"Watch your thoughts; they become words. Watch your words; they become actions. Watch your actions; they become habits. Watch your habits; they become character. Watch your character; it becomes your destiny." -- unknown

Insanity is doing the same thing over and over and expecting different results - Albert Einstein

rich in head or pocket?
March 04, 2004 - 10:56 am

this will do three things:

1) give the politicians something nice to trumpet to the people back home. what could be a better way to prove you care for your people (and should be relected) than voting for this bill to keep jobs in the states? just think of the potential backlash against someone who doesn't support it? next election time all you'd hear is so-and-so voted to send your job overseas!

this is the short-term, politcal gain benifit.

2) limiting a company from sending jobs overseas ultimately means our government is telling a business how to run itself. it means the business can't operate in the most effective way. it means that another business that isn't so restrianed will take an advantage our domestic business can't and, in the long-run, beat the domestic business. simple economic fact. it's like.. telling lance armstrong he can only train every other day. sure he's an awsome biker and will continue to win races, but he's handicapped and won't be the 'best' for long.

in other words, limiting offshoring hurts our businesses and will end up costing more jobs.

3) limiting a company from being competitive, which is what i just said, means the company will most likely charge higher prices. a company wants 'x' amount of profit and has 'y' costs, it's price is easy to figure out. if costs can fall and the profit goal stays the same, prices fall. so keeping company from being their most competitive means the consumer pays more. it also means that non-domestic companies are going to see a chance to make better profits. here's what i mean:

let's say it cost a US company $50 to make a pair of shoes and they want 20% proft. they will sell the shoes for $62.50 (62.5 - 20% = 50 not the same as 50 + 20%, that's only 60). an overseas company can make shoes for $35 and would incurr an extra $5 to ship the shoes to the states - total cost of $40. they see the market price is $62.50, so they can make something like 36% profit at that level.. or they could stick with the 20% profit and sell shoes for $50. the domestic company can't even begin to compete with this.. they'd be selling at cost.

i made those numbers up on the fly, so it's a just a freak chance how it worked out.

anyway, what would you do as a foreign company? why not sell your shoes at $60.00? make the extra money. if the US moves to match your price, drop yours a little more. provided your shoes are of the same quality, the domestic firm will lose, it's just a matter of time.

in the meantime, we are paying too much for something. yeah, so i overlapped numbers 2 and 3 a bit.

like i said before, we are a victim of our own culture - the short-run is our focus.. money is our focus.

i understand that without our drive being this, we'd not have a lot of them marvels we have today.. but i question just how valuable it is to have a cell phone, a wireless internet, a microwave.. i mean, do these things really make us happier or are we just in a materialistic downward spiral?

does it really matter who has the biggest house? the nicest car? are we living in a game were the one who has the most at death really is the winner?

seems odd.. since you can't take anything physical with you when you die.

i guess i have something more along the lines of an eastern outlook on things. i want to be rich in my head far, far more than in my pocket. i need to read up on such things.