In the link above is a video of a Mr. Michael Tanner of the Cato Institute stating that outsourcing is good for America. He says that outsourcing gives entry to the US companies that outsource into the markets of the country where the jobs are outsourced to.
Is this guy an idiot or not? I say idiot, because of his statement I noted above.
If outsourcing gives entry into markets then where are the Fords, Dodges, and Chevys being sold in China? I don't think there are many, if any, sold there. He also states that the 'money' comes back to the US. From what? The only money that would come back to the US is the profits, which is considerably less than the cost of the goods. If an article of clothing was made in the US from US grown fibers for a US company then 100% of the cost of the article of clothing would stay in the US, not just the profits.
I happen to own 6 pair. I'm wearing a pair now. They're what I wear exclusively for work. Best pants I've ever owned by far.
If the population of a country can't afford the products they produce because of the low wages, the very reason the company moved production to that country in the first place, then how many of the products of that company will be actually be purchased in the country? Once the wages reach the level where the workers can, maybe, afford the product the company will move the jobs somewhere else where the wages are lower. And if you think 3 million cars sold in a country of 1.3 Billion people is market entry then, wow they've sold cars to less than 0.3% of the population and it's not likely to change very much in the near (10 years or so) future.
As for Lenovo I won't purchase one and I don't expect any Government agency would purchase one either.
How are we to pay for the education and re-education system if the tax base has lost their jobs to overseas production? Oh, I guess the wealthy can pay "Their fair share". What jobs do you suggest would be available for those children? Service jobs, engineering jobs, design jobs, food service, food production? Can you honestly say an economy based primarily on those sectors is a healthy economy? How do you think we got into the mess we're in? The backbone of any economy is production, take that away and your economy isn't healthy.
Good thing we're the number one manufacturer in the world then.
I would ask how much of that manufacturing is actually putting things together from 'parts made overseas'. I think you would be suprised at the answer. Every vehicle I can think of has parts made overseas. Computers, if put together in the US, are put together from parts made overeseas. Much of the clothing made in the US is made from cloth manufactured overseas, some of our cotton goods are stitched together from cotton grown in the US that is shipped overseas to make the cloth and then shipped back to the US to make the clothing.
Doesn't matter too much anymore:
Hazlitt is cool.
After I wrecked myself financially I went looking for how money works and stumbled across him. Excellent primer on economics.
I don't propose protectionism. More equitible entry to market in our own country is what I would strive for. If goods produced in foreign countries have lower costs to market than goods produced here the the barriers to entry for US companies are not equitible.
A positive trade balance would be nice too as well as equal access to the markets of the countries we outsource to.