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America's People Can't Have Jobs Because They're People

by destor23 1/25/2012 - 6:20 pm   |

Today, in my purely masochistic Thomas Friedman reading ritual, I followed a link to a long (and well written) article called "Apple, America and a Squeezed Middle Class," that I recommend to you because of the truth that it quietly reveals:

Outsourcing is less about finding skills that don't exist in America anymore than it is about finding depravities that are no longer tolerated by Americans.  Oh, yes, the many Apple executives and industry observers quoted in the article do make some claims about the vast number of engineers available for work in China, but what Apple's executive really love is the "flexibility" of the factories that they can employ in China and other low wage markets dominated by companies like Foxconn.

"A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day."

The workers live in dorms.  They can be woken up and sent to the line at any time by management.  They make, the article later reveals, an average $17 a day.  They also recreate on their factory campuses, smoking and drinking tea in Foxconn sanctioned (or owned, it isn't clear) tea houses.

If these workers were food animals in the U.S. they wouldn't qualify as certified organic.  They certainly aren't free range.  It's hard to tell if these people are free at all.  When does somebody working a 12 hour shift, six days a week, living with co-workers and at the beck and call of their managers even while sleeping, find time for personal pursuits.  The answer, of course, is that they don't and U.S. outsourcer would probably file "personal pursuits" under "first world problems" and dismiss the issue entirely.

Does the U.S. lack qualified engineers for much of what it needs?  Undoubtedly.  But it seems a different question than what American-based companies are really asking.  Americans who pursue costly and difficult to obtain engineering degrees do not envision themselves putting those skills to work in small component manufacturing operations.  They do not think the reward for their efforts will be corporate communal living where their employer's "central kitchen cooks an average of three tons of pork and 13 tons of rice a day."

It's not so much qualified engineers that these companies are hungry for so much as it is cheap technology workers who lack better options.  The claim that America lacks the talent would hold a lot more water if U.S. companies were outsourcing to China for design and concept.  That could well happen some day.  There's nothing so special about "American creativity," that can't be matched by a well educated person anywhere in the world who hasn't been herded into a dormitory and forced to eat at the company store.

 

“They could hire 3,000 people overnight,” said Jennifer Rigoni, who was Apple’s worldwide supply demand manager until 2010, but declined to discuss specifics of her work. “What U.S. plant can find 3,000 people overnight and convince them to live in dorms?”

Indeed.  Is it laziness that motivates the American worker to want to spend a reasonable time of the day in toil, a reasonable time in uninterrupted sleep, a reasonable time on personal pursuits and a reasonable time with their loved ones?  Or is it dignity?

Apple doesn't want to do business where thousands of people can't be mobilized in the middle of the night with nothing but a cup of tea, a biscuit and marching orders.  But Apple relies on the U.S. government, its diplomatic apparatus and its military, to make it possible for it to trade internationally, to protect its intellectual property and to ensure that it is not on its own in a world of dictators and rogue states.  The American people pay for that.

Last time I wrote about this, some people got mad at me for suggesting that American firms, who desperately want access to American consumers and who depend on America's military power to be able to operate internationally in the first place could be banned from manufacturing in markets where workers are allowed to be treated like animals by companies like Foxconn.  In any event, propping up China's oppressive government by sending money their way doesn't make any sense from a human rights perspective.  But, if you don't like just outright banning, how about this:

You go manufacture in this manner, it's your right.  But you're on your own.  The U.S. Navy will not help if your shipments are ripped off by pirates.  The State Department will not intervene if the Chinese manufacturer you hire steals your designs and undercuts you with cheap knock-offs.  If you want to do business in a post human rights world, learn to take care of yourself.  That would teach some lessons real fast.

 

Apple has $100 billion in cash to use.  It doesn't need slaves in dorms and the drum from Ben-Hur as a prerequisite to doing well.  

The people who made these decisions have spent too much time as latter day, seitan-eating Masters of the Universe, Silicon Valley-style.  Apple could make iPhones in Michigan and cut their price, and it would do just fine.  Hell, Apple could make them in Bermuda and Manhattan and it would do ok.

I think that article is a call to public action.  I am glad Obama raised the question of when corporate leaders are going to bring jobs back stateside.  Apple needs to answer it.

by Articleman 1/25/2012 - 6:30 pm

holy mackerel. this is the kind of dagblog i had longed for - stories on sports, business, technology AND politics - plus, how could a little comment catfight between genghis and articleman not get me back reading. nice job fellas on some interesting posts lately. 

