4.09.2004

CNN's Lou Dobbs is a man on a mission: He's telling the public about the dangers of sending jobs overseas MSNBC.com (4/9)

Every weeknight for more than a year "Lou Dobbs Tonight" on CNN has insistently covered — and condemned — sending American jobs to other countries, aka outsourcing or offshoring.

[snip]

Unapologetic, Dobbs says he’s driving a story of critical importance with "Exporting America," the program's catchy tag for its series of reports.

"I think if this trend continues, is allowed to continue, that the United States, without being unduly alarmist, is headed toward if not a third-world category than a second-world category as a nation," Dobbs said in a recent interview.

Without tarring all corporate executives, Dobbs said, "There are some who simply look at this (U.S. economy) as a convenient piggy bank to loot, and the worker be damned."

Okay, so no more torturing Lou a la Atrios. Lou also provides a list of companies that offshore... Go get 'em Lou!

4.08.2004

Offshore Doublespeak Computerwire (4/9)

Companies considering an offshore strategy are very reticent to reveal their plans because they are wary of a backlash from consumers and their own soon-be-redundant workforce. One BPO vendor recently said at a conference that as these companies go to ground, they are leaving the vendors to take the flak. But now vendors have joined them in a virtual vow of silence, and are trying to deny that moving work to lower cost countries should be called offshore at all. For example, an IBM spokesperson recently told ComputerWire that IBM does not do "offshoring" because it is a global company and has always had operations in places such as India.

Such doublespeak is already rife in the industry, and the use of the word "offshore" is often replaced. Cap Gemini Ernst & Young calls it "Rightshore", Computer Horizons and EDS both use "Bestshore", and BearingPoint calls it "Anyshore", for example.

Well isn't that just doubleplusgood. We wonder why they're so ashamed?

Voices join chorus against outsourcing: Economists, politicians worry about lower tax revenues, eroding benefits Oakland Tribune (4/06)

As U.S. companies shift jobs to low-paid workers in developing nations, a growing number of economists and politicians worry that offshore outsourcing could damage the nation's fiscal health by draining tax coffers.

[snip]

But up to one quarter of lost wages translate to lost tax revenues, by conventional accounting methods. So if 3.3 million white-collar jobs and $136 billion in wages move overseas by 2015 as Forrester Research predicts, that means federal, state and local tax receipts could decline as much as $34 billion.

"Here's the big reason why tax revenues are declining: all these jobs are leaving the country," said John McGowan, professor of accounting at Saint Louis University. "We need to start talking about this problem and not just blithely saying, 'Free trade is the solution' just because it boosts corporate profits and Wall Street likes it."

Where have we heard this before? Oh, we know: it's what we've been saying all along!

4.06.2004

From our 'Letters from the American People' file:
How India is destroying the American middle class: Readers respond to Katharine Mieszkowski's "How India Is Saving Capitalism." Salon.com (6/06)

You disappoint me greatly in that you do not ask why wages are so low in India. Indians pay less for food, housing and services because many of their agricultural, construction and menial workers are held in debt bondage and victimized by caste discrimination. This is common knowledge, which you ignored.

I feel sure that you are aware of the very good information on bonded labor and the denial of civil rights to one in every six Indians at the Human Rights Watch Web site. Check the "Broken People" document. Human Rights Watch and Amnesty International both recommend sanctions against India. Check the Amnesty site also. The book"Disposable People," by Kevin Bayles from Antislavery International, also explains the bondage practiced in India.

"Red China Blues," by Jan Wong, details some of the abuses of workers in China. Even better, "China's Workers Under Assault," by Anita Chan, includes accounts by Chinese journalists working undercover in sweatshop factories. Including accounts of beatings and murder. Amazon sells these books.

Offshoring jobs to countries that have low costs because of their repression of their citizenry brings that repression to bear on Americans. People have made the point that U.S. companies buy a lot of services already from Europe. Well, Europeans no longer shoot labor organizers. They no longer practice slavery or feudal bondage. They must compete on their innovation and energy, not their willingness to send out a goon squad. Competition with any country that maintains labor and civil rights will never cause massive unemployment or drop the floor out from under wages.

