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Maybe Make a Quality Power Tool?

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  • #16
    Re: Maybe Make a Quality Power Tool?

    The chinese junk we are forced to buy is part of our economic problems. Lost time and wages for American professionals at the mercy of this junk along with the loss of American wealth needed to repurchase defective, poorly made products over and over again takes it's toll on our economy.

    The formula for selling substandard goods to American consumers is brilliant from the chinese standpoint. We are at their mercy, same as drug users with no free will to make better choices. Remarkably, there are still plenty of Americans who do not understand what is going on, and those who do are powerless to change the process.

    We can try and buy older, better made items, or upgrade and improve the things as they break but the chinese are getting wise. They make things so bad that they cannot be fixed, designed so even a handy person would be stumped. I have seen this on tools, machines and cars. Plastic gears, in plastic housings, with flimsy switches and cords, you might as well build it from scratch!

    Comment


    • #17
      Re: Maybe Make a Quality Power Tool?

      Franki,

      The only problem I have with your "Chinese" is that there's an awful lot of "American" in that process. Yes these tools are being made in China... but, to a very large extent it is American-owned and management decision that has take those products there and it is American management and stock holders that are making profit from it.

      Just looking at the major manufacturer's in my area.... Corning, Dresser-Rand, Ingersoll-Rand, and even IBM have all moved much of their manufacturing to China. In the case of my past employer, that move was made willingly and without coersion. As a matter of fact, they took $10 M from NY taxpayers on the same day they laid off almost 200 employees and were starting a major move of our product line to China.

      Corning Inc, laid off a over a thousand employees and closed several U.S. plants during the big tech bust, but within just a few years they invested over $5 Billion in China!

      Those moves (and I'm sure a lot of moves by other U.S. manufacturers) were done for the sake of profit and those profits continue for those U.S.-owned companies. It isn't the Chinese... they're just wanting the jobs, like you and I.

      CWS

      Comment


      • #18
        Re: Maybe Make a Quality Power Tool?

        Originally posted by CWSmith View Post
        Franki,

        The only problem I have with your "Chinese" is that there's an awful lot of "American" in that process. Yes these tools are being made in China... but, to a very large extent it is American-owned and management decision that has take those products there and it is American management and stock holders that are making profit from it.

        Just looking at the major manufacturer's in my area.... Corning, Dresser-Rand, Ingersoll-Rand, and even IBM have all moved much of their manufacturing to China. In the case of my past employer, that move was made willingly and without coersion. As a matter of fact, they took $10 M from NY taxpayers on the same day they laid off almost 200 employees and were starting a major move of our product line to China.

        Corning Inc, laid off a over a thousand employees and closed several U.S. plants during the big tech bust, but within just a few years they invested over $5 Billion in China!

        Those moves (and I'm sure a lot of moves by other U.S. manufacturers) were done for the sake of profit and those profits continue for those U.S.-owned companies. It isn't the Chinese... they're just wanting the jobs, like you and I.

        CWS
        You are 100% correct, thousands of formerly American based businesses moved to mexico, china and other countries. No more taxes, EPA, OSHA, Unions, or American wages. Great profits as they kill off their consumer base. I wouldn't pat the chinese on the back either, their government is brutal and goes against every freedom we stand for, the products they send us whether American or chinese based ownership is garbage. We lose tax revenue, jobs and quality goods at the same time. How or why our legislators allowed this to happen is beyond me because I can't see how this can eventually result in a positive manner for us.

        I'm sure it would take a while to list all the American companies that left over the last thirty or so years, this has been a long time in the making! Does any intelligent person really think our economy and country can survive the loss of all these businesses and jobs? Wealthy folks getting tax breaks are not creating the millions of jobs that were lost. Our government is not about to stop spending money it does not have. We as a people are for the most part spoiled, severely distracted, and incapable of doing what it takes to fix this mess.

        Maybe when and if china rules over our citizens we will realize the people of china want much more than jobs. We will finally understand what it is like to live in fear, when the government tells you how many children to have and what to say and do. We stand to lose so much and yet we accept the embarassing and unAmerican excuse for politics democrats and republicans have given us. Our borders remain open as illegals burden our economy and conduct drug trade with other fine Americans. The best plan to fix our economy is yet to take place as we hear of green jobs and the bright future.
        What the heck happened to our country? Is our drinking water drugged?

