Outsourcing – It’s a bad thing

We have heard a lot about outsourcing, i.e. hiring people in other countries to do work that used to be done here, in the past few years. It would be understandable if some people thought that this was a recent phenomenon; however, outsourcing in America has roots that go deep into our past. I don’t think we called it outsourcing then; we just said that jobs were being lost as businesses were closing down. Here is an example:

Beginning in the 1800’s New England experienced a financial boom based upon the industrial revolution. Factories were built by the hundreds. The town of Lowell, Massachusetts was built as a model of the new industrial society, with dormitories provided for factory workers, many of whom were imported from other countries because these factories could not find enough labor in the United States. Factories throughout New England eventually manufactured almost everything you could imagine, from shoes, wool, textiles, and linen to structural steel, copper wire, and high tech abrasives. However, by the 1950’s and into the 1960’s the factories began to close and the model factory town of Lowell became a synonym for a slum town. The major manufacturing city of Worcester, Massachusetts saw factory after factory close, with perhaps the greatest blow coming when its massive United States Steel plant closed. But where did all the jobs go?

They went south. They went to states like North Carolina and others where new factories were built and a flagging economy, that had yet to recover from the Civil War, saw a boom that led to nearly full employment and the beginning of an economy based upon something other than agriculture. The industrial jobs of the prosperous north had been outsourced to the indigent south. Why? Because the factory owners had determined that as the cost of employing people in the north increased they were making less and less profit. The south was a source of cheap labor and therefore an opportunity to return to the glory days of maximum profit. The outsourcing of jobs from the north to the south was a bad thing for the north, but a good thing for the south, wasn’t it? It was also a good thing for the factory owners – at least for a while. What about the overall American economy? Was it a good or bad thing overall? You might say that the north’s loss was the south’s gain and I think you would be mostly correct. I think that, for a closed economic system like the eastern U.S., outsourcing was, overall, a neutral economic activity, although it certainly inflicted a lot of pain – and happiness- in specific places.

Moving on to the 21^st Century, a new type of outsourcing has occurred. The new outsourcing sends U.S. jobs to foreign countries, where the workers are paid much less than American workers, but the owners of the companies can return, once again, to the glory days of maximum profits. In this round of outsourcing we see the textile mills in North Carolina closing and new ones opening in China, India, and lots of other places. In the north, which transitioned to a high tech based economy after the loss of the mills, we see high tech jobs being outsourced to China, India, and lots of other places. In the new outsourcing, American jobs have been lost in both the north and the south. There is good news, however. You can now go to Wal-Mart and buy a pair of $60 Levis for only $20.

Eventually this sort of thing has to have consequences. One of these is that the owners of the companies are now making truly massive profits. It is better even than the old glory days. Money is pouring into the U.S. Is this a good thing? I don’t think so because the money isn’t really going into the overall economy; it’s going into the bank accounts of the owners of the companies. Fortunately, there are service jobs at places like Starbucks that seem to be immune to outsourcing. Lots of skilled American workers eventually have to settle for something like these and now make just enough money to pay for a $20 pair of Levis at Wal-Mart.

The new outsourcing doesn’t have an overall neutral effect on the average American like the old outsourcing; it makes their quality of life worse. The reason the new outsourcing is a bad thing is that, unlike the U.S. economy, the global economy is not a closed system. It is an open system. Money that flows out of the U.S. economy doesn’t flow back into it – instead it just winds up in the bank accounts of the ultra-rich.

I suppose then that it is not correct to say that no one benefits from outsourcing, because they do… It just isn’t you.

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Justice for American Indians

Not too long ago, I took a road trip from the west coast of the U.S. to the east coast. It goes without saying that you can see a lot more of this beautiful country by driving across it than by flying across it. It was about the time that I crossed the California/Arizona border in Yuma that I started becoming aware of something that I guess a lot of people already know. There are these highway signs you see as you pass through the desert. The land is made up pretty much of mostly rocks with a little bit of sand and hardly a trace of anything green. The signs tell you that you are now driving through an American Indian reservation. I had never even heard of many of the tribes – they weren’t the famous ones like Apache and the Sioux. They were just small, mostly insignificant in the course of American history, consigned to living in a place in which I suspect neither you nor I would like to spend more than ten minutes.

