Our Productivity Problem: US Workers Won’t Be Treated Like Zoo Animals

Foxconn, the giant Chinese manufacturer of iPhones has been in the news lately, most recently in yesterday’s Times piece on how they were able to respond quickly to retool to make glass-fronted iPhones:

In mid-2007, after a month of experimentation, Apple’s engineers finally perfected a method for cutting strengthened glass so it could be used in the iPhone’s screen. The first truckloads of cut glass arrived at Foxconn City in the dead of night, according to the former Apple executive. That’s when managers woke thousands of workers, who crawled into their uniforms — white and black shirts for men, red for women — and quickly lined up to assemble, by hand, the phones. Within three months, Apple had sold one million iPhones. Since then, Foxconn has assembled over 200 million more.

The point of the article is that Apple just couldn’t get that done in the US, and if you read the muted Times’ description of Foxconn, or, better yet, listen to Mike Daisey’s eyewitness account of visiting Chinese factories, it’s easy to understand why. Those workers live in dorms which house 13-15 people in bunks in 12 by 12 rooms. They officially work 12 hour days, but often work for up to 16 hours a day, for a little more than Chinese minimum wage (about $1.30/hour if my math is right). Turnover at the plants is estimated at 10-20% per month. And their leader has this attitude:

According to WantChinaTimes, Terry Gou, the head of Hon Hai (Foxconn), the largest contract manufacturer in the world, had this to say at a recent meeting with his senior managers:
“Hon Hai has a workforce of over one million worldwide and as human beings are also animals, to manage one million animals gives me a headache,” said Hon Hai chairman Terry Gou at a recent year-end party, adding that he wants to learn from Chin Shih-chien, director of Taipei Zoo, regarding how animals should be managed.

There’s nothing new and sophisticated about the way that digital devices are assembled. It’s just brute manual labor of the most repetitive and mind-numbing sort, done by underpaid workers who have to threaten mass suicide to get any changes in their working conditions.

173 replies
  1. 1
    THE says:

    All academic. Foxconn plans to introduce a million robots in three years.

  2. 2
    flukebucket says:

    If we were more like China we could compete.

  3. 3
    c u n d gulag says:

    Oh, but this, THIS, is the business model our American Conservatives will want to follow!

    Serfin’ USA!

  4. 4
    Ron says:

    It’s terrible, but most of us are guilty of taking advantage of this sort of thing. If not from Apple, then someone else. I find it hard to believe that Apple does this but HP, Motorola,Samsung, etc. don’t. I would really love to see a realistic cost analysis as to how much more we’d have to pay to get stuff that was made in the US (of course that can be variable depending on what kind of profit margin the manufacturer is willing to cut down to)

  5. 5
    Cargo says:

    I’m a big fan of Mike Daisey, and the one man show Agony and Ecstacy of Steve Jobs is well worth seeing. Two thoughts:

    1) I’m waiting for a Foxconn-like factory complex or ten to be built in the US, with local “easing of oppressive regulations” in order to “revitalize American manufacturing” and “create jobs” – never mind that the jobs work you to death. It’s what was going on in those cool old steampunk factories a hundred years ago!

    2) Funny how Apple takes all the hits for this, like your Xbox and Android phone and your 3DS and your toaster oven were built by happy elves frolicking in forest glades, but your iPad was cobbled together by Dickensian waifs.

  6. 6
    Villago Delenda Est says:

    China is the capitalist exploiter of the workers’ paradise.

    No two ways about it.

    I think the biggest split amongst the 1% is whether or not we should make the US more like China, or more like Honduras.

  7. 7
    Schlemizel says:

    TDS did a devastating piece on Foxconn a few weeks ago (I’ll see if I can find a link).

    This is really what our masters want for us. We will have full employment in the US once we accept the wages & work standards currently available in China.

    Who they will sell $600 iPhones to when we are all making $1.30/hr I haven’t a clue but its what they want for us.

  8. 8
    mistermix says:

    @THE: I’ll believe that when I see it.

  9. 9
    Aris says:

    Wouldn’t it be nice if a journalist were to ask the Republicans if they consider Foxconn the model for making the US competitive? Is this what Newt means when he talks about a paycheck society? Perhaps they want not only to do away with unions, but do what the Chinese have done and put anyone who even contemplates a union in jail for a few years. Austerity, hard work, doing what you’re told, etc. are all hallmarks of the Republican/Foxconn solution.

  10. 10
    kindness says:

    I love my iPhone and do feel badly as I am part of the problem. I wonder what the factories that make Android phones are like.

  11. 11
    Doug Danger says:

    I love how Apple takes 100% of the heat for this, while employing a lot of people here in the US and finding new ways to Molly people here every day – in IT, retail, engineering, marketing, etc. but HTC, Sansung, etc. get no heat whatsoever despite their looky-loo ripoff designs and identical manufacturing methods – without the self-policing and independent auditing Apple has voluntarily subjected it’s manufacturing processes to.

    Or should we talk about ageist Google? Plenty of jobs for kids who went to MIT or University of Bangalore – not so many for smart older guys who went to the same places.

    There’s a problem in China, alright. Apple has very little to do with it. Why do they always get the heat?
    .

  12. 12
    Chris says:

    Shorter Goopers: it’s all fine and good to want America to be more like the world’s biggest communist dictatorship, but wanting it to imitate some of the economic policies of our democratic, capitalist NATO allies goes WAY over the line. It makes you a traitor, an elitist and a fag who Doesn’t Believe in American Exceptionalism.

  13. 13
    Cargo says:

    kindness – it’s the same factories.

  14. 14
    Amir Khalid says:

    Those workers live in dorms which house 13-15 people in bunks in 12 by 12 rooms. They officially work 12 hour days, but often work for up to 16 hours a day, for a little more than Chinese minimum wage (about $1.30/hour if my math is right). Turnover at the plants is estimated at 10-20% per month.

    I think you left out the suicide nets under the balconies at the factory dorm. There were reports a few years ago that work stress had driven some Foxconn employees to jump.

  15. 15
    Nash says:

    @Doug Danger: I thought Apple invented heat(r).

  16. 16
    Schlemizel says:

    @kindness:
    Why would they be any better – there is no reason for them to be. Says the guy with the android phone.

    Ah liberal guilt – we are all responsible for the world we are creating.

  17. 17
    bnmng says:

    I don’t know if my half-hearted efforts to avoid Chinese products does much good, but I picked the Samsung Droid Charge because as far as I could tell, it was one of the few phones made in Korea. Motorola’s are all made in China now.

  18. 18
    Villago Delenda Est says:

    The thing here is, those workers in China could be paid a lot more, and work under much better conditions, and sure, it would cut into pure profit on this side of the Pacific, but the Apple execs would still be driving Maseratis, they just wouldn’t be getting new ones every six months, they’d have to wait like two years.

    The poor babies.

  19. 19
    Belafon (formerly anonevent) says:

    @Doug Danger: Apple has a lot to do with it, and they deserve the heat they are getting, while other companies deserve more heat. The same article talks about how Apples attitude is basically where else are they going to find workers they can wake up in the middle of the night like that.

  20. 20
    Comrade Javamanphil says:

    @Doug Danger:

    Why do they always get the heat?

    One theory: Apple is a liberal company (excuse the broad generalization but we are talking the perception in the press, not the nuance of reality.) As such, they are expected to do things better (or different, if you prefer.) It’s the same stupid narrative that drives our political press to ignore GOP obstructionism (because they are expected to hate a reasonably functional government) but then breathlessly report when the Dems hold up the works.

    Also too, I would love to see a company actually make their products in the US and charge the necessary premium to still make the same profit. How many people would actually buy them?

  21. 21
    phantomist says:

    U.S. workers access to guns would make the Chinese suicide problem an American homicide problem.

  22. 22
    Schlemizel says:

    @Doug Danger:
    Because they present themselves as something different, something better.

    Its not right as far as it lets others off the hook but that hardly makes it OK for Apple either. Just because every master on every plantation beat their slaves does not mean the one who gets singled out is not so bad,

  23. 23
    Redshift says:

    @Doug Danger:

    I love how Apple takes 100% of the heat for this, while employing a lot of people here in the US and finding new ways to Molly people here every day – in IT, retail, engineering, marketing, etc. but HTC, Sansung, etc. get no heat whatsoever despite their looky-loo ripoff designs and identical manufacturing methods – without the self-policing and independent auditing Apple has voluntarily subjected it’s manufacturing processes to.

    Read the fucking article before you spout off crap like this. It makes clear that:

    1. This is how all electronics are made now and other electronics companies are just as bad.
    2. Apple may have more employees in the US than Asian electronics companies, but the number of non-retail (meaning middle-class career) jobs in the US is tiny compared to manufacturing companies in the past, and that’s a big problem for our future.

    Apple gets the heat because fanbois like you are eager to give them a pass for practices that are just as bad as the people you want them ignored in favor of. I’m sure the Foxconn employees who have threatened suicide find their “self-policing” a great comfort.

  24. 24
    Roger Moore says:

    @THE:
    I have a hard time believing they’re going to do that much automation. I remember reading about one company that was saying they’ve deliberately moved away from automation recently. Part of that is the low wages, of course, but a more important part is that people are more flexible than robots are, so it’s easier to keep up with modern, rapidly changing production patterns with people. That was for a factory in Thailand rather than China, and a company owned facility rather than a contract one, but I’m sure the same basic principle applies.

  25. 25
    scav says:

    @phantomist: That does suddenly put the whole “I like to fire people” concept in a new light. Maybe Mitt is classical GOP VP material.

  26. 26
    Doug Danger says:

    Let’s ignore the cultural issues in China that lead to factories owned by former generals and run like military work camps. Obviously, Apple came up with all of that, militaristic as they are.

