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IDemo

(16,926 posts)
Sun Aug 31, 2014, 10:42 AM Aug 2014

US manufacturing in China: 'Just the way it is'

The CEO of the tech startup I'm working for was talking business matters last week; specifically, the cost savings of having certain components manufactured in China. After he spoke of the risks of IP (Intellectual Property) theft and of the various means of disguising the purpose of the circuitry involved, I asked "is the risk of piracy and/or patent theft really worth the cost savings?"

Silly me.

His response? "Absolutely. That's just a part of doing business in the world we live in."

And that is basically how virtually all US businesses think, here in the 21st Century. I'm surprised any of them even care about the minimum wage issue, as if they really intend to hire Americans in the first place.

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L0oniX

(31,493 posts)
1. In the old days they just abducted people from Africa for cheap labor.
Sun Aug 31, 2014, 10:54 AM
Aug 2014

Now they do the next best thing for themselves ...send manufacturing to where the labor costs are the cheapest. My how times have changed. Back then they destroyed peoples lives with slavery ...now they destroy peoples lives by moving work to cheap/slave labor countries and gutting our middle class. Rich people back then and rich people now. What a difference ...huh.

KoKo

(84,711 posts)
3. Interesting point....
Sun Aug 31, 2014, 11:37 AM
Aug 2014

hadn't thought of it that way before...but, it makes sense.

That would make a great "Talking Point" if we ever had a Real Democrat (what is that anymore?) run in an election. Fits well with the 1% vs 99%" Meme that took off...and was the lasting legacy of OWS.

"Back then they destroyed peoples lives with slavery ...now they destroy peoples lives by moving work to cheap/slave labor countries and gutting our middle class. Rich people back then and rich people now. What a difference ...huh."



antigop

(12,778 posts)
2. Hillary: "Outsourcing will continue..."
Sun Aug 31, 2014, 11:16 AM
Aug 2014
http://www.washingtonpost.com/wp-dyn/content/article/2007/09/07/AR2007090702780.html

When Sen. Hillary Rodham Clinton flew to New Delhi to meet with Indian business leaders in 2005, she offered a blunt assessment of the loss of American jobs across the Pacific. "There is no way to legislate against reality," she declared. "Outsourcing will continue. . . . We are not against all outsourcing; we are not in favor of putting up fences."

Two years later, as a Democratic presidential hopeful, Clinton struck a different tone when she told students in New Hampshire that she hated "seeing U.S. telemarketing jobs done in remote locations far, far from our shores."

The two speeches delivered continents apart highlight the delicate balance the senator from New York, a dedicated free-trader, is seeking to maintain as she courts two competing constituencies: wealthy Indian immigrants who have pledged to donate and raise as much as $5 million for her 2008 campaign and powerful American labor unions that are crucial to any Democratic primary victory.
 

FreakinDJ

(17,644 posts)
8. They (Congress) is not going to "Undo" the Lucerative Corp Tax Loop Holes for the Wealthy Elite
Sun Aug 31, 2014, 12:36 PM
Aug 2014
NO THEY DO NOT SAVE MONEY MANUFACTURING IC CHIPS OVERSEAS

My friend I went to school with years ago is an R&D engineer for 1 of the Biggest names in the business. He tells me the cost of doing business overseas is 10x the cost of doing business here in the USA.

A Chip Manufacturing Facility MUST include the following infrastructure not provided by the host country

1. Power Plant - 25 - 50 Megawatts
2. Water Treatment Plant
3. Housing for Key workers (Management)
4. Facility Transportation (Goods and Workers)

Additional cost will include

1. Educating Workers
2. Health Clinic for workers
3. Government Kick-Backs

antigop

(12,778 posts)
11. there was an article someone posted not too long ago that talked about the costs of
Sun Aug 31, 2014, 01:49 PM
Aug 2014

outsourcing.

I cannot find it....I thought that the name of the company was something like "Vargo", but DU search doesn't show anything.

10. on outsourcing...
Sun Aug 31, 2014, 01:02 PM
Aug 2014

"The two speeches delivered continents apart highlight the delicate balance the senator from New York"

I love that line from the news article. Instead of being an example of rank hypocrisy it is keeping a 'delicate balance' between two constituents. The news media continually gives legitimacy to statements which deserve ridicule.

KT2000

(20,583 posts)
7. there is another feature too
Sun Aug 31, 2014, 12:35 PM
Aug 2014

There are lots of complaints about the quality of goods made in China but that fault rests with the US firms that are demanding cheaper and cheaper costs. Corners are cut to get the costs down and that is how we end up with poor quality products.
American consumers are filling landfills with products that do not work or quit working in a short time or break. We just go out and buy a new whatever hoping it will work or last.
That is "just the way at is."

