How can american corporations compete globally with higher costs?

[slakjaw]

any ideas?

[350HP930]

Better trade policies for one. We need fair trade, not free trade.

The pendulum will naturally swing the other way at some point. Try to regulate it and you end up with bigger government. Some people will never understand.

[350HP930]

Trade and economies have been regulated for hundreds, and in some cases thousands, of years.

Why is it that so many people believe in utopian anarchy which has proven time and time again it does not work?

[island911]

As it is now, our tax structure put us at a disadvantage, globally.

Define "fair trade". You can't - for anyone but yourself. The economic correction we've been in for the last 4 years is in effect bringing inflated salaries down. That's the kind of natural correction that occurs WITHOUT new laws or govt agencies. Some people don't believe in natural ebb and flow and want to overregulate and control when others can take a piss.

[350HP930]

Wow, 'correcting inflated salaries' is a good thing? So much for the labor movement fighting for improved wages for hundreds of years. Yeah, lets just trash those hard fought gains for the benefit of the bottom line of multinational corporations.



Fair trade is easy to define. Adjust tarrifs to reward or penalize a particular country's products based on things like wages, environmental regulations, subsidies and taxes.

What is the good of having child labor laws and minumum wages in this country if they can be undercut by allowing companies to exploit third world countries and their citizens and then ship those items here with a lesser tax burden than what a domestic company would pay to produce the same item domestically.

You can't have your cake and eat it too. Despite the treasonous trade policies of the past several decades the solution is simple. Tax foriegn products appropriatly. For example there is no reason to have any tarrifs on imports from germany but imports from mexico or china would be another story.

Once again, you're proving how little you know about economics. Yes, salary corrctions are a good thing when they are artificially high. It's part of a natural cycle that you cannot micro manage (though some of you cradle to grave-ers think that's best).

You are wrong.

[slakjaw]

Then what is right Mr. Wilson?

so far I like 350`s idea it sounds good to me

Easy quick fixes often sound good and certainly sell well to the general public. The problem is that we pass laws and create govt agencies to manage our way out of short term problems. After the problem is gone, there is an agency with nothing to do but justify it's existence and irritate the hell out of the citizenry. I'm not denying that there are inequities in costs. I'm just saying that it will naturally equalize. In that natural flow, new businesses and opportunities will be created. That's the backbone of what the U.S. is built upon - winning in the face of adversity. It's all about the long game.

And back to Island's point, Our tax structure to support this huge beheamoth govt is the main problem. Some estimate have taxes taking up to 70% of each of our paychecks. That causes everything to cost more and as Island so wisely stated puts us at a global disadvantage.

[350HP930]

Yes, once most americans are making third world wages things will all be evened out.

I think its pretty clear that mark's ideas of what is right and wrong is pretty skewed here.

Its also pretty clear that mark knows little about the history of US economics. For example, in the days before the personal income tax nearly all of the federal government's tax money came from tarrifs on international trade, tarrifs that were meant to protect american interests.

In addition to winning the race to the bottom I guess believing in a bunch of fairy tales about 'winning in the face of adversity cuz we'er americuns' will also save the day.

International trade is the new global warfare and while the rest of the world does its best to get the upper hand our own government is selling us down the river to our international competitors.

The dupes of 'free trade' are just cheerleaders for the idiocy that is US foriegn trade policy. When a nation like china is granted 'most favored nation' trading status right after mowing down thousands of citizens protesting for democracy it certainly shows you what side of worker rights and wages our leaders are on.

[thomschoon]

How can american corporations compete globally with higher costs?

They can when they invest in their people through programs such as Lean Manufacturing/Toyota Production System. It takes guts and intergrity to train your people, give them the opportunity to develop skills, and then allow them a voice in how they do the work so the business can get better.

The outsourcing decisions are usually based on short term benefit versus creating a long term ongoing enterprise ( i think that is actually the responsibility of management). I am sorry to say that I have sent more than a few jobs overseas, all the decisions were made for all of the right reasons, at that moment. Sadly, teaching how to compete globally is not a common topic in many MBA programs. At some point we will need to train tomorrows leaders on how to compete versus following the Walmart/Nike model of finding the latest disadvanted country.

Sorry for the rant

[Moneyguy1]

You are forgetting that many other countries underwrite some things that employers here include in their expense column. Health care is but one of these.

Doctor, if you can come up with new and exciting ways to pay for the military, police, fire, refuse collection, infrastructure maintenance and expansion and the myriad of other necessary functions that government at various levels must provide, I am certain that those supplying these services would be happy to hear.

