An NDD Spin-off Thread

Excuse the intrusion, but I didn't see anyone mention patents
and how they have been given away. Nor did anyone mention
reverse engineering.

We accept people from foreign countries to study and then they
go back and steal our technology. I have to be careful what I say, but I know for a fact one specific manufacturer we visited had the US components plainly on the table. They made no attempt to hide the fact they were reverse engineering US equipment.

We are losing jobs, I see it in my sector.

my .02.

[CRad]

Originally posted by NousDefionsDoc
Ok, let's say you're CRad Computer Company Inc. You sell 85% of your products to US citizens.

That's kind of funny about that computer since the first computer we had and the one that worked the best and longest (still being used by a niece) is one the other half built from parts bought on the American market, SF CSM who got out and opened a computer store to be exact. I have no clue where they originated but since he built that first one in the mid-80's I would guess the Silicon Valley.

My tv is a Phillips, dvd player an RCA and my cd player a Pioneer. I got rid of the vcr.

Originally posted by NousDefionsDoc
Sure, I care about American consumers. But they can't consume if they don't have jobs.

Where was your TV made that we have equal access to their market?

Every industry is strategic when it involves the national unemployment rate.

They only don't have jobs if they and their industries fail to compete. Forcing any solution that is not market driven on industry doesn't work.

Originally posted by CRad

My tv is a Phillips, dvd player an RCA and my cd player a Pioneer. I got rid of the vcr.

None are built in the USA.

[CRad]

Originally posted by Greenhat
None are built in the USA.

I figured as much, but I like being able to at least say the name of what I own.

[Valhal]

Mega companies seem no longer to be American. They are international companies now. The parent company might be US, based in US, but look at the major stock holders. The age of globalization is on us. If the invisible hand doesn't care about American workers, it certainly cares about our technology and innovation. This in turn will create other types of jobs in a continually evolving marketplace. Americans are bold and innovative. That is something that can not be contracted out to a foreign entity. There might be tough times for American workers in fields that are cheaper to produce outside, but the invisible hand suggests that when things balance out it will be good for all.

The culture of corporate greed, Enron, MCI...etc. worries me more. These CEO's make ungodly amounts of money, then oftentimes get mega bonuses for making deals that are part of their job in the first place.

Another thing that I see as despicable are US companies based in the Bahamas so they do not have to pay our government taxes.

My .02 I hope I didn't miss the party.
Mark

[NousDefionsDoc]

Originally posted by Greenhat
Forcing any solution that is not market driven on industry doesn't work.

Now that is a bold statement - I like it. What about environmental protection?

[Roguish Lawyer]

Originally posted by NousDefionsDoc
Now that is a bold statement - I like it. What about environmental protection?

There are market-based solutions to environmental problems like tradeable pollution permits. Unlike the topic at hand, pollution is an externality which requires market intervention.

[Solid]

Good evening, and sorry to intrude, but I'd like to continue the CRad computer company illustration slightly farther.
CRad invests overseas- foreign direct investment. This is money flowing out of the US economy, which isn't great. Furthermore, what was once a US-manned call center is now a Bangladeshi call center, which translates to excess labour supply (unemployment) in the US.
The advantage/attraction of having a call center in Bangladesh is that the labour costs (wages) are lower because of excess supply or lack of regulation. This relates back to the US-based firm in the form of decreased unit costs, of which wages for a substantial percentage. Assuming that the import/export market is not interfered with by trade barriers (tariffs etc), the decreased unit cost derived from globalisation allows the US firm to compete with foreign firms, and perhaps establish dominance of the global market.

Global competition increases demand for the firm's product massively, and the firm stretches to increase supply capacity. This is likely to be done in the United States, because if factor costs were better elsewhere, it would be logical that the firm would have already shifted production to another country. New facilities create more jobs, potentially more than were lost to the Bangladeshi call-center. Furthermore, the lower unit costs and increased demand for the good increase revenue for the firm, which translate into tax revenue for the US government and increased living standards, amoung other multiplier effects. Furthermore, global sales translate as an inflow of money into the US current account (and an outflow from foreign countries! ).

In short- this situation isn't all bad. Foreign Direct Investment is generally good for the home country (in this case the US), providing, over time, profits, and either improves the host country (Bangladesh) or stagnates growth, based on how corrupt the host government is.

Thank you for reading,

Solid

Originally posted by NousDefionsDoc
Now that is a bold statement - I like it. What about environmental protection?

