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(The New York Times)   Here's Steve Jobs as the Ghost of Labor Day Future. You really don't want to read the headstone he's pointing to   (nytimes.com) divider line 244
    More: Scary, Labor Day, Steve Jobs, iPhones, United States, Henan Province, Jared Bernstein, foreign worker, production lines  
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9492 clicks; posted to Business » on 22 Jan 2012 at 7:14 AM (3 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-01-22 09:53:39 AM  

Flint Ironstag: We were promised a cure for cancer. That didn't work, so lets give up all research. Right?


You don't give up looking for a cure but you try something different in your research techniques for look to cure it in other ways because just maybe you are on the wrong path.

The goal is to create a strong, stable, economy that supports a large middle class and robust job market. I don't think going down this path of free trade as we are practicing it now is the right path.
 
2012-01-22 09:57:32 AM  

DrewCurtisJr: The goal is to create a strong, stable, economy that supports a large middle class and robust job market. I don't think going down this path of free trade as we are practicing it now is the right path.


Which means no cures for cancer, just expensive chronic treatments for the symptoms. What idiot would cure such a profitable disease?
 
2012-01-22 10:01:01 AM  
A foreman immediately roused 8,000 workers inside the company's dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day

So, a captive work force that seems to have little labor protection. I wonder if all the stores in Foxconn city are company owned. I would imagine at the least they need to have company approval.

The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory

But, but, socialism is BAD for companies. SOLYDRA! (BTW, this is why the Chinese are kicking our ass in solar panel production at the moment as well)

"They could hire 3,000 people overnight," said Jennifer Rigoni, who was Apple's worldwide supply demand manager until 2010, but declined to discuss specifics of her work. "What U.S. plant can find 3,000 people overnight and convince them to live in dorms?"

I know its a shame that we busted the labor camps and company stores back in the 30s. This is proof that those type of tactics still work today to make money for companies.

"We were told we would have to do 12-hour days, and come in on Saturdays," Mr. Saragoza said. "I had a family. I wanted to see my kids play soccer."

What an asshole. He should be happy with what his job creators tell him he can have off. And why are his kids playing sports when they could be working in a shoe factory.

"We shouldn't be criticized for using Chinese workers," a current Apple executive said. "The U.S. has stopped producing people with the skills we need."

Yeah, willing to live in a company dorm, no family, work 12 hours, 6 days a week and be able to do engineering tasks with more than a high school degree, but not a bachelor's. We really need to cultivate such skills again.
 
2012-01-22 10:02:28 AM  

DrewCurtisJr: Flint Ironstag: We were promised a cure for cancer. That didn't work, so lets give up all research. Right?

You don't give up looking for a cure but you try something different in your research techniques for look to cure it in other ways because just maybe you are on the wrong path.

The goal is to create a strong, stable, economy that supports a large middle class and robust job market. I don't think going down this path of free trade as we are practicing it now is the right path.


I'm sure a lot of other countries would love to do without US companies in their markets. In the UK for example the two big car manufacturers are both US owned. I'l sure the UK car industry would be far more successful without Ford and GM. Tesco would be far more profitable without WalMart owned ASDA. Wimpy (yeah, I know) would be far more successful without McDonalds and Burger King. (Though BK was British owned) Amstrad would still be a PC maker without Compaq and Dell etc. British Airways would have to buy Airbus planes instead of Boeing. We wouldn't have to put up with US owned newspapers like The Sun.

I'm game. Lets give it a go.
 
2012-01-22 10:05:00 AM  

Flint Ironstag:
I'm sure a lot of other countries would love to do without US companies in their markets. In the UK for example the two big car manufacturers are both US owned. I'l sure the UK car industry would be far more successful without Ford and GM. Tesco would be far more profitable without WalMart owned ASDA. Wimpy (yeah, I know) would be far more successful without McDonalds and Burger King. (Though BK was British owned) Amstrad would still be a PC maker without Compaq and Dell etc. British Airways would have to buy Airbus planes instead of Boeing. We wouldn't have to put up with US owned newspapers like The Sun.

