Aimed At Keeping Government Service Jobs In U.S.
Sen. Christopher Dodd (D-Conn.) has been losing his voice lately speaking emphatically about the loss of U.S. manufacturing and service sector jobs to foreign countries. Dodd was pressing the issue with sound and fury on the floor of the Senate trying to galvanize support for his proposal to require that all federal service contracts be fulfilled using U.S. workers. But his efforts were attacked by Republicans. After two days of debate, the final version of his legislation excluded most federal agencies from the requirement.
Dodd's amendment to the "Jumpstart Our Business Strength (JOBS) Act," which is being considered as a replacement for the Foreign Sales Corp, generated a spirited debate over how Democrats and Republicans view the economy and international trade. In the end, the Republicans prevailed, arguing that restricting government procurement to U.S. companies and workers would create retaliation among trading partners. They argued that such legislation was "isolationist" and would likely cost the U.S. economy more jobs than it protects. Dodd's proposal was eviscerated.
As it was originally written, the amendment restricted any organization using federal tax dollars from shipping jobs offshore. All federal funding going to states and local governments would be impacted. "I realize it is a loud shout at this moment and I know others will argue that maybe it is louder than it need be," said Dodd on the Senate floor early in the debate. "But I do not know any other way to express my deep concern about what is happening in my state and all across this country if we do not begin to say that at least with taxpayer money, you are going to have to act differently. You may decide to do it on your dime, but you are not going to do it on the dimes of my taxpayers. You do not need to do that in order to survive."
Dodd pointed out that the Senate had just spent the past five weeks debating medical malpractice, immunization for gun manufacturers and pension reform, "but we have not spent five minutes debating the issue of what is happening to American jobs," he said. "This is a big issue. The American people are outraged that we have nothing to say when it comes to outsourcing of jobs to other nations and we are not standing up and defending our own workforce."
GOP: Outsourcing Everything
"...Naturally, in Texas, National Laboratory for Bad Government, we do it all first and worst. We started with this dandy plan to outsource applications and enrollment for social service programs such as food stamps and Medicaid. In theory, we were to save millions -- though I never could understand it myself. You see, Texas has one of the cheapest state governments on the continent, but when we hire outside contractors, they expect to make a profit. Add profit, add cost. Oh well.
So the state hired this firm based in Bermuda on an $899 million five-year contract. So far, the health and human services commissioner has been forced to ask 1,000 state employees who were scheduled to be laid off by the end of the year not to leave after all -- and to offer each of them a $1,800 bonus to stay. Oops.
Among other errors, the private consortium mistakenly dropped 6,000 children from the children's health insurance program. The state comptroller (who is running for governor against the incumbent, Goodhair Perry) says the program is "a perfect storm of wasted dollars, reduced access to services and profiteering at the expense of Texas taxpayers."
By Kim Chipman -- Bloomberg
Monday 07 August 2006 -- "Prominent economists of all ideological persuasions long believed that raising the US minimum wage would retard job growth, creating unintended hardship for those at the bottom of the ladder.
Today, that consensus is eroding, and a vigorous debate has developed as some argue that boosting the wage would pull millions out of poverty.
A moderate increase in the minimum wage won't raise unemployment among low-skilled workers, according to recent studies, many economists say. They are joined by some business executives who say they can live with that, especially if it's coupled with tax relief.
"My thinking on this has changed dramatically," says Alan Blinder, a former Federal Reserve vice chairman who teaches economics at Princeton University in Princeton, New Jersey. "The evidence appears to be against the simple-minded theory that a modest increase in the minimum wage causes substantial job loss."
The debate over how to help struggling American workers was at the center of a battle in Congress recently over whether to increase the federal minimum wage to $7.25 an hour by 2009 from the current $5.15.
Blinder and others note that the federal minimum wage, last raised in 1997, is at its lowest level in 50 years when adjusted for inflation.
"Workers' wages need to at least keep pace with inflation," says Andrew Puzder, chief executive officer of Carpinteria, California-based CKE Restaurants Inc., which owns the Hardee's and Carl's Jr. fast-food restaurant chains. Puzder says he supports a reasonable increase in the minimum wage along with some form of tax relief for small businesses.
