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The fallacy of insourcing

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"They [foreign companies] send work here, in terms of legal, financial, accounting, high-tech, medical and manufacturing".
- Thomas Donohue, President, US Chamber of Commerce

Recently I've heard, in several places, that Toyota Motor Corp. created 30,000 US Manufacturing jobs in the US and DaimlerChrysler AG now employs 94,000 US workers. These companies are really investing in America and creating new jobs due to the free market!

I bought it as fact at first and also accepted the recent insourcing arguments by leading conservatives about how we have more jobs being created in the US by foreign companies than we are shipping out.

Then I decided to do a little digging.

What most of these arguments and statements fail to mention is that Toyota and other non-US companies were forced to hire US workers due to trade laws. Generous DaimlerChrysler didn't really create these 90,000 US jobs that they mention. Chrysler Corp. was purchased in 1998 by Daimler and already employed all 90,000 US workers before they were acquired.

That's where the fallacy comes in. The fact that DaimlerChrysler AG is a German company, these 90,000 jobs that they are credited with are looked at by the proponents of outsourcing as being created by these foreign companies. If I'm a British company and buy out a small 5 person publishing company in the US I've just created 5 insourced US jobs!

These numbers are used constantly by Conservatives, Republicans and business leaders who want to justify their short term paper earnings through cheap labor as numbers to show that we are importing more jobs than we are exporting.

If a foreign company aquires a US company those numbers immediatley are marked down as 'created by a foreign company'. It's all bullshit and adds meaningless numbers that cover up the truth of the situation. I don't know how any decisions can be made without reliable input data. As long as it serves someones agenda they will bend the numbers in their favor.

Now I'm no Liberal, but this is one position that I differ with the Conservatives on (along with religion dictating policy, censorship, pro-life and numerous other things). I'm all for business and making money, but someone needs to take a look at the real numbers and do something before there is nationwide revolts over the treatment of workers, it's really getting out of hand.

I'm not just talking about outsourcing here, but the treatment in general is totally unprofessional in a lot of cases. Things like firing people with no notice through no fault of their own, treating people like kindergarteners if they are 5 minutes late to work because of an accident on the highway or they had car trouble or there was a snowstorm, general lack of basic insurance coverage. Now I know some of these are MAJOR business expenses, but sometimes you just got to do the right thing.

If this makes me look like a pansy-ass Liberal Democrat because I think you should treat workers with just a bit of respect, so be it, but one day, when you're really screwed and need help from your workers, I hope they shaft you real good.

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Posted by Digger on May 5, 2004 01:29 AM (Permalink)

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