I'm game. Lets give it a go.


Plus of course, we'd all have to buy decent phones like HTC and Samsungs instead of iPhones......
 
2012-01-22 10:05:39 AM  
Flint Ironstag: But they would then be totally unable to compete with all the other companies that would still manufacture in China, Korea, Taiwan etc

No they wouldn't.

farkeruk: there's far more people who want a new shiny iPad2.

You could make those in the UK and they wouldn't cost more than the ones made in China. You might want to have a clue what it is you're whining about.
 
2012-01-22 10:06:52 AM  

Flint Ironstag: I'm sure a lot of other countries would love to do without US companies in their markets.


There is nothing preventing anyone from producing locally goods that would be purchased locally. We do have this whole limited supply of fossil fuels thing going on.
 
2012-01-22 10:08:10 AM  
So the pyramid scheme of capitalism is exposed and people don't like it.
What a bunch of crybabies.
 
2012-01-22 10:09:40 AM  
Mr. Jobs's reply was unambiguous. "Those jobs aren't coming back,"
________________________________________

It's ridiculously easy to make those jobs come back. Do what has always been done for hundreds of years.

Tariffs
 
2012-01-22 10:09:49 AM  

WhyteRaven74: Flint Ironstag: But they would then be totally unable to compete with all the other companies that would still manufacture in China, Korea, Taiwan etc

No they wouldn't.

farkeruk: there's far more people who want a new shiny iPad2.

You could make those in the UK and they wouldn't cost more than the ones made in China. You might want to have a clue what it is you're whining about.


So, just to be really clear, you are saying that Steve Jobs did not know what he was talking about? He could actually have built iPhones and iPads in the US, or the UK, at no extra cost?

Steve Jobs built Apple into the worlds biggest company by market valuation but he couldn't work out production costs?

Is that what you are saying?
 
2012-01-22 10:10:03 AM  

Flint Ironstag: I'm sure a lot of other countries would love to do without US companies in their markets. In the UK for example the two big car manufacturers are both US owned. I'l sure the UK car industry would be far more successful without Ford and GM. Tesco would be far more profitable without WalMart owned ASDA. Wimpy (yeah, I know) would be far more successful without McDonalds and Burger King. (Though BK was British owned) Amstrad would still be a PC maker without Compaq and Dell etc. British Airways would have to buy Airbus planes instead of Boeing. We wouldn't have to put up with US owned newspapers like The Sun.

I'm game. Lets give it a go.


I'm pretty sure we did business with all those countries before the current manifestation of "free trade", fair trade and adjusted trade does not mean no trade.

And what about the competition the U.S. firms get in our own market from foreign firms? It works both was. China has made no secret about its ambitions. Not only are our firms going to have Chinese firms that are going to compete against some of the current success stories of U.S. firms in China, they are going to challenge to be exporting to the U.S. as well.
 
2012-01-22 10:10:17 AM  

BullBearMS: No, labor has been turned into a competitive market by the world's obscenely wealthy.


No, it's always been a competitive market, and it's as much about consumers as the "obscenely wealthy".

In the late 90s there were at least half a dozen local computer suppliers in my town - shops or industrial units that built PCs from scratch (I did a bit myself). Today, there's 1 and they really mostly do repairs. Why is that?

Well, I'll tell you what started to happen - by around 2004, I'd get calls from people asking about PCs. I'd take the cost of the parts, add on around an hour's labour and give them a quote and they'd say "I can get a cheaper one at Dell". None of them said "well, I know Dell's cheaper, but I'd rather give a guy in the UK a job".

Anyone who thinks consumers won't put the guy down the road out of business to save a few bucks is deluded.
 
2012-01-22 10:11:26 AM  

Bob16: Mr. Jobs's reply was unambiguous. "Those jobs aren't coming back,"
________________________________________

It's ridiculously easy to make those jobs come back. Do what has always been done for hundreds of years.