In a Wells Fargo-Gallup poll taken in March, 46 percent of small-business owners said the minimum wage should be increased, and 86 percent said the wage had no effect on them.
"The wage has been left at such a low level for so many years now that inflation has eroded it," says Scott Anderson, a senior economist at San Francisco-based Wells Fargo & Co., the fifth-biggest US bank. "It's not as onerous to employers as it once was."
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But he saves his greatest scorn for job outsourcing. His 2004 book, Exporting America, advocates "balanced trade" over "globalization." He mocks free-traders as "faith-based" advocates who promote their cause with an almost religious intolerance.
"The ultimate message in outsourcing is this: America be damned. It's all about the lowest cost," says the silver-haired, 59-year-old newsman at his new Time Warner Center digs in Manhattan. "I can't accept that statement. Nor will I, whether it comes from a lawmaker, a politician or a businessman or woman. The pain that's being exacted on our middle class from so many quarters is intolerable.
"...A pox on both parties. Dobbs is a lifelong Republican but says President Bush's "compassionate conservatism" rings hollow when "the White House obviously supports outsourcing of American jobs to cheap labor markets."
Democrats, meanwhile, have "all but abandoned their traditional commitment to working men and women in this country," he says.
And neither party will stand up to money, he says. "Corporate interests have as much sway over the Democratic Party as the Republican. The political power of Corporate America is all but unchallenged."
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Bush Adviser Supports Outsourcing
http://www.foxnews.com/story/0,2933,111225,00.html
Thursday, February 12, 2004 -- AP
"WASHINGTON — Gregory Mankiw, President Bush's chief economic adviser, gained recognition as a Harvard college professor for writing a popular textbook that explained complex economic principles in clear and precise language.
But now he's finding that being too clear and precise in the political world can land a person in a lot of hot water.
Not only Democrats but the top Republican in the House are castigating Mankiw for comments he made on the hot-button political issue of the outsourcing of American jobs to foreign countries.
Mankiw, head of the president's Council of Economic Advisers, discussed the advantages that offshore outsourcing of jobs can provide to U.S. companies in the "Economic Report of the President" released this week.
Mankiw argued that in economic terms, the outsourcing of a customer call-center job to India was the equivalent of buying a manufactured product shipped into this country from overseas."
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White House Under Fire for Outsourcing Proposal
http://www.foxnews.com/story/0,2933,111287,00.html
Friday, February 13, 2004
WASHINGTON — Under new legislation introduced by a group of Senate Democrats on Thursday, American employers would be required to warn their employees and affected communities before moving any jobs overseas.
The Jobs for America Act was introduced in response to President Bush's annual economic report, released Monday, in which he highlighted the benefits of sending jobs to other countries.
"This week, Americans learned something important. Exporting jobs isn't an accident — it's administration policy," Senate Minority Leader Tom Daschle, chief author of the bill, told reporters on Capitol Hill.
"This is Alice in Wonderland economics," Daschle, D-S.D., continued. "Nearly every state in the nation has lost manufacturing jobs, and contrary to the administration's economic theories, there is nothing good about it. The administration is putting corporate profits ahead of American jobs. And the exporting of jobs is hurting millions of Americans and countless communities across the country....
... Democrats say any policy supporting outsourcing is a foolish one.
"We need to create jobs in this country, not China, Bermuda or anywhere else," said Sen. Tom Harkin, D-Iowa.
On Wednesday, Sen. Hillary Rodham Clinton D-N.Y., introduced a nonbinding resolution saying Bush's policies "have either failed to address or exacerbated the loss of manufacturing jobs" in the United States.
The resolution said the Senate should oppose efforts to send American jobs overseas and approve tax incentives to discourage U.S. manufacturers from doing so.
A group of more than a dozen Senate Democrats also called on Bush to repudiate Mankiw's positive remarks about outsourcing."
