Large corporations are killing jobs faster than you can send them abroad
Greed. Plain and simple, greed is what is killing the American Dream.
Allow me to attempt to explain.
Lets say Billy Bob has a little company in say Kentucky, 20 people, a manufacturing plant, two trucks, a small warehouse and 20 customers that buy his products. Billy Bob sells, oh, I guess Titanium wool socks for hunting (don't laugh, I have two pair) and sells enough socks to keep his little company growing 15% every year and shares his successes with his employees by bonuses. His employees live in the same town as the plant and so on.
Lets say Billy Bob is a good business owner and puts half of his growth back in the business and buys more trucks, maybe hires another employee, pays his employees a fair wage yada yada blah blah blah...
So after several years of constant growth, decides he wants more (nothing wrong with that, right???) so he sells his small company to Company X and walks away from his baby with a very small fortune in his hands. His employees are left to fend for themselves. He will probably build a house way too large, buy expensive European cars and probably die of congestive heart failure at 55 years old because he didn't even mow his own lawn.
So what happens to the "small" business? Well the huge publicly traded company now mass produces his socks in a factory in Ohio by robotic equipment and it requires only five people to run the line. These are minimum wage button pushers barely making enough to keep the lights on and have to commute 1 hour each way because they cannot afford to live in the same city as the plant.
The company raises the profit margin on the product two ways, it's cheaper to make them, and the worldwide advertising allows a higher retail price, meanwhile 20 good paying jobs, a local business that bought raw materials locally, shipping companies, local taxes, not to mention the pride of working for a local icon, are all erased in a small percentage of the time it took to build it. Leaving a small hole in small town USA.
Where do we go from here? How do we slow this down?
Having been a small business owner and being the son of a small business owner, then working for one of the largest publicly traded companies in the world, I can tell you without a shadow of a doubt, this is what is killing America.
Not looking to save the world here. All I ask is that you think before you buy.... Try NOT to shop at a business that has more than two stores once a week. Even if you don't think so, if every person in every state in the Union did this, the jobs discussion would not exist.
Support your local small businesses. They will thank you for it.
I'm not a smart man, I have worked hard for everything I have, will probably die with very little and am OK with that.
Buy only what you need
That is all.....
If a day goes by and you have learned nothing, I hope you got a lot of sleep.
In ascertaining the cause of the GOP’s critical condition, let us use Occam’s razor – the principle that the simplest explanation is often the right one.
Would the GOP wipeout in those heavily Catholic, ethnic, socially conservative, blue-collar bastions of Pennsylvania, Michigan, Ohio and Illinois, which Richard Nixon and Ronald Reagan swept, have anything to do with the fact that the United States since 2000 has lost 6 million manufacturing jobs and 55,000 factories?
Where did all those jobs and factories go? We know where.
They were outsourced. And in the deindustrialization of America, the Republican Party has been a culpable co-conspirator.
Unlike family patriarch Sen. Prescott Bush, who voted with Barry Goldwater and Strom Thurmond against JFK’s free-trade deal, Bush I and II pumped for NAFTA, GATT the WTO and opening America’s borders to all goods made by our new friends in the People’s Republic of China.
Swiftly, U.S. multinationals shut factories here, laid off workers, outsourced production to Asia and China, and brought their finished goods back, tax-free, to sell in the U.S.A.
Profits soared, as did the salaries of the outsourcing executives.
And their former workers? They headed for the service sector, along with their wives, to keep up on the mortgage payment, keep the kids in Catholic school and pay for the health insurance the family had lost.
Tuesday, these ex-Reagan Democrats came out to vote against some guy from Bain Capital they had been told in ads all summer was a big-time outsourcer who wrote in 2008, “Let Detroit Go Bankrupt!”
Yes, the simplest explanation is often the right one.
You need to look at the bigger picture, stop looking at the blame game.
Economic growth is heavily related to population growth.
I will give a simplistic example, housing stock, if every body lives in a house, then there is no need to build more houses, In this case when one house is built, then another one is destroyed, but this housing stock has many generations of life. It could be said that the housing stock valve does not change in real term. With population growth, more housing stock is required, more direct and indirect employment, increased stock turnover and inflation (not always a bad thing if kept under control), increasing borrowing and free money in the market to be spent.
The increased internal spending, allowing for increased local investment, and normally productivity, which then aids in export and the introduction of foreign capital. As the population rate drops, return on investment drops, and investors then look further a field for there returns. The USA great wealth came from the transfer of wealth and population form countries who were at that time more advance in the cycle. This is some what exaggerated where high standards are the norm. So china has very high population but low standards that are increasing, and there is a transfer of wealth, from the USA to China.
As far a trade and tariffs, you limit imports, then you should expect that your own exports should also be limited to other countries. You can no longer rely on your expertise in manufacturing, (as in the past) as many countries have modernized to at least an equal level in production techniques.
