On Wed, 25 May 2005 20:26:51 GMT, james wrote:

On Wed, 25 May 2005 08:12:20 -0400, Dave Hall
wrote:

Outsourcing is inevitable until the standard of living in the rest of
the world equalizes with our own.

It's not good news for us, but it's an unfortunate reality.
******

You will sing a different tune when your $60K per yr job goes to China
and your planned retirement of $120K+ dwindles down to $36K per yr.

Why would I sing a different tune? The reality is the same whether I'm
directly affected by it or not. I never said it was a good thing for
American workers, but it is an understandable trend considering the
economic dynamics of the world market.


Think who benifits from outsourcing?

Long term or short?


Corporations. Why?

Consumers demand lower prices and Corparations are doing their best to
give the consumers what they want. Sorry but cheap prices can't go on
for ever. Once the world's cheap labor is exploited, consumer prices
will rise like a Proton Rocket.

So, here we have a double edged sword. We live in a world economy,
with companies from all over the world competing for market share. So,
what's a U.S. based corporation to do? Should it:

A. Keep its U.S. work force in order to altruistically keep the
American work force employed?

B. Outsource to a foreign country where labor and overhead is much
cheaper?

Considering that other countries have no objection to using cheap
foreign labor, and producing products cheaper, the U.S. company is now
at a competitive disadvantage with those products which they are in
direct competition from foreign companies.

Tell me, would you pay 50 - 100% more for a TV or some other product
just to keep the U.S. company here? Considering that the government is
squeezing more and more money out of us in the form of taxes, and the
costs of things like fuel are skyrocketing, we look for the best
bargains in everything we buy.

And that doesn't cover the foreign market. Would a European pay more
for a U.S. made product over a foreign made product?

What ultimately happens to a U.S. corporation who loses a competitive
edge?


What happens when there are no more cheap labor countries like China?
Can you spell double digit inflation??? How about 20% per yr for about
ten yrs. Maybe even longer or higher inflation rates.

Yes, inflation is a very real fear. But when the standard of living
equalizes, then there will be no further incentive to manufacture
overseas. Then factors such as shipping costs will make domestic
manufacturing attractive again for the U.S. market. Inflation may also
be mitigated by market pressures. If people cannot afford to buy as
much, demand goes down. When demand goes down, so does the price.
That's free market 101.


Yes as the world's standard of living increases, so will inflation. I
forsee 10 to 20% annual inflation rates somewhere in the 2030 to 2040
time frame. By then the world will dream of 4% inflation rates.


Out sourcing is eventually going to drag the US' standard of living
down to the rest of the world's as their's rises towards.

That's what I meant when I said equalize the world's standard of
living. Not only will the 3rd world catch up, but we will fall
somewhat. That is the price we pay for living in a world market. 50
years ago, when most of our goods were made here, we controlled the
market. Now we're just one of many players.


You can't get something for nothing.

You don't know just how much truth there is in that statement.

In time the US will suffer. Prepare for
China owning more an dmore of teh US debt and consequently the US'
economy .

Ok, We pretty much agree that the road ahead will be a bit bumpy. So
what do we do about it? Can we do anything about it?