Tariffs


And when every other country does the same, goodbye exports.

As I said, I'd love to see how UK companies could do without Ford, GM, McDonalds, Dell, Apple, Walmart.....
 
2012-01-22 10:14:02 AM  

farkeruk: BullBearMS: No, labor has been turned into a competitive market by the world's obscenely wealthy.

No, it's always been a competitive market, and it's as much about consumers as the "obscenely wealthy".

In the late 90s there were at least half a dozen local computer suppliers in my town - shops or industrial units that built PCs from scratch (I did a bit myself). Today, there's 1 and they really mostly do repairs. Why is that?

Well, I'll tell you what started to happen - by around 2004, I'd get calls from people asking about PCs. I'd take the cost of the parts, add on around an hour's labour and give them a quote and they'd say "I can get a cheaper one at Dell". None of them said "well, I know Dell's cheaper, but I'd rather give a guy in the UK a job".

Anyone who thinks consumers won't put the guy down the road out of business to save a few bucks is deluded.


Exactly. The same people who say "Walmart should buy US stuff!" are the ones who will look at the price ticket and buy the Chinese product because is is 20c cheaper.
 
2012-01-22 10:14:58 AM  
Flint Ironstag: Is that what you are saying?

Labor costs aren't that big a deal when it comes to something you make thousands of in a day. And plenty of CEO's are great with one side of business, but absolutely suck at another part. Those who are good all around, Louis Gerstner IBM's former CEO comes to mind, are very rare.

farkeruk: Anyone who thinks consumers won't put the guy down the road out of business to save a few bucks is deluded.

You're assuming the cost of a product made in the US or the UK would be any different from one made in China.

Bob16: Tariffs

Didn't work for the US steel industry. Turned out the problem then, as now, was the people running things.
 
2012-01-22 10:16:21 AM  
Henry Ford's ghost is spinning.

Who the hell do they expect to buy the iPhone 7 or 8 in a few years? The $17 a day Foxconners? 20 of them pool their money to buy one prepaid Nokia-knockoff to call home. Even the $8/hour 'engineer' at Foxconn, who has his own phone, will buy a cheap one.

The knowledge workers in the US and the executive-levels in China. Great. Shrinking market and concentrating market.

Henry Ford could have paid his workers 1/4 of what he did. 12-hour 6-day shifts were perfectly normal back then. As were factory dorms. But, then, the Model T would have remained in the luxury goods range. His workers would have had neither the money to buy nor the time to use his products.
 
2012-01-22 10:18:07 AM  

Flint Ironstag: Bob16: Mr. Jobs's reply was unambiguous. "Those jobs aren't coming back,"
________________________________________

It's ridiculously easy to make those jobs come back. Do what has always been done for hundreds of years.

Tariffs

And when every other country does the same, goodbye exports.

As I said, I'd love to see how UK companies could do without Ford, GM, McDonalds, Dell, Apple, Walmart.....


BWAHAHAHAHAHAH

Ah Einstein.

We lived and exported for close to 200 years with tariffs.
 
2012-01-22 10:21:05 AM  

Flint Ironstag: bill_01915:

Back in the 80s I believed in free trade. I was naive enough to be free trade and fair trade were one and the same. They're not. Free trade with countries that actively stack the deck against us is killing the American dream.

If you think the US does not stack the deck just as much as other countries I have a bridge to sell you.

Like Airbus who won the tanker contract. So the US did it again. And again, until Boeing won.


That's slightly different because that is Congress directly picking a winner of a government contract not using taxpayer money to build a factory for Boeing so they can win a private contract. But yes, I concede we do it as well, more so in the area of agricultural products. A couple of years ago I read that we could import ethanol cheaper than we can make it, but we can't import it because we protect corn growers. That said, on balance I believe we're losing on the exchange.
 
2012-01-22 10:22:44 AM  

HotIgneous Intruder: Yes, five-day work weeks and environmental protections have really farked things up. It really sucks having some time off to rest and being able to breathe clean air and enjoy the outdoors without worrying about mercury and lead and gawd knows what other persistent contaminants in the soil and drinking water.


