Originally Posted by Jeff Kleist
Getting back on topic, is there any wonder why so few American companies make electronics any more? That union markup makes it impossible to sell a competitive product.
While I agree Union demands really got out of control in many manufacturing sectors (and remain out of control in other areas like education), there's a lot more to why jobs leave the United States for sites in Mexico or even Asia.
Workers comp insurance is one of the biggest factors pushing companies to outsource jobs overseas. I contend it's an even bigger factor than union issues.
Many businesses have the option whether or not to provide benefits like employer provided health insurance coverage. Most small businesses no longer do so because of the outrageously high costs of the health insurance premiums. However, workers comp is not optional. You have to carry that on any employee legally on the books. Workers comp premium costs are tied directly to health care inflation, which remains very high. Even if you hire a person at minimum wage and are making the minimum in matching social security and medicare payments you may still end up getting bent over on the workers comp premiums for that entry level employee. As a result more and more large businesses are sending jobs overseas. And a growing number of small businesses are paying employees off the books, cash under table. There is a lot more than millions of migrants from Mexico working in the underground economy; millions of legal American citizens are working the same way as well.
Oklahoma is a right to work state and by all logic should have a lot more in the way of non-union manufacturing plants. The state's backward worker's comp system does a lot to keep many heavy industries from locating here.
In the end, China and other countries in SE Asia can mass produce electronics so much cheaper than anyone in the US could ever manage -even if you paid every worker in the plant minimum wage. They would still be making a lot more money than workers across the Pacific. So the "if unions weren't around" argument really doesn't work.
Add to that the safety and environmental regulations we have in the United States. China and most other countries in Asia have next to nothing in terms of those kinds of regulations. They're basically where we were in the late 1800s during the industrial revolution: rivers so polluted they catch on fire and young children working in sweat shops or even coal mines.
Do we really want to compete with countries like China by sinking way back down to that filthy, dangerous level and paying everyone who doesn't own their own business poverty wages? Or do we want to figure out a different solution? I think the bean counters wouldn't mind seeing us revert to late 1800s standards.
Originally Posted by cjamescook
Work on an American standard for high-definition TV was initiated under the theory that it would give a shot in the arm to the declining American TV manufacturing sector. Specifically, because the standard was to be originated in America, it was seen as giving them an advantage. At the time, the main competition was the Japanese MUSE standard.
That's kind of ironic because it was during the late 1970s when Japanese electronics companies were "dumping" millions of TVs into the US market at prices well below the cost it took to manufacture them. In 1975 the US had a couple dozen TV manufacturing companies. By 1980, Zenith and RCA were the only ones left. RCA was bought out by Phillips in France; a few years later their last American TV plant in Indiana closed. Zenith moved its manufacturing offshore.
American politicians often let large overseas businesses do whatever they want, including breaking just about any trade rule on the books, in return for diplomatic favors. We basically gave most of our electronics industry away to Japanese companies in return for a commitment the country wouldn't become a Soviet satellite with warm water ocean ports.