It would seem many fear Islam, this may be right or wrong, but they are taking over, not because of war, terrorism only because the breed at high rate (population growth)
Have a look at times of population growth, then look at economic growth or so called good times. It marries up quite nicely.
I have to agree with GT JETS, 15% profit margins used to be excellent. Then something happen, Wall Street seemed to adopt the motto that "greed is good" for the country and everyone bought into it. 15% profits were under acheiving. People wanted 30%-35% and more which I don't blame them but at what cost. Well the cost is a week economy. Sure Wall Street is doing great again but that's about it. There's no magic formula to a strong nation economy. They are made up of strong local economies. I'm not saying imports are bad, but when you import everything..... The USA stamped on a product used to mean something, it used to mean quality and durabilty. For the most part everything coming from China is subpar, flimsy garbag, but it's cheap! and yeilds a high return.
The big box chain stores like the Walmarts and Home Depots are killing local economies, driving the mom & pop stores out of business who had a vested interest in the community to begin with.
I don't remember a corporation making me buy anything. Maybe it is the consumers fault for never giving a ratsass. Maybe if everyone was responsible and lived in their means instead of paying 300k for a glorified manufactured house, renting a big screen, and a 40k vehicle just to feel like something on their 30k income.
Like GT jets says though buy what you need, buy American. It is hard for me to comepletely vilianize something we made.
You hit the nail on the head, but let me take it one step further. We, as consumers, are also contributing to our downfall. We all bad mouth walmart because of all the products they import from china,etc....
Originally Posted by GT Jets
And we all declare that corporations like walmart are putting the small businesses under, etc...
But we as Americans are always looking to pay the cheapest price we can.
Corporations like walmart are killing us but they always seem to be full of shoppers.
While I agree with you, part of the reason many are shopping cheaper is due to the face that when inflation is taken into account the average American makes less than they did in the sixties.
Originally Posted by ncboston
The other reason many are shopping cheaper is because in a lot of towns walmart is all we have. Even if you do find a store other than walmart they likely have the same products from overseas trying to compete.
Profit margins vary widely by industry. You don't just state a number that works for everyone. For example, in the 70s and early 80s the auto parts industry required retail sales at 30% margins to stay alive. Depends on many factors like how inventory heavy your business is and how many slow movers you need to reasonably stock.
I agree that Republicans are complicit with regards to the outsourcing of jobs, but if the liberal unions had not caused American labor to be way overpriced with regards to the rest of the world THERE WOULD BE NO REASON TO LEAVE. Regardless of things like NAFTA.
Don't get me wrong, I don't exactly consider unions a bad thing. It is simply that we don't appear to know when to rein them in.
We see that sort of thing often, which is one of the reasons I said to Robo the other day that the path to hell is paved with good intentions. Good intentions has led us to the current situation of idiot litigation in the US, where doctors can't afford to be human beings and we need to label cups of coffee with warnings that they are hot.
Look at any unit that you're installing today that has a fan. There will be a sticker on it warning you to not stick your hand in there.
Unless this ridiculous pandering to the world's morons stops, this ride to oblivion is far from over. America will be service oriented from now on, because of world conundrum. We want fair wages and employee rights, not a bad thing, but unless we can convince the rest of the world to follow suit, then what is right and good will continue to be a detriment to the USA.
"Social networking" is an oxymoron.
I agree somewhat, the problem with not pandering to morons is lawsuits....if companies were to take those stickers off they would go bankrupt in no time.
Originally Posted by scrogdog
When it comes to wages, we got ourselves in a pickle....inflation is way above wages, which should be great for companies....enter cheap imports.
Are you picking on all of us illegal immigrants in Ohio?
Originally Posted by GT Jets
A few books that bear on this topic:
A People's History of the United States by Howard Zinn
Confessions of an Economic Hit Man by John Perkins
Monsoon: The Indian Ocean and the Future of American Power by Robert D. Kaplan
Why Your World Is About to Get a Whole Lot Smaller: Oil and the End of Globalization by Jeff Rubin
The Jungle by Upton Sinclair
No one forces anyone to go into those large stores.
Originally Posted by GT Jets
Look in a free society prices are determined not by a popular vote but by demand and competition.
Any deviation from those principles has a negative effect.
Simply put, we can't have it both ways. We can't have a strong economy, high wages, low taxes, high standard of life, good healthcare, good schools, and expect to pay the absolute bare minimum for everything from general household items to luxury items.
It's called champagne taste on a beer budget. America has been this way at least since the end of the 2nd world war, and it's only fueled by a growing sense of entitlement and exceptionalism.
The concept of economic entropy barbar refers to is a reality in a world where the population is increasing exponentially. There is only so much raw material, and in america, even fewer people willing to work to cultivate it into new wealth and economic equity.
Islam is the fastest growing religion in the world for one reason and one reason only; muslims are breeding at a faster rate than other groups. It's not by voluntary conversion as Islamic apologists would suggest.
The key to happiness is lower expectations.