Why are jobs headed overseas?

[southsider2k5]

Could it be our corporate tax rates?

 

http://www.aei.org/publications/pubID.23656/pub_detail.asp

[Rex Kickass]

Or could it be our insistence on paying the working class a living wage?

[AnthraxFan93]

Question.. The country has a huge deficit from the war if we cut revenue from corporations.. who is going to pay the bills? we are

 

Bottom line companies are looking to say cash, and Bush is allowing it to happen.

[Balta1701]

Toyota placed a factory in Canada instead of the U.S. because the health care costs in Canada were dramatically less and the workers are vastly better trained.

[kapkomet]

My commie ass better stay out of this thread.

[NUKE_CLEVELAND]

Add to that outdated and onerous pension programs which are chewing up profits.

 

 

The company pension is going the way of the dinosaur and rightfully so. I say the 401K and IRA are more than sufficient to provide for ones retirement.

[NorthSideSox72]

Add to that outdated and onerous pension programs which are chewing up profits.

The company pension is going the way of the dinosaur and rightfully so.  I say the 401K and IRA are more than sufficient to provide for ones retirement.

 

I agree.

 

And as for why they are going overseas, taxes are usually not the reason. If you look into it carefully, you'll see that even with some fancy shelters, most earnings of US companies gained overseas will get taxed the same anyway. It's the simple fact that costs are often lower in the underdeveloped world. By a LOT, in many cases. Much more differential there than in taxes.

 

But even that will change. Globalization pushes jobs around the world to the cheap places, those places become less cheap, they move elsewhere. Eventually, such huge salary differentials will reduce significantly because economics says they have to (in direct relation to the rate of globalization of industry).

 

If the US wants an edge, they need to produce what others can't as well - intellectual property. We rule the world in creating new stuff - not manufacturing it. Those industrial jobs will continue to go overseas, and trying to protect them with tariffs will get us nothing but more taxes and higher prices for consumer goods.

 

One other thing - an idea. If the U.S. wants to stem the tide in a more "natural" way, do this: make the government act like a business. In this case, that means watching out for your own interests. How? Let companies go overseas all they want. But for every U.S. contract for ANY product, tell US companies that the government will always give preference to companies with the highest employee presence in the US of those competing for the bid. Watch what happens. So many companies rely on US government purchases, that many companies will keep more people here if there is a positive incentive to do so (as opposed to a system of penalties).

[jasonxctf]

a line from the Simpsons a few nites ago gives my sentiment...

 

Marge at a Crate and Barrel knock off... "made in america?? no, thank you!"

 

maybe the auto industry is a bad example but its the only thing in my head right now. how many times have you heard about GM, Ford and Chrysler recalls. Now think how often you've heard of Honda and Toyota recalls.

 

American Craftmanship has gotten pretty damn poor. Partially due to poor assembly, partially due to poor design and engineering. In a global economy, with capitalism everywhere, you've got to earn it to keep it. No free lunches anymore.

[Texsox]

When we are willing to live like workers in Mexico, Hunduras, Sri Lanka, et al then the jobs will return.

[NorthSideSox72]

When we are willing to live like workers in Mexico, Hunduras, Sri Lanka, et al then the jobs will return.

 

Actually, it's a two-way progression. Those countries will, as time goes on and they get good at what they do, expect more money for their services. In this country, as jobs leave and companies tighten belts, costs fall. The two cost levels approach each other until some degree of parity is reached.

 

The wrench in the works though, of course, is that some countries' laws are SO out of whack that the increase in expected revenue has a very low translation to increased pay. But even then, local political forces will likely push up wages when lots of business comes in. It will happen - just more quickly in some countries than others.

[Cerbaho-WG]

You don't need to cut corporate taxes or write a stupid article wondering why we're losing jobs. Companies have the option of using workers who are paid an average of say $15/hr versus $.4/hr. Now what do you think the companies are going to choose?

[Texsox]

You don't need to cut corporate taxes or write a stupid article wondering why we're losing jobs. Companies have the option of using workers who are paid an average of say $15/hr versus $.4/hr. Now what do you think the companies are going to choose?

 

Sadly, the delta isn't that close. Manufacturing workers on this side of the river, on average, make $8-$9 per hour. Real wages, with government mandated and union mandated benefits, on the Mexico side are $6 to $7. But add up thousands of hours a week times 52 weeks and the difference between US/South Texas and 20 miles south in Mexico makes economic sense.

 

Now in some ways this helps us by opening up markets for our intellectual property and eliminates some of the desperation that temps Mexicans to risk their lives coming to the US as illegals.

[Balta1701]

Sadly, the delta isn't that close. Manufacturing workers on this side of the river, on average, make $8-$9 per hour. Real wages, with government mandated and union mandated benefits, on the Mexico side are $6 to $7. But add up thousands of hours a week times 52  weeks and the difference between US/South Texas and 20 miles south in Mexico makes economic sense.