I do want to comment on this piece - so many things to say, so little time to say it. I'll try to be a bit more specific with my complaints but the best way to sum up my issue with this well-argued piece is to say what I often find is so frustrating with this blog: Everybody sees things in black and white, when so much of this world is colored in gray. 

1) Apple would do OK if forced to use higher-wage mfg plants in this country but NOWHERE near as well as they are doing now. The stock would be hammered - in an attempt to keep profit margins reasonable, they would likely have to slash costs elsewhere, so higher-paying engineering/design/marketing jobs in this country would likely be lost. 

2) Most companies - and make no mistake, Apple is only doing what almost every other technology company in this country does - couldn't afford to move their manufacturing stateside and make a profit, because they don't make products which can get the kind of premium Apple products do. Instead, the winners would just be the foreign technology companies - Samsung, HTE, etc etc - that feel free to use the low-cost labor elsewhere. Again, end result, more jobs lost here. Just be thankful that a lot of the most creative, innovative best-designed products still get thought of here. We'll be in real trouble should that ever change (thus the importance of high levels of continued educational investment)

3) Our standard of living decently is much different than they are in emerging markets around the world, and I personally don't think we should impose our standards in those countries. Sure, rates of suicide and depression are high in Foxconn, but for a lot of people, the pay and conditions of that type of job are infinitely better than they would otherwise be should American technology companies decide to pack up en masse and leave. 

This is how the process of industrialization has worked since industrialization and globalization began - a country mired in poverty with a purely subsistence economy starts making shit instead of just crops. most of its citizens still live a shitty life, under horrible conditions, but gradually, slowly, the standard of living begins to rise, and workers start getting more rights, even start to unionize, and the standards of living rise even more. It's a virtuous cycle, and I have a lot of confidence that barring a political dustup (always possible in a communist-ruled country like China) this is the way things will turn out there. Eventually (its already happening to a very small extent), Chinese companies will begin to outsource some of their manufacturing to lower-wage regions (Africa) and the process will begin again. 

4) I do think it's reasonable that America insist that its manufacturing partners and facilities overseas do abide by a certain minimum level of decency - no child labor, no physical abuse, etc. etc. Otherwise it'd be like us sending prisoners of war overseas to have them tortured because we don't agree to that sort of thing (Oh wait ...). But here's the thing: We already do this - whether we enforce it well enough is another issue - but American companies do insist on minimum standards which are generally greater than those in the host country. And companies which are found to be lacking in this area - Nike, Kathy Lee Gifford - often get destroyed by the rightly indignant American consumer

I haven't argued this perfectly or completely as Im in a rush but that should start a healthy debate at least. 

by Deadman 1/26/2012 - 11:30 am (re: Articleman)

Good points, and while we're considering the "other side", I wonder what would happen if we did have to pay these employees a wage we'd consider reasonable here in the United States. As you say in your first point, Apple could most likely still survive if they did so, but would this cause a tipping point to be reached where it becomes cheaper to replace more of those jobs with robots/automation? That's not necessarily a bad thing, but something to consider, especially considering your third point.

Edit to add: I still don't like the way Apple's treating their overseas workers.

by Verified Atheist 1/26/2012 - 12:19 pm (re: Deadman)

These are really good points by both of you and, of course, there is another side to this.  I want to deal a bit with Deadman's "virtuous cycle" and a little bit with the point of life.

Deadman's right that if Apple brought all of its manufacturing to first world countries and paid everybody a wage where they could live in homes, instead of dorms, and eat meals instead of "tea and biscuits" and have families and have the freedoms that allowed people like Steve Jobs to build computers in a garage in the 70s, that it would be immediately undercut by overseas competitors who would flood the U.S. markets with much cheaper smartphones, tables and computers.

If we let those oversea manufacturers do that.  We don't have to.  But stopping them would mean having a broad public consensus that the "virtuous cycle" isn't really virtuous.  It is, in some respects, a cycle of exploitation.  Foxconn will herd Chinese workers into dormitories and force them to work through the night until those workers just won't do it anymore.  This can take generations.  How many individual lives will be ruined?  If the only answer is, "it beats starving at the farm," I'm afraid that's not much of an answer.  If the answer is, "Soon, Foxconn or some company like it, will go to Africa to find even cheaper labor," I'm not sure I like that either. It's way too "misery's the river of the world," for me.

