Archive for May, 2012

The Reality of Multinational Corporations

The Wall Street Journal recently reported that many large U.S. corporations are hiring, but hiring more people in other countries than they are here at home.

Eager to highlight the evils of multinational corporations, Think Progress reported on the report, noting that some companies had even cut jobs in the U.S. while hiring abroad. References to the problem of outsourcing and a look at the article’s comments section make clear how Think Progress and the left see this issue, and that this sort of information is their evidence.

Here’s what they overlook. Think Progress calls out Wal-Mart specifically (because who doesn’t love to hate Wal-Mart), and then posts the chart at right. The bottom section is the group guilty of layoffs in America while hiring overseas.

But these aren’t outsourced call centers and sweatshops. UPS, Starwood Hotels, International Paper. Think about what these companies do. UPS employees get in trucks and drive packages around their city, or work in warehouses necessary in every city they deliver to. UPS isn’t going to hire a driver in Detroit to deliver packages in Peru. Attacking UPS won’t save any jobs, it will just make it more expensive to order products online. In the same way, it makes no sense to blast Starwood Hotels for hiring people in Brazil to staff their hotel in Brazil. It’s not like hotel chains run sweatshops in China. They open hotels all over the world, and staff them locally.

They go out of their way to mention Wal-Mart, though they didn’t even make the list. But Wal-Mart has opened almost 700 stores abroad since 2009, giving them almost 1200 more stores abroad than they have here at home. And they still employ almost twice as many people in America as they do in other countries (around 1.4 million). Are they supposed to fly cashiers from Minnesota to Singapore every day so that they can use American labor? Yet these are the numbers the left points to when they complain that businesses need to be more regulated and punished for not hiring American workers. This is the standard counterargument whenever someone uses the term “job creators.”

As it turns out, manufacturing in America is still strong. We’re still, by far, the most productive country in the world, and manufacturing salaries continue to rise (currently averaging around $50,000). International Paper, also on this list of offenders, is a good illustration of manufacturing in the modern world economy. International Paper runs paper mills and distribution centers in America to sell to America. They also have dozens of mills, offices, and centers in other countries. To do business in those countries. Just like Toyota and Honda have factories in Indiana and Ohio to make cars to sell in America. Just like American auto makers have opened factories in China–gasp!–to sell their cars in China. Doing otherwise would be inefficient and make their product more expensive. Attempts to impede companies’ ability to operate where it makes sense to operate will not save any jobs–it will only drive up the cost of products and services. It will make all stuff more expensive. Helping the poor, that ain’t.

I know there are companies that make use of cheap overseas labor. Yes, Apple has a lot of components put together in China. But they also employ 47,000 people here at home, more than twice as many people employed abroad. And that’s only direct Apple employees–that business supports literally hundreds of thousands of other US jobs in affected industries providing raw and technical materials, services, transportation, health care. If you forced the 23,000 employees in other countries out of their jobs, Apple might be able to hire some here, but they’d also lose a lot of their sales when the price of the new iPhone doubled, and have to lay those workers right back off. And thousands of people in China would be kicked off the lifeline that’s finally pulling that country out of a peasant economy.

So if you think Apple’s overseas factory is the reason for 14% real unemployment here in America, you’ll be disappointed to see the hundreds of thousands of American workers harmed by making it harder for Apple to do business. And since the most common fixative I hear liberals support in order to deal with this supposed problem is to levy extra taxes on companies that do business overseas, you’ll be disappointed when all that does is make your vacations and Amazon purchases more expensive. Most of all, if you think damaging UPS and Starwood Hotels’ business is worth it just to “get” companies like Apple, keep in mind the hundreds of thousands of US workers you’re “getting” at the same time, and driving up the cost of goods for every single one of us.

All the supposed solutions simply make imports more expensive. If you make imports more expensive, then the end product will be more expensive too, and that’s bad for the customer and manufacturer alike. That just means less business gets done, and you and I have access to less stuff. Protectionary tariffs are one of the things that led to the Great Depression. If you threaten businesses here, some may submit, but none will choose to do business in America any longer if they can help it.

Conservatives have an alternative. Free trade makes the world a better place. It’s hard to get many economists to agree on anything, but they generally agree on that. More jobs here, more jobs abroad. If one company moves a call center to India, another company opens its doors here in America. Cheaper goods everywhere. And the more markets we open for American goods to be sold abroad, the more American manufacturing jobs can be created.

If you really want to help the poor, that sounds like a good start.

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GOP and Women

From my recent article at Kendall County YR:

The May 10th editorial by Tony Scott in the Kendall County Record claims that the GOP needs to stop alienating women with backwards social issues like abortion and birth control. Scott goes so far as to claim that “most Republican candidates support limits on… birth control.” This is made up. It’s false. Scott wants the uninformed to assume that these dangerous Republicans are coming to ban sex and make women wear burkas. In fact, the issue of birth control has only been brought up by Democrats recently, in attempts to force religious institutions to provide free contraception for their employees. Even the staunch social conservative Rick Santorum stated that, though he morally disagreed with contraception, he had no interest in restricting anyone’s access to it. If you remember all the way back to January of this year, when the issue was first artificially injected into the campaign by former Democratic advisor George Stephanopoulos at a debate, every single Republican on stage was variously bemused and/or annoyed at the waste of time. Stephanopoulos spent over four minutes repeatedly asking each candidate, in so many words, come on… you want to ban the pill, right? Tell me you want to ban the pill.

The Republican audience got so fed up with the absurdity of the line of questioning that they started to yell and boo. Romney summed up the general sentiment: “George, I — I don’t know whether a state has a right to ban contraception. No state wants to. I mean, the idea of you putting forward things that states might want to do that no — no state wants to do and asking me whether they could do it or not is kind of a silly thing, I think.”

Scott correctly reports that 77% of those recently polled thought birth control “should not be part of the national political debate.” Republicans agree. They’re not interested in it either, despite attempts to characterize the GOP as the party of “extremism and gender inequity.”

Also brought up is the issue of abortion. Republicans need to back off abortion, goes the claim, because 53% of Americans support it! Polls on abortion are tricky. They change. A lot. Constantly. Pew did report last month that 53% of those polled were in favor of keeping it mostly legal, but that number, in its pendulous swings over the past few decades, keeps slowly swinging in a pro-life direction. And swing it does. Between October 2008 and April 2009, support swung from 57% to 46%—eleven points in eight months. There was a three point change between two polls conducted in the same month in 2008. Even six months ago, only 51% of those polled supported abortion. This number moves a lot, but the big picture is a trend towards protecting the lives of our unborn children.

Here’s the bigger picture still. These social issues make for good press and loud arguments, but when asked what issues will determine their vote this November, people list abortion, contraception, and gay marriage low on the list (39%, 34%, and 28%, respectively, answer these issues are “very important”). The top of the list? The economy (86%) and jobs (84%). Our current President is running on a failed record on those issues, against a man who’s spent his life demonstrating a spectacular ability to turn financial failures into successes, in both the public and private spheres. Which of those two men do you think Americans should trust with our economy?

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