        Comment


        • #19
          Re: Maybe Make a Quality Power Tool?

          Originally posted by CWSmith View Post
          Franki,

          The only problem I have with your "Chinese" is that there's an awful lot of "American" in that process. Yes these tools are being made in China... but, to a very large extent it is American-owned and management decision that has take those products there and it is American management and stock holders that are making profit from it.

          Just looking at the major manufacturer's in my area.... Corning, Dresser-Rand, Ingersoll-Rand, and even IBM have all moved much of their manufacturing to China. In the case of my past employer, that move was made willingly and without coersion. As a matter of fact, they took $10 M from NY taxpayers on the same day they laid off almost 200 employees and were starting a major move of our product line to China.

          Corning Inc, laid off a over a thousand employees and closed several U.S. plants during the big tech bust, but within just a few years they invested over $5 Billion in China!

          Those moves (and I'm sure a lot of moves by other U.S. manufacturers) were done for the sake of profit and those profits continue for those U.S.-owned companies. It isn't the Chinese... they're just wanting the jobs, like you and I.

          CWS
          I'm not getting your point. I for one have no problem with the Chinese, other than they happen to be the source of most of the poorly manufactured stuff, and their monetary policy has succeeded in capturing, unfairly in my view, market share that will be hard for US domestic industries to win back.

          But to blame corporations? The executives have a job to do and that job is to make money for the shareholders. As long as they aren't breaking any laws, their job is to find and pursue a business strategy that maximizes their return. Of course they make business decisions for profit. They're not running benevolent societies.

          Want to cast some blame? How about the folks that have established the highest corporate tax rate in the world? Or the ones that impose costly laws like Sarbanes-Oxley that contribute notheing to productivity? Or the ones that impose high payroll taxes and other expensive requirements on a company's employees to the point where having employees are far too expensive? Or the ones that have made it a legal requirement to offer health insurance to employees (like work has anything to do with health insurance)? Or the ones that have created a legal climate that puts companies on the hook for all sorts of inane liabilities? I could go on (and on) but I think you get my point.

          After years of high unemployment and a sputtering economy, coupled with a consistently weakening dollar, it's interesting that the Government hasn't done ONE THING to make domestic manufacturing more competitive or attractive. In fact, instead, they passed 6000 pages of Obamacare that will increase administrative costs to companies.

          The corporate tax rate in the US is 35%. Highest in the world. The cost advantage in going to China is generally considered to amount to 10-15%. If you're in business and have to compete, that 10-15% is a lot. But with a 35% tax rate, the problem could be fixed instantly, if only Washington wanted to. Instead, they cheerlead for the demonization of corporations that seek profit. Funny... profit is the entire point of business, isn't it? Didn't profit provide the motive that built the US into an industrial giant?

          The US Federal Govt needs to wake up to the reality of what it takes to bring good-paying industrial jobs back the these shores. The concept is nothing new. Many states through the years have offered businesses advantageous deals to incentivize them to build factories in their state. The Chinese make it very easy. Washington, on the other hand, passes ever-more laws that make it more expensive to be here. And the worst part, for many executives, is that you never know what the US Govt is going to do next. There is no stability. Its pretty sad when American business believes that China and India and Viet Nam and Malaysia are more stable and less risky over the long term than the United States. But they do.

          Comment


          • #20
            Re: Maybe Make a Quality Power Tool?

            "The US Federal Govt needs to wake up to the reality of what it takes to bring good-paying industrial jobs back the these shores"

            Sorry but people who make such staements need to realize the differences between our governments and societies. You can offer big business the same tax incentives and they would tell you to take a hike! Why would they come back and have to deal with the EPA, OSHA, National Labor Relations Board and Unions, workers rights, human rights? Why would they pay an American minimum wage or living wage when they can pay the equivilent of slave wages?