The cycle of exploitative labor arrangements is how we've figured out how to alleviate extreme global poverty.  But it's an inefficient and heartless system.  We need an alternative.  But that can only come from people having standards and allowing the government to better regulate the global market place to stop exploitation from happening in the first place.

 

by destor23 1/26/2012 - 12:50 pm (re: Verified Atheist)

Again, eloquently argued, destor. of course, to me, 'it beats starving at the farm' is exactly the answer.

without a globalized economy with somewhat open borders, the same process would take place within china - just as it happened in the US, the UK and most other developed nations, it would just take a hell of a lot longer to get from what was (agrarian-based economy mired in abject poverty with nearly everybody in china living a subsistence-based lifestyle) to what is now (a mixed, rapidly industrializing and urbanizing economy still mired in poverty with the majority of chinese living a subsistence-based lifestyle with some doing worse but with not an insignificant number doing better) to what will be (an economy like ours, but probably a lot more kick ass) - Again this analysis ignores any potential political disruptions. 

You can very fairly argue in my opinion that Apple and other major outsourcerers are actually helping foreign citizens by speeding this process along and generally insisting on labor standards that exceed those that currently exist in the host countries. they are only doing it due to the profit motive, but a lot of good things happen because of adam smith's unseen hand, especially in the early days during a country's development. 

you could also very fairly argue that perhaps these companies should be more worried about the citizenry within the country where they are headquartered, but that's a whole other ball of waxy discussion, imo. 

by Deadman 1/26/2012 - 2:58 pm (re: destor23)

 I never did like how Nike treated its overseas workers since it packed its manufacturing component and took it offshore. I have been boycotting Nike shoes for more than fifteen years. I think I [along with about twenty other diehards] am just about to turn this outsourcing thing around. I only use this Chinese built computer so that I can tell you about it. 

by Anonymous LULU (not verified) 1/26/2012 - 1:00 pm (re: Verified Atheist)

love this! laugh

by Deadman 1/26/2012 - 2:59 pm (re: Anonymous LULU)

I might add something which is mentioned in the original Times' article but which many commenters are conveniently ignoring: like a lot of big firms these days, Apple's customers are international, not just American. (And no, I don't know the percentages, but I have seen the photos of the commotion in Beijing when Chinese Apple junkies can't get their new Apple doohingie as soon as it comes out.)

A lot of us still have this kind of imperialist attitude, coming, I think, from the end of WWII, when we were the main victors left without damage to our infrastructure and therefore got a jump on the rebuilding business. Like we are the only ones who can make the good stuff and that's the natural state of things where if they want good stuff they have to buy it from our workers, and their workers are only permitted to make the junk.

I will just point to what many auto companies have been doing for quite some time: they set up plants in the countries where they want to sell the autos, and you don't hear much complaining from Americans when cars are assembled by American workers by mostly Japanese companies Leaving the whole outsourcing to cheaper labor issue out of it, with the world's energy future in question, shipping stuff from a single manufacturing location to the rest of the world, and importing supplies to that single location to manufacture there, isn't the wisest decision for many big businesses.

by artappraiser 1/26/2012 - 12:59 pm (re: Deadman)

very good point about apple's customers not just being americans - their business in china has exploded - now 16% of the cos entire revenue (vs 2% only two years ago) - a fact almost certainly influenced by the dramatic economic rise in that country, a fact almost certainly influenced by the dramatic increase in foreign investment in that country,

and you're right about auto companies, tho it's a lot cheaper to ship phones than it is cars. 

by Deadman 1/26/2012 - 3:03 pm (re: artappraiser)

One of the most cohesive and comprehensive compilations on this subject I've read. (And I am a Friedman fan!)

Perhaps I haven't been paying close enough attention or sought more awareness of the facts you report.  However, I cannot recall any MSM entity bringing this to the forefront of their audiences the way it needs to be published.

I wouldn't purchase an Apple product that was made in China.  But, Apple certainly has, 'if you build it, they will buy it' benefit.  Yet, if the facts that you presented were well known by the populace, do you think it would negatively impact their sales to any meaningful degree?  I'm not sure.

Please, post more on other entities that are utilizing the same practice and/or if you know, please inform what resources we can access that will give us this type of data.