    It’s every phone. By every manufacturer. Most are worse than Apple, who pays for onsite monitoring and holds suppliers responsible for breaking the rules. Samsung just rips off everyone else’s designs, builds their honors in the same factories, and looks the other way. But Android is Google, and Googlle is perfect, except for paying no US Tax and ripping off NASA to the tune of millions a year, so everything is covered in a layer of “Don’t be evil” dust.

  27. 27
    Judas Escargot says:

    @THE:

    All academic. Foxconn plans to introduce a million robots in three years.

    Yep.

    The dirty little secret behind Friedman and company’s global race to the bottom is that, no matter how deeply the 1% manages to depress wages, it’s all moot by 2030 or so.

    Eventually, with robots and 3D-printing, the wage/productivity line for manufacturing goes below the wage needed to support human workers (what with their pesky need for food, clothing, and a nice concrete dorm room to sleep in).

    Wonder what happens then?

    Our current social/economic arrangements will not survive the 21st century.

  28. 28
    LittlePig says:

    @c u n d gulag:

    Oh, but this, THIS, is the business model our American Conservatives will want to follow!

    Serfin’ USA!

    Oh, they’ve known since Henry Ford days that is their business model, and Reganomics has made great strides in that direction. That’s what they mean when they talk about China being a threat: the Chinese can implement slavery on a massive industrial scale. We gotta compete, Amurica!

    This isn’t the stuff of their nightmares, it’s the stuff of their wet dreams.

  29. 29
    Doug Danger says:

    Let’s ignore the cultural issues in China that lead to factories owned by former generals and run like military work camps. Obviously, Apple came up with all of that, militaristic as they are.

    It’s every phone. By every manufacturer. Most are worse than Apple, who pays for onsite monitoring and holds suppliers responsible for breaking the rules. Samsung just rips off everyone else’s designs, builds their phones in the same factories, and looks the other way. But Android is Google, and Googlle is perfect, except for paying no US Tax and ripping off NASA to the tune of millions a year, so everything is covered in a layer of “Don’t be evil” dust.

  30. 30
    Gromit says:

    Foxconn manufactures products for:

    (country of headquarters in parentheses)
    Acer Inc. (Taiwan)
    Amazon.com (United States)
    Apple Inc. (United States)
    ASRock (Taiwan)
    Asus (Taiwan)
    Barnes & Noble (United States)
    Cisco (United States)
    Dell (United States)
    EVGA Corporation (United States)
    Hewlett-Packard (United States)
    Intel (United States)
    IBM (United States)
    Lenovo (China)
    Logitech (Switzerland)
    Microsoft (United States)
    MSI (Taiwan)
    Motorola (United States)
    Netgear (United States)
    Nintendo (Japan)
    Nokia (Finland)
    Panasonic (Japan)
    Philips (Netherlands)
    Sharp (Japan)
    Sony Ericsson (Japan/Sweden)
    Toshiba (Japan)
    Vizio (United States)

    Apple gets all the headlines because they are on top, but, yes, Foxconn makes all your X-Boxes and many of your Android phones, too.

  31. 31
    bnmng says:

    There is a real issue of competition here. If any these companies don’t find the cheapest way to get their products assembled, their products will cost more than the competition’s and most people won’t buy them. The only ways to stop serfdom are a groundswell of consumers refusing to buy these products or the government protecting the poor at home and refusing to allow the products of near-slavery into our nation.

  32. 32
    Benjamin Franklin says:

    @Villago Delenda Est:

    The GOP, along with BBB and the Chamber of Commerce are envious of the Dickensian Economic structure of China and their 1/100 of one percent.

    It’s a Free Market, Supply-side Paradise.

  33. 33
    Redshift says:

    @Ron: The whole article is well worth reading. It cites estimates that iPhone would cost $65 more if manufactured in the US, but the real reason for the difference is the savings in ramping up manufacturing and the speed with which that can be done and changes to manufacturing processes.

  34. 34
    Zifnab says:

    @Ron:

    It’s terrible, but most of us are guilty of taking advantage of this sort of thing. If not from Apple, then someone else.

    You know, part of me agrees. It feels like buying a “Made in China” electronic product is a form of endorsement of these slave labor practices – except for two things:

    a) Freak’n everything is Made in China. Saying “I’m going to shop responsibly” really just boils down to “I’m not going to shop at all”. There is a slave labor market monopoly and it is prohibitively difficult (and often prohibitively expensive – given our declining wages) to locate products that aren’t produced in these terrible conditions. And besides, not buying Chinese products (unless you do so under a massive, public boycott) won’t change working conditions. FoxConn will just hire a few less workers at slave wage salaries.

    b) iPhones retail for $600 / unit, usually with a $400 subsidy from the telecomm service provider you purchase it with, to whom you then pay exorbitant phone fees. It’s not like we can’t have high tech gadgets for market prices if the employees are paid more. It’s just that Apple, etc would have to sacrifice some of their massive bottom line to do so.

    When you are buying products at Made in USA prices, while employees make the products at Made in China wages, and the middle men pocket the difference then the fault lies no more in the consumer than in the phone assembler. Give blame where blame is due.

  35. 35
    THE says:

    @mistermix: @Roger Moore:

    It’s more subtle than that. Foxconn figures its going to need so many robots that it intends to become one of the world’s largest manufacturer of robots as well.

    Two birds meet One stone.

  36. 36
    numbskull says:

    @Comrade Javamanphil:

    Also too, I would love to see a company actually make their products in the US and charge the necessary premium to still make the same profit. How many people would actually buy them?

    If the end price to customer was same, then everyone would continue buying. The company would make a lower profit. According to Daisy, last year it was $10Bn and it’s projected to be $30Bn this year. That’s with a “B”. As others have pointed out elsewhere, image if we had had $5Bn in wages injected into the US economy last year. Might even have sold a few more units over the holidays since more workers would’ve had the cash to buy.

    Just a thought…

  37. 37
    Roc says:

    @THE: Exactly. When Jobs said “Those jobs aren’t coming back”, he was saying that in the long term, automation will make those jobs irrelevant. Even if you brought them back at great expense, they’d still be automated and destroyed.

    It’s worth pointing out, however, that once automation reaches the point where it can perform the remaining manual tasks and has the flexibility of a Chinese factory (for just-in-time line changes/parts changes/etc), those *factories* will be coming back to the US. Because shipping and storage overhead can be cut massively, feeding profit back into the bottom line. And bringing those factories back will bring back factory-building jobs, factory maintenance jobs, robot maintenance jobs, robot research/design/customization jobs, etc.

    Further, companies like Apple will recognize the profit- and competitive-advantage of building/running their own factories and putting their own optimizations into place. (Not unlike Apple did with its custom Aluminum machining plant.) And that will lead to even more jobs as the shared assembly lines of Foxconn give way to dozens of variations and specializations.

  38. 38
    burnspbesq says:

    @kindness:

    I wonder what the factories that make Android phones are like.

    No different.

  39. 39
    Schlemizel says:

    @LittlePig:
    While I am loath to defend Hank Ford (may be burn in peace) He did have the right idea about wages. He stated that he wanted to pay his workers enough so that they could afford to buy what they were making.

    He was actually creating a model that would generate tremendous wealth for himself and a great standard of living for his employees. Nobody at Foxconn is going to buy an iPhone or an X-box (hence the rip-off clones available on the street). But once our masters have killed the economic engine that is the American consumer what will they do then?

  40. 40
    PurpleGirl says:

    @Doug Danger: I don’t know why it seems that only Apple gets the heat but Apple has everything to do with the problem because they decided to have outside contractors in China do their manufacturing. Or do you think that an executive from Foxconn held a gun to Steve Jobs head (or maybe his daughter’s) and said “sign a contract with us or I’ll blow your (her) brains out”.

    Who will be the first one here to move to China and take a job for $1.30 an hour?

  41. 41
    deep says:

    Let us not forget that much of the cost of paying workers better can be easily pulled from the executives’ salaries which are often 1,000,000% or more than the lowest worker.

  42. 42
    Raven says:

    Any of you remember when Tricky Dick went to China and loved their discipline?

  43. 43
    Zifnab says:

    @numbskull:

    If the end price to customer was same, then everyone would continue buying. The company would make a lower profit.

    Without high profits, you don’t get inflated stock/bond prices. And without inflated equity prices, it costs you more to borrow and expand.

    The financing side of the equation deeply favors the slave-labor capitalist because he is able to get bigger loans, more easily, and at lower rates than his competitors. It’s not enough to simply “Buy American”. You absolutely need legislation to curtail the advantages provided to slave profiteers by the free market.

  44. 44
    Belafon (formerly anonevent) says:

    @Nash: It would have been called iHeat.

  45. 45
    patrick the pedantic literalist says:

    When I was a kid I read a science fiction story about a future where robots did all of the work. I figured that someday, as robots were able to produce more wealth, that wealth would have to be shared and there would be some sort of social distribution of wealth that a democracy could agree on. I was a naive child. The 1%, whether the Chinese 1% who call themselves communists, or the American 1% who call themselves capitalists, want to keep it all. And whether they think of us as secular animals from a zoo, or non-christian sinners unworthy of god’s grace, they always find a rationale for keeping the boot on your neck.

  46. 46
    Senyrodave says:

    “Hon Hai has a workforce of over one million worldwide and as human beings are also animals, to manage one million animals gives me a headache,” said Hon Hai chairman Terry Gou at a recent year-end party, adding that he wants to learn from Chin Shih-chien, director of Taipei Zoo, regarding how animals should be managed.

    Terry Gou, the next Secretary of Labor under a Republican administration.

  47. 47
    THE says:

    @Roc:

    those factories will be coming back to the US.

    I think that might be right if transport costs were high enough. But there is a caveat:

    The real advantage of China in the long run, that must make her the workshop of the world, is the size of her domestic market and the fabulous economies of scale, and learning-curve gains, that result from that.

