Posted by DR on July 23, 2005 at 04:26 [67.83.76.91]
In Reply to: Brian goes on and on about stuff, posted by BrianInSF on July 23, 2005 at 03:17
Brian, you support your arguments well. Some counterarguments to think about are below. Hope you find the DVD or the video. I look forward to seeing the penguin movie soon. Best regards.
Opponents to outsourcing don't often war against domestic outsourcing, but foreign. The two most heated arguments against foreign outsourcing are: the loss of US jobs, and worker treatment,
particularly among less developed countries (LDC's). Competition and consumer price expectations dictate that jobs must flow both
where the opportunity exists and where a company can sustain a competitive advantage. This phenomenon is not only true of job outflows to LDC's, but is also true domestically where companies relocate within the US to better compete. In the latter case (domestic corporate relocation) jobs are also "lost," though such
corporate decisions seem to receive less politicization than that of the former (job relocation to a foreign country). Said another way, Americans react much more vociferously when jobs flow from Texas to India than when they flow from Texas to Florida.
Union advocates are often the first to remind us that foreign workers are neither paid a "reasonable" US wage equivalent, nor are
they afforded "quality" protections (such as a standard workweek), as are US workers. These opponents cite worker exploitation and "corporate greed" as the impetus for moving jobs offshore.
Ah, but when in Rome, what exactly is a "reasonable" wage, and what are "quality" protections? In Indonesia, for example, average
income is the equivalent of US $3200 per year. (Worldbank, indexing average incomes to the purchasing power parity (PPP) of US dollars)
Said another way, the average Indonesian earns the US equivalent of $61.5 per week -- $1.78 per hour is a very livable wage in Indonesia. (assuming a the US benchmark 35 hour workweek, which I should point out is an unreasonable work week standard for Indonesia where the average person works many more hours weekly) Indonesia's GINI index (which measures the degree of income distribution inequality in a particular country) is 37 (CIA World Factbook) -- about on par with the US. Thus it is reasonable to conclude that while the average Indonesian may earn the equivalent of US $1.78 per hour, the poorest segments earn substantially less.
However, Indonesia's income distribution is not a factor of American corporate enterprise, but rather the nature of its own economy, and
as such, Indonesian low-skill workers likely earn the US equivalent of $.50 to $.60 per hour. US corporations pay a similar wage to
such workers. How draconian!
Or is it? Suppose Nike et al., paid its Indonesian workers the US minimum wage of $5.15 per hour -- nearly 300% greater than the
average Indonesian per hour income! Indonesian workers in the highest income brackets, doctors, lawyers and politicians, would leave their jobs to work for Nike to manufacture sneakers. Would
one hundred such US corporations act similarly, Indonesia's economy would be destroyed -- its skilled labor force nullified. Even paying the average wage ($1.78 per hour) for unskilled labor would have a devastating effect on the Indonesian labor pool. Michael Moore miraculously obscured this little fact in his 1997 documentary, "The Big One."
"When in Rome", the same relationship exists with worker protections. Child protection advocates cite that US corporations "maliciously" employ children to work excessive hours, at exceedingly low wages. Scarcely do these advocates understand
that children in LDC's regularly work long hours to supplement their household income. Nary do they recognize that most LDC's lack
social safety nets, such as retirement trust funds, to assist the elderly into their golden years. Families in most LDC's are
agrarian-based and are proliferous -- for two reasons -- first, because of high infant mortality rates, and second, so that the
surviving children may tend to the land, generate income and care for their parents once the parents are no longer able to work. For
those low-income families who are not so fortunate as to own farmable land, their children must work if the family is to
survive. This is the hallmark of industrialized nations vs. LDC's: children in industrialized nations consume assets, while those in
LDC's must produce them.
Perhaps the sole justifiable knock on US corporate policies in LDC's is the lack of healthy working conditions (safety, cleanliness,
etc.) for such workers. Corporations offer working conditions to the extent that local law promulgates -- no more, no less. But then
again, asking a corporation to go beyond the scope of local health requirements is as preposterous as is comparing LDC worker rights to
that of the West.
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