Appreciate.

 

by Aunt Sam 1/25/2012 - 7:10 pm

Excellent piece Destor, you left out the little gem in Friedman's piece:

Yes, new technology has been eating jobs forever, and always will. As they say, if horses could have voted, there never would have been cars....

I never heard anyone ever talk about horses voting, is he referring to some new twist on the scourge of voter fraud? Friedman is comparing people to horses? If so, it goes along with his usual 'view from the $10 million dollar home and huge fortune I married into' patrician 'I got mine' perspective.

It is ironic that the most stellar symbol and embodiment of American free enterprise entrepreneurship, Apple, would find a communist country and its workers the ideal place for the rubber to meet the road in production.

Frankly, although I have never bought an Apple technology toy, if I wanted to I could wait a week or a month for a US made product.  Apparently the market scoop on Americans is they want their stuff now, or even yesterday.

 

 

by NCD 1/25/2012 - 7:37 pm

I did notice that, too.  Pure backward Friedman.  If horses could vote, they'd be all for cars.  You think horses want to spend their lives carrying people on their backs, sometimes to war?  Or pulling wagons, sometimes through deserts?  Of course not.  Horses would be all for technologies that would free them to graze the fields, hang out by streams and swat flies with their tails.

Which is supposed to be the point of technology -- it's meant to increase leisure time, not to increase the likelihood that we'll all be penned up in some dormitory by evil Foxconn managers.  Technology is supposed to alleviate the need for wages, not exacerbate the need, while at the same time driving wages lower.

by destor23 1/25/2012 - 9:08 pm (re: NCD)

HAHa! How true. Friedman has likely never done a days physical labor in his life. His only relation to horses is when you look at the equines from behind.

by NCD 1/25/2012 - 9:34 pm (re: destor23)

Think Jetsons...

Which is supposed to be the point of technology -- it's meant to increase leisure time, not to increase the likelihood that we'll all be penned up in some dormitory by evil Foxconn managers.  Technology is supposed to alleviate the need for wages, not exacerbate the need, while at the same time driving wages lower.

...cause only a few people OWN the technology and taken all those benefits for themselves.

by Peter Schwartz 1/26/2012 - 2:17 pm (re: destor23)

This would be true IF the horses got to ride in the cars. Or better, drive them.

But if all it meant was that horses could no longer earn their keep, then the car would've been bad news.

It would be an interesting bit of trivia to find out if there were more horses back then when they were used for utilitarian purposes than there are now.

If so, then the car has also led to the dying out of this noble species (or is it genus or family, I can never remember). At least the human being per se hasn't become obsolete. Yet.

by Peter Schwartz 1/27/2012 - 10:24 am (re: destor23)

Outsourcing is less about finding skills that don't exist in America anymore than it is about finding depravities that are no longer tolerated by Americans.

Depravity is a managerial skill.

by Dan Kervick 1/25/2012 - 8:28 pm

Where's DD with that award?

by Verified Atheist 1/25/2012 - 8:39 pm (re: Dan Kervick)

Oh another nap!

I tell ya what though, I am so struck by the entire blog that:

I hereby render unto Destor (as if he needs it) the Dayly Blog of the Day Award for this here Dagblog Site given to all of him from all of me.

Here is another line that grabs me:

Outsourcing is less about finding skills that don't exist in America anymore than it is about finding depravities that are no longer tolerated by Americans. 

I heard something about these goings on some time ago and I think I did what a lot of folks did; I erased it somehow.

Like Apple and computers and slavery.

This is one hell of a blog period.

And I shall not forget.

by Richard Day 1/25/2012 - 9:28 pm (re: Verified Atheist)

This line hit me, too--but I wonder if it's entirely true.

Perhaps by now, there are skills our workers are missing.

by Peter Schwartz 1/27/2012 - 10:30 am (re: Richard Day)

Yeah, I think I read about this in business school; Depravity 102

What in the hell is the matter with us?

Us being Americans; us being human beings?

by Richard Day 1/25/2012 - 9:37 pm (re: Dan Kervick)

Just published:

Poll Finds Consumer Confusion on Where Apple Devices Are Made, by Marjorie Connelly, New York Times

by artappraiser 1/25/2012 - 9:32 pm

Thanks, Double A.  Looking at my iPhone right now and it says "Designed by Apple in California.  Assembled in China."  Which is a tad confusing.  Almost as if Apple is trying to say, "Don't worry, the good jobs you want for your kids are still here in Cupertino."