All that stuff imposes a cost. You can debate the morality of that, but ultimately if someone charges more for the same deliverable then they're going to lose trade. No, that's not nice, but that's the reality of the world.

I could also talk about things like maternity leave, minimum wage laws and employment protection. The last contract I did got outsourced to India at a rate that was sub-UK minimum wage. Even if I'd wanted to compete on price, I literally couldn't have done without breaking the law.
 
2012-01-22 10:22:57 AM  

WhyteRaven74: Flint Ironstag: Is that what you are saying?

Labor costs aren't that big a deal when it comes to something you make thousands of in a day. And plenty of CEO's are great with one side of business, but absolutely suck at another part. Those who are good all around, Louis Gerstner IBM's former CEO comes to mind, are very rare.

farkeruk: Anyone who thinks consumers won't put the guy down the road out of business to save a few bucks is deluded.

You're assuming the cost of a product made in the US or the UK would be any different from one made in China.

Bob16: Tariffs

Didn't work for the US steel industry. Turned out the problem then, as now, was the people running things.


Like I assume the sky is blue or the sun is hot.

Seriously, if you disagree with this then that ranks alongside moon hoaxers and birthers. In very high value and/or specialised products like drugs or making Aston Martins where labor is a tiny part of the cost and/or where shipping cost is significant, such as soft drinks, then local production can compete.

But when you employ 700,000 people to make iPhones and iPads you simply cannot in any way argue that "labor costs aren't a big deal"

At an average wage of $50k, including taxes, healthcare etc, that is $35 billion a year. Not including the extra workers needed because workers in the US and the UK won't work 12 hour days.
 
2012-01-22 10:24:26 AM  

bill_01915: Flint Ironstag: bill_01915:

Back in the 80s I believed in free trade. I was naive enough to be free trade and fair trade were one and the same. They're not. Free trade with countries that actively stack the deck against us is killing the American dream.

If you think the US does not stack the deck just as much as other countries I have a bridge to sell you.

Like Airbus who won the tanker contract. So the US did it again. And again, until Boeing won.

That's slightly different because that is Congress directly picking a winner of a government contract not using taxpayer money to build a factory for Boeing so they can win a private contract. But yes, I concede we do it as well, more so in the area of agricultural products. A couple of years ago I read that we could import ethanol cheaper than we can make it, but we can't import it because we protect corn growers. That said, on balance I believe we're losing on the exchange.


Or corn syrup, hence all the HFCS crap in Coke.
 
2012-01-22 10:25:15 AM  
Flint Ironstag: Ford, GM,

The companies Ford and GM own in England and Europe are plenty big to survive on their own. What's more, they could start exporting their cars to the US. Ford has sold cars in the US based on UK products and they've been seen as inferior to the actual cars sold in the UK. In GM's case they sell cars in the US based on cars sold in Europe under the Opel name, and they too are seen as inferior to what Opel sells. Funny enough the US has no competition for the English car companies it doesn't own, Lotus, Jaguar, Rolls Royce, Bentley and Aston Martin. Not long ago Aston Martin looked to be not long for this world, now they're all over the place.
 
2012-01-22 10:26:42 AM  

Flint Ironstag: At an average wage of $50k, including taxes, healthcare etc, that is $35 billion a year.


Oh. My. God.

You mean the rich would get richer more slowly and the little people would be allowed to get off food stamps?

Well, that is horrible.
 
2012-01-22 10:29:17 AM  

WhyteRaven74: And if you made the iPhone in the US the overall benefit to the US would be far greater. Plus the cost of shipping the phones to Europe would be a lot lot lower.


Shipping is so small portion of the overall cost of a product that its a completely irrelevant measure in determining where to assemble something.

/like any companies supply chain - Apple sources for materials is all over the globe
 
2012-01-22 10:30:04 AM  
BOO.