            Our government needs those high taxes from busineses as well as individuals (the rich) in order to pay for all the out of control spending, government programs and now three wars. Very nice of communist china and other goverment to swipe our credit card and run up our tab, but they should say sorry no more credit and we should live within our means.

            Complain about an abusive boss, or unsafe work condition in the USA and you have a legal process to investigate and rsolve the issues, do that in communist china and you end up in jail or dead. I'm probably wrong, china is more than likely a great place to live and raise a family, critisize the government, fight for better wages and working conditions. See my point? Big business will not come back on their own because they would have to function in a society that protects it workers, environment, and other needy citizens through the collection of taxes.

            Comment


            • #21
              Re: Maybe Make a Quality Power Tool?

              Andy,

              Not sure that "blame" was used... it is what it is! But let's NOT blame the Chinese either, and that was my point. U.S. companies make plenty of profit from their "off-shoring" to China, yet some of us appear to only blame the Chinese for that. And Yes, the Chinese government does some manipulation of the yen, and why shouldn't they? It obviously works in thier favor and afterall, isn't that what a government is supposed to do... work in the favor of it's own?

              Regarding your "highest in the world"... I'm sure that you know more about that than I. But, while that tax rate might well be at 35%... what company actually pays that? There are so many tax breaks and write offs, that reportedly, many corporations pay much, much less and sometimes nothing at all.

              Many years ago, my Division "moved south" and I lost my job for 3-years, finally returning to the remaining division here at Painted Post. That move was done during that time when the "Dollar" was very strong and tax breaks and incentives provided well for corporate "advancement". Nice, because it now became much more affordable for my company to to buy more "services" abroad and thus a few hundred of us became a simple matter of "economics". Likewise dozens of small, dependant companies suddenly found that they no longer competed locally, but now globally. Hey as you say, a business's purpose is to make money, and I certainly can't disagree with that.

              During this 3-year period, I incorporated as a freelancer. My first year income was about half of what I made as an employee. But I gotta tell you that we lived better. Everything I made I kept and I paid NO taxes. Bought all kinds of new equipment, new car, etc. Legally, the write-offs and tax benefits make it a very profitable (although uncomfortably insecure) venture. I worked all the time, and over the almost 3-years, my business grew substantially and yet I never paid taxes. (I should point out that I never cheated either, to me "taxes" are a serious responsibility that I am more than willing fulfill.)

              The point is, "business" has the ability to write away much of it's tax burden and they make every effort to do so. So feeling that the 35% rate is grossly unfair, doesn't take into account the true picture I think.

              We used to live in a time when corporations felt some loyalty to their employees and the community in which they were located. While I believe that is still true in many areas, it has largely disappeared. Companies now have the mindset (and perhaps the reality) that "profit" is the real bottom line and to that end, "loyalty" is an old-fashioned expense that cannot be afforded. Unfortunately, the strategy and mindset of the worker hasn't kept up with the corporate accounting technology of profit-squeezing.

              While I never "represented" my employer's management, I was often the commucations talent behind the "presentation" of thier cost reduction and capital expense ventures. In almost every case, "cost reduction" was about manpower reduction here in the U.S.. Likewise, capital expense almost always had "write-off" and "amortization" in mind. Very few things squeeze profits as easy as cutting the manpower and nothing presents a "positive" picture toward "meeting the numbers" as easy as the manipulating the labor count. To that end, it has been my sad experience to witness layoff's during almost every holiday season, in order to "make the numbers" and ensure the key corporate management members had a very nice bonus and thus a great Christmas. To hell with the hundred or so workers who spent those holidays with a meager un-employment check and the insecurity of no jobs and having to possibility hit up the savings account and perhaps the kid's college fund.

              Everywhere I look in my region of the country, I find empty lots and abandoned buildings that once were filled with American workers. While some represent technology advances resulting in abandonment of obsolete needs, most are a direct result of profit objectives that have either afforded the corporation to buy foreign services or have exported jobs to a more affordable country. Sometimes the reason is the "strong dollar" and at other it's the "weak economy"... from a lost job point of view, both are the same, as it simply means that your employer got a better deal elsewhere and owes you nothing.