Love to see how hot shot Apple's designers would be if I got to wake them up at midnight whenever I wanted to shove them onto an assembly line.

by destor23 1/26/2012 - 10:10 am (re: artappraiser)

Great post, Destor. I am not an Apple devote and any light which is shed on this company's shameless outsourcing of jobs is a good thing. The company is sitting on $100B in cash, equivalent to a big chunk of the S&P. 

Apple has the resources to do something really innovative in training and assembly in America---obviously outside California.

Small companies like mine have a difficult time hiring good people. My model can support up to two times minimum wage as the base rate. I try to be fair and people get a lot of overtime which raises their  base compensation substantially. I pay overtime by the day when I am not required to do that. This means if the person can complete the job in three long days he can make more money than straight time forty hours a week---and I'm o.k. with that. That's what a successful small business does when they want to keep their good employees. Good employees are hard to find, simple as that. I can tell you horror story after horror story. 

We worked quite a bit in Arkansas. I think the whole state is on drugs. Many of our assembly oriented clients had turnover rates of 20 and 30%. It got to be comical. They found one illegal who had a stolen SS# and he was holding down three separate jobs using the same number. One time one of my workers was late to breakfast at a motel, I went up to his room and two waitresses from the night before stumbled out of his room. One guy disappeared and by the time I canceled his credit card he'd taken his relatives to both Disneyland and Universal Studio, plus some liquor charges at a convenience store. 

Maybe I was too trusting with the credit cards. But I found that a card with a $1K limit was a lot better than getting a call from a motel operator in Georgia in the middle of the night because the worker had spent his cash advance on something else.

I hate to sound like a Republican but there is a great swath of folks out there who are unreliable and even dangerous, to hire. As I posted sometime before, the solution to much of our unemployment problem is another WPA, in conjunction with a rehab program.  A large company like Apple could mount a respectable assembly operation somewhere with high employment. I think it is their responsibility to do so, particularly since they are sitting on more cash than they can conceivably employ. A small company like mine cannot afford to run a rehab program but I can tell you that on many days I feel like I am running a YMCA rather than a resource recovery company. 
 

by Oxy Mora 1/26/2012 - 11:29 am

It's not P.C. to tell such anecdotes on a left-of-center political site. You are deviating from the early-20th-century heroic labor narrative. What do you think this is, a private chat room for business people with left of center leanings so they can feel comfortable talking about reality?

devil

by artappraiser 1/26/2012 - 1:06 pm (re: Oxy Mora)

I was just thinking about how to thank Oxy for this perspective.  Of course it's very easy to paint everyone with a job as some sort of heroic self-sacrificer.  Oxy's in a real business, I'm not.  He knows what it takes to get competent workers at a scale he can pay and it's hard.  He's also, by any account, a good employer.

I don't much like the notion of a national rehab-to-work program, though.  I don't think that major companies should be influencing people's lives and behaviors that way.  I don't believe that our national ethos should serve the needs of Apple.

The other, I guess the slightly harsh thing I could say is that there are probably better workers out there who either don't want to live where Oxy does or don't want to work for what Oxy can afford to pay.  So Oxy winds up with a few substandard employees for the same reason I do own a subway metro card and I don't own a Ferrari -- the manufacturer won't sell it to me at the price I can afford and I wouldn't want to park it where I live anyway.

by destor23 1/26/2012 - 1:24 pm (re: artappraiser)

Thanks, Destor, as I say there are days when I wake up and think I am a chump for not doing what Romney did and voting for lower taxes and gutting OSHA regs. etc. 

Apple doing rehab was somewhat facetious, I don't actually think it could be done. Just by way of illustrating the magnitude of the problem.   

Drugs are a huge problem---I'm not talking the occasional weed off the job. When I have my folks operating my equipment on site at a client company, that liability is mine and when you have your life savings in a company, it's a very serious proposition.( I didn't mention the one who locked himself in an apartment and shot up heroin and drank vodka for a week and I dragged him out and took him to the Salvation Army because he had no other options.)

The sub-standard guys were weeded out. The other guys do a great job, some earning over $40K a year---pretty good for no-degree-required manual labor in today's world.