    From China’s pov, in the long-term, exports are just a modest increase in her vast domestic production runs.

  48. 48
    Villago Delenda Est says:

    @Schlemizel:

    But once our masters have killed the economic engine that is the American consumer what will they do then?

    Look out from the windows of their castle at the serfs tilling in the fields, and laugh the laugh of Joseph Stalin as he enslaved Eastern Europe.

  49. 49

    There’s nothing new and sophisticated about the way that digital devices are assembled. It’s just brute manual labor of the most repetitive and mind-numbing sort, done by underpaid workers who have to threaten mass suicide to get any changes in their working conditions.

    Right, and regulations in America that prevent workers from being treated like zoo animals are the very regulations that people like Newt and Rick Santorum and the rest are clamoring to repeal because they’re “crushing jobs.” Thing is, they could outlaw the entire NLRB and unions and everything else and the only people who would work under these conditions are the illegal immigrants. In fact, I question if even they would … they could get these same jobs with the same pay and working conditions if they just stayed home. A lot less effort, that’s for sure.

    My view on this is, this is a bell that won’t be unrung. Slowly Chinese workers are waking up and demanding better working conditions (and Western consumers of these products are helping, by demanding better from companies like Apple…) but these are not jobs we want, not if this is what it takes. And Apple is not going to make an iPhone in Michigan.

    The labor force has been globalized. That’s reality, I don’t see that changing any time soon. Hell, half of our call centers are now operating out of India and the Philippines. So in the meantime we need to figure something else out. The software that makes these phones run is created here. The content is created here. These are the things we need to focus on. There are some things that can be manufactured here. Focus on those things. iPhones, not so much.

  50. 50
    300baud says:

    @Redshift:

    For those interested in the topic of “why things don’t get manufactured in the US”, check out the This American Life episode “NUMMI”:

    http://www.thisamericanlife.or...../403/nummi

    It’s about attempts to bring Toyota practices (aka Lean Manufacturing) to GM, and why that failed in most plants. Incredibly poignant. Especially the interviews with workers from a previously terrible plant: they were so much happier working the new way, and it made you see how GM could have become a totally different company.

    In my view, the biggest barrier to US manufacturing competence is MBA dogma. E.g., their obsession with maximizing shareholder value and cost reduction. And thinking of employees as a cost. As opposed to the Lean alternatives: focusing on customer value, reducing waste, and treating employees as a valuable asset worth continuing to invest in.

  51. 51
    Redshift says:

    @THE:

    From China’s pov, in the long-term, exports are just a modest increase in her vast domestic production runs.

    Maybe that’s what they’re hoping for, but I’m having a hard time seeing the intersection between a market of billions for iPhone clones and a mass of workers a $1.30 an hour. Which may be the best hope for this to change.

  52. 52
    Jon O. says:

    Y’know how cigarette boxes require images of diseased lungs, people on breathers, etc.?

    What if Foxconn-produced products (or others from factories over a certain suicide rate) had pictures of workers committing suicide? I mean, you should know when your product is going to kill someone right?

    Pardon my grandiose thoughts.

  53. 53
    gene108 says:

    U.S. manufacturing remains the world’s largest manufacturer, despite an inaccurate report in today’s Financial Times that China has passed the United States. American manufacturing, in fact, is so large that if it were a self-standing economy, it would be the eighth largest in the world.

    There are a number of errors in the data provided to the Financial Times by a private sector consultant. First, the report did not measure the physical quantity or volume of manufacturing, but rather measured current dollar output which is impractical due to price changes and exchange rate changes. Real Gross Domestic Product (GDP), and its manufacturing component, Real Manufacturing Value-Added, are the correct ways to measure economic output, because they are adjusted to remove the effect of price and exchange rate changes and measure real output.

    The United Nations Statistics Division compiles global data on manufacturing value-added, and its most recent data shows the United States continues to lead, with close to 21 percent of all global manufacturing output in terms of constant dollars (real manufacturing value-added in 2009). China is the second largest, with about 15 percent of global manufacturing. No official data are available for 2010 yet, but given the gap between the top two manufacturers, China will not have surpassed the United States in 2010.

    http://shopfloor.org/2011/03/u.....gest/18756

    From last March.

    U.S. economy is still the largest in the world. 10%-20$ of 14 trillion is going to be a huge number compared to any place else on Earth.

    People in the U.S. forget that America accounted for 80% of the world’s manufacturing capacity at the end of WW2.

    I don’t think we’re ever going to have that degree of dominance in manufacturing again.

    The issue is what other industries are going to fill the gap that manufacturing had post-WW2.

    So far the capitalists have come up with Wal-Mart. That needs to change.

  54. 54
    Schlemizel says:

    I can’t be sure because video is blocked here but I believe this is TDS on FoxConn
    http://www.johninnit.co.uk/201.....lefoxconn/

    It should be required viewing before the 1% can speak.

  55. 55
    Enhanced Voting Techniques says:

    @Roger Moore:

    Part of that is the low wages, of course, but a more important part is that people are more flexible than robots are, so it’s easier to keep up with modern, rapidly changing production patterns with people.

    Robots are like any capital investment. Only worth over 20 years.

    Here’s a question for you kids; why do you think the 1% ended slavery? Because you can’t lay off a slave when their skill set becomes obsolete.

    The hilarious part in all that is the 20% staff turn over rate. That’s basically saying Foxconn will lose it’s full staff in five years. Speaking as a someone who working in manufacturing that’s a big issue.

  56. 56
    gene108 says:

    @Redshift:

    a mass of workers a $1.30 an hour

    The question you need to ask yourself is what were the Chinese making before they got those good paying $1.30/hr jobs at Foxconn?

    I’m not being sarcastic.

    $1.30/hr on 2080 hr year = $2704/year. That’s probably a huge bump up in the annual income for a lot of the Chinese versus a generation or two ago.

  57. 57
    jharp says:

    I too have toured several Chinese factories. Though working conditions ain’t the best. It’s a factory after all. At the end of the day the Chinese worker has more disposable income than the the minimum wage earners here.

    The get fed, clothed, medical care, and housed. So they basically get to keep all that they earn.

  58. 58
    dmbeaster says:

    Its been said above, but its worth repeating. China is the elites’ dream come true – if only they would give a formal name-change to themselves so that they are no longer formally “communists.” Then forget emulating the Japanese who we infected with unions (that damned liberal McArthur!); China is the new black.

  59. 59
    jibeaux says:

    I have to admit I think this is a lost cause. I try to keep my consumer electronics purchases to what I need — I never have the coolest or the latest gadgets, and that’s o.k. Even if you could magically manufacture, say, the iPhone 4S here in America, in six-twelve months they’re going to want to roll out the iPhone 5 that will have many different components. They’ll get their prototypes for these components from the suppliers who can provide them quickly and in large quantities, and who can then get them rolling quickly off their assembly lines — who are all in China.
    I try to buy American & locally made in other things — cars, clothing, toys, linens, housewares — you actually still have some choices there. Don’t make any assumptions, though, I was appalled to pick up one of those novelty lollipops at a counter one time, and find it made in China. Really, we can’t support a lollipop industry here any more?

  60. 60
    Yutsano says:

    @Aris:

    but do what the Chinese have done and put anyone who even contemplates a union in jail for a few years

    China has official state unions. Everyone must join up, but they do not represent the interests of the workers. The union is there to enforce state discipline. Period.

  61. 61
    Mark says:

    Part of my job involves dealing with chip and PCB manufacturers in different countries for a variety of different companies. Some thoughts:

    1. Not everything gets manufactured in China; lots of stuff is actually done in Japan. Not much in Korea. Taiwanese companies do a lot in China, but that’s to be expected. I also see stuff being done in Thailand.

    2. Apple has a 5% market share but 50% of the profit. They built a brand with massive margins and they are spiriting a big chunk of that to China. The notion that they couldn’t find people to do assembly in the US is ridiculous. (Samsung and HTC would be screwed because they have no margins.) However, the conditions under which people used to do large-scale electronics assembly in this country were horrendous even when the pay was ok, and they resulted in so many Superfund sites that I highly doubt that we’d touch that again.

    3. Android is an operating system. Apple is an operating system plus the entire phone and manufacturing process. Apple made this decision – its CEO decided to junk its American manufacturing plants and was proud of it. Wal-Mart (aka Apple here) is a bunch of bastards, but we sure as hell never indicted the American companies that sold to Wal-Mart (aka Android here). One of these companies has real market power in the cell phone space, the other doesn’t.

    4. I’ve never understood why Apple was great and Microsoft was shit. It’s like refusing to go to Starbucks because it’s a big chain and getting your coffee at Peet’s instead.

  62. 62
    Lurker says:

    @bnmng:

    I don’t know if my half-hearted efforts to avoid Chinese products does much good, but I picked the Samsung Droid Charge because as far as I could tell, it was one of the few phones made in Korea. Motorola’s are all made in China now.

    FWIW, my Samsung-manufactured Google Nexus S also has a “Made in Korea” stamp, though the battery that shipped with it had a “Made in China” stamp.

  63. 63
    Doug Danger says:

    Motorola mobile Code of Supplier Responsibility. One page, no linked reports, details, nothing. Just a list of what they expect from suppliers.

    http://responsibility.motorola.....iers/scoc/

    Apple Supplier Responsibility web site:

    http://www.apple.com/supplierresponsibility/

    Reports, details, Human rights initiatives, supplier names, education efforts in the factories, and audit results.

    Other than the massive difference between the two, I can see how they’re exactly the same, and why Apple is constantly cited as being the most egregious offender here.

    Not a fanboy – but was a consultant – and I saw how closely they monitor suppliers and inform those choices with their own corporate values. Jobs tried twice to build computer factories in the US before he gave up and outsourced to Foxconn and others.

