Monday, March 01, 2004
The World As Virtual Store
Money magazine: U.S. jobs moving offshore—what can be done?0 comments
This is a hot-button issue now, of course.
But this particular argument put forth in this article is particularly stupid, as well as nasty:
"We need reforms that will enable us to thrive in a dynamic, open, world market and not seek to shut our borders and go down a path proven to lead to reduced national wealth and overall lower standards of living," said Aaron Lukas, a trade policy analyst at the Cato Institute, a libertarian think tank.
All on one breath? Impressive, if so.
Sounds great, n'est pas?
I'm sorry, this is neo-con, newschannel, talking-head drivel of the highest order, and it cries out to be challenged.
"... to thrive in a dynamic, open, world market..."
Who, exactly, are the "we" and the "us" who are doing all the supposed thriving here?
Are YOU dealing in world markets? Probably not.
Is your company? Probably not, but let's say it is. The debating model holds that you make the widget your company sells. If they can sell these widgets in Uruguay and Tanzania, you make more money selling more widgets and everyone benefits. Cool.
But, this is, like, soooooo Twentieth Century.
There is a market of approximately 300 million of us here. Sounds sizeable. But there is a potential market of a few billion people around the world. And they'll all want widgets. So selling to them becomes a higher priority than selling widgets to you and me. Plus, people have been laid off here, so there's less money around to buy widgets.
Plus, if we close down our U.S. plants and re-open them in a jungle somewhere, we'll only have to pay 5-10 cents on the dollar for labor costs and we can send that windfall right on to shareholders.
Yeah. Good business move.
Hold on, let's not be so naive (read: gullible) here.
There's not a company, large or small, who couldn't be enticed to make this move. In fact, any owner or CEO who doesn't make it today is thought of as an unsuccessful neanderthal, who MUST be running his company into the ground. That's great pressure. Much like the greed-fueled pressure of the Nineties forced thousands of Americans onto Wall Street, where money was supposedly just sitting there on the ground waiting for the smart people to just scoop it up. And if you didn't attempt to, you were just a throwback loser. And if the market eventually tanked, and you lost most of what you had, and there was no longer any pension or decent interest rate for savings accounts to act as a safety net, since no one wanted them anymore, well, them's breaks.
Don't be misled.
There is now a real disconnect between the company and the worker. The company doesn't need the worker anymore. Or, more exactly, American companies don't need American workers anymore. Nor, soon, American consumers anymore, either.
Eventually, American companies will merely be a few executives on expense accounts, working out of smaller office space with a few necessary underlings and assistants. Their registration will be offshore to avoid all taxes. All of their manufacturing or service product generation will be done overseas, mostly on contract; all their administration will be farmed out, and their distribution, advertising and human resource systems will be outsourced. An underling collects the invoices; the CFO cuts the checks. Simple.
So this powerful, worldwide conglomerate we are all in awe of will soon barely consist of a few corporate officers in a corner office suite. The whole enterprise run by anywhere from 5-40 people.
And they won't skip a beat.
Sure, they'll claim 100,000 employees, but that'll be counting their contractors' workers.
So now you know why there are soooo many articles in business magazines about Jeff Bezos of Amazon.com.
Because Jeff's the future. The founder of the Virtual Business. There's nothing really there except people's assumptions and expectations, and a whole lot of intricate business relationships.
Sweet.
So we'll soon be the United States of Amazon.
Which is another way of saying, "There'll be no there, there."
Now, if they only took virtual money...
posted by Gotham 8:36 PM
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