But to the issue of work programs, I think we need a serious WPA for many of these long term unemployed. Not doing so is just ignoring the problem. (Whether that could have a "rehab" component, I honestly don't know.) But in this climate it would be like Democrats shooting themselves in the foot to even suggest it. I have a hope that if Obama does win a second term, some of these obvious common sense decisions could be made.

In any case, sorry to digress so far from the thrust of your post. 

  

by Oxy Mora 1/26/2012 - 2:22 pm (re: destor23)

It's no digression, Oxy.  You actually employ people, I don't.  I have supervised people and I've been involved in hiring and firing, but in a very different, college-educated is assumed before the applicant walks through the door, kind of field.  I think Artappraiser is right to point out that people like me should be very careful about an in the clouds assessment of the capability of America's workforce across industries.  My experiences and yours differ wildly.

I'm with you on the need for a WPA, too.  For people who aren't convinced by the unemployment problem, there's a "bridges falling down" problem that needs tending.

by destor23 1/26/2012 - 2:32 pm (re: Oxy Mora)

Oh, I didn't think of it as a digression at all. I haven't read the Jobs biography (I am about as far from being an Apple groupie as one can be, some of that actually makes me sick to my stomach-what ever happened to hating planned obsolescence?) but some of the publicity/reviews went into his discussion with Obama on the quality of the American work force and the need for government to do something about it. Now you're not saying the same stuff he did, and most of us probably rightly suspect that Jobs doth (dothed?) protest too much on that front. But you're offering evidence that that type of plaint is not made up out of whole cloth. If one is going to address the Apple problem and be honest about how to fix it, one has to address that part of it, not just mouth pie-in-the-sky platitudes about some President Bernie Sanders forcing them to hire 100% Americans. (In case of the pie-in-the-sky happening, I see an easy choice to up and move the whole frigging operation to China, and let the Americans who still like Apple products pay the huge markup for the tariffs that President Sanders puts on the IPhones they still are crazy for.)

by artappraiser 1/26/2012 - 6:30 pm (re: Oxy Mora)

I was just thinking about how to thank Oxy for this perspective

I was just trying to do the same sarcastically, while at the same time pre-empting some possible screeching I imagined. wink

by artappraiser 1/26/2012 - 6:34 pm (re: destor23)

On some days I wonder which side of the fence I'm on. Born liberal, I guess. But the truth is that my business improved under Obama. The excelled capital equipment depreciation this year was a real benefit. My vocational interest tests showed I should be running a non-profit. I said to hell with that and got an MBA. What do I do? Wind up running a YMCA. 

by Oxy Mora 1/26/2012 - 1:47 pm (re: artappraiser)

Well, seems to me, from the older small business people I know....the ones who felt they have had the richest lives aren't the ones who became big businesses, but the ones that have lots of memories of all the crazy people they employed and worked with and all the crises and zany things they made it through.

Edit to add, re:

But the truth is that my business improved under Obama. The excelled capital equipment depreciation this year was a real benefit.

The spouse has often said he doesn't understand why the bigwig business people he knows won't admit to their hearts what they know in their heads: our living history is that the Democrats in Fed government are way way better for both the economy as a whole and the business economy.

by artappraiser 1/26/2012 - 6:40 pm (re: Oxy Mora)

fascinating stuff, oxy. i actually think our govt would be greatly served giving tax-based incentives for companies to do basically what you are suggesting - creating manufacturing jobs in areas with high unemployment (i think that's what you meant to say). Detroit certainly comes to mind as a place with, despite our best efforts, a lot of underutilized factory-capable workers. 

of course, right now, the incentives in place generally do the reverse -  encouraging our companies to utilize the foxconns of the world. 

by Deadman 1/26/2012 - 3:10 pm (re: Oxy Mora)

This idea, back in the 80s/90s was what Jack Kemp was calling enterprise zones.  Of course, today in 2012, Jack Kemp is what Republicans would call "a raging socialist."  The other side did used to have some very good ideas.

by destor23 1/26/2012 - 3:23 pm (re: Deadman)

Did they ever work?