BrotherIvan

(9,126 posts)
15. As a small US manufacturer, I can tell you that this is a problem most don't address
Sun Aug 31, 2014, 04:17 PM
Aug 2014

The consumer has been educated to buy the very cheapest product and then dispose of it when it falls apart. I have had towels and clothes disintegrate in the first wash. And people do no understand that investing in quality (not necessarily an expensive designer label) will save lots of money in the long run. Big corporations did this on purpose so you have to keep buying their product. That's why buying a used appliance from 50 years ago is a better investment than one today which will last a year.

One of our best selling products is under $20. People complain that it is $2 more expensive than the largest competitor. What they get for $2 less is a product made in China/India/Pakistan/Vietnam so you have no idea what's in it. The thread and fabric are the cheapest, lowest quality possible because labor is so cheap in those products, the real cost savings is in the materials. That item lasts 3-6 months and then it needs to be replaced.

Our product is made with the highest quality materials because in the US, labor is the most expensive so a little more for thick thread that doesn't pop when you use it, sewing techniques to make it extra sturdy, and materials that will last over a decade of hard daily use. So for all the people who say, "Expensive for what it is" there are more who say "I bought four of the competing brands and so have wasted over $100 until I got this one."

"Expensive for what it is" means I buy Chinese products and don't give a damn about US workers because I just want to shop all day for cheap junk made by slave labor. People do not understand how much power they have to change all this. If they were willing to pay what it costs to manufacture in the US, DEMANDED US made goods, the jobs would be brought back yesterday.

KT2000

(20,583 posts)
16. Our choices are limited
Sun Aug 31, 2014, 05:04 PM
Aug 2014

As a seamstress, I often send complaints to the companies that are selling sewing supplies. Dritz for example is selling nothing but crap anymore - blunt pins & needles, shabbily made embellishments etc.. Coats and Clark and their hideous threads - on and on. They never reply.

Yes - consumers want cheapest but it is getting very difficult to find anything higher quality even for higher cost. I guess that market share is too tiny to bother with.

There is a principle here - we have to go for quality as we may be the last generation to do so.

BrotherIvan

(9,126 posts)
18. Yes, both of those companies have changed their production to Pakistan which is even worse
Sun Aug 31, 2014, 05:14 PM
Aug 2014

than China. The bias tapes are atrocious and lose color on the first wash and shrink so badly they will ruin your project. This comes mostly from chains like Wal Mart competing with fabric stores for lower prices. They are putting the small sewing stores out of business. The good news is, there are many thread manufactures in the east and south. We buy from a company in North Carolina that adheres to the Living Wage standard. It's great and their customer service is very good.

Most of these companies only sell wholesale, so I recommend getting with a group to purchase in bulk. We also use German notions if we can't find US and they are very good as well.

It is very difficult to find everything US made. We can't find a lot of fabric we need that is made in the US (our knits are made here in California) so we have compromised that at least we do our best with materials and our workers are in a union shop. A lot of the fabric mills in the US have shut down, though states like North Carolina are doing their best to bring them back. I long for the days when I can buy things like sheets and towels again that are like my grandmother's that must have lasted forty years and were the softest things ever. I just bought some great ticking and had a friend make up some reusable grocery bags (I don't sew) and just took them to the store and three people asked me where I got them. I can wash them and they don't get icky like the ones made from bottles. I bet they will last a decade.

I'm going to be doing this for a lot more things because I'm tired of buying crap. The one thing I know for sure that saving up to invest in great quality means it's not just going to last, it's going to be a pleasure every time I use it. So it is well worth it to me. It just means I can't impulse buy lots of items and I'm perfectly fine with that.

airplaneman

(1,239 posts)
13. one of my favorite articles
Sun Aug 31, 2014, 02:52 PM
Aug 2014

that explains what happened and why its really bad. On the issue of sending our manufacturing to China.

http://www.321gold.com/editorials/gaines/gaines092004.html

-Airplane

KT2000

(20,583 posts)
17. He is spot on
Sun Aug 31, 2014, 05:12 PM
Aug 2014

the stupidest thing is that China has done it before - nationalizing foreign companies - and it is not ancient history.
I have a good friend who is from China and she has said many times - China is going to bury the US. She cannot believe how stupid we are to turn over so much to China.
While Americans go there to join in the gold rush, they are thinking only of the short term. The long term thinking Chinese are miles ahead in their planning.

BrotherIvan

(9,126 posts)
19. Yes, they are using our greed to make us vassals. They have a long term plan.
Sun Aug 31, 2014, 05:17 PM
Aug 2014

They are going to dominate the solar market because we're too stupid. They will be like the sheiks of oil regions because they control production. They have already strong armed a few times with computer chips because they bought up all the mining for certain minerals that are necessary. Why do you think we keep invading countries, *cough* Afghanistan?

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