              You and I live at opposite ends of the country and probably at the opposite end of the economy and corporate structure. So we may well be on opposite ends of any economic argument. Neither of us appear to blame the Chinese for our situation, but I don't view the corporate responsibility in this mess in the same manner that you do. And while I think we both agree that the government is really the fault, We obviously differ in how those faults are defined. Bottom line though, at least for me, is that the government has provided well for corporate input and for the last few decades corporations have faired far better than the American worker. What I'm surprised at is that too many American workers don't see it that way and still believe that what's good for big business is good for them. As I think we both agree, the objective of business is to make a profit. I just wish they'd be a bit more far-sighted, and look beyond next year's annual report.

              CWS

              Comment


              • #22
                Re: Maybe Make a Quality Power Tool?

                CWS, I appreciate your comments on tax write offs, and the fact is that you are correct, there are many loopholes.

                However, business leaders are fairly consistent when asked why they go offshore and/or elect to contract with offshore manufacturers to produce their products. The order of importance of thee items, predictably, varies from business to business. But these are the reasons:

                (a) high taxes - corporate and payroll
                (b) over-burdensome regulation
                (c) no confidence that (a) and (b) won't get worse.

                That's from the horse's mouth. No one relished doing business in Asia. I don't knwo if you've ever been involved, but it is a royal pain. Yet DC has done and continues to do *nothing* to address these three items, that they are being TOLD are the reasons companies are taking jobs offshore. How many more years of Govt failed stimulus packages bailouts and other nonsense will it take before we understand that Government, their taxes and their propensity to constantly add more over-regulation, are the problem? They are not providing for business.... the Govt simply closes its eyes to basics of economics, and continues to spend, tax and regulate American business and jobs directly into the waiting arms of foreign competition... fueling their growth while we die on the vine.

                I am not making a gloomy prediction... this isn't a prediction, it is what is happening and what has been happening all around us for the past 40 years.

                regarding loyalty: "Loyalty" is lovely concept. However, I see little evidence that it ever really was a significant player in the business world. Unions rose to power precisely because business did not pay proper attention to the well-being of employees. Loyalty, to me, is a wonderful romantic notion, but has always taken a seat in the back of the bus to profits. As well it should. Like it or not, a capitalist economy is, after all, economic... not humanitarian or socialist.

                regarding Chinese currency: Yes, it is true that the Chinese government has done a very good job of promoting China's growth and well-being. The real problem, I agree, is not with them. They are doing what they can get away with. The blame, and I purposely use that term, is with the US Govt. It is the US Govt - not American business or even the American consumer - that has allowed itself to be so dependent on foreign debt financing as well as reliance on their industrial output to fuel our own fragile economy, that have no leverage to compel them to adopt a level playing field.

                Here is what is happening. Because of the yuan being pegged to the dollar at unrealistic levels, China's goods have been unbelievably cheap in the United States. This is an age-old business strategy - to gain market share via loss leaders. The consequence of this currency manipulation is that is that (and check the business pages to confirm this if you have doubts) China is experiencing very large inflation. They are currently tightening their monetary policy, which will result in price increases of the stuff we buy... which is more or less most of the consumer goods in the US.

                You will also learn that China is leading the international call to strip the dollar of reserve currency status, which would be an enormous blow to the US. If this happens, and it may, within tis decade, expect $5 gasoline to look like a real bargain. China is positioning itself for this, today. They are using the huge numbers of US dollars that they have amassed as a result of trade and the interest we pay on the US Treasury bonds they hold, and pumping that money into commodities... including oil, and the monetary precious metals. There are many reasons for this, but one of the most important is their complete lack of faith in the US dollar. If they're right, and they have the horsepower to push that view along and make it the reality, your imported goods will skyrocket in price. And, because we have no production capability in the US, there will be nothing we can do about it. The already-rising prices of imported goods will go completely off the chart. At that point, the US market won't matter to China. China is itself a huge market that can more than absorb their industrial production. They simply used the US consumer market to finance their industrialization. China is not our friend. But it is the US Govt, that through years of irresponsible spending, regulatory bumbling and utter lack of recognition of the realities of currency, economics and business, is really our worst nightmare. They Chinese think we must be stupid to be letting this happen. I think they're right.

