Saturday, June 04, 2005

Outsourcing

As I've said before, there must be a balance between labor and the capitalists. If the capitalists have too much power, the workers get exploited. If labor has too much power, nothing gets done.

Currently in America, it's tipped heavily on the side of the capitalists. Capitalists have found an old tool, just with slightly different looks -
outsourcing. What capitalists don't realize is this time, it will come to bite them in the a**, as it already has.

I had my job outsourced to India in 2002. I loved that job, gladly averaging 45 hours a week. In the early days before we went public, I worked around 50-55 hours a week. According to my former boss, my work ethic, my performance, and my jokes to this day are sorely missed there.

We got bought out by some other company and that company's CEO retired, and he got replaced by some hot shot CEO from another company. We literally would have been better managed by a pack of monkeys than this guy, who watched our profits turn to losses as our stock quickly dipped from over $100/share to under a dollar a share.

So we went through three rounds of layoffs as the laid off people had their jobs sent to India. I survived round one and got hit round two.

Before I got that job, I was making x amount of money and spending y amount of money. Afterwards, I made 4x and spent 3.5y. I bought my first new car ever. Money ended up everywhere, in restaurants, barbershops, G-strings, hotels, resorts, clothing places (I had formerly worn hand-me-downs or shopped at Goodwill), etc. A lot of it went to Canada and Mexico too, because I loved visiting our neighbors to the North and to the South.

After getting laid off, I stopped spending. But it wasn't just me, it was everyone else who got their jobs outsourced. The economy crashed and the S&P 500 has yet to recover from what it was five years ago.

I now make 2x and spent y, so money no longer goes into local people's pockets. It's not that I'm now cheap, it's because I fear it happening again and we want to have a safety net. I no longer invest in stock, so it's hurting the stock market as well (the capitalists).

As for those outsourced jobs, they spend money in their own country. They pay their mortgages or rent there. They buy their food from there. They buy local clothing, etc. It does not help us in any way and people who say outsourcing benefits us are either misled idealists or plain out liars. Every time Lou Dobbs has debated pro-outsourcing people, he has shown again and again that they have no facts to back up their beliefs. Dobbs has facts to prove outsourcing stinks. The best they can do is say the benefits will come. When?

The point I'm trying to make here is not only does outsourcing not benefit us, it hurts you as well. If you're a restaurant owner, I'm no longer your customer. If you were my waiter or waitress, I was the guy who tipped you 20% for average service and 25% for good service. If you were my barber, not anymore. Mrs. Zombieslayer now cuts my hair. I no longer have a masseuse. I vacation locally now. It's back to hand-me-downs and Goodwill for clothes. General Motor's and Ford's performance for the past few years is proof that nobody is buying new cars anymore.

I shop at garage sales for clothes and furniture instead of buying new stuff now. We used to buy lots of books, but now bug the local librarian to purchase such and such book if the library doesn't have it, so it affects authors and publishing houses as well. I also pay substantially less in taxes than I did when I made money. Hint hint to any government guy reading this. And believe me, it's not just me. I'm using me as an example of many good, hard-working folks who got laid off and are currently underemployed.

Oh, and don't worry about us. We're doing fine financially. We're still on track to get that anti-zombie compound built within a few years. I'm not b*tching, I'm just saying that I spend considerably less and because of this, we're not helping the economy like we used to. And by us not spending, it's hurting you (if you're a North American).

There is a solution though and it's very simple. Tax outsourcing. Tax it enough that the government will get its lost revenue and some of us will get the good jobs again. The US is in heavy debt. People are making less money so they're paying less tax. It's so simple, even a guy like me with only high school economics could figure this out.

9 Comments:

Blogger Laura said...

Totally agree with you here. Something has to be done to balance this out. It's ridiculous. There's also the issue of the human rights concerns in those sweatshops. Ever wonder why we outsource to countries with military/autocratic regimes? They don't allow labor organizing and that's just fine with Nike et al.

It is SO hard to find products made in the USA, though I try. I don't mind paying a little extra, though I think that there should be a cap on the markups too. If Nike or Reebok can make a sneaker for $5, they should not be able to turn around and sell said sneaker for $105 (or whatever they're goin for now) without passing on some more wages to the workers or passing on the savings for that cheap labor on to their consumers.