Your exports will disappear if you impose tariffs

Your exports will disappear if you impose tariffs

Your exports will disappear if you impose tariffs


Be afraid. Always be afraid.
 
2012-01-22 10:30:31 AM  

WhyteRaven74: Flint Ironstag: Ford, GM,

The companies Ford and GM own in England and Europe are plenty big to survive on their own. What's more, they could start exporting their cars to the US. Ford has sold cars in the US based on UK products and they've been seen as inferior to the actual cars sold in the UK. In GM's case they sell cars in the US based on cars sold in Europe under the Opel name, and they too are seen as inferior to what Opel sells. Funny enough the US has no competition for the English car companies it doesn't own, Lotus, Jaguar, Rolls Royce, Bentley and Aston Martin. Not long ago Aston Martin looked to be not long for this world, now they're all over the place.


Both Ford and GM have often relied on huge subsidies from their US parents.

And Jaguar and Aston were US owned for many years. Ford even made Jaguar make a car based on the Mondeo.
 
2012-01-22 10:30:42 AM  

BullBearMS: You mean the rich would get richer more slowly and the little people would be allowed to get off food stamps?


$35B/yr is not "the rich getting richer more slowly". That's "$2B more than Apple's operating income."
 
2012-01-22 10:31:34 AM  
Flint Ironstag: Aston Martins where labor is a tiny part of the cost

If you make 1,000 of something in an hour and it's something whose assembly relies chiefly on automation, you don't need very many people, so labor costs are a small price of the overall cost of the product. This works for cars and cell phones. Even if you're not making 1,000 of something an hour, as long as your making enough of it, labor costs aren't a big factor. The labor cost of assembling a Ford F-150 truck is about $500. Ford charges dealers between $21,000 to $45,000 for each F-150 depending on the particular model. In the case of the Corvette, assembly costs about $3,700 per car. GM charges dealers somewhere between $50,000 and $100,000. Now there are other labor costs associated with the F-150 and Corvette, like the labor in making the engines, but there as well, the labor cost per unit is a small fraction of the price of the item.
 
2012-01-22 10:33:05 AM  
It isn't just that workers are cheaper abroad. Rather, Apple's executives believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have so outpaced their American counterparts that "Made in the U.S.A." is no longer a viable option for most Apple products.

Riiiiiiiiiight. "Flexibility and diligence of foreign workers" == "We pay them as slaves and treat them as slaves, and they have nobody to turn to for help".

And yet, with the full power of your vast wealth, you still couldn't get your third-world plantation-workers to cobble together a pancreas for you.
 
2012-01-22 10:36:58 AM  

bill_01915: Flint Ironstag: bill_01915:
The profit doesn't come back to the US it stays in overseas accounts so they don't have to pay US taxes on it. The majority of Apple's $90b in cash is held overseas.

So they just leave it overseas? Forever? Seems a waste...

/Sarcasm off.

No, just waiting for another tax holiday so they can bring it home at 0% instead of 35%. Republicans pushed for that last year. No doubt it will come up next Jan if Obama loses in Nov.

//didn't want to go there and turn this into a political thread


I think we should let them have their tax holiday.

Then the US govenment should take a holiday from all that crap that does nothing for those businesses overseas. You know, stuff that just costs the tax payers (and we know its only the glorious job creators that pay taxes) but yet provides nothing in returns.

I suggest:

1. Anti-piracy effort. Real priracy on the open seas. We have the Coast Guard here, so why worry about other places. Let all the taxes they pay in other nations protect their international shipping routes.

2. Protecting intellectual property through the US government. We are members of the WTO and othe organizations that pushes China and other nations to recognize that it takes a lot of investment to develop new products. Why should we care what happens in China to a US based company? If they start producing exact replica iPhones, well, not our problem. After all, the profits earned overseas have nothing to do with the US, right?

3. Anti bribery efforts. Its tought to operation in locations where you are being forced to put up bribes to protect your assets. The US is a leader is clearing out corruption. But why? We have enought to worry about at home, and well, if obvious that profits earned outside our shores have nothing to do with anything back home, so take care of it yourself.