Many foreign countries depend upon the US of A to maintain a defense umbrella over them, at our expense. If we, as a country, decided not to provide this service, we could reduce the defense budget but at our own peril. I am sure the Pentagon and the defense industry would really go along with THIS idea (sarcasim)

Government expands to fill the voiced and sometimes merely perceived wants of the public. Sometimes what is accomplished is useful, sometimes not. Sometimes divisions within the government are at cross purposes, but this happens mostly at the federal level since the locals cannot run the risk of alienating the public in perpetuity. I offer that local govt is far more responsive and efficient than federal or state. And, for the past three years or so, federal expense and complexity has grown at an alarming rate. Some say due to 9/11. But, all the elements for internal/external protection were there all along. Where has the additional money gone?

The problem of government size and the ability for this country to compete globally is a complex one. There is no magic pill. Provide national health insurance like some European countries. Depend on other countries to defend you. Tax at a higher rate for energy; reducing waste. All ideas, some not practical.

[CamB]

I actually agree with Dr Mark (unusual, I know). It would, if left to its own devices, sort itself out eventually (if the govt left it alone).

Unfortunately, there is some pretty serious short and medium term pain - the US standard of living has to come down, and everywhere else has to come up a bit.

Because of the pain involved, it is politically (and socially) unacceptble, so the govt WILL try and ammeliorate the "problem" with the free (and efficient) market.

[kumma]

how about not paying the ceo's 200 plus million per year, thats a lot of cheese that can be spent on research and development, training, better technology etc... how about being happy with a nominal profit instead of obscene amount of money. after all the waltons arent 5 of the top 10 richest people because they care about there employees. just import crap from china mark it up 5 times and laugh all the way to the bank.

i really dont think its higher costs that put us companies at a disadvantage its their sheer greed and disdain for there own employees that does that.

[304065]

Talk about your broken records, that same kind of protectionist/jealousy crap has been espoused probably since the beginning of socialist labor movements in the 1880s.

How do we compete "globally?" We focus on things that are value-added, like engineering, research and development, etc. Low-tech manufacturing jobs SHOULD be outsourced, except in strategic cases like the Steel industry. Instead, you have cartels that attempt to artificially raise the price of labor.

One thing we're good at (although so are Europeans) is pharmaceutical development. And yet you have members of the Left who think it's OK to allow drug reimportation from countries that have imposed price controls, effectively imposing price controls here. How's that for destroying the value of the pharmaceutical industry!

Say all you want about "greed" and the rest of the looter diatribe. It's an immutable law of the universe that Capital, like water and electricty, flows in the path of least resistance. You can harness it with free trade, and try to let the impact of outsourced production bring improved wages around the world. You might just save a few bucks in the long term on international development assistance if the rest of the world learns to help itself, and has enough value to their own economy that they don't go overthrowing it or crapping on their environment.

Which brings up another point. It is the worst kind of paternalistic garbage to moan about environmental conditions in developing nations, as they attempt to drive economic growth. The history of industrialization is the history of environmental damage, look at the UK, look at the Hudson River Valley, look at Pennyslvania. You cannot possibly expect people to preserve their environment as a pristine playground for you to vacation in, as they try to figure out how the hell to feed themselves and grow their economy above the agricultural/demesne level. If they don't place a value on the impact presently, or to future generations, there is nothing we can do about it, unless you are prepared to levy sanctions or fight a war. And don't give me that "diplomatic pressure" business, when has that EVER worked?

[widebody911]

Originally posted by john_cramer
How do we compete "globally?" We focus on things that are value-added, like engineering, research and development, etc.

Guess what, that's moving offshore, too. If we simplisticly assume the trend continues linearly, the only jobs left here will be telephone sanitizers.

Low-tech manufacturing jobs SHOULD be outsourced

So, with a nation of ~300 million people, you're suggesting they all become pharmaceutical researchers and marketers?


It's an immutable law of the universe that Capital, like water and electricty, flows in the path of least resistance. You can harness it with free trade, and try to let the impact of outsourced production bring improved wages around the world.

It's just that 'around the world' won't include the US.

You cannot possibly expect people to preserve their environment as a pristine playground for you to vacation in, as they try to figure out how the hell to feed themselves and grow their economy above the agricultural/demesne level.

A good chunk of the pollution overseas (and Mexico) American companies setting up shop over there and doing the polluting they can't get away with here. Basically, they're making the same mistakes - or worse - that were made during the US's industrial development, only now they're using processes and chemicals that didn't exist in the 1800s.

[chuckw951]

Originally posted by slakjaw
any ideas?

Government regulation/price controls/trade restrictions?

[chuckw951]

Originally posted by john_cramer
And yet you have members of the Left who think it's OK to allow drug reimportation from countries that have imposed price controls, effectively imposing price controls here. How's that for destroying the value of the pharmaceutical industry!

Reimportation of drugs is the easy way out politically. The issue is government mandated price controls. If that is the solution have the poltical will to pass them in Washington, DC. If they do that they we would also save on roundtrip shipping costs.