Saturday, August 27, 2011

Private Sector Jobs

There can be no doubt that private sector jobs are disappearing in America at an accelerated pace. My main concern has to do with manufacturing but the service sector is also being diminished. When President Obama and Congress finally return from their vacations the ideas will be filling the newspapers and talk shows on a daily basis. Ideas usually proposed are; extend unemployment benefits, provide tax breaks for hiring employees, give billions to the States to assist them in resolving their respective shortfalls, continue under funding of Social Security by the 2% already in effect (further weakening the fund and shortening the time when funds will run out), infrastructure, etc. None of these will address the main point of creating private sector jobs. All of these will be a drain on our depleted treasury. Only private jobs will put money back into the treasury because the business and its employees will all be paying taxes. Not only that, but most manufacturing companies create other jobs in the community to support their mission. Taxes will accumulate from them as well.
It must be understood that business in order to be free must be allowed to pursue their endeavor as they see fit. They are duty bound to do all in their power to make a profit for their owners, whether stock holders or privately held. A company that is not successful goes out of business. It is as simple as that. If you do not believe in the free enterprise system then, of course, what I have just written does not make sense. Under Communism or Socialism, the government owns all property and makes the decisions on what should be produced. There are offshoots of these systems that have proven to be successful such as China which is a hybrid combining the power of the Communist State with allowing private enterprise to function on a small scale and subsidizing larger manufacturing who are competing with true free enterprise from America and elsewhere. There will come a time when this system will collapse. No country can continue to subsidize manufacturing. The problem for Americans is waiting for that to occur. In the meantime community after community in America loses more manufacturing jobs with nothing of value to replace the good paying jobs that have been lost.
Here is what I believe needs to be done. Evaluate all the reasons why manufacturing of products wanted in America are sent overseas. Certainly with all the high powered brains in Washington, this should be easy to accomplish. I want to be clear that I am talking about products to be sold in America. Manufacturing goods for other countries use are better if located in the respective country for all kinds of good reasons.
So let’s start. A study could be made of those companies that have moved their manufacturing or are in the process of doing so. I am sure the management would be willing to share the decision making process. Out of these interviews should produce a basis to start? High taxes are certainly a major reason. It is my understanding that America has the highest business tax rates in the world. Government restrictions and regulations are another. I read that some effort is being extended towards alleviating this burden while at the same time the clock is ticking on increasing regulations from the health care system approved two years ago. Certainly we need oversight of our food supply, drinking water and the air we breathe but I can tell you from my own personal experience that government regulations are a burden and detract from the primary mission of making a profit. China, in particular, does not burden their industry. Frivolous law suits are a continuing drain on profit. No large company would deliberately make unsafe products. Their goal is to entice repeat customers because of price, quality and service. Manufacturers are treated as if they were evil by intent. This is outrageous.
Skilled, industrious employees are a must. We are all aware that our educational system is failing our young people. Other countries are doing a superior job. If an employer cannot hire people capable of doing their assigned task then he must go to where he can find them. Right now China and India are leaving us far behind. I don’t even know if trade unions exist today, those places where young people can learn to be electricians, plumbers, pipe fitters, welders, machine shop operators, and tool and die craftsmen. Thirty years ago we had them but as industry has faded away the need for these skills has diminished to where I doubt that a new start up company could hire these type individuals. I retired from what I like to refer to as a mature plant. What I meant by that, is that new people were being hired while at the same time older workers were retiring. We had all levels of skill working. We are losing the work ethic. Millions have been receiving financial assistance while not leaving there homes, whether welfare or unemployment. Each is as bad as the other. Once the work cycle has been broken there is generated a lack of interest in returning as long as the combined income for the family is sufficient to support the family.
The sum of what I am trying to say is that all factors being weighed by manufactures should be placed in the open and then formulate legislation that would mitigate the strength of these arguments. The recovery process might be long and perilous since factories already sent overseas would not readily return due to the high cost of relocating and the uncertainty of what the next Administration and Congress might do to reverse course once again as they have done repeatedly over the decades. An immediate result could be stopping the outflow so that more jobs are not lost. Over time, at least some factories would return those that are not labor intensive. After all it is extremely expensive to ship finished goods across the ocean. I know they have perfected shipping but irregardless that is an expense. Then there is an increased assurance of higher quality products as a result of our stringent standards.
My last comment has to do with the weak kneed approach to China not only by the Obama Administration but during Bush’s eight years in office. We continue to play the role of patsy allowing China to break every rule in the book from stealing our manufacturing secrets, to blackmailing manufacturers who do relocate to follow their edicts, to manipulating the value of their currency, to using child and prisoners in the work force, for lack of concern for safety and quality. Vice President Biden has just ended a “good will” visit to China. I can assure you that no pressure was brought to bear to keep more factories from closing and relocating to China. We hear words from time to time, particularly from those attempting to stay in office but regardless of fine words they just don’t have the gumption to change the disastrous outflow of good paying jobs. It is up to us, the people to force them to do the job we send them to Washington to accomplish. I hope you will be one of those persons.

Jack B. Walters
August 27, 2011

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