Take a look at the companies that have operated in areas/industries that are considered environmentally challenged for many years. Each of them has a stringent environmental approach of their own that is based on market forces and long-term vision, not on a legal basis. Companies that take a short-term view of pollution/environmental protection don't survive. The Chinese are learning that, just as it was learned in Pittsburgh and Manchester. It wasn't laws that brought about that change, it was the communities and the market.

If I am intruding, then let me know. I didn't see the following considerations in the CRad Corp.

1) trade agreements - we want to sell our equipment to third world countries and in return the company *must* establish a manufacturing plant or guarantee x number of jobs. The drive to save money in the US is not the only factor in the relocation of work. Now we have an established plant, can we ship our equipment? Er.....wait a minute. Is that a monitor or a fish tank?
You can't bring anything in that we can build here.

2) Debt. The country can't raise funds through the IMF or anywhere else and our trusted US company fronts the doe. However the country subsequently defaults on the loan.
The sales pitch somehow justifies boosts in market price, albeit temporarily. Example: Now you have x number of telcos billions of dollars in debt. How do you mask this debt? Spin off the company and call it a new name.

3) market demands - Let's take an example. Why is it that FCC regulations for Locator Services can be extended, but the ability to sell a phone so some buffoon can take a picture is so important? Market driven has it's drawbacks.

4) Environmental concerns - in my experience it depends on the target country.

I have thought about this stuff a lot and I have no answers. I used to think tax reform would clear up some of the mess. Maybe I am getting cynical, but I don't see quality product improving the situation. Cost rules. It doesn't seem to matter how reliable the product is nor how well designed.

Sorry for the vent (well, sort of).

[Solid]

Each of them has a stringent environmental approach of their own that is based on market forces and long-term vision, not on a legal basis. Companies that take a short-term view of pollution/environmental protection don't survive.

Sir, while I would absolutely agree that in most instances market-based internalization of externalities is the best way to go about things, I would also suggest that:
a) some changes corporations are unwilling to push on themselves. Seatbelts and airbags are a good example, laws were created and now, through Say's Law, they are a standard feature in most forms of transport.

b) in some pollution cases, it is very, very difficult to create market-based solutions. In my very limited experience, I have noted that the foremost market-based solution to pollution is tradeable pollution permits, as RL states. However, tradeable permits can only function in a market that is easily regulated, which is generally one with few companies. Some areas that pollute don't have only a few companies in the field, and market-based solutions therefore become very difficult to devise.

One of the big problems, as I see it, with internalization of negative externalities is that there are many of them to be dealt with, and the cost of dealing with them is high enough to have serious inflatory effects on the price of US goods. This makes it more difficult for the US to compete internationally with NICs like Taiwan and other Asian Tigers. It's the same argument for labour laws- if they aren't equal everywhere, the Most Developed Countries, like the US, will be fighting an uphill cost battle.

Again, sorry to intrude,

Solid

Originally posted by Solid

a) some changes corporations are unwilling to push on themselves. Seatbelts and airbags are a good example, laws were created and now, through Say's Law, they are a standard feature in most forms of transport.

Your assumption here is that seatbelt and airbag laws are good things, and I'm not sure I agree with that.

Both are devices intended to protect people from themselves, and the laws that mandate them basically assume that people cannot be responsible for themselves. I disagree.

Also, those features have become major market features on a number of vehicles (as have ABS brakes, which are not mandated by law), even in countries where they are not mandated. Brands like Volvo started a market trend prior to any law, a trend which suppliers either respond to, or choose not to recognizing that limits their market.

[Solid]

Thank you for pointing this out to me. One question- do you think seatbelts, airbags, ABS etc primarily protect people from themselves, or from other people?

Solid

PS: I did some research and was interested to find out that the Volvo 240 series was used to set US safety standards. I was under the impression that Volvo had not always had the 'saftey' slant to their cars, and instead had expanded into the market later in their commerical lifetime. Lesson learned.

[Roguish Lawyer]

Originally posted by Greenhat
Your assumption here is that seatbelt and airbag laws are good things, and I'm not sure I agree with that.

Both are devices intended to protect people from themselves, and the laws that mandate them basically assume that people cannot be responsible for themselves. I disagree.

Also, those features have become major market features on a number of vehicles (as have ABS brakes, which are not mandated by law), even in countries where they are not mandated. Brands like Volvo started a market trend prior to any law, a trend which suppliers either respond to, or choose not to recognizing that limits their market.

Right on, GH.