Apologists for India say that their tech workers are not bonded or oppressed. I agree. Their tech workers come from the hereditary higher castes. But check Arundhati Roy's book "Power Politics" for a description of emaciated workers digging ditches by candlelight -- to lay fiber optic cable. A bonded workforce cuts costs for infrastructure. And for food and housing. So Indian professionals can charge less for their work.

You probably know that the U.S. Congress passed sanctions against trade with Myanmar (properly called Burma) last year. Coerced labor, often unpaid, contributed to the building of a pipeline there for an American oil company. American companies will readily take profits that rest on violence done against the poor.

I very much dislike your deliberately omitting the daily violence done against India's working poor from your discussion.

-- Patrick Tibbits

Ohh, and he name-checks Arundhati Roy! 10 points for Patrick! We dig Arundhati and she comes up to infrequently.
The simple and sole determining factor in outsourcing is money. When you live in a country with one of the highest living standards in the world, and perhaps the highest prices (outside Japan), it is impossible to compete, skill for skill, with workers in other national markets. The wage differential is simply against you.

This condition will continue to apply until global wages are equalized in real terms. This means that working a 70-hour week in Malaysia, India, Mexico or the U.S. won't earn you more buying power than working 70 hours anywhere else.

Then you can argue that outsourcing is due to the lack of skills or motivation.

Until then, let's keep this "debate" an honest one. Foreign workers can afford to work for less than Americans, period.

What the hell are we supposed to do about that?

-- Jon R. Koppenhoefer

You're supposed to keep shopping like a good little consumer and trust that our corporate masters know what is best for us!

There's more there folks so go check it out for yourselves (Read the original story).

A MUST READ!
Workers asked to train foreign replacements USA Today via Yahoo!News (4/06)

When computer programmer Stephen Gentry learned last year that Boeing was laying him off and shipping his job overseas, he wasn't too surprised. Many of his friends had suffered the same experience.

What really stunned him was his last assignment: Managers had him train the worker from India who'd be taking his job.

"It was very callous," says Gentry, 51, of Auburn, Wash., a father of three who is still unemployed. "They asked us to make them feel at home while we trained them to take our jobs."

'Callous'? What Mr. Gentry probably wanted to say was "Fucking sadistic" but he's also probably too polite. But we aren't. Bastards.
More cost-cutting companies are hiring workers in other countries to do jobs formerly held by U.S. employees. But in a painful twist, some employers are asking the workers they're laying off to train their foreign replacements - having them dig their own unemployment graves.

Gee, where have we heard that before?
Here's what typically happens: U.S. workers getting pink slips are told they can get another paycheck or beefed-up severance if they're willing to teach workers from India, China and other countries how to do their jobs. The foreign workers typically arrive for a few weeks or months of training. When they leave, they take U.S. jobs with them. The U.S. employees who trained them are then laid off.

Employers say they need workers to train replacements to ensure a seamless transition, but the practice is coming under fire.

In a congressional hearing in February, some lawmakers denounced the training of replacements as "unconscionable."

No, that's 'fucking unconscionable.'
On a Friday in 2003, the former WatchMark software tester was part of a team of workers summoned to a meeting. There, she says, managers handed out letters explaining that the testing staff was being laid off. Managers then told the group that their replacements would be workers in India, she says. The workers were flying in and would be in the office Monday. She says she was instructed to train them.

Bronstein felt trapped. She says she believes that if she refused, she would have probably been fired without severance and would have been ineligible for unemployment benefits. If she quit, she says, she wouldn't have received severance or been eligible for unemployment.

The next week, she and the other employees facing layoffs were introduced to the workers who were taking their jobs. The workers from India, she says, would be earning a sixteenth of what she had been paid.

"I was staring hard at my shoes and trying not to cry. It was hideously awkward. I felt forced," says Bronstein, 48, of Mercer Island, Wash. She is still unemployed. "It was very deflating and dehumanizing to train your replacement. I felt sucker-punched. It was as if they handed us a shovel and said, 'Here, dig your own grave.'"

Competition is still open folks: what do we call it (besides 'sick,' 'sadistic,' and 'fucking unconsionable') when you have to train your own replacement like this? Use the comments feature!