 

by Peter Schwartz 1/26/2012 - 5:37 pm (re: destor23)

I'd have to do some research but my recollection is that Kemp's enterprise zones did do some good.  But Kemp kind of fizzled when the Republicans really started to radicalize in response to Clinton existing.

by destor23 1/26/2012 - 5:43 pm (re: Peter Schwartz)

I was listening to Rich Lowry on C-Span and I almost ran off the road when I heard he was Cain's economic advisor. The 999 plan, supposed to be simple, but people kept calling in with questions about it, and he kept saying, "No, that's the OTHER 9..." So that was pretty comical after I realized it wasn't just me who couldn't understand it.

He then started talking about "enterprise zones," and how they were going to have them. Then he added quickly, "In fact, the whole country will be an enterprise zone." At that point, I had to pull over I was laughing so hard. It was like the first time I heard the Stiller and Meara Blue Nun ads on the radio. The imagine of "a little blue nun" just had me in stitches.

But to pull back...if we have a problem of a mismatch between the workforce's skills and, per Oxy, work ethic and the needs of businesses with job openings, then this enterprise zone idea strikes me as passe. Simply opening up a factory in the ghetto won't do anything to improve life in the ghetto if those people won't get hired.

by Peter Schwartz 1/27/2012 - 10:14 am (re: destor23)

There are a lot of them in the tri-state area. For example, the whole city of Elisabeth New Jersey, by Newark airport, is one from that era; IKEA decided to open in the US because of that one, if I recall correctly. Customers still get cheaper sales tax at that IKEA than at the other ones.

Isn't the concept commonly dissed now as "corporate welfare" in some circles....with the idea that they should want to settle in down-and-out areas of their own volition? And yes, of course, cities and states have gone to crazy levels offering all kinds of incentives, bidding each other up....possibly better done by a Federal entity? Then it's called pork....? (Also see Charles Rangel/Harlem/125th St/ex-president's office)

What do I know....this stuff is supposed to be your beat, destor....wink

by artappraiser 1/26/2012 - 6:52 pm (re: destor23)

When the problem is national...all these local efforts strike me as taking from Peter to pay Paul. Which I'd be in favor of if we were taking from Paul to pay Peter.

by Peter Schwartz 1/27/2012 - 10:18 am (re: artappraiser)

Thanks, Deadman. Yes, Detroit definitely comes to mind. I heard a report on Bloomberg a couple of weeks ago that there is a lot on downtown redevelopment planned and an upbeat mood.  

I'm a rookie around here, but good to see you back. 

 

by Oxy Mora 1/26/2012 - 3:32 pm (re: Deadman)

But there was the idea that Obama floated and that's in effect in some places I think, where local community colleges and trade schools partner with businesses to produce graduates with the skills and work ethic the businesses need.

I don't think business would need pay out of pocket to participate in this program except in helping design the curriculum, perhaps providing some work-study slots, and hiring the graduates afterward.

 

by Peter Schwartz 1/26/2012 - 5:43 pm (re: Oxy Mora)

One time one of my workers was late to breakfast at a motel, I went up to his room and two waitresses from the night before stumbled out of his room

Of course, he got a promotion...

by jollyroger 1/26/2012 - 9:57 pm (re: Oxy Mora)

...to match his raise.

by Peter Schwartz 1/27/2012 - 10:16 am (re: jollyroger)

I could never figure out the appeal, he was like a p-magnet. Finally, I asked him what his secret was. I wanted to bottle it and make a lot more money than what we were doing. 

He said, "I never let them catch me lookin at em. They come to me."  Go figure. 

I did tell him that the company was paying the Motel room for him and him only, not to have anyone else in the room. But of course he did. 

by Oxy Mora 1/27/2012 - 11:04 am (re: Peter Schwartz)

Okay, I've done my fair share of white collar corporate travel and I know people who've done far more and... well... the idea that your employer would tell you "not to have anyone else in your room," is a little unthinkable in that context.  Again, different worlds.  But I'm sure you see my point that there are a whole lot of people out there who would take the position that "sure, you can pay for my accommodations if you need me in a certain spot to do work for you, but no, you can't give me a curfew or sleepover rules."

I don't mean to criticize you, but I can see why, as an adult, he felt free to ignore your instructions.

by destor23 1/27/2012 - 5:00 pm (re: Oxy Mora)

Destor, in case you miss it, see

White House Offers Plan to Lure Jobs to America by Annie Lowrey for the Feb 3 NYT for a good mixture of admin economist and anti-admin economist opinion on topic, plus some good factoids on specifics of  "industrial policy"

by artappraiser 2/2/2012 - 10:10 pm

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