Nice analogy Bundlemaker. The process you describe is all about productivity, which is all about economic wellfare.
AT&T to slash 4,600 jobs No. 1 long-distance company says it would save about $400 million by cutting 8 percent of workforce. February 25, 2004: 4:07 PM EST NEW YORK (Reuters) - AT&T Corp. Wednesday told analysts it was planning to cut 8 percent of its workforce, or about 4,600 jobs, this year in a drive to cut costs. The nation's largest long-distance company said the moves would save about $400 million this year, and leave it with about 57,000 employees. AT&T (T: Research, Estimates) Senior Vice President and Chief Financial Officer Thomas Horton said the company cut 18 percent of its workforce in 2003 and saved $800 million.
I thought about this for a while. A few possible scenarios; A) The fishing net (offshoring) is invented and it is allowed for American fishing men. > Productivity UP > Prices DOWN > Many fishermen go out of business, but the fishing net using, high producing fisherman makes so much money, he hires the unemployed fishermen as entertainers, doctors, tax attorneys, whatever. > Jobs remain STABLE AND Economic welfare UP B) The fishing net (offshoring) is invented, but it is disallowed for American fishermen. Situation remains STABLE, but a chance for economic advancement is gone. C) The fishing net (offshoring) is invented, but disallowed for American fishermen. Canadian fishermen are allowed to use fishing nets. > Price of fish DOWN > American fishermen lose their jobs. What happened to the days of pneumonia leading to almost certain death?
I forgot something: C) The fishing net (offshoring) is invented, but disallowed for American fishermen. Canadian fishermen are allowed to use fishing nets. > Price of fish DOWN > American fishermen lose their jobs. > US$ DOWN until American fish becomes attractive again for Canadian customers > American fishermen fish again with their fishing rods, but in exchange for their fish they receive less maple syrup than before the dollar drop. > Economic welfare DOWN And in anticipation for those members who are thinking: but we have to pay the workers offshore our $'s: What do you think those workers are going to do with the US coin? Not burn it I can assure you. In order to get something for it, they have to spend it or invest it in the US. So it doesn't make a difference at all. If I am still unclear please let me know.
It's not a coincidence that the economy with the highest GDP has the highest amount of service industry. (US +- 80%, Europe 60/70%, China way down). That's because after food and basic industry has been taking care off in high productivity, the freed up workers will be hired in more advanced functions.
Outsourcing is great for capitalists because they can now find cheaper labor and open new markets globally. Outsourcing is good for labor in certain poor countries because they will get more jobs. Outsourcing is generally bad for labor in rich countries because they will be more likely to lose their jobs. Therefore, depending on what you do, outsourcing could be great or bad for you. Personally, I believe as outsourcing enriches the corporations and capitalists far more than everyone else, they should be taxed more to compensate the people hurt by outsourcing. But as long as the Republicans are in power, that is not likely to happen.
hehe thats funny. my aunt used to clean houses before illegal mexicans took it over (in Connecticut). before illegals took over guess who filled those positions? it comes down to one question - how come the CEO/VP positions are not outsourced?