The first time I passed one of these reservations was surprising, but after passing several more it became disheartening. This was land where you would have a hard time growing weeds. It was more of the same in New Mexico. You drive for miles passing what look like derelict trailers with some broken down cars parked beside them as you go from Albuquerque to Las Cruces. I don’t know how many different tribes and reservations I passed, but when I got to Texas they seemed to disappear from the side of the road. I didn’t see any more roadside reservations until I came down out of the Great Smokey Mountains National Park and drove into the town of Cherokee, North Carolina. As it happened there was a minor landslide on the highway and I had to take a detour through some of the residential areas of the Cherokee reservation. It wasn’t as bleak as Arizona or New Mexico and the small homes looked a little better than the beat up trailers I had seen in the west, but I don’t think anyone would mistake the town of Cherokee for Chapel Hill.

My guess is that most Americans spend less than one second a day thinking about the American Indians. They are pretty much out of sight and out of mind, unless I suppose you frequent some of the tribes’ casinos. There is one in Cherokee. It is a nice, mini-Las Vegas-looking facility, clean and neat and glittery and prosperous I hear. It provides a nice contrast to the rest of Cherokee.

If you would bear with me, I would like to recount a little prehistory and history for a paragraph or so. Most experts now say that the people we call the American Indians settled in North America approximately 10,000 years ago. This entire continent was their homeland for about 9,500 years until the Europeans “discovered” America. Remember the Pilgrims who landed in Plymouth, Massachusetts in 1620 and who were befriended by the Indians? The Indians taught them how to plant corn and survive in the New World. Without their help the Pilgrims would almost certainly have perished, like the settlers of lost colony of Roanoke in North Carolina. It wasn’t long, however, before the Pilgrims wanted more land from the Indians and fighting broke out. There’s not much left of the Indians in Massachusetts today, except place names (like Massachusetts). Many of the Indians died of diseases like small pox and those that didn’t died from bullets.

This systematic destruction of the American Indian population (today it would be called genocide) occurred throughout the colonies. The Cherokee, whose territory once covered almost four states, were decimated and then driven from their homes and made to march on the Trail of Tears to a new “home” in no man’s land in Oklahoma under orders from President Andrew Jackson. A few of these Cherokee escaped from the march and made their way back to North Carolina and became the eastern branch of the Cherokee.

This destruction of the American Indian population and the appropriation of their lands that they had owned for almost 10,000 years was carried out while the colonists professed belief in the mass delusion that was called Manifest Destiny – today we know it is nothing more than a Hitlerish justification of theft and murder. Now, conveniently, the remnants of that genocide and monumental theft of sovereign territory have been swept from the view of the average U.S. citizen.

There has been an effort this year to have the American government apologize to the American Indians in a way similar to what the Australian government recently did for the Aborigines. I haven’t seen any recent press releases about the American apology, but whether the bill actually did make it through Congress and was signed by the President doesn’t make much difference. It is time to make real amends. It is time for justice for the American Indians.

I know it isn’t practical to think of giving the country back to the Indians, and besides, it wasn’t us who killed all the Indians. OK, so what would be a fair thing to do? Is it fair to force so many of these people to continue to live on some of the least desirable land in the country with essentially opportunity to live lives as good as ours? Here’s a bold idea that will make you catch your breath: why not give them our National Parks? OK, calm down – relax – think about it for a minute. We don’t live on those lands, right? And we don’t conduct business on those lands either. So it wouldn’t really inconvenience us in those sorts of ways. The American Indian has traditionally been a good steward of the land too – much better than we have been.

We could make an agreement with them, as part of the settlement, that they would continue to operate these areas as national parks and would allow us perpetual access, for a fee of course – that’s how they can make money. They maintain the parks and could also live in the parks, providing we all agree on certain guidelines, like no mobile homes allowed and so forth. As part of righting a grievous wrong, we should also give them a generous financial settlement for stealing their land. Can you imagine how many trillions of dollars the U.S. would be worth today if you wanted to buy it? I know we can’t give them what the place is truly worth, but the deal they have now amounts to nothing more than the continued theft of their property that those misguided and murderous religious pilgrims (our heroes) began four hundred years ago.

It is time for our government to stop its righteous preaching to the world and deal with the continuing disgrace of our treatment of the American Indian. Until then, we are in no position to teach the world anything about morality.

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The Imaginary Oil Crisis

If you listen to John McCain you might think that we were in danger of running out of energy tomorrow. You might think that we are in a desperate situation and we need to start digging for offshore oil right now…today…this minute, and if we do, why you can bet that oil prices will come down tomorrow after all that offshore oil starts flowing to our gas pumps next month. I can’t wait, can you?