4. Nationalization efforts. Spent all that capital and built a plant in a somewhat unstable nation? Well, the military won't come in to 'promote democracy' for you and if you lose all that, well, that sucks. We don't really have the time or resources to go in front of international organization to promote your case.

TLDR, if companies want to say that overseas profits should not be taxed because it is not fair, no problem. Its not fair to spend domestic only tax revenue on assisting their business overseas then.
 
2012-01-22 10:37:09 AM  

BullBearMS: Flint Ironstag: At an average wage of $50k, including taxes, healthcare etc, that is $35 billion a year.

Oh. My. God.

You mean the rich would get richer more slowly and the little people would be allowed to get off food stamps?

Well, that is horrible.


No, I mean that with an extra $35 billion in costs (even if you could assume the same productivity!) Apple would not be able to compete and go bust, losing all those jobs. Why is this so hard for people to understand?

And the comment I was replying to said labor costs are "not a big deal".

Even for Apple do you consider £35billion a year to be "not a big deal"?

Let me put it this way. $35 billion is more than Apple's profit. In the US, with US working laws, you would have to double that at least.

Do you know what happens when a companies costs exceed it's income?

Apple's profit would be wiped out twice over by bringing those labor costs to the US. It is not a case of "Oh dear, some CEO might have to go without a new yacht". It is "Oh dear, the entire company has gone bankrupt and everyone ahs lost their job"
 
2012-01-22 10:39:05 AM  

WhyteRaven74: Flint Ironstag: Aston Martins where labor is a tiny part of the cost

If you make 1,000 of something in an hour and it's something whose assembly relies chiefly on automation, you don't need very many people, so labor costs are a small price of the overall cost of the product. This works for cars and cell phones. Even if you're not making 1,000 of something an hour, as long as your making enough of it, labor costs aren't a big factor. The labor cost of assembling a Ford F-150 truck is about $500. Ford charges dealers between $21,000 to $45,000 for each F-150 depending on the particular model. In the case of the Corvette, assembly costs about $3,700 per car. GM charges dealers somewhere between $50,000 and $100,000. Now there are other labor costs associated with the F-150 and Corvette, like the labor in making the engines, but there as well, the labor cost per unit is a small fraction of the price of the item.


Yeah, it takes 700,000 workers to build Apple stuff in China. At US pay rates that's £35 billion a year, if you could get the same productivity.

That is more than Apples profit.

How are they going to pay for that?
 
2012-01-22 10:41:37 AM  
bravian: Shipping is so small portion of the overall cost of a product that its a completely irrelevant measure in determining where to assemble something.

Better to spend the money on labor than shipping. It's far cheaper to ship 10 tons of something from the US to Europe than from China to Europe. It's also faster, which makes the whole supply chain thing easier.

Flint Ironstag: And Jaguar and Aston were US owned for many years.

Aston was owned by Ford, and nearly went under. Now? It's doing awesome. As for GM's and Ford's other European companies, they don't need much in the way of subsidies from Detroit. Opel and Vauxhall could easily survive on their own. Ford is a bit trickier since they have English and German divisions as opposed to simply owning car makers there. But they could spin off those divisions and they'd do fine.
 
2012-01-22 10:42:08 AM  

WhyteRaven74: You're assuming the cost of a product made in the US or the UK would be any different from one made in China.


Why would someone running a business in the US want manufacturing in China for any other reason than cost? Outsourcing is a pain in the ass compared to having suppliers an hour down the road.

Companies can talk about "they have the capacity" but that's just a smokescreen because they don't want the PR hit of saying that they're sending work to China to make more money for their shareholders.

I live near a town called Malmesbury in the UK where James Dyson first built Dyson cleaners (the R&D is still there). He shipped his manufacturing out to Malaysia because "the local government didn't want us to build another factory to expand production". The local politicians were kinda flabbergasted about this because according to them, Dyson hadn't even mentioned it.
 