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Outsourcing causes jitters: Is my job next?
http://www.eet.com/story/OEG20030827S0014
Bob Bellinger -- EE Times -- 08/27/2003
Outsourcing to overseas locations is nothing new. Many software development teams and chip fabs are based in Asia, where engineers and high-tech workers earn salaries considerably below those of Americans. Half our respondents work with international teams, especially engineers in the computer and components arenas. And more than three-quarters of the people working with teams overseas like the experience.
However, readers also detect a more-ominous trend: They see design and development work being transferred out of the country. Some 69 percent say these international teams are involved in design work, vs. 58 percent in manufacturing and 51 percent in software. Thus, American EEs worry about the future of their jobs-and their profession-here in the United States.
"Most manufacturing has already moved out of the country (especially to China)," one reader says. "Now engineering is starting to move out of the country also. There is a trend at my company to increase the engineering work in China. The Chinese engineers so far have been far behind us in abilities but they are catching up. I am sure that as soon as they are good enough, our company will transfer the majority of engineering work to China and reduce the engineering staff here in the U.S."
"Too much is being outsourced to countries such as India where engineers will work for a cup of rice a week," declares another reader. "I truly believe that if something isn't done, engineering will no longer exist in the U.S. and will go the way of such industries as clothing, etc. This trend will only stop when someone decides to outsource upper-management and CEO jobs. Then legislation will be passed by the Republican party faster than George W. can bomb Third World nations."
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Comments: 15
Now, instead of just dozens or hundreds of people competing for a job, there are tens of thousands.
The recent legislation to raise the minimum wage called for an increase of over $2 per hour. Many small business are lucky to break even while paying the current MW or a salary based on the MW plus.
From a business owners perspective, the increase in MW does represent a threat to the stability of small businesses. If the company has 10 employees, a $1 increase in wages for each employee translates to $10 an hour plus the addditional costs in benefits and government contributions. The small business owner is facing increased costs of more than $2,000 a month with no offsetting increase in profits. This could easily result in taking a company that is in the black and pushing it into the red. That money will come directly out of his pocket and may well push him into firing employees, closing the business, or into bankruptcy.
The facts do not support your premise in any way. here is another excerpt and link follows from teh Economic Policy Institute. There is NO evidence that a rise in MW, to keep up with inflation, causes any job losses, business bankruptcies, or closings. A raise, in fact, enhances employee productivity, morale, leads to less training and recruitment time and money, and helps decrease absenteeism. AS noted in the following article. If you follow the link, it will lead you to numerous sources from both conservative and progressive studies on this subject.
Please don't buy into the anti-MW talking points without doing some critical research and analysis.
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MINIMUM WAGE - Facts at a glance
"A minimum wage increase would raise the wages of millions of workers.
An estimated 14.9 million workers (11% of the workforce) would receive an increase in their hourly wage rate if the minimum wage were raised from $5.15 to $7.25 by 2008. Of these workers, 6.6 million workers (5% of the workforce) currently earn less than $7.25 and would be directly affected by an increase. The additional 8.3 million workers (6% of the workforce) earning slightly above the minimum would also be likely to benefit from an increase due to "spillover effects".
Minimum wage increases benefit working families.
The earnings of minimum wage workers are crucial to their families' well-being. Evidence from an analysis of the 1996-97 minimum wage increase shows that the average minimum wage worker brings home more than half (54%) of his or her family's weekly earnings.
An estimated 1,395,000 single parents with children under 18 would benefit from a minimum wage increase to $7.25 by 2008. Single parents would benefit disproportionately from an increase — single parents are 9% of workers affected by an increase, but they make up only 7% of the overall workforce. Approximately 3.9 million parents with children under 18 would benefit.
Adults make up the largest share of workers who would benefit from a minimum wage increase: 80% of workers whose wages would be raised by a minimum wage increase to $7.25 by 2008 are adults (age 20 or older).
Over half (54%) of workers who would benefit from a minimum wage increase work full time and another third (30%) work between 20 and 34 hours per week.
A minimum wage increase would help reverse the trend of declining real wages for low-wage workers.
Since September 1997, the purchasing power of the minimum wage has deteriorated by 20%. After adjusting for inflation, the value of the minimum wage is at its lowest level since 1955.