**sigh**

But it's good to hear the anti-Zombie compound plans are on schedule. ;-)

6/04/2005 4:57 AM  
Blogger Notta Wallflower said...

I totally agree with your post. I don't pay as much attention as Laura does about products made in USA - especially cars. I will go out of my way to not buy an American car because I get burned every time. :-/ Usually the most I've thought about outsourcing is how irritated I get when I have to call customer service and get someone who can barely speak English. I think what is scary is that most Americans will continue to spend as if they have a job or purchase things on credit. I know that bankruptcy laws have changed, but how many more bankruptcies will we have as a result of outsourcing?

6/04/2005 6:57 AM  
Blogger tshsmom said...

Excellent post ZS! Your spending habits sound identical to our household.
I'm with you on the Nike thing, Laura! Nike is the example I always use when discussing outsourcing. They used to pay an American living wage to produce their product, and are now paying sweatshop wages (probably $20/month). Then Nike has the gall to raise the price on their product! I haven't bought a Nike product since this happened.
I'm sure it isn't bothering them any, but it makes ME feel better.

6/04/2005 10:43 AM  
Blogger Bridget Jones said...

Totally frickin agree with you, ZS. There was a thing in the automotive world years back called 'local content legislation', where whatever was sold, in this case cars/trucks, had to have a certain content (60%) minimum made in NA.

About time to bring that back. I've advocated it here too. Multinationals hate it (which to this child of the 60s means that it's good).

Very sorry for your circumstances, extremely glad that you're managing...I'll be with you soon I think (taking a penalty for retiring early head over heels in debt).

Bridg

6/04/2005 11:04 AM  
Blogger Ben said...

my dad lost his job to outsourcing too, I know how you feel. We were lucky to survive.

6/04/2005 12:57 PM  
Blogger The Zombieslayer said...

Some seriously intelligent responses here. Thanks all.

Ben - hope your Dad's doing okay. We had a rough few years afterwards but are now on our way to doing pretty well again, although not making as much as before. But I know a lot of good folks who have never recovered from having their jobs outsourced.

6/04/2005 7:14 PM  
Blogger Ben said...

Zombie- yea he is fine and so is our family, he is now working to make cops lives easier, as opposed to helping out uppity real estate people.

6/04/2005 10:20 PM  
Blogger Jason said...

Yeah, this is one of those cases where America has to protect its own interests. I'd never outright ban outsourcing, but not only would I tax companies that do it, I'd put the heat on these other countries to have reciprocal agreements on tariffs, etc.

6/05/2005 10:46 AM  
Blogger savage said...

It is so weird that this happened to me. When I was "the computer guy," it was one thing, word-of-mouth was powerful advertising. But I killed that gig and made sure that it stayed dead.
But I was a programmer since jr. high. And my hobby finally became my job (actually several jobs) -- mostly, as a computer consultant, I avoided web publishing, because I thought -- still do -- that if a person is going to have an online presence -- website -- he/she should create it him/her self -- anyway I finally became a regular full-time programmer.
I was apparently good at it but was eventually outsourced on one project (my own original project this is) and my second project (that I picked up from an incompetant -- and mia -- coworker) eventually made 0x and I couldn't even live on 0x and so I had to threaten to sue to even get 1/2 of what I would have earned had I spent 40 hours a week (I always work way more than that, ask ZS -- all programmers worth their salt ALWAYS work over 40 hrs/week) ... and of course if you blackmail (threatening to sue) your employer, you lose your job.
It was weird and I intend to soon discuss the subject in person with ZS -- I was actually working for a company that employed mainly Indian people -- they lived and worked here and had work visas. I think ZS is against this particular type of immigration ... I'm not sure, but I think he said something like that to me once.
-r
PS:
I had to put up with weird mind-shit from my boss. He'd do this weird shit. He'd compliment me then he'd insult me. My ego isn't that week that I need positive attention from this guy. But I don't take unfounded insults well. (again, ask ZS.)
-=-

6/21/2005 8:43 AM  

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