2012-01-22 10:43:14 AM  

Flint Ironstag: Yeah, it takes 700,000 workers to build Apple stuff in China. At US pay rates that's £35 billion a year, if you could get the same productivity.

That is more than Apples profit.

How are they going to pay for that?


I get the feeling that the same conversation was being made when plantation owners were discussing the possibility of emancipation.
 
2012-01-22 10:47:34 AM  

LouDobbsAwaaaay: Flint Ironstag: Yeah, it takes 700,000 workers to build Apple stuff in China. At US pay rates that's £35 billion a year, if you could get the same productivity.

That is more than Apples profit.

How are they going to pay for that?

I get the feeling that the same conversation was being made when plantation owners were discussing the possibility of emancipation.


Does that alter the fact that that cost is more than Apple's profit? Because there are some here saying that labor costs are "no big deal".
 
2012-01-22 10:48:50 AM  

WhyteRaven74: bravian: Shipping is so small portion of the overall cost of a product that its a completely irrelevant measure in determining where to assemble something.

Better to spend the money on labor than shipping. It's far cheaper to ship 10 tons of something from the US to Europe than from China to Europe. It's also faster, which makes the whole supply chain thing easier.

Flint Ironstag: And Jaguar and Aston were US owned for many years.

Aston was owned by Ford, and nearly went under. Now? It's doing awesome. As for GM's and Ford's other European companies, they don't need much in the way of subsidies from Detroit. Opel and Vauxhall could easily survive on their own. Ford is a bit trickier since they have English and German divisions as opposed to simply owning car makers there. But they could spin off those divisions and they'd do fine.


Great. Let's nationalise them and have their profits go to shareholders in the UK. If the US puts up trade barriers against UK companies that seems only fair.
 
2012-01-22 10:50:47 AM  
Flint Ironstag: . Why is this so hard for people to understand

The actual cost of manufacturing in the US wouldn't be much if any higher than manufacturing in China. One of the problems with China is quality control, while there are no official numbers, it's estimated manufacturing defects result in up to 1% of a particular product being rejected. For something like the iPhone or iPad that's disastrous. If they're talking about 10,000 units a day, that's 100 rejected units a day, that's tens of thousands in lost revenue. A day. A proper manufacturing process would see that reduced to almost nothing. And that savings would more than pay for any extra labor costs as well as other costs.

it takes 700,000 workers to build Apple stuff in China.

In a properly tooled factory you could make 10,000 iPhones a day with 100 people actually working on assembly, easily.
 
2012-01-22 10:51:21 AM  

ComatoseB0nerToes: Is America farked because Apple makes crap in China, or is America farked because millions of people in America who cannot afford a $500 and $100 dollar / month payment are still buying them?


therayarea.com

I think you have a very good point. We've got people who aren't qualified to make these luxury products going into debt to buy them. Seriously, how does a barista afford their iPhone data plan?
 
2012-01-22 10:53:32 AM  
Flint Ironstag: Does that alter the fact that that cost is more than Apple's profit? Because there are some here saying that labor costs are "no big deal".

I love how you think it would cost $35 billion to make Apple products in the US.

farkeruk: Why would someone running a business in the US want manufacturing in China for any other reason than cost?

If it were about cost you'd see certain products get cheaper. But that has happened. So where's the extra money going?
 
2012-01-22 10:54:52 AM  
It's 2012, who are these lackeys so adamant about defending free trade on web forums on their weekend? Are you guys being paid for this?
 
2012-01-22 10:59:02 AM  

Lawnchair: Who the hell do they expect to buy the iPhone 7 or 8 in a few years? The $17 a day Foxconners? 20 of them pool their money to buy one prepaid Nokia-knockoff to call home. Even the $8/hour 'engineer' at Foxconn, who has his own phone, will buy a cheap one.


Didn't Chinese counterfeiters knockoff entire Apple stores?
 