                I think we all "wish" that US business took a longer term view. Are they stupid or un-American? No, they are not. They simply very good at playing the game according to the rules. The rules are set by the IRS code, by business regulation, and by the objectives and behavior of the shareholders. Two of those three are under the direct control of the Federal Govt, and the third can be strongly influenced as well. So we can "wish"... but I don't really see that as getting us too far, do you? Seems to me that health and future of the US would be be far better served if we stopped "wishing" and started adjusting the rules of the game to promote our best interests. That is what the competition is doing. Communist China has a far more accomodative capitalist stance than the United States, and that's why they are kicking our butt.

                Comment


                • #23
                  Re: Maybe Make a Quality Power Tool?

                  Well Andy, your points are well taken and I have no arguement with it. So where and what is the answer?

                  But I do wonder if we should believe that it is the Tax codes and the regulations that are the driving forces behind our economic and job dilemma? Is the problem only that the vane and ignorant enter politics so that they profit recognition for themselves, but yet do their worst to our nation? Is it really an independant-thinking government that has screwed everything up?

                  I'm not sure how much influence you may have on our government's decisions regarding such things, but I seem to be at a loss... other than to do my best to make the right decisions at election time and to occasionally write letters to my Senator or Congressman and to attempt to keep up by listening and reading the news. I confess that I'm probably too focused on getting through my daily projects and needs, when I should be watching the rascals every moment of every day.

                  But even then, I do believe that our big corporations have far more influence on these issues than I would ever have. And, I believe that they've pretty much been getting a lot of benefit from their influence of past legislation. Surely, they don't like regulation and likewise they don't want to pay taxes either. So I'm not at all surprised at that their "reasons" for off-shoring are the excuses that best work for thier profit objectives.

                  There are "costs" to doing business and of course there are "costs" to living. Business may well have thier excuses or reasons for doing business in China rather than here; but, it seems a bit strange to me, when they site regulation and taxes and then also speak of dislikes in China too, like they are making big sacrifices, in order to have increased profit thier switch. It appears that they demand icing on both sides of their cake while those of us charged with living, get to eat any of the debris that they leave in their wake. I wish that I had the influence to decrease my taxes and the regulation that I have to pay for, but such is life for those of us paying out on the lower ends of society.

                  I liken this business to pre-WWII when Japanese products were the brunt of jokes about thier tin-trash. I always found it strange that no one ever questions how a country with no natural resources could possibly come to such power. We sold them the iron, the coal, and the technology. All of which our stupid government promoted and allowed willingly, while it worked with the League of Nations to then restrict the Naval tonnage. Had NOT Japan gone to war it was faced with sinking much of it's own fleet, built with American coal and steel. Even the fledgling flight simulator business sold more orders to Japan than it did it's own domestic customers. But hey, "profit" is what American industrialists do!. The only problem was that Japan wasn't about to sink their own fleet; and it's "tin-trash" manufacturing had the capability to build airborn torpedoes that ran true in shallow waters... which was something that we had yet to manage. Back then, American industrialist made a lot of profit by building the conflict and then further profit by it's action and results. The "people" picked up the tab.

                  Of course China is no Japan and China isn't nearly as friendly as 1939 Japan. Of course the United States isn't the same United States that it was back then either. More powerful from a military point of view, Yes! I'm not sure if we are any weaker now then we were then, but surely we've got a much bigger debt; and as you recognize, industrially we are much weaker.

                  So Andy, what is the anwer? Who makes the sacrifices here and who do we need to shove in the right direction? And how do we go about doing that?

                  As I see it, the Dem's want to focus on rebuilding a neglected infrastructure, provide benefit to the masses, and tax and regulate those with the power to make that happen. But where do we get the funds and the power to do that?

                  The Republican's want to heavily reduce regulation and taxes to the rich and to business. They cry it isn't fair and they believe that given a more de-regulated market, that everything is going to be made right and that future generations of workers will make this country great again. Guess Reagonomic's must of worked well for many of them (it sure didn't do anything for me) and the recent Wall Steet bust was just an anomoly.