Many Firms Avoided Taxes in Boom CNNMoney (4/06)

More than 60% of U.S. corporations didn't pay any federal taxes for 1996 through 2000, years when the economy boomed and corporate profits soared, Tuesday's Wall Street Journal reported, citing the investigative arm of Congress.

[snip]

But more so than similar previous reports, the analysis suggests that dodging taxes, both legally and otherwise, has become deeply rooted in U.S. corporate culture. The analysis found that even more foreign-owned companies doing business in the U.S. -- about 70% of them -- reported that they didn't owe any U.S. federal taxes during the late 1990s.

The basic federal corporate-tax rate for big corporations is 35%. But the federal tax code also offers many credits and loopholes that allow many companies to pay far less than that.

Do you know what would happen to you if you didn't pay your taxes like that?

And folks wonder why there's not more money for schools, for healthcare and to provide basic services for Americans.

CEO pay up again - Average executive compensation rose by 16% last year, says new study. CNNMoney (4/06)

edian cash pay for chief executives -- base salary and bonus -- grew to $2,029,500 from $1,750,000 in 2002, up 16 percent, according to a study of 345 of the Standard & Poor's 500 companies conducted by Equilar for Reuters.

Bonuses overall leaped 20.4 percent to $1,064,099 from $883,944, and six out of 10 CEOs enjoyed lump sums last year. The median base salary increased to $950,000, up 3.1 percent from 2002.

Who wants to bet that pay and bonuses are up due, in part, to outsourcing of jobs? We don't think that suggestion is all that far-fetched, do you?

4.05.2004

From the "We Have to Hold Our Nose" File (because John Stossel tends to be a real jagoff)
Confessions of a Welfare Queen - How rich bastards like me rip off taxpayers for millions of dollars ReasonOnline (3/04)

Ronald Reagan memorably complained about "welfare queens," but he never told us that the biggest welfare queens are the already wealthy. Their lobbyists fawn over politicians, giving them little bits of money -- campaign contributions, plane trips, dinners, golf outings -- in exchange for huge chunks of taxpayers' money. Millionaires who own your favorite sports teams get subsidies, as do millionaire farmers, corporations, and well-connected plutocrats of every variety. Even successful, wealthy TV journalists.

That's right, I got some of your money too.

Then give it back you smug bastard.
Why? As my eager-for-the-business architect said, "Why not? If the ocean destroys your house, the government will pay for a new one."

What? Why would the government do that? Why would it encourage people to build in such risky places? That would be insane.

But the architect was right. If the ocean took my house, Uncle Sam would pay to replace it under the National Flood Insurance Program. Since private insurers weren't dumb enough to sell cheap insurance to people who built on the edges of oceans or rivers, Congress decided the government should step in and do it. So if the ocean ate what I built, I could rebuild and rebuild again and again -- there was no limit to the number of claims on the same property in the same location -- up to a maximum of $250,000 per house per flood. And you taxpayers would pay for it.

Thanks.

Don't thank us you fucker: pay us back. Fair is fair right? We're not kidding - you shouldn't be able to admit you scammed us like this and act like it's funny.
Andreas' attitude is rampant in many different areas of corporate America, and it's an ugly one. But there's always some legitimate-sounding justification. The politicians need your money for national security, research, job protection, or to "protect the food supply." After spending time on the golf course with lobbyists, politicians will find a way to justify almost anything. They justify giving subsidies to prosperous companies that sell goods overseas by saying that the resulting exports will be "good for America." They will be. But does Sunkist need taxpayer help to sell oranges? McDonald's to sell McNuggets to the Third World? Let them do their own marketing. My employer -- Disney, which owns ABC -- got tax money to create better fireworks at Disney World. Really.

Really? Really you should pay us back and so should they. Give it to the United Negro College Fund, Greenpeace or a school that trains guide dogs for the blind We're not fucking around here you bloody wanker.

And that moustache? It's looked completely fucking ridiculous for 20 years. You may be rich, but you've looked like an idiot on TV for 20 some years.

Does the concept of 'wealthy journalist' strike anyone else as a bit of a problem?