  64. 64
    Nash says:

    OT, but I hope they’re working on a post about this breaking story:

    http://www.politico.com/news/s.....71818.html

    Rand Paul detained by the TSA for refusing a patdown.

  65. 65
    Roger Moore says:

    @300baud:

    In my view, the biggest barrier to US manufacturing competence is MBA dogma. E.g., their obsession with maximizing shareholder value and cost reduction the very short term.

    FTFY. The problem isn’t that they’re focused on shareholder value and cost reduction. It’s that their focus on the very short term makes them ignore the real source of value to the company. Loyal, competent workers start to look like an asset when you worry about what your company will be doing in five years. So do satisfied customers. It’s only when you take the myopic view that nothing beyond this quarter really matters that you stop seeing everything as an unnecessary expense rather than an attempt to get value for your money.

  66. 66
    Amir Khalid says:

    @Jon O.:
    Some years ago, there was a big fuss about major sporting goods/sportswear brands (think adidas, Nike, and others of that ilk) hiring contract manufacturers in places like Pakistan and India who employed kids, some not even of school age, to make things like soccer balls for long hours at token wages. Faced with activist and consumer pressure, these big brands instituted processes to weed out these labor abuses, rather like Apple is doing now. So there is precedent for what you’re suggesting here, and I agree that it should be done.

  67. 67
    ruemara says:

    @jharp: I’m sorry, obviously I forgot what a glorious paradise it was to sleep in a cage and work 12-16 hour days. What were we thinking, criticizing Foxconn? This is so much better for those Chinese workers and the suiciders are just bitter whiners.

    asshole.

  68. 68
    Cermet says:

    @THE: Do recall that nearly half a billion chinese live on a dollar a day – not likely to consume much; of the larger 0.6/0.7 billion, the vast majority make little compared to the cost of many high end items – most are happy to have food/shelter and a chance to live in a city. The middle class is still very small and not growing – look at the vast housing market bubble. China has all our problems but many more and all very large. Pollution is at a level we have never seen; loss of top soil; health costs way above wages (for very primative care.) The list goes on.
    Is China better now than forty years ago? Yes. Will it become another Amerika? No way.

  69. 69
    300baud says:

    @Southern Beale:

    There are some things that can be manufactured here. Focus on those things. iPhones, not so much.

    In the short run, sure. In the long run, I disagree. Direct labor cost is the obvious thing everybody seizes on, but it’s only a small part of the problem. Foxconn’s real advantages are quality, adaptability, and reliability. Those things aren’t harder to get with well-educated, well-paid workers. If you’re serious about it, they’re easier.

    An example is hair clippers. If you have some, good odds they’re Wahl clippers. They are made in the US and they solidly beat Chinese manufacturers year after year: http://www.evolvingexcellence......gut-1.html

    Another example is Toyota. They have steadily risen over the years to become the number 1 manufacturer of cars. They did that not by chasing cheap labor, but by investing heavily in their people.

  70. 70
    slag says:

    @300baud:

    In my view, the biggest barrier to US manufacturing competence is MBA dogma. E.g., their obsession with maximizing shareholder value and cost reduction. And thinking of employees as a cost. As opposed to the Lean alternatives: focusing on customer value, reducing waste, and treating employees as a valuable asset worth continuing to invest in.

    I couldn’t agree more.

    Thank you, mistermix, for highlighting this issue! It’s en vogue, right now, thanks to TAL, TDS, and a bunch of other real news outlets, such as ArsTechnica. I’d love it if the problems highlighted here didn’t slip quietly out of our minds at the end of the news cycle! This is a cautionary tale, and we should treat it as such.

    And as for all those “Well, at least they HAVE jobs” arguments, all I can say is that the soft bigotry of low expectations is a bitch.

  71. 71
    jharp says:

    @jibeaux: I was appalled to pick up one of those novelty lollipops at a counter one time, and find it made in China. Really, we can’t support a lollipop industry here any more?
    *****************************************

    We can’t even make fucking toothpicks to compete with China.

  72. 72
    sherparick says:

    @Villago Delenda Est: Honduras, Gautemala, or Paraguay I think our .1% preferred model, since in those countries they own the thugs to do the enforcement, while in China, the Party controls the thug and if one day they find Mr. Gou no longer useful, they can have a nice little show trial, a public execution, and then find some other man on the make to run FOXCOMM.

    I expect the Zookeeper, who are a usually a pretty humane sort by temperment, will horrified that FOXCOMM workers are treated so much worse than his animals.

    The WTO & “free” trade, ain’t it wonderful, eh. And it the Democratic Party under Clinton, with NAFTA and the WTO, that have up labor rights, environmenatal standards, and human rights in regard to commerce that pretty much eliminated the reasons the white working class voter had to vote Democratic. And the Republicans have been reminding him of all the reasons not to vote Democratic since the 1964 Civil Rights Act.

  73. 73
    THE says:

    @Judas Escargot:

    Our current social/economic arrangements will not survive the 21st century.

    My sense too. In the end we have to pay people to consume or industry becomes self-defeating.
    Guaranteed minimum income or something like it.

  74. 74
    Roger Moore says:

    @gene108:

    The question you need to ask yourself is what were the Chinese making before they got those good paying $1.30/hr jobs at Foxconn?

    They were growing rice, soybeans, and possibly pigs. Seriously. Most of these people were farmers before they got their factory jobs.

  75. 75
    Brother Shotgun of Sweet Reason says:

    @Comrade Javamanphil: Some people will pay a premium for “Made in the USA”. I’ve been looking at hand tools lately. Most (Craftsman, Channellock, Snap On, SK, etc) are made in the US and the mechanics who buy them know it.

    Craftsman is on the brink of outsourcing, and if/when they do, their brand will die.

  76. 76
    The Republic of Stupidity says:

    Turnoverr at the plants is estimated at 10-20% per month.

    “Turnover”… is that the officially designated state euphemism for “died from exhaustion while standing at their workstation in the midst of yet another 16 hr workday”?

    I hear it’s far more elegant in the Chinese characters…

  77. 77
    The Moar You Know says:

    The question you need to ask yourself is what were the Chinese making before they got those good paying $1.30/hr jobs at Foxconn?

    @gene108: I’ve been there, not as a tourist. Those folks were making maybe a buck a day slogging through fields up to their hips in human and other shit.

    That being said…

    Glad one of the frontpagers caught this, I damn near blew a gasket when I read this sorry tale this weekend. The fapping throughout the article was perhaps the most impressive thing about it, but when you boil it down to the ugly facts you’re back to the old company town where you are bought and owned by the company, and they can do any goddamn thing they feel like to you, because your alternative is to starve.

    Impressive? What Foxconn has done is surely impressive. Admirable? Fuck no. I don’t want that as America’s future.

    I’ll tell you what. The 1% has been looking at China and really like what they see. Don’t think it can’t happen here.

  78. 78
    Roger Moore says:

    @Brother Shotgun of Sweet Reason:
    Craftsman is already dying a slow death. They used to be the reasonably priced alternative to professional mechanic’s tools like Snap-On. If you liked working around the house but didn’t use your tools 40 hours a week like a mechanic, they gave you a less expensive but still well made alternative. That market has been eroded by cheaper imported tools, and Craftsman’s threat of offshoring their production is an admission they can’t get away with charging a premium anymore.

  79. 79
    Martin says:

    Christ. Did nobody actually look at what the critical issues were that drove them to China?

    When an Apple team visited, the Chinese plant’s owners were already constructing a new wing. “This is in case you give us the contract,” the manager said, according to a former Apple executive. The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day.

    “The entire supply chain is in China now,” said another former high-ranking Apple executive. “You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.”

    Another critical advantage for Apple was that China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States.
    __
    In China, it took 15 days.

    In the US, those factories are time zones apart. If you need parts, you’re at least 24 hours away from getting them. And nobody in the US has excess capacity just in case, because there’s a earning statement within the next 90 days, and that idle capacity just eats profits, and we can’t have that. So anytime anyone needs anything in the US, you have to start building the infrastructure for it.

    But the big one is the trained workers. There’s lots of workers in the US capable of doing this kind of work, but no place for them to get trained. None. And that’s the problem.

    One of Apple’s biggest competitive advantages comes from the cases on the iPhone and the iPad and the Mac. Milled from a single piece of aluminum, it’s rigid and light. Apple has bought damn near every CNC machine produced in Japan and Germany over the last 2 years and installed them at Foxconn factories. There’s certainly enough people in the US capable of learning how to run 10s of thousands of precision million machines, but there’s no place to actually learn it.

    Let’s say CA wanted to take this on. We’ve got that kind of labor force currently out of work – and it’s Apple’s back yard, so that makes sense. The logical place to do it would be the CA community college system. 115 campuses, so they could do hundreds of workers per campus, and the campuses are well distributed. (Nobody is going to move their family on a hope in a nation lacking safety nets, which is part of the reason why China has more worker mobility.) Each of those campuses needs trainers themselves, and equipment to train on. There is no chance in hell that the State of CA is going to pay for that. Democrats would love to, but the tax base has been so ravaged by the Republicans, that it’s effectively impossible. It’d pay for itself over 5-10 years, but it can’t be done because there’s no cash now. Apple would need to pay for it – and there’s no assurance that they’d get those workers back.

    The layers of economic idiocy we’ve built in this country is staggering at times. Stop focusing on the labor costs, because they’re largely immaterial. The entire piece starts with a time-to-market problem, not a labor costs problem. They went to China not because they were cheap, but because only China had the infrastructure to do it. Period.

    Apple needed 8700 industrial engineers. The US turns out half that many per year, for the entire country. Apple needed to hire the entire US output for 2 years, for one project. What about the next project? Where do those workers come from? You need anthropologists? The US drowning in those. Liberal Arts? Same thing. Industrial Engineers? “Sorry, that’s too expensive to fund. We can educate 3 liberal arts majors for the cost of one industrial engineer.” Well, yeah, no shit. And the industrial engineer will earn 3x as much as well.

