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writing for godot

The Un-American Business of America

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Written by Thomas Magstadt   
Sunday, 11 November 2012 17:42
In July 2012, the Center for American Progress published a kind of factsheet on the growing practice of "overseas outsourcing". The article was prompted by a deeply divisive presidential campaign that, among other things, placed venture capitalism – and it's champion, Republican standard-bearer Mitt Romney – on trial. Remember Romney's frenzied late-inning ads accusing bailed-out Chrysler of planning to ship jobs to China? How's that for chutzpah?!

Now that the campaign is over, it's hard not to hope things will change in Washington. But the problems remain, the Wingnuts won't go away, and there's no time to lose. Where to start, you ask? Tax reform? Deficit reduction? Jobs?

Jobs. Start by doing whatever is necessary to create jobs. Now. In this country.

Are "private equity" capitalists job creators, as Romney loudly proclaimed, or job exporters, as Obama countered? Is the practice of "offshoring" – moving manufacturing operations abroad – a boon to business at the expense of labor or does everybody benefit from a competitive global economy in which goods and services flow freely according to unrestricted market forces?

These are big, complicated questions that confound and divide even the best and brightest economists. Let's not even get into the definitional confusion over "outsourcing" versus "offshoring" – suffice it to say, both practices are widespread and spreading wider all the time and both are coming at a high cost to US workers even as they lower costs to US consumers.

According to the US Department of Commerce, “U.S. multinational corporations, the big brand-name companies that employ a fifth of all American workers… cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million.” And last spring the Wall Street Journal ("US Firms Add Jobs, Mostly Overseas," April 27, 2012) reported, "Thirty-five big U.S.-based multinational companies" added the most jobs in the past two years, "but nearly three-fourths of those jobs were overseas.”

In the 30 years since the dawn of the Reagan Era, the US has suffered a stunning net loss of 8 million manufacturing jobs. Not a few large US corporations such as Apple Inc., offshores all of its manufacturing; Nike Inc., outsources all of its footwear production to foreign firms.

This writer decided to do a random fact-check in a big box store – Costco. The results are not meant to single out or pillory Costco, not at all. Costco provides a wide variety of good quality merchandise at decent prices. Costco is also an equal-opportunity employer that treats its employees fairly, provides benefits including health insurance, and stands behind what it sells.

But even Costco's fine business model cannot hide the secret that's there in plain view for anyone who cares to look. If you do – care to look, that is – here's what you will discover: Almost nothing on offer is produced here in the good old United States of American anymore.

Here are a few specific examples, randomly selected from hundreds of items in the store. Let's start with Bionaire, a "Manufacturer of a wide range of air cleaners and humidifiers, replacement parts and filters." At Costco you can buy a nice Bionaire Ultrasonic Humidifier with Visible Mist. Made in China. Not interested? How about a PureGuardian 120-hour Ultrasonic Humidifier? Made in Korea, presumably not North Korea. (Or you can go online and get the PureGuardian H1000 12-Hour Ultrasonic Humidifier. Made in China.)

Then there's the seasonal Masterbuilt Butterball Indoor Turkey Fryer XL for just $134.99. Made in China. Or the Hoover Windtunnel T-Series Rewind Bagless Upright for just $109.00 after $20.00 off. Made in Mexico. But wait! If Hoover is too clumsy to lug up and down the stairs, consider the Dyson DC35 Digital Slim Full Kit Cordless Vacuum just across the aisle. Cost: 349.99. Made in Malaysia. Don't need a vacuum cleaner? Okay, for just $89.99 you can pick up a HoMedics Shiatsu Message Cushion. Made in China. Bet that got your attention.

What's that: you're putting your foot down, refusing to buy any more stuff made in Asia? There's always the Brita water filter system. Made in the UK.

In fairness, you can buy a Vornado fan with signature Vortex Technology "Designed, engineered and manufactured in the USA" at Costco. But you will have to look high and low for other products made in America. And when you do, be sure what you see is actually what you get.

And it's not only Costco. Take Craftsmen Tools ("America's Most Trusted Tool Brand"), for example. Made here in the USA and synonymous with Sears, right?

Wrong. Fact-checking on the Internet led quickly to this bubble-bursting Wikipedia entry: "Sears has never manufactured Craftsman products itself, instead relying on other manufacturers to make the products for them and then apply the Craftsman brand name. Sometimes, the Craftsman branded items include exclusive features or functions that separate them from the manufacturer's own brand or other brands that that manufacturer produces. Other times, Craftsman products are identical models to other brands with a different name badge on them. In the last 4 years, many of the hand tools sold under the Craftsman brand name are now made overseas."

Calvin Coolidge famously said the business of America is business. He had no way of knowing the Stock Market Crash of 1929 was only four years away, that it would occur just 7 months after he left office (and hapless Herbert Hoover would get all the blame), or that it would usher in the Great Depression. Coolidge, of course, was a contemporary of Henry Ford, a titan of the American auto industry, the very same one that Romney excoriated Obama for bailing out. (Ford was 9 years older but lived 14 years longer.)

Today the business of America is clearly not what it was in Coolidge's and Ford's time. If you're a capitalist true believer in America today, moving manufacturing and jobs overseas while getting massive tax breaks and government subsidies is not hypocritical, unpatriotic, or deceitful. It's business as usual for the new breed of entrepreneurs – the venture capitalists and private equity profiteers.

You know, the business of America.

Note: This article appeared at Nation of Change (11/12/2012); only the title is different.
 

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