Our thought for the day:

"The majority by their silence shall pay for days like these"
     --Billy Bragg
, Days Like These

'Neoliberal' Economic Policies Widen Gap Between Rich, Poor EthicsDaily.com (9/17/03)

As the middleclass becomes an endangered species, CEO salaries, ironically, have increased at the expense of workers' wages.

In 1975 corporate leaders made 44 times as much as the average factory worker. During the early 1980s, CEOs such as Goizueta of Coca Cola and Eisner of Disney convinced stockholders to link their compensation to company stock prices. By 1985, CEO salaries rose to 70 times the average worker.

A 2001 report published by the Institute for Policy Studies revealed that today's corporate leaders make 531 times as much as the average factory worker. That is a 571 percent increase (before adjusting for inflation) since the 1990s alone. Worker pay, meanwhile, grew 37 percent--barely keeping up with 32-percent inflation.

The average pay for top executives at 365 major U.S. corporations is $13.1 million a year, while the average factory worker makes $24,668 a year. If workers' annual pay had grown at the same rate as CEOs, their 2000 annual earnings would be $120,491. If the minimum wage had grown at the same rate as CEO's earnings, it would have been $25.50 an hour instead of $5.15.

CEO salaries also outpaced the stock market and corporate profits. From 1985 through 2001, the average worker saw his or her pay increase by 63 percent, while the S&P 500 index rose by 443 percent. Over the same period of time, CEOs enjoyed a pay increase of 866 percent.

One might have expected CEO incomes to drop as the market took a bearish turn in 2000, based on the 1980s model of linking compensation to stock prices. This did not occur, however, because we have created an economic order described by George Will as "welfare capitalism," where profits are privatized while losses socialized.

[snip]

The new economic system established since the 1980s is known as "neoliberalism." It essentially transfers wealth from the bottom of society to the top, creating a growing income disparity between the poor and rich. The process is carried out through the dismantling of social services, such as welfare, adequate education and health care, while increasing tax breaks for the wealthiest.

The greatest danger of neo-liberalism is the threat it poses to our democracy. When wealth in concentrated in the hands of the few, political inequality follows.

Note: the emphasis is ours.

More IT Jobs to Go Offshore, Controversial ITAA Report Says ComputerWorld (4/5)

"Some workers may have to take a job that pays less than their [current jobs]," and some IT workers will face "wage compression" as a result of overseas competition, said Nariman Behravesh, chief economist at Global Insight.

"But not management: no, never management... in fact, they're doing better than ever! So don't worry your pretty little heads about them." He added

John Steadman, president of the Institute of Electrical and Electronics Engineers-USA, said the report assumes that the savings from offshore outsourcing will be used to create new jobs in the U.S. And it's "not absolutely clear that will happen," he said, adding that companies can "invest overseas, and the new jobs get created elsewhere and do not help U.S. workers."

We have a word for anyone that thinks these savings will go towards creating jobs equal to the jobs lost: naive.

Outsourcing Sending San Diego's High-Skilled, High-Wage Jobs to India, China The Miami Herald (4/4)

Last week, Treasury Secretary John Snow picked up the theme.

"You can outsource a lot of activities and get them done just as well, or better, at a lower cost," Snow said. "If we can keep the American economy strong and growing and expanding, we'll create lots of jobs."

But high-tech workers and a chorus of economists wonder whether the economy can keep expanding as jobs are shifted overseas.

"Any time somebody says jobs are being created, you have to ask what kind of jobs they are," said John Pagakis, a technology consultant in Arizona who runs a Web site on offshoring, www.whosoutsourcing.com. "If you lose 100,000 software jobs and gain 100,000 retail jobs, I'm not sure you're coming out even."

The jobless rate for electrical and electronics engineers hit an all-time high of 6.2 percent last year, compared with 4.2 percent in 2002. The jobless rate for computer scientists and systems analysts also is at record levels of 5.2 percent, according to the Institute of Electrical and Electronics Engineers.

The weakness in tech jobs is reflected in San Diego, which has lost 1,900 computer manufacturing workers, 1,500 telecom workers and 700 software writers in the past two years.