 

Now in some ways this helps us by opening up markets for our intellectual property and eliminates some of the desperation that temps Mexicans to risk their lives coming to the US as illegals.

Um, Tex, with the $.4 an hour, they weren't talking about moving stuff to Mexico, they were talking about genuinely overseas, i.e. to Asia.

[Texsox]

Um, Tex, with the $.4 an hour, they weren't talking about moving stuff to Mexico, they were talking about genuinely overseas, i.e. to Asia.

 

Yes, but my point is, even with a much smaller delta, the jobs are still being moved. You also have to factor in trasportation amd logistic costs.

[southsider2k5]

Interesting article that sort of ties to this...

 

December 2005 set a record of collections for corporate taxes and spending, and somehow we managed to run a small surplus.

 

http://www.breitbart.com/news/2006/01/12/D8F3AUAG7.html

[NUKE_CLEVELAND]

Interesting article that sort of ties to this...

 

December 2005 set a record of collections for corporate taxes and spending, and somehow we managed to run a small surplus.

 

http://www.breitbart.com/news/2006/01/12/D8F3AUAG7.html

 

 

I thought all these tax cuts were making us lose revenues?

 

 

 

ITS A CONSPIRACY!!! THE ILLEGAL, IMMORAL, REACTIONARY BUSH ADMINISTRATION IS COOKING THE BOOKS!!!!

[Texsox]

I thought all these tax cuts were making us lose revenues?

 

ITS A CONSPIRACY!!!  THE ILLEGAL, IMMORAL, REACTIONARY BUSH ADMINISTRATION IS COOKING THE BOOKS!!!!

 

Let's cut taxes 90% and really get things cooking

It's fun being a Republican.

[Rex Kickass]

I thought all these tax cuts were making us lose revenues?

 

ITS A CONSPIRACY!!!  THE ILLEGAL, IMMORAL, REACTIONARY BUSH ADMINISTRATION IS COOKING THE BOOKS!!!!

 

I thought we cut income taxes, not corporate taxes.

[Balta1701]

I thought we cut income taxes, not corporate taxes.

That was the 2nd round of Bush tax cuts, and probably some of the 3rd and 4th also...that was the one a few months after 9/11 where the tax package gave something like $100 million to Enron after they were already bankrupt, etc.

[Rex Kickass]

Ah, Ok.

[Texsox]

By MARTIN CRUTSINGER

AP Economics Writer

 

WASHINGTON

 

The federal government posted the first budget surplus for December in three years as corporate tax payments hit an all-time high, helping offset a record level for spending, the Treasury Department reported Thursday.

 

The department said in its monthly budget report that government receipts surpassed spending by $10.98 billion last month. A year ago, the government ran a deficit of $2.85 billion in December.

 

The improvement reflected the fact that government receipts were up 12.1 percent from a year ago to $241.88 billion while government spending rose by a slower 5.6 percent to $230.9 billion. The figure for outlays still represented an all-time high for spending for any month.

 

Corporate income tax collections totaled a record $73.5 billion last month, surpassing the old record of $72 billion set in September.

 

Even with December's surplus, experts are predicting that the budget deficit for this year could well surge above $400 billion, reflecting increased government spending to help with reconstruction efforts in hurricane-ravaged states along the Gulf Coast.

The largest deficit in dollar terms was an imbalance of $413 billion in 2004. Last year, the deficit narrowed to $377 billion as a surge of tax revenues from an improving economy helped offset rising government spending.

 

President Bush has vowed to cut the deficit in half by 2009 and still preserve the tax cuts he pushed through Congress in his first term.

 

More here

Eventually someone else will pay our bills Bush's legacy will be over a trillion dollars in additional debt. And this is from the fiscally conservative party? :headshake :puke

[Balta1701]

More here

Eventually someone else will pay our bills Bush's legacy will be over a trillion dollars in additional debt. And this is from the fiscally conservative party?  :headshake  :puke

Bush has already compiled well over $2 trillion in debt. At the end of 2000, the debt was something like $5.7 trillion, and it currently stands at $8.1 trillion. Bush's legacy will more likely be something like $3-$4 trillion in additional debt, not 1 trillion. Source.

[NorthSideSox72]

Bush has already compiled well over $2 trillion in debt.  At the end of 2000, the debt was something like $5.7 trillion, and it currently stands at $8.1 trillion.  Bush's legacy will more likely be something like $3-$4 trillion in additional debt, not 1 trillion.  Source.

 

One of the big reasons why I am surprised that more Republicans (or should I call them "rightists") are not more up in arms with the guy. Regarding anything fiscally related, he is as far from being a conservative as Ted Kennedy.

[YASNY]

One of the big reasons why I am surprised that more Republicans (or should I call them "rightists") are not more up in arms with the guy.  Regarding anything fiscally related, he is as far from being a conservative as Ted Kennedy.

 

That is one issue most of the conservatives are in agreement with you.

[southsider2k5]

That is one issue most of the conservatives are in agreement with you.

 

Very in agreement with. Read through the GOP thread if you don't believe me.