    Before you return to the wage issue, answer how those problems get solved first. The wage issue is easy. Apple’s pay and benefits are among the best of any retailer in the US. They’ll pay. But that’s not the problem. It’s not been the problem for a decade, now.

  80. 80
    Catsy says:

    @Judas Escargot:

    Eventually, with robots and 3D-printing, the wage/productivity line for manufacturing goes below the wage needed to support human workers (what with their pesky need for food, clothing, and a nice concrete dorm room to sleep in).
    __
    Wonder what happens then?
    __
    Our current social/economic arrangements will not survive the 21st century.

    This. And it is a serious issue that does not get enough attention.

    There is a very interesting novel by David Brin called Kiln People, in which a technology colloquially called “dittoing” allows people to make a copy of their “Standing Wave”–their personality and sentience, in effect–and impress it into a cheap, recyclable artificial body that expires in about 24 hours. Once a toy of the 1%, like most technologies it eventually became cheap enough for the general public, and it drove a sea change in work effort and employment. Instead of hiring 100 workers, you could hire five or ten who are really good at what they do, and those people would create a set of “dittos” each day who would perform their jobs while they did other things.

    You can see where this leads: a massive increase in productivity, and an equally massive increase in unemployment. As of the novel’s timeframe dittoing has been around for some time, and by this point it is accepted as the norm that real people don’t spend their precious lifespan doing actual labor, they create dittos each day that do this work and inload their memories at the end of the day. Those who can’t find a job–and this constitutes the vast majority of people–are on what’s called the “purple wage”, which is essentially welfare or “the dole”.

    The dittoing stuff is science fiction, of course–though quite fascinating in its own right–but the evolution and spread of technology, especially robotics, is eventually leading in a similar direction. What we’re seeing now is only a hint of what’s to come.

    Sooner or later–and better sooner than later–we are going to have to figure out how to deal with that. With the human population growing and the scope of work that must be performed by a human being shrinking, it’s really just a matter of time and math.

    I don’t have the answer to that. But I don’t see any way forward that doesn’t involve either mass poverty and unemployment, or a welfare state.

  81. 81
    The Moar You Know says:

    The only ways to stop serfdom are a groundswell of consumers refusing to buy these products or the government protecting the poor at home and refusing to allow the products of near-slavery into our nation.

    @bnmng: I don’t let my wife buy anything for the kitchen unless it’s made in the US or Europe. I just spent $90 on a wallet because it’s American-made with leather that I know came off a cow and not a dog or a Chinese political dissident (what, you think that doesn’t happen?). I think Americans should have decent jobs and decent pay, and I’m willing to pay a LOT more for that. Plus, American/European goods last ten times longer anyway. Less waste, less needless consumption.

  82. 82
    Linnaeus says:

    @The Moar You Know:

    I’ll tell you what. The 1% has been looking at China and really like what they see. Don’t think it can’t happen here.

    Hell yeah, it can. Instead of the Party running everything, though, it’ll be our neofeudal corporate lords.

  83. 83
    Pavonis says:

    I was just over at Daily Kos and the ad appearing in the sidebar was for a company, “Made-in-China.com”, which connects Chinese suppliers with buyers overseas. It’s strange that the ad advertises only “China” rather than efficiency or price or anything like that. Methinks some of our Galtian overlords have a Chinese (sweatshop) fetish.

    And yeah, Daily Kos is probably the weirdest place for such an ad.

  84. 84
    Villago Delenda Est says:

    @Catsy:

    The thing is, we’re going to have to find a new paradigm for human society, and those at the top of the current one don’t want to change it.

    The notion that people must work for a living in a society without scarcity creates too many dissonances that can’t be readily resolved.

    At one time, it looked like we had a solution to all this, but then 30 years ago the greed is good people came to power, and frankly these folks live to see others suffer.

  85. 85
    The Thin Black Duke says:

    Here’s a drive-by book recommendation: Cory Doctorow’s “For The Goal” offers a fascinating and disturbing perspective on this problem.

  86. 86
    liberal says:

    @Catsy:

    The dittoing stuff is science fiction, of course—though quite fascinating in its own right—but the evolution and spread of technology, especially robotics, is eventually leading in a similar direction. What we’re seeing now is only a hint of what’s to come.

    It’s really not so clear.

    Economists are fond of pointing out that people have been saying these things for centuries.

    OTOH, it’s certainly possible that this will turn out to be the productivity revolution that breaks this.

  87. 87
    liberal says:

    @300baud:

    They have steadily risen over the years to become the number 1 manufacturer of cars.

    I’m not so sure that’s a good example. My admittedly anecdotal impression is that in the dash to surpass GM they dropped some quality standards.

  88. 88
    Linnaeus says:

    @Martin:

    The layers of economic idiocy we’ve built in this country is staggering at times. Stop focusing on the labor costs, because they’re largely immaterial. The entire piece starts with a time-to-market problem, not a labor costs problem. They went to China not because they were cheap, but because only China had the infrastructure to do it. Period.

    That infrastructure also includes the massive control that Foxconn exerts over its workers. I don’t think we should overlook that.

  89. 89

    I don’t know if my half-hearted efforts to avoid Chinese products does much good, but I picked the Samsung Droid Charge because as far as I could tell, it was one of the few phones made in Korea. Motorola’s are all made in China now.

    What’s the difference? From a U.S. jobs point of view, of course?

    The “buy American” push hasn’t gained as much traction here lately, not like it did back in the 80s. I’m not sure why that is except people are so disconnected from how their consumer choices have real world implications. Or maybe they just don’t give a fuck anymore. They really REALLY want that $5 T-shirt from Wal-mart and they don’t care if it was manufactured by slaves in a Chinese prison.

    I mean really, everyone seemed to be concerned about slave labor making Kim Kardashian’s lingerie line or whatever the fuck it was but when it comes down to it, do people really care? Don’t they just want what they want and the rest be damned?

    Something else, all over Canada are these retail stores selling Canadian-made products. And not just maple syrup, they sell clothing and all sorts of other things. We saw them all over Canada. We tourists love ’em because who wants to bring back a souvenir that says “Made In China” on it? Don’t know whose idea these are, if it’s the Canadian government or some Canadian trade group but why in God’s name hasn’t the free hand of the market created a Made In USA store? You’d think that would be something good Patriotic Americans would be interested in.

  90. 90
    Martin says:

    @Catsy: Look, the 40 hour work week is not some kind of Universal Constant, like the speed of light. There’s no reason why a 30 hour work week, or an honest to god vacation couldn’t be workable.

    As mentioned above, Apple is going to replace those assembly workers with robots. It hasn’t happened until now because the robots weren’t up to the task, but the latest generation of robots are either there or damn close. The problem isn’t the labor costs (the robots will cost far more due to up-front costs and the much higher cost for technicians to keep them calibrated and working) but the fact that Apple has done something fairly remarkable here – the demand for their products is now high enough that even China is having trouble feeding them enough skilled workers – in part because Apple’s products require more technical skill to build than the competitors. Apple is trying to build new plants in Brazil and other countries, but they can’t build the plants fast enough to keep up with demand – and that includes moving workers to where the plants are, hiring them, training them, and so on.

    But the economic truth is that there is no added value by assembly line workers. There’s nothing they can do to make a product better. They aren’t like designers or engineers or even salesmen. It’s inevitable that they’re going to be replaced, like every other non-value-add worker. Switchboard operators provided no value over a mechanical switch, and so they were eliminated. And for everyone’s benefit – cell phones couldn’t exist without that move. I’m sure there was a lot of boohooing over the loss of those jobs, but if you provide no value, your job will get automated eventually.

    A century and a half ago we worked >40 hour weeks. We started working well before age 20, sometimes before age 10, and we stopped working when we died. There was enough economic demand to keep that many hours of labor going. The industrial revolution allowed for the same output from fewer hours, so we improved labor standards, took kids out of the workplace, lowered hours to 40, and created the opportunity to go to high school, then college, and to retire at a reasonable age. Those economic forces haven’t changed. We’re able to create more economic output with fewer work hours, but we haven’t changed our work standards since the New Deal. That’s going to have to happen at some point.

  91. 91
    chowkster says:

    Yes, this is bad. However, please keep in mind that the conditions Chinese and Indians now work in are far better than the conditions they used to work in. Workers are threatening suicide etc. because they know that things can be and should be better, but the factory owners are not responsive to their demands.

  92. 92
    chowkster says:

    Adding to my post above, I really have no idea how the situation can be improved. I don’t think those jobs are coming back to US. In today’s globalized marketplace, the jobs will go to wherever the wages are the lowest. It might be china today. It could be Bangladesh tomorrow. The only way to fix this would be to level the playing field by bridging the wealth gap between the countries, I think.

    Apologies if someone has already made this point upthread.

  93. 93
    Brother Shotgun of Sweet Reason says:

    @Catsy:

    But I don’t see any way forward that doesn’t involve either mass poverty and unemployment, or a welfare state.

    You forgot economic and ecological collapse and mass die-off. Wish I was joking.

  94. 94

    @Doug Danger:

    Not a fanboy – but was a consultant – and I saw how closely they monitor suppliers and inform those choices with their own corporate values.

    Considering a half-assed journalist on NPR was able to speak to 12 year olds who worked on his iPhone, I think Apple’s “values” are pure PR.

  95. 95
    pseudonymous in nc says:

    My great-grandfather lived in “lodgings” in a port town: it’s recorded in the census a hundred years ago. This is a well-known stage of industrialization: the scale is just larger.