Wage inequality has been increasing, in part, because of the declining real value of the minimum wage. Today, the minimum wage is 31% of the average hourly wage of American workers, the lowest level since the end of World War II.
The inflation-adjusted value of the minimum wage is 30% lower in 2006 than it was in 1979.
The effect of the last minimum wage increase in 1996-97 has been completely eroded by inflation.
$5.15 today is the equivalent of only $3.95 in 1995 — lower than the $4.25 minimum wage level before the 1996-97 increase.
There is no evidence of job loss from the last minimum wage increase.
A 1998 EPI study failed to find any systematic, significant job loss associated with the 1996-97 minimum wage increase. In fact, following the most recent increase in the minimum wage in 1996-97, the low-wage labor market performed better than it had in decades (e.g., lower unemployment rates, increased average hourly wages, increased family income, decreased poverty rates).
Studies of the 1990-91 federal minimum wage increase, as well as studies by David Card and Alan Krueger of several state minimum wage increases, also found no measurable negative impact on employment.
New economic models that look specifically at low-wage labor markets help explain why there is little evidence of job loss associated with minimum wage increases. These models recognize that employers may be able to absorb some of the costs of a wage increase through higher productivity, lower recruiting and training costs, decreased absenteeism, and increased worker morale.
A recent Fiscal Policy Institute (FPI) study of state minimum wages found no evidence of negative employment effects on small businesses."
http://www.epinet.org/content.cfm/issueguides_minwage_minwagefacts
So you're saying this theoretical business has no plans to ever give it's employees a raise, you provide no benefits, and when someone wants a raise you just get another sucker to work for you? That's a business that needs to go out of business and let that poor worker find someone that won't exploit him for their gain at his expense. Not all businesses are good for the economy, and this would be a good example. The employees would have to use government sources or charity for healthcare, etc. Minimum wage would not support a single person right now in most areas. At least not without medical benefits, dental benefits, etc. This is what gets me about Republicans, they think as long as the owner makes a profit, it's great. The vast majority of small businesses suck the blood out of their workers, and have no sense of responsibility.
Employers who must raise wages to meet the requirements of a new law must pay for these raises either by raising prices or cutting workers and requiring the remaining workers to do more. If prices go up, the standard of living of consumers go down. The other alternative causes job loss and a rise in worker capabilities. This rise in capabilities may include a rise in actual skills or a rise in the worker's ability to more regularly show up for work. The employer who pays more will expect more for his money.
The result is that it becomes harder for the new entrants to the workforce to get a job, to get on the first rung of the ladder going up to a good standard of living.
If you don't care about the most disadvantaged of us, then raising the MW makes a lot of sense. I remember when the restaurant where I worked gave meals to a very old man who did cleanup. He wasn't strong enought to do a very good job, but it did keep him alive. Then the rules changed and the owner had to pay him an hourly wage far higher than the man's work was worth. Eventually the owner was forced to let the man go. Who could afford to give him a job? What happened to charity and why did the government force the owner to stop his charity for this man? It was OK with the man and the owner, but not OK with the government so the man was the loser. That is compassion and charity government style.
You might make yourself feel good by being for a minimum wage, but that won't help those adversely affected and they are the poorest among us.
Best regards, Ben
Author "Leading People to be Highly Motivated and Committed"
That's the best argument that black is white I ever saw. You have truly outdone yourself, and I will forever believe that black, from this day forward, is white. Thank you for elucidating me on the reasons that exploiting, unfairly, other people for personal gain is not a sin. I would think that you might have included a stirring story of why the Pinkerton's used guns and baseball bats on strikers for their own good, and how when they were restrained from using bats, that just meant they had to shoot more of them. Try living on $5.15 an hour, I think you'd have a different outlook Ben. And the old man. If he was doing it out of the good of his heart, why did he not just feed the old man, anyway? If the old man felt the need to pick up a broom of his own free will, no one could stop him. Obviously he wasn't just doing it out of the good of his heart, he was getting some work out of him. Try living on $5.15 an hour Ben. That is all anyone has to say to cut through the chaff of your argument, I think.