                  As I see it, neither party is right. It appears that the Republicans are winning though, and with the help of Tea Party members we'll gladly sacrifice any benefit to the people by demanding the government downsize to next to nothing. I think that would be one helluva windfall to big business and given last year's Supreme Court ruling, the special interest groups, including American corporations will be able to freely fund whatever politics it wishes, without disclosure. We are in the midst of never knowing who or what to believe or to what purpose thier commercialized views will serve.

                  Perhaps we should just rethink "Democracy"... "the people" no longer seem to matter nearly as much as the "corporation". Perhaps we could all become corporations, with each incorporated family having all the rights and priviledges of going about their business, thier profitability, and thier survival with the same loopholes and right-offs. I could then deduct my car, write off my house, my taxes, our meals, and maybe even amortize the expense of the new widescreen that I'd like to get. Gee, maybe I could even fly out to California and we could discuss this thing over lunch one day. I wonder if they'd add to my income with a subsidy for investing in my community and continueing to maintain my home here or maybe researching an expansion of the family subsidiary?

                  Problem with that of course is that there would be NO tax revenue to speak of.

                  So, I have no answers, only questions. Are we in such dire straits as to have no way to work ourselves out of this mess?

                  CWS
                  Last edited by CWSmith; 05-01-2011, 05:43 PM.

                  Comment


                  • #24
                    Re: Maybe Make a Quality Power Tool?

                    Not to drag this yet further into political taboo.... but I wish they (DC) would just throw the IRS out on their ***, pass a no frills, simple 10% flat tax with ZERO deductions and loop holes. I don't think an ounce of them realize just how much this type of tax system would create a business boom in this country. For corporations, I personally think there should be a small (5% or less) tax that is state gathered and used solely for infrastructure needs in that particular state to attract businesses (ie transportation systems)

                    Comment


                    • #25
                      Re: Maybe Make a Quality Power Tool?

                      "So, I have no answers, only questions. Are we in such dire straits as to have no way to work ourselves out of this mess?"

                      CWS

                      MY last post and response was ignored, but to answer your question, most definately! Unless we build factories, bring back businesses and employ Americans to manufacture what Americans consume we are sunk. We cannot compete with the slave wages of a place like communist china, they do not have the EPA, OSHA, human or worker rights to deal with. In my opinon the only way to to bring back once American based businesses is the big stick of making business more painful if they remain in mexico and abroad.

                      Anyone who thinks this is about corporate taxes is missing all the other things I mentioned. These businesses are free to pollute, free to abuse workers with no fear of organized labor or government interference. Do you really expect them to return here of their own free will simply because the tax codes are changed or eliminated?

                      Take an honest look at the mess we are in and you tell me if we are getting out? The government is involved in three wars, none of which they can fund without raising the deficit, republicans and democrats can't agree on the massive program and spending cuts necessary to reduce our deficit, there is no plan to fix the economy. Businesses and jobs are not coming back, our wealth continues to go to other countries who provide us with our consumer goods. We support millions of illegal immigrants who do not support the tax base, burden our economy and send American dollars back home never to return.

                      This big mess has been many years in the making, overseen by several administrations of both political parties and aided with legislation such as NAFTA. We would need an immediate, far reaching plan that impacted major facets of the government and private sector to begin making a dent in this disaster. What we have in reality is a President busy running for a second term and a populace entranced with the royal wedding. I can't imagine the straits being any more dire, with no way to possibly work this thing out!

                      Comment


                      • #26
                        Re: Maybe Make a Quality Power Tool?

                        You could blame our legislators who were bought off to pass laws like NAFTA.
                        I think you need to go back even further. Where would we be if we had not
                        normalized relations with China many years ago? And where would China be?
                        On whose watch did that happen anyway..Nixon.
                        ---------------
                        Light is faster than sound. That's why some people seem really bright until you hear them speak.
                        ---------------
                        “If I had my life to live over again, I'd be a plumber.” - Albert Einstein
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                        Comment


                        • #27
                          Re: Maybe Make a Quality Power Tool?