2012-01-22 11:00:33 AM  
Protectionism works

http://pavelpodolyak.blogspot.com/2009/09/protectionism-works.html
 
2012-01-22 11:01:12 AM  
As for American competition, think of all the products that aren't even made in the US. Want a sportbike? Japan, Italy, Germany and the UK are your only option. The only American company that made them, Buell was thrown off a cliff by their parent Harley Davidson for reasons never made entirely clear. And judging by what I see when the weather is nice, there are lots and lots of people who buy these motorcycles. Then there are scooters. Where there are two small US companies involved. So two huge markets, and the US has almost no presence in them at all.
 
2012-01-22 11:03:26 AM  

WhyteRaven74: If it were about cost you'd see certain products get cheaper. But that has happened. So where's the extra money going?


Are you serious? What electronics products have you bought recently that went up in price (OK, there's the temporary blip in hard drive prices).

And for non-electronics, I watched the price of clothing going up for decades, then in the early 2000s, the prices just went rocketing down. I buy jeans from Tesco for less than I paid for jeans in the 80s. That's down to one thing and one thing only: Chinese production.
 
2012-01-22 11:04:09 AM  
Bob16: Protectionism works

The example of the US steel industry says otherwise. The problem is not laws, it's the people in charge of enterprises. US steel companies were run by people who thought it was just hunky dory to use equipment that was ancient. There's no law on Earth that's going to save companies run by people like that when they go up against companies run by people who understand that you need to update your equipment regularly, scrutinize and improve your processes and actually provide what the market wants when it wants it. While the steel industry got all sorts of favors, the aluminum industry didn't, but the people in charge there were very different than those running the steel companies, so they did just fine, because they took care of what it takes to actually do business.
 
2012-01-22 11:05:24 AM  
Why Tariffs Work

http://www.unz.org/Pub/AmConservative-2003jun30-00017?View=PDF
 
2012-01-22 11:06:33 AM  

Flint Ironstag: LouDobbsAwaaaay: Flint Ironstag: Yeah, it takes 700,000 workers to build Apple stuff in China. At US pay rates that's £35 billion a year, if you could get the same productivity.

That is more than Apples profit.

How are they going to pay for that?

I get the feeling that the same conversation was being made when plantation owners were discussing the possibility of emancipation.

Does that alter the fact that that cost is more than Apple's profit? Because there are some here saying that labor costs are "no big deal".


Not in the least. I'm not commenting on that argument (I'm functionally retarded when it comes to business/economics, so I'll stay out). But you have to admit the whole thing seems to boil down to "Slaves are just so damn profitable! How can we possibly give up margins like this?" We fought a civil war in an effort to maintain that business model in the face of a need to recognize the rights of all people, and now that the plantations have moved off-continent and we're making iPads instead of cotton, I doubt it would take anything less than a war to do it again.
 
2012-01-22 11:07:35 AM  
farkeruk: Are you serious? What electronics products have you bought recently that went up in price (OK, there's the temporary blip in hard drive prices).

The decrease in prices in electronics is due thanks to the cost of the components falling owing to improved manufacturing and the improvement of technology itself. But if you look at non-electronics that were made in the US and then had their manufacture moved elsewhere, even though it was claimed the cost of manufacture went down, the cost didn't go down. So where'd the money go?
 
2012-01-22 11:07:50 AM  

WhyteRaven74: Flint Ironstag: . Why is this so hard for people to understand

The actual cost of manufacturing in the US wouldn't be much if any higher than manufacturing in China. One of the problems with China is quality control, while there are no official numbers, it's estimated manufacturing defects result in up to 1% of a particular product being rejected. For something like the iPhone or iPad that's disastrous. If they're talking about 10,000 units a day, that's 100 rejected units a day, that's tens of thousands in lost revenue. A day. A proper manufacturing process would see that reduced to almost nothing. And that savings would more than pay for any extra labor costs as well as other costs.

it takes 700,000 workers to build Apple stuff in China.

In a properly tooled factory you could make 10,000 iPhones a day with 100 people actually working on assembly, easily.


So once again, Steve Jobs, and every other CEO, just didn't know what they were talking about?
 
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