If you listened to George Bush a few years ago you might have thought we were in immediate danger of a nuclear or biological attack from Iraq. You might have thought that there was no time to waste; we had to invade immediately. There was no telling when that diabolical, fiendishly clever Saddam would choose to unleash his array of biological, chemical, and nuclear weapons upon the free world. Aren’t you glad we acted? Now we can sleep at night, safe from imminent attack by those Iraqis, who also happen to be swimming in oil. Thank God we finally corrected one of Saddam’s worst, most dastardly deeds – the one where, thirty-seven years ago, he booted the U.S. oil companies out of Iraq. Well, thankfully, things are back the way they should be now that the new Iraqi government has awarded no-bid contracts to those same companies to get the oil flowing again. That Saddam was a sly one, wasn’t he?

If you remember the Arab oil embargo in the early 1970’s you might recall how the price of oil skyrocketed too. There wasn’t enough gas any more so the price went up – supply and demand and that sort of thing. The major oil companies came out with dire predictions: we only had enough oil on Planet Earth to last about another twenty years. Yikes! Upon reflection though, it is pretty clear the price of gas, which rose during the embargo from about seventy-five cents a gallon to about a buck fifty (this are approximate numbers – what, you expect me to remember every detail from forty years ago?) really should not have come down much after the embargo was lifted, after all, you know its supply and demand, and besides, like the oil companies said, it wouldn’t be long until we didn’t have any gas at all.

Here’s something to think about: in the 1960s a gallon of gas cost between 30 and 40 cents. A new house cost between $30,000 and $40,000. A typical electrical engineer’s salary was about $10,000. Tuition for a top college was between $1500 and $2000 a semester. Today a gallon of gas is between 3 and 4 dollars. A new house costs between $300,000 and $400,000. A typical electrical engineer earns about $100,000. Tuition for a top college is about $15,000 to $20,000 a semester. In general, things cost about ten times more today than they did in the 1960s. That’s inflation for you.

So why all the fuss about oil? It’s just inflation right? Not exactly. The real problem we face, and from which our Republican leaders have cleverly diverted our attention, is the mortgage meltdown. The U.S. banking industry has saddled the entire world with a ton of bad debt. Maybe a trillion dollars, maybe more, that our clever bankers wrapped up in pretty wrapping paper and sold as triple A rated securities to unsuspecting investors. Too bad that when they opened the pretty wrappers they found a pile of doggy poo instead. You may recall that the next thing that happened was our banking industry tanked (come on, you remember – it wasn’t that long ago, just before the offshore drilling crisis, actually). Anyway, it was about then that the rest of the world said they didn’t want to buy our pretty packages of doggy poo anymore. It turns out they weren’t too keen on our money anymore either and they began selling dollars for Euros and other currencies. A lot of people didn’t feel good about buying currencies so they bought other things that would keep their value as the dollar began losing its value (also called inflation by some who like to think positive). So they bought valuable things like gold. They also bought oil. You can do that you know on the stock market. You don’t really have to take delivery of the oil either. So guess what happened? The price of oil went up! Or, if you are a believer in the theory of relativity, the price of the dollar went down! It’s all in how you look at it.

Supply and demand, that’s the free market place for you. Well, gee. Now, oil’s down again! And the dollar is up! Incredible how that works. Let’s see, a gallon of gas is now about ten times what it cost in the psychedelic sixties. Sounds right to me. Everything else costs about ten times more too. So Johnny, what is the crisis all about? Why do we need to start drilling TODAY? What about the meltdown in our mortgage market? What about the fact that the greediness of the banking and real estate industry has caused a collapse in our economy throwing millions of people out of work and millions more out of their houses that they can’t pay for? What about the fact that even people with good credit can’t get a loan anymore? What about the fact that without a housing construction pyramid scheme in operation we don’t really have any American industry anymore because we have outsourced all of our manufacturing jobs? I know it costs me about $10 more a week to buy gas, but is that really the problem?

OK, Johnny. We need to DRILL OFFSHORE RIGHT NOW. I heard you, I heard you. I’m so glad you have the experience to be Commander in Chief. I just wish you were our Commander in Chief when Saddam was around. I’ll bet you would have found those nukes. He probably buried them offshore along the Iraqi coastline along with all his biological and chemical weapons.

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