                          The #1 problem that will occur in the United States in the near future will be....

                          BOTH private and public healthcare. Medicare etc.

                          It's a quiet secret right now that elected officials are scared to death to address for fear of not getting re-elected by the grey haired majority. (No offense intended.)

                          But it is coming. And you better get your checkbook ready for some serious taxes & payments.

                          Trust me.


                          J.C.

                          Comment


                          • #28
                            Re: Maybe Make a Quality Power Tool?

                            As long as we continue to talk about taxing the "rich" (businesses in general) the "rich" will continue to send work out of the USA. We need to cut businesses a break and add fair tariffs to imports.

                            Mark
                            "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

                            I never lost a cent on the jobs I didn't get!

                            Comment


                            • #29
                              Re: Maybe Make a Quality Power Tool?

                              Mark, I don't know how many folks making over that magic number of $250,000 are contributing to the creation of jobs in the USA, but I agree tariffs on imports might be part of a move to bring businesses and jobs back.
                              I'll try to make my case once more that even with massive tax breaks, businesses would be hard pressed to return to the USA and our EPA, OSHA, Union. worker's rights, minimum wages and other profit prohibitive facts of life.

                              Our government wheter republican or democratic run is addicted to spending without limits. There is a refusal to make the massive cuts in spending and programs necessary to reduce the debt.

                              We are fighting three wars, dealing with massive out of control government spending, having our taxes pay for unemployment, the burden caused by illegals using services for which they did not pay, and now a healthcare plan most do not approve. There is too much wrong right now and what seems to be zero cooperation between the political partys to work for the better good of the country. Where or what is the plan to fix any of this?
                              Does anyone believe the businesse and jobs will return given the inaction or inability to fix anything? Why are our borders still open? Why is our President fighting to pay for education for illegals when our economy is in ruins?

                              Comment


                              • #30
                                Re: Maybe Make a Quality Power Tool?

                                Originally posted by Frankiarmz View Post
                                Anyone who thinks this is about corporate taxes is missing all the other things I mentioned. These businesses are free to pollute, free to abuse workers with no fear of organized labor or government interference. Do you really expect them to return here of their own free will simply because the tax codes are changed or eliminated?
                                I have absolutely no doubt whatsoever that if the tax code was changed correctly that significnat rebuilding of US industry would commence tomorrow.

                                The total cost of doing business in China or any developing country is very high. You are absolutely right in noting that in other lands, there are few environmental or labor laws. However, the bottom line is, the decision to do business offshore is made strictly based on the bottom line cost compared to doing the same work domestically. The impetus, in dollars, to conduct manufacturing offshore is not huge. It is however, compelling when one must compete in the market. On the other hand, there are very many real advantages to doing business in the United States. There is no language, cultural, or time zone hurdles to overcome. Access is unfettered to a very well educated and extremely productive workforce, that has the means to get to work (cars and roads - despite all the ballyhoo about Chinese hi-speed rail, the overloaded US highway system is far superior overall). Abilty to buy support and get quality materials in the United States is still better than anywhere in the world. And of course, the technical resources - from engineers to scientists to the most extensive University system in the world - are unrivaled. Yes, US labor is much more expensive than Chinese or Indian or Vietnamese labor. The actual labor content of mass produced consumer goods is not the dominant cost. When you consider all these factors, the advantage of offshoring amounts to 10-15% for most products.

                                The tax code, between the corporate rate at 35% and payroll taxes, compared to 10-15% cost advantage of offshoring, definitely has the legs to change the landscape.

                                The key, however, is not to simply cut taxes. There are those in DC that want this sort of blanket cut. It won't accomplish squat. However, if taxes gave (strongly)preferential treatment for profits derived from domestic production... and I would favor 0% for such domestically-generated profits, we would see a strong impact starting mmediately. Well, realistically, business would have to gain confidence and be convinced that the Govt wouldn't change their mind next year, as they have a history of doing.

                                Of course, the climate could be made twice as attractive for business by repealing draconian over-regulation. Most of these regulations are well past the point of diminishing returns and serve no real purpose other than to make US domestic operations more expensive and thus less attractive.

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