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Hypocrisy_Central's avatar

Is John Q citizen a de facto cause of outsourcing in the US?

Asked by Hypocrisy_Central (26843points) July 24th, 2011

Watching the Shark Tank on TV I have noticed a lot of good inventions or business ideas get passed up because the Sharks do not think there is a large enough profit margin and the person can’t have it made overseas. If it had a larger profit margin, the price would be more than John Q would pay, even in a good economy much less a soft one. So isn’t the US consumer a de facto reason for outsourcing? If big business wants to sell a widget to John Q, he has to make it in the range John Q will be willing to buy. If that means making it overseas to keep the price down, that is what John Q wants, right? If John Q insisted on having the ”made in the USA” label, and was willing to pay more to have it, do you think companies would still outsource if they knew John Q would not buy it without the ”Made in America” stamp on it?

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10 Answers

dabbler's avatar

Tariffs are the right way to fix that.
Counting on JQP to insist on “made in the USA” will only be partly successful.
Too many JQP are looking for the label “guaranteed lowest price”.

marinelife's avatar

You get your economics lesson from a TV show?

dabbler's avatar

@marinelife I’m surprised at you, it’s “Shark Tank” after all ! ;-)

Ron_C's avatar

You are absolutely wrong about that one. Corporations, especially large ones are concerned solely about profit. The would gladly eliminate thousands of American jobs to save just one penny on each product they sell. Jobs would move to the cheapest place whether Americans invented a product that could be made for a small profit here or a slightly larger one overseas. In fact is has been shown American consumers will accept lower quality to save a few cents.

Personally, I have had enough of that and make an effort to by American especially if it is Union made. The only way to protect American jobs is to re-establish tarrifs, and eliminate “free trade” agreements that don’t protect the employees in the U.S. and in our trading partner’s country. We also need to stop subsidizing job transfers with tax write-offs and off-shore accounting.

Hypocrisy_Central's avatar

@marinelife You get your economics lesson from a TV show?—Open up your books, if you have or earned more than the Sharks, I am all ears.—

@Ron_C Jobs would move to the cheapest place whether Americans invented a product that could be made for a small profit here or a slightly larger one overseas. In fact is has been shown American consumers will accept lower quality to save a few cents. Then John Q is more of a force in the outsourcing and unemployment than Big Business. If John Q passes up on a quality clutch purse for his daughter’s 15th birthday, because he can find a purse almost as good, but $8 cheaper due to it being made in Kazakhstan, after the US purse company goes out of business, leaving Polly Purebred unemployed. John Q can pat himself on the back, because he helped that to happen, along with many others. Now that Polly and many of her coworkers at the factory or out of work, the dinner that use to feed them have 26% less customers per day and Molly Bookworm loses her waitressing job and now can’t buy her college books because tuition went up et again.

When I was a small boy and I wanted a toy my mother made me look to see where it came from. If it said ”made in Japan”, whish is where most imported toys came from then, “made in Mexico”, etc, she would not buy it for us. It had to say, “made in America”. For every one toy she purchased that was imported 15 or more was manufactured domestically.

chewhorse's avatar

@Ron C is absolutely correct.. The reason for imported products in this case is the profits made by big industries because of lax tarrifs and g’ment inaction (that they seem to press upon others).. Just adding tarrifs to the profit mongers scenerio would place the profit margin no better than if it were made in the USA and that doesn’t include other write-offs. Our own people are doing this to us just to fill their pockets a little more. I say, “OFF WITH THEIR CORPORATE HEADS!!”..

Ron_C's avatar

@chewhorse thanks for your support. If fact, the whole price problem goes round and round. Manufacturers see people gravitating towards cheaper products and assume that’s what people want. They then find the essential slave labor and regulation free state to produce their products. Since I work in international industry (based in the U.S.) I see numerous problems with that scenario. First they move to Mexico (for instance) and find that warranty repairs or replacements increase and bring in American consultants to fix the problem. Later the even end up bringing in engineers and technicians to correct problems to correct the situation. Later they move to an even cheaper country, China, Pakistan, or even Bangladesh. Eventually they consider returning home. By that time, however the company is in such bad shape they are ripe for a takeover. The jobs and industry is now permanently lost.

If there were simple tariffs, some companies would still move but the financial and tax breaks disappear. In place of adding tariffs, the right wing solution seems to be to downgrade education in the U,.S. to level the playing field an make our country on par with third world countries.

dabbler's avatar

One challenge is how to stem the offshoring of information worker jobs.
How do we encourage bringing back call center jobs (some companies have done this to fix quality problems)? What kind of tariff can we put on work that goes out over the wire and comes back over the wire? Insurance claim agents, computer systems programming and especially support continue to grow overseas to cover US needs.

I’m totally for that to, just don’t have any idea what kind of effective measure can be applied to that kind of product.

chewhorse's avatar

I agree with you Ron.. Education in the US is a disgrace, even going so far as to fake grades in order to pass them on. We’ve got high school graduates walking around today who literally have problems reading street signs, imagine how this will become in future generations if underhanded tactics like this (and worse) continue in education.

dabbler.. you too make a good point but I have confidence in our g’ment.. I’ve actually seen them squeeze blood out of rocks. But first things first, at present their working on a national internet purchasing tax THEN on to better things.

Ron_C's avatar

@chewhorse thanks for the comments. I can almost understand the tax except it ought to go to the States, not the Fed. Many brick and mortar companies are screwed by out of state purchases that don’t pay state sales tax. That is unfair to local businesses in competition through the internet.

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