is happening by our uneven trade with china. Do you say it's not?
1. Why have the chinese not revalued the yen..thereby hurting our poducts sales to their country.
2. What happened when all the corporate leaders said trade with china would bring a ton of export orders to our companies-which it has not.Deficit is growing larger each month.
3. They have nukes pointed at us and have drawn up plans for fighting a war with US. I don't see Britain or Australia doing this.
The chinese will not buy from us unless they have to because they look out for their own countries interest. We don't care if we sell out our country as long s we get cheap dvd.
This'd be stronger if you came up with such quotes, whether from CNN.com, BusinessWeek Online, Forbes, etc.
I don't doubt you, but those who do will want substantiation!
We had unconstrained capitalism in post civil war USA, sweat shops, child labor, all powerful monopolies and an impoverished working class and small middle class. It did not work. All (most) of the wealth was in the hands of a few Barrons of industry, TR busted the monopolies, labor laws were past and the nation, all of the nation became wealthy. History is hard to argue against.
Very good point grey-whiskers.
When Nike shut down the shoe pnt in Memphis and moved first to Mexico then China I did not see the price of Nikes go down to $10.00
Make that OUT of power.
Quote: I don't doubt you, but those who do will want substantiation.
Gov't accounting office and comngreesional budget office put out these figures.
Also when you go down any stores isles and all you see is "made in China" it does not take an export to discount my figures.
Yup, that's true--but I was talking about point 2 explicitly, which referred to quotes from business leaders. If you find them, you will silence more of your critics-- you may finally be able to embarass them into silence ! Cheers!
China puts tariffs on our proucts, as does India. So don't expect them to buy anything from us. Also 30 cents an hour ain't gonna buy much.
One, don't put words in my mouth because it is utterly dishonest. Two, I didn't say that. Three, it isn't even implied and does not logically follow...
What is illegal here paying less wages? You lobby the government to put restrictions on the Free Market and then are outraged the Free Market reacts in a way you don't want it to when every valid economic principle ever conceived points to to the outcome at hand.
Objection, your honor, Leading the witness, mistating the record, etc. No, I didn't say that either. But you're crafting such a fine strawman and piling mistatements up..
In point of fact, I didn't lobby the government to change trade policy, your side did that. We out here in flyover country that are being subverted by your actions in changing trade policy are protesting the result of your actions. That's for starters, so let's get the record straight here.
Next, Tarrifs existed on products from outside of our market in order to keep outsiders from subverting our market by dumping. That would be where - oh - say the chinese come over here and undercut our prices across the board putting millions of workers out of work and causing the economy to collapse turning us into a third world nation that can't mobilize for war to defend ourselves. It's the non-military version of war. See, I know this is tough to follow for you that can't be constrained from profiteering - whatever the cost.. but..
Come on say it. Say you want the government to control the ebb and flow of the market.
Yet another false proposition. I want the government to do the same job Washington did - use tariffs as Washington did to prevent foreign powers from subverting our economy. Real simple. Worked incredibly well right up to the point when you decided that protecting America from such a thing was harmful to you making more money. Right back there again aren't we - where you making greater profits is supposed to be somehow more important than the continued viability of this nation..
"Please Hillary give me Collectivism in the name of fairness to all."
What Washington, Jefferson, et al did up to the time that you free traders changed it wasn't collectivism and doesn't even enter the same realm. But, this is the type of tactic you engage in apparently, which tells us the import of the truth to you as well as your capacity to deal forthrightly. I learned long ago from my grandparents that if you have to lie and decieve to get your way, your motives aren't worth the words you put to them. When you lie to America with this spin in attempt to pull the wool and keep them from protesting your actions, you're well into subversion. And that alone tells me that you know that what you're doing is wrong. Care to actually dialogue insteand of shadow-boxing fraudulent arguments and pretending you've done something?
Quote: (P.S. I'm still waiting for the great Chinese middle class to start buying our products)
They don't need to buy from us when all of our goods are made over there?
Wait another 10 years when their industrial base really starts humming along. They are still young pups.
The .NET experience requirement is a tip-off, that technology is not old enough for most to have 5 years experience, they are trolling just to be able to say they tried to get americans with the experience. They will then lower the requirements and seek employees overseas. In terms of experience, I have experience in all of those arenas, though not 10 years of Java, but 15 years of COBOL, 4-5 years with Java and I teach object oriented C++ at the college level in the evenings. Fortunately, I do not need a job right now, but there are plenty of americans with my experience and more who do.
Havoc
You have made some very fine points and very eloquently said. so true about maddawg. he twisted around everything I said.
I can't compete with that. he is a master.
Signing off for now.
Ok slowly and with feeling:
Your post had: "Unions are a neccessary evil, collective barganing is goodness... a standard mantra of the Socialist movement.
OK, and then I posted: "What is: "Communism works, it just hasn't been tried by the right people, yet." another mantra from the Socialists and then posted:
"I'll stick with "More Myths of Socialism" for 200 Alex
see it is a little play on Jeopardy and...
Oh never mind, it is like trying to explain color to a blind man.
Thank you. Trying my best to keep a level head and stay on point. Clarity is required so that when looked upon later, there'll be no dissent from the opinion that caused these folks to get stretched.. But, I think it would be humorously ironic to stretch them with chinese made rope on a mexican gallows with a high-tech indian throw switch for the trap.. just to show there's no ill.. lol
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