    At the same time, I think it’s unarguable that SE Asia presents the kind of manufacturing. This is basically Paul Krugman’s new trade theory — the same reasons you make movies in Hollywood apply to building electronic widgets in SE Asia, in terms of returns-to-scale and network multipliers. That’s where the components are; that’s where the workers are; that’s where you can iterate fast. I was reading a comment from a guy who makes earphones in Taiwan, saying this: “Many things that we need is just a few phone calls away. Someone know somebody who know someone who can get you the stuff you need.”

    And I truly don’t think the US can compete with that — and shouldn’t, because it’s volatile. What’s needed are different concentrations of skills and investment that are further along the path of economic development, but aren’t so rarified that they leave out the bulk of the population. (Bill Clinton’s Esquire interview is good in this regard: he talks about things like retrofitting homes for energy efficiency as ground-up infrastructure projects.)

    Eventually, China’s factory workers will want the kind of stable family life and return on their sweat that America’s factory workers fought for. Whether that’s possible given the demographic skew is another matter, and managing those basic human desires — the willingness of a generation to live in dorms and work shitty hours so that the next generation doesn’t have to — will be the true test of the one-party system.

  96. 96
  97. 97
    Belafon (formerly anonevent) says:

    @chowkster: I don’t think we’re blaming the workers for choosing to make more. We’re blaming the companies for willingly accept servitude as a condition for making profits. It’s the same as griping about VW because they come here for cheaper labor.

    And some of the fault belongs to the consumer.

  98. 98
    chowkster says:

    Also, too: In spite of what we hear in the media, US share of global manufacturing output is equal to if not more than China. It is just that all those factories turning out high tech products such as robots that were first to enter the Fukushima plant do not employ a lot of people.

  99. 99

    Apple needed 8700 industrial engineers. The US turns out half that many per year, for the entire country.

    A country that has 4 times the US population will have, will always have, 4 times the industrial engineers. It’s only partially teachable, and so it’s only partly scalable. Some of the things that make an industrial engineer an industrial engineer are innate — and they’re the things that an engineer has, and a technician does not, besides the mere degreee.

    Most disciplines, academic or not, are not just things you know, they’re ways you be.

  100. 100
    chowkster says:

    @Belafon (formerly anonevent): Yes, I do see your point. But to the Chinese or Indian guy who was making $0.005/ hour before the economies were liberalized, companies like Foxcon or Coca Cola who pay $0.1/hour are godsend. It is nearly 200% increase in his salary.

  101. 101

    @chowkster:

    I actually agree. I don’t think things will stay like this for long. China has already been dealing with massive strikes and protests, and has had to make changes at its factories. Yes China has a massively authoritarian government but they also have a population of — what is it now, 1.3 billion? They can’t throw ALL of those people in prison. And at the same time, China’s billionaire “entrepreneurs” are all fleeing the country and taking their money to the west. Doesn’t take a genius to see things are changing, very quickly over there.

    India, too. Not as authoritarian as China but huge cultural shifts are happening as standards of living rise and the workforce gets educated.

  102. 102
    chowkster says:

    @Southern Beale: Prayers for him and his family, but I do hope he retires.

  103. 103
    Villago Delenda Est says:

    @Southern Beale:

    It is, but sometimes these things happen to the young and fit when the template is older and not so fit.

    Once again, the intelligent designer is shown to be not so intelligent in his design.

  104. 104
    kindness says:

    @Mark: Your own argument you suggest favors you is

    I’ve never understood why Apple was great and Microsoft was shit. It’s like refusing to go to Starbucks because it’s a big chain and getting your coffee at Peet’s instead.

    Fail on so many levels. You don’t see any difference between a PC and a Mac? You don’t see any difference between buying coffee at Starbucks vs buying coffee at Peets?

    You’re 0 for 2 there buddy.

  105. 105
    Martin says:

    @Linnaeus:

    That infrastructure also includes the massive control that Foxconn exerts over its workers. I don’t think we should overlook that.

    Look, China isn’t our goal, and the massive control isn’t necessary. At most it speaks to a problem of urban planning – how the fuck do you get hundreds of thousands of workers in a limited amount of space. This is somewhat an artificial problem in China because those economic zones are physically limited in space due to national policy. Imagine trying to cram the entire US economic output onto Manhattan. We don’t have that kind of a scenario here. But we would have the problem of how do you build housing for hundreds of thousands of people in short order. North Dakota is dealing with that problem now, and the results aren’t any better than a Foxconn plant. Nor are they better in Alaska boom towns. Hell, even here in OC, it’s not uncommon to find 3-4 families in a 2 bedroom apartment, with people hot bunking in the dining room. China doesn’t do that because it’s desirable, they do it because it’s the fastest route from A to Z, which the US is no less willing to do. What you find is that once those Chinese workers find the economic means, they move out into better conditions, just like in the US.

    Again, this is avoiding the issue, which is that the US doesn’t have the infrastructure to provide a suitably large trained labor force, doesn’t have the ability due to corporate MBA 90 day earnings attitude to maintain surplus capacity (basically, infrastructure), and doesn’t have the political adaptability to create economic zones because everyone demands a slice of the pie. You think it’s a competitive economic advantage that every defense contract effectively mandates that each plane gets some part of it built in all 50 states? You think that lowers the cost of the contract? Makes the plane faster to build? Makes the plane better? Or does it just spread our labor force out over larger geographic areas, entrench workers locally because they buy homes, put their kids in school, and so on, so that if we need the workforce to shift and concentrate there is now huge economic friction against doing that.

    Rouge River worked for a reason – it concentrated workers and skills in one place. If you needed to shift workers from one area to another, you didn’t have to ask them to uproot their family to do it. They just went to the next building over. You didn’t need to stop production on one thing because the parts you needed got stuck on a truck in a snowstorm being driven from 9 states away. What’s the added value of all of that transportation? There’s none. China is Rouge River taken to industry scale. And guess what – it works, and the US does nothing to try and compete except find excuses about labor rates and taxes.

  106. 106
    rlrr says:

    @Southern Beale:

    “He’s a victim of Obama’s brain melting ray.”
    — tea-bagger

  107. 107
    chowkster says:

    @kindness: I use a MacBook at home, PC at work. Frankly I do not see much of a difference. (The one thing I do find superior in Mac is how installing a new software is a breeze.)

  108. 108
    The Moar You Know says:

    why in God’s name hasn’t the free hand of the market created a Made In USA store? You’d think that would be something good Patriotic Americans would be interested in.

    @Southern Beale: Isn’t it weird? Google “Made in USA” (item of choice). You won’t find much helpful. Tracking down American manufacturers is a huge pain in the ass, and it really shouldn’t be. We still have more manufacturers than anyone else does.

    And some of the fault belongs to the consumer.

    @Belafon (formerly anonevent): Before I got married I would have agreed with you. I married a smart, socially conscious liberal, and she had no idea where you’d even look to see where an item is made, much less why you’d do such a thing.

    I never used to look either, or understood why it was important, until I ended up working as the American design end of a Chinese musical instrument manufacturer. After my first trip to China, I look at everything. Even food. As mentioned above by someone, even candy is getting imported. Found a box of crackers the other day from Indonesia. How the fuck is importing crackers from Indonesia cost effective for anyone? (I know how and I’m damn sure not buying crackers made from what is likely cardboard waste from fucking Indonesia). But my point remains. Americans are simply not trained to even look, much less consider it important.

  109. 109
    Roger Moore says:

    @Southern Beale:

    The “buy American” push hasn’t gained as much traction here lately, not like it did back in the 80s. I’m not sure why that is except people are so disconnected from how their consumer choices have real world implications.

    I suspect a big part of it is that for a lot of goods there isn’t an affordable American made alternative. For cheap disposable crap, there’s really no choice but to get it from somewhere else.

    There’s also an issue with those “Made in XXX” stamps being less and less meaningful over time. It used to be that manufacturers made most of their own parts, or at least kept their critical suppliers close by, so that the point of assembly was essentially the same as the point of production for all the sub-assemblies. Now, though, the whole supply chain has gone global. That “Made in USA” device may only undergo the very last stages of assembly here and be made from foreign-made sub-assemblies, while something “Made in China” may get most of its value from computer chips imported from elsewhere.

  110. 110
    slag says:

    @Martin:

    Before you return to the wage issue, answer how those problems get solved first. The wage issue is easy.

    If the wage issue were easy, why hasn’t it been solved yet?

  111. 111
    pseudonymous in nc says:

    @Doug Danger:

    It’s every phone. By every manufacturer.

    This is, in part, why I stick with a 10-year-old Nokia that was made in Germany.

    The suicides at Foxconn? I don’t want to diminish the problems, but Foxconn’s factory sites are massive, employing the equivalent of a medium-sized US city. If you were to look at death stats from mill and steel towns in the early 1900s, I’m not sure what you’d see, but it wouldn’t be pretty.

  112. 112
    Belafon (formerly anonevent) says:

    @chowkster: I totally agree with you here. And I don’t think the change will come until consumers start demanding better production standards. But the largest consumer, the US, still has a part of its population that thinks that slavery was misunderstood and only happens to others.

  113. 113
    Yutsano says:

    @Belafon (formerly anonevent):

    It’s the same as griping about VW because they come here for cheaper labor.

    That’s only part of the story. The US is a HUGE market for VW. It makes sense for them to build their cars here because we buy them, and if you can take shipping costs off the top = PROFIT!! Win-win for them!

  114. 114
    Villago Delenda Est says:

    @Martin:

    You think it’s a competitive economic advantage that every defense contract effectively mandates that each plane gets some part of it built in all 50 states? You think that lowers the cost of the contract? Makes the plane faster to build? Makes the plane better?

    It’s not a competitive economic advantage, it’s a competitive political advantage.

    It’s deliberately done to make defense contracts difficult to kill, because they’re spread over as many congressional districts as possible, to make it so that congressmen are reluctant to KILL JOBS in their district, even a handful, because that’s political dynamite.