The problem with America isn't our minimum wage laws. It's more about, so called, free global trade, outsourcing, H-1B visa style insourcing, legal and illegal immigration and our nation's destructive monitary policy of dollar devaluations. Ben makes a good point but we really must take our country back from the globalist free traders who plan to squander our standard of living on the alter of the god of the global community. Fix those lethal flaws in our economy, and our national poverty problem will disappear without any help from the federal government! I Promise!
Food for work,
Sounds like Pakistan, where entire families wander and beg for food to eat and a place to sleep in exchange for menial work.
Ben calls it chairty.
It is what he wants for you.
Yes, it's more complex, but I doubt Ben wants to take our country back from globalists. Or that his intent is to help the truly poor. He is a corporation hack. That's what motivational speakers (or writers) do, they figure out clever ways to convince people that they are what's wrong with the workplace, and their loving, innocent corporation just wants to help them work out their problems. When I was in management, I used to wonder at the number, and cost, of these guys. Peters, and after him, a flood. If my company had taken the money they spent on the motivator of the month, and used it to improve, say, just office furniture, morale would have soared. They have one purpose, to mess with your mind and increase production for the company, at what they consider a small fee. I consider them the emperor's new clothes. All psycho babble, and no substance. Other than that, you are correct.
I'm sorry if I turned your article into a personal rant, but some of this stuff just angers me to no end. The spin of good to bad will always get to me.
Ron, I have worked for less than 50 cents/hr and got along. I know quite a few people today working for the minimum and most of them move up by learning more, acquiring skills and acquiring new employment or being advanced where they are. That process has been going on for a long time. The problem is, if you can't get on the first rung of the ladder you can't ever climb it.
The IRS stats indicate that over 80% of the people in the lowest quintile of income move up at least one level after 5 years, often two. America is all about opportunity and the minimum wage laws remove some opportunities.
You don't see immigrants complaining about our system. The only complainers are those who "know better" than everyone else and want to use the coercive power of government to impose their way on others. Are you in that group, Ron?
One more point, Ron. You have made quite a few assumptions about me as if you know me. Let me assure you that you don't, anymore than I know you.
Best regards, Ben
Author "Leading People to be Highly Motivated and Committed"
I don't know you, but I know an elitist when I hear him spout propaganda. You got 50 cents, or less, an hour, looking at your age, probably when it's value was much more than 5.15 an hour, today, Ben. I came a little later and started off at 95 cents, but I couldn't live on it and you couldn't live on 50 today, either. I know you know that. I think you also know how long it's been since the minimum wage was raised, as well, and why. I also know that you are taking one small part of the picture and using it to justify the much bigger injustice in a much bigger part of the picture. I don't see immigrants complaining, yes that is right, so what I get from this- you want, or don't care if, fellow Americans live, no, not live, exist in the squalor and poverty of third world countries, right here in our borders? Oh, I know you, your kind. I seriously doubt that you come in contact with anyone making minimum wage, I seriously do. Maybe your daughter or son's friends? Maybe living at home and working? maybe your servants? That I might believe. Don't get me wrong, I know there are people, as we speak living on it, I know that. But living with any semblance of dignity, I think not. Do I think I know more than you? NO, that's what really makes me dislike you, I know you know you twist the truth. Do I want to see government impose it's way on others? When talking about companies that use and exploit their workers this way, YES, most definitely. You and your kind have no conscience of your own, so one needs to be regulated for you, and a lot more, if I had my way. Have you ever watched the TV show "Thirty Days", Ben? There's an episode where the guy and his wife or maybe girlfriend, I can't remember, try to exist for thirty days on minimum wage jobs. They didn't do so well. Neither would you. The minimum wage has not been raised in years, in the meantime, productivity of the worker has increased, the cost of living has increased, and health care costs have simply ballooned. The way I figure it, you weren't complaining about how any of that was unfair, so why are you complaining now, that raising it would be unfair? Because you don't care what happens to employees, you care about what happens to employers, and only them. The rest is just obfuscation.