    China doesn’t have to worry about that sort of thing in a top down system.

    So, yeah, apples and oranges.

    Much too complicated, too nuanced, for most Americans to grasp. Amateurs talk tactics. Professionals talk logistics.

  115. 115
    The Moar You Know says:

    @kindness: Way to totally miss the point.

  116. 116
    Villago Delenda Est says:

    I might add that defense contractors have one customer only. They don’t have to worry too much about cost. They do have to worry about politics. So they respond to what they need to worry about.

  117. 117
    Brazilian Rascal says:

    $1.30/hr on 2080 hr year = $2704/year. That’s probably a huge bump up in the annual income for a lot of the Chinese versus a generation or two ago.

    And that makes them so happy that management has to install nets to catch them when they leap from the ramparts in excess joy.

    Please. The fact that person A was beated 5 times a day before you came along to beat him twice a day in front of an audience to earn your living is not really a glowing moral triumph on your part.

  118. 118
    PIGL says:

    @Villago Delenda Est: Don’t be preposterous. You are welcome to detest Stalin, but the cases you are comparing are not in anyway comparable, Stalin was not a cartoon villain to entertain us with Evil Laughs, the people of eastern europe were not enslaved or enserfed, and guess who’s military bases are still there in Western Europe?

  119. 119
    Mark says:

    @kindness: Fuck you, you cocksucking troll.

    You can argue about the design merits of each product, but they’re all made by corporate chains bent on world domination. See: Lululemon and Ayn Rand for a great example of what’s beneath the surface of even the most pious companies.

  120. 120
    Martin says:

    @chowkster:

    In today’s globalized marketplace, the jobs will go to wherever the wages are the lowest.

    No, no, no, no, no!

    That might be true for textiles, but it’s absolutely not true for tech. Tech goes to China not because of wages but because of education and because of infrastructure. Seriously.

    The #1 concern for every consumer electronics company, and more and more companies in peripheral tech fields is time-to-market. When the latest and greatest CPU gets designed, the key to winning in the market is ‘How fast can we get this into a product and into consumers hands.’ NEVER do they ask, who can assemble it cheapest. Read the fucking linked article. The entire reason they went to China was time to market. And don’t just take this article’s word – Fallows was writing about this in China years ago.

    China is building bullet trains and the most powerful supercomputers. Don’t get distracted with their huge low-wage labor force. That’s secondary to why companies are there. Companies are there because if you need a technical thing built fast, and you need a lot of them, there’s no other place that can compete. Period.

    And wages in China are climbing. Minimum wage is going up 5% per year. Apple’s largest market for their items will be China by next year – so there’s enough income in China for them to be buying iPhones faster than Americans can. The cheap labor isn’t as cheap as it was in 2008, and it certainly won’t stay cheap. But the trained technical workforce will remain. And the US isn’t doing a goddamn thing to compete with that.

  121. 121
    Catsy says:

    @liberal:

    Economists are fond of pointing out that people have been saying these things for centuries.

    And so they have. Thousands of years ago, plowing, planting and harvesting fields of grain was the work of an entire season for a community and their slaves, if any–using hand tools such as scythes. Horse-drawn plows and combines changed this, making it so that a single family could do this work in a matter of days or weeks. Had there been economists in those days, no doubt they would have expressed something similar about the effects of technology on the need for labor. And they would’ve been as correct then as they have been for centuries now.

    It was still true during the industrial revolution, where one person operating a factory machine could do the work of twenty or more working with only hand tools; it’s still true now of robotics and automation. The Internet itself has rendered a number of occupations dying or obsolete.

    Economists may have been saying similar things for centuries, but that doesn’t mean this isn’t where we’re heading. It is the inexorable result of the way advancing technology reduces the amount of human effort required to perform basic tasks. When you reduce the amount of human effort necessary, you are reducing the number of people needed to do that job.

    To name just one example: before this century is out, computers will be capable of operating a vehicle much more safely than a person, with better reaction times, no ego or road rage, and optimum efficiency. A company won’t need to employ a fleet of bus, taxi or delivery drivers–just a handful of people to remotely monitor the vehicles and maintain the automated systems. If we still have a postal delivery service, the vehicles will be automated, replacing a fleet of mailmen with a handful of people to monitor and maintain the vehicles.

    The logical end of this process, applied across human society, is the elimination of the need to employ human beings for any task that can be automated. I don’t think we’ll ever be able to encode human creativity, and there will always be things we are unwilling to trust a computer to do without human supervision, but long before we get to that logical end point our society will have to come to grips with the fact that there are simply vastly more people than there are jobs that need to be done by a person.

  122. 122
    Martin says:

    @kindness: Apple vs Microsoft is fairly simple. I am Apple’s customer. HP is Microsoft’s customer.

    Everything flows from that.

  123. 123
    mattH says:

    “Our Productivity Problem: US Workers Won’t Be Treated Like Zoo Animals”

    Thank you yes. The entire article reminds me of labor history in the U.S. 12+ hour work days, company towns, unsafe environmental conditions, incredibly low wages, collusion in who knows how many ways with the very government. It’s the 1890’s all over again, and the only reason there isn’t more unrest in China is because there has still been amazingly rapid growth. As things slow down over there economically it’ll be interesting to see if the Chinese government can keep things under control.

  124. 124
    kindness says:

    @The Moar You Know: You suggest I’m missing the point by telling Mark his analogies suck. Might be. Depends. His analogies do suck though. If you can’t tell the difference between a cup of Peets and a cup of Starbucks or a Mac or a PC well…..I can’t help you. What I was conveying is still very valid.

  125. 125
    kindness says:

    @Mark: So I’m a troll because I point out you say dumb things? We’re all trolls on this bus now I guess. (here is where I would squeeze my red horn nose if I had one)

  126. 126
    The Moar You Know says:

    @kindness: Again, you have managed to completely miss the point of the original comment. Some people can’t be helped.

  127. 127
    mattH says:

    When the latest and greatest CPU gets designed, the key to winning in the market is ‘How fast can we get this into a product and into consumers hands.’ NEVER do they ask, who can assemble it cheapest. Read the fucking linked article. The entire reason they went to China was time to market.

    So I take it you are excited to see company towns, 12+ hour work days, the ability of companies to wake workers at all hours of the day, regardless of contracts, to get the work done? For minimum wage? Did YOU read the fucking article? I don’t see anyone else here living in a 30 hour work week pipedream. You even mention a 35 hour work week like France has and you’ll be laughed out of any “polite” conversation.

  128. 128
    Baron Jrod of Keeblershire says:

    @kindness: Starbucks and Peets aren’t exactly, 100% the same in each and every respect, therefore it’s stupid to say that both are giant corporations?

    Maybe I’m just as dumb as Mark, but I fail to see how it’s not true that both are massive exploitative corporations. Switching from one to another for moral reasons rather than preference is silly.

    Just as it would be silly to switch from Mac to PC because you don’t want products manufactured by Chinese slaves. You know, since both are made that way. Please explain how this thought makes me unforgivably stupid.

  129. 129
    Catsy says:

    @Martin:

    Look, the 40 hour work week is not some kind of Universal Constant, like the speed of light. There’s no reason why a 30 hour work week, or an honest to god vacation couldn’t be workable.

    I never said it was, and personally I’d love to have a shorter work week or a real vacation. But that isn’t what I’m talking about. I’m talking about the fact that as technology progresses, the total amount of human effort required for tasks that can be automated or optimized through technolgy goes down. At the same time, our population continues to increase. This is not a new problem, but it is a real one.

    Let’s say you have a task that requires 4000 man-hours per week to support. Right now that task is being performed by 100 employees with a standard 40-hour work-week. An advance in techonology makes it possible for one worker operating a machine to accomplish as much as ten workers did before. Suddenly you only need 10 employees, not 100.

    No, the 40-hour work week is not a law of nature. So this hypothetical company could, in theory, reduce the job loss by employing 20 workers in 20-hour work weeks instead of 10 workers in 40-hour weeks. But why would they? Each person a company employs carries with them significant overhead in the form of training, benefits, management infrastructure, facilities, and scores of other costs. Additionally, the company would have to purchase and maintain twice as many machines in order to give those extra employees something to do part time. It’s extremely costly and ineffcient.

    And even if the company decided to do that, how would that work out for the employees? They’d be working half the hours they did before, and on an hourly wage then that means they’d have to work two jobs in order to make as much as they had been. And even if salaried, the company certainly isn’t going to pay them the same salary for working half as much.

    And that’s only for technological advances that reduce the number of people needed to do the same job–that’s not even getting into advances that render human effort completely unnecessary.

    To be clear, I’m not presenting any kind of luddite argument against technological advancement, here. I’m just pointing out that there will come a point when the number of employable adults vastly outstrips the number of jobs that actually require human effort, and we’d better figure out how we’re going to adapt society to that.

  130. 130
    Judas Escargot says:

    @Catsy:

    I’m a big fan of Brin’s, though I haven’t read that particular story yet.

    IMO, Ian M. Banks does a good job speculating what a functional post-scarcity society might look like in his Culture series of novels. He has the MacGuffin of ultra-intelligent AIs to drive that society, though (benevolent machines essentially run everything, leaving trillions of humans to do essentially whatever they want with their lives– including a nice clean ‘termination’ when they finally get bored of living).

    It’s ironic: The unspoken ‘end state’ of Capitalism is a post-scarcity society… otherwise, what would be the point? But the politics of Capitalism requires scarcity to function (so much so that it will create that scarcity if needed).

    I don’t know where it ends up, either. But some here will still be living when it happens.

  131. 131
    kindness says:

    @Baron Jrod of Keeblershire: Do you not drink coffee? Anyone who actually drinks coffee and comes here and says Peets and Starbucks are the same are morons. And I meant that on the coffee taste level but if you want to use corporate practice analogies….There again, Peets is a much better company in human terms than Starbucks.

    Just pick better analogies, please.

  132. 132
    Martin says:

    @slag:

    If the wage issue were easy, why hasn’t it been solved yet?

    Because the wage issue isn’t the problem. Fucking A, how hard is this for people to understand? If I need tires for my car, it doesn’t matter how much the local grocery store pays in wages, they don’t fucking sell tires! I’m going to pay the wages of the tire guys because tires are what I need.

    Apple pays Chinese wages because only China can make their stuff. Why the fuck would they even entertain the idea of paying US wages IF THE US IS INCAPABLE OF MAKING THEIR STUFF. When you change things so that Apple can realistically pull their stuff back to the US, then we start talking about wages. But at least in the case of Apple, they have more than enough profit overhead to cover the wage difference, so that’s not a problem. Right now Apple is dropping billions of dollars per year on capital equipment. They build factories for other companies, for fucks sake. They spend millions of dollars per retail store in the US. They pay $1000 per square foot for retail setup. Seriously, that’s 10x the industry average. They give health benefits to their part time retail workers. They are willing to spend astronomical amounts of money, but they need to get something for that. They can be convinced to pay US wages if there’s a way to do the work in the US because they actually want to pay US workers. But they can’t get the job done in the US. Period. Fix that and the wage issue will fix itself.

  133. 133
    Linnaeus says:

    @Martin:

    I don’t dispute that the infrastructure issue is a big one, maybe even the single biggest issue. But if China isn’t the goal (and it isn’t for you and for me), then that leaves me wondering why, if all of the means to do high-tech production are here in the U.S., isn’t that potential being developed? The same folks who say we need to move production to China because of time-to-market challenges are the same ones who won’t fork over the cash that we need to develop U.S. infrastructure. And you have to wonder why. I’m sure China’s huge population is a part of it, but it’s also the highly disciplined work environments and the Chinese government spending the money that the very same corporate entities try to stop here.

    The Rouge plant worked, in its original incarnation, for about 30-40 yrs., then Ford decentralized its production. If the economic logic of keeping Rouge in its integrated form were compelling enough, Ford would (hypothetically) have kept it that way. But it didn’t.

  134. 134
    Julie says:

    @Mark: Is there a link to context about the Lululemon-Ayn Rand connection? I’m not getting any search results for it, and am wildly curious. (I’ve always thought Lululemon was *wildly* overpriced versus quality, so I’m intrigued by this.)

  135. 135
    Martin says:

    @mattH:

    So I take it you are excited to see company towns, 12+ hour work days, the ability of companies to wake workers at all hours of the day, regardless of contracts, to get the work done? For minimum wage? Did YOU read the fucking article?

    I’ve read it 4 times. I read Fallows articles on the same thing, and a zillion articles on Apple’s manufacturing chain, labor, and so on. I could have written that NYT article.

    I’m not excited to see any of those things you list, but they don’t exist because Apple demanded them. You’re listing those things as goals rather than consequences, and I assure you, they’re consequences. The goal was to be able to turn out 5 million iPhones in 2008 and 125 million iPhones in 2012, when Apple had no idea they’d sell more than 10 million iPhones in 2012. There is no fucking way that any US industry could scale up to that degree and not wind up with what Hon Hai has.

    And where in the US would Apple find the 1 million skilled workers that Hon Hai employs? I pointed out above that in 2008 they needed as many industrial engineers as it takes the US 2 years to produce. They need 10x that many now. Even if they came to us and said “Can you get us 20,000 industrial engineers”, we’d have to say ‘No’. US universities aren’t capable of doing that because the US at the federal, state, and local level won’t prioritize growth in engineering over other, more cost effective programs. They won’t invest in them, because they don’t want to spend the tax dollars, they don’t want to give the appearance that engineers should pay more in tuition over liberal arts, they don’t want to take the land from football to build facilities.

    You wind up with China’s labor issues when you cede the market to China. If you want to make an argument in favor of moving jobs to the US, demonstrate how the US can meet the needs of the market, because the article lays out the ways in which we can’t. And the labor issue is the consequence of that failure, not the cause of it.

  136. 136
    Judas Escargot says:

    @Villago Delenda Est:

    The thing is, we’re going to have to find a new paradigm for human society, and those at the top of the current one don’t want to change it.

    I wonder what the Ferengi word for ‘tumbrel’ is…

  137. 137
    Catsy says:

    @Judas Escargot: I would recommend Kiln People without reservation to any sci-fi fan, and especially to someone who’s already a fan of Brin’s. It’s one of his most thought-provoking works of fiction IMO–good, quality speculative fiction of a kind you don’t see too often anymore.

  138. 138
    slag says:

    @Martin: OK. The wage “issue” isn’t a problem. You’re right. How could anyone think that? What morons!

    When you change things so that Apple can realistically pull their stuff back to the US, then we start talking about wages.

    I appreciate your optimism, but I’d rather start talking about wages now, thank you. By your logic, there’s no reason for China to pay “Chinese wages” since they’ve already got the whole infrastructure piece figured out. But they do. And they treat their workers horribly in the meantime. If the problem were simply one of infrastructure, that would not be the case. So…there’s obviously much more to it than that. And by saying “the wage issue is easy”, you’re totally ignoring all that other stuff.

  139. 139

    @Martin: You are correct, but also missing the point. Yes, the fundamental issue is time to market, but this is not separable from the issue of labor costs. Yes, the number o0f industrial engineers is critical and, yes, the co=location of suppliers is critical. But underlying all of this, one way or another, is labor costs.

    For instance, the things you mention are not in any way the only things mentioned in the article that are necessary for quick time to market. Another is the ability to wake an entire workforce up at midnight and immediately set them to work with the completely changed design specs. That is, fundamentally, an issue of labor costs. You could get an American workforce to do all of that. You’d just have to pay them a lot more than Foxconn pays its workers in order to get it.

    The funny thing is that you almost, sort-of seem to get this and then lose the thread. You say that it is important to have spare capacity and that we don’t because of an MBA mentality. That’s exactly correct but you then miss that this, too, has to do with labor costs. It’s a fuckload cheaper to have spare capacity in China, because you don’t need to pay people to sit around, and if you do need to pay them, it isn’t costing you much.

    In the end, it is the need for insanely quick times to market that is the driver of these problems. There is no way to meet those requirements that does not depend upon the practices that you and the rest of us decry. There is a choice: we can run things that way *or* we can have a decent civilization. It really isn’t possible to do both, not on a large scale.

  140. 140
    Tone In DC says:

    The Chinese, given this discussion on this post, are a small part of the problem. The US (gov’t and the MotU) are a much bigger problem.

    We haven’t cranked out enough engineers for decades, if I recall correctly.

    All those math and physics classes (and others this language major doesn’t know about)? That’s for GEEKS. Real Murkans study business!

  141. 141

    @Martin:

    At most it speaks to a problem of urban planning – how the fuck do you get hundreds of thousands of workers in a limited amount of space.

    Where can I find a city built for 2 million people, with only 750,000 residents? How about Detroit?

  142. 142
    Doug Danger says:

    How is this very different from the Chinese steel used on the new Bay Bridge, then? We decimated the US Steel industry with help from Bain Capital, and now we are forced to buy steel from the Chinese for our fabulously expensive bridge that should have been completed in the 1990s.

    Is it all Rose Pak and Willie Brown’s fault, or is it Mitt Romney’s fault? Oh – the Unions – I know, it’s the unions.

    Seriously – I love everyone here who thinks it’s an easy problem to solve when the essential fact – the real reason we are here – is that as a country, we’ve been eating our seed corn for decades.

    Comes time to go a’plantin’, there will be nothing to sow but ideas and recriminations. And we’ll beat up the companies that are actually doing their best to spend money here because we don’t like their “fanbois” and because Google is so much more awesome and because culturally, this is fundamentally a problem of Chinese design; they treat their own people like crap, and we came in an took advantage of the cheap labor and educated work force.

    Oh, evil us. Let us peck at our own breast. From religious self-loathing we came, and to that we are returning.

  143. 143
    trollhattan says:

    @Julie:

    Read and retch.

    http://www.slate.com/articles/.....tion_.html

    Doppelganger to the Whole Foods dude.

  144. 144
    El Cid says:

    When the latest and greatest CPU gets designed, the key to winning in the market is ‘How fast can we get this into a product and into consumers hands.’ NEVER do they ask, who can assemble it cheapest.

    Well, yes, but to have that flexibility and rapidity here would be very expensive and would involve setting up of a workforce which while having far more rights would be equally flexible.

    In this case, the speed is directly related to the cheapness and relative powerlessness of the available Chinese labor force, as well as the fact that the same factors of cheaper labor, weaker labor, and centralized authoritarian subsidy and protection of related materials and production industries are also there for the taking.

    It’s not impossible to set up as skilled and integrated and rapid a process here — it would just involve far more expense than current production goals could even be imagined to support. I guess. Maybe it could be done efficiently, but in some very clever way I’m not thinking of at the moment.

  145. 145
    gene108 says:

    @Martin:

    The layers of economic idiocy we’ve built in this country is staggering at times.

    The key part of the article and the key part in China’s manufacturing rise is due to the fact the government has subsidies for industries it wants to support.

    Apple got raw materials – glass, from the article – at below market cost because the Chinese government is picking up the tab.

    They got labor for free because the Chinese factory owner is picking up the tab to lure Apple.

    The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost.

    The reason countries don’t compete with China is because they don’t have a top-down command structure, where the central government tells a copper mine to sell its ore at below market costs to a factory and the copper mine happily obliges.

    You can’t compete with that sort of price fixing.

    Also, too China’s still a communist country. The State runs a lot of stuff still, so they can jigger their “market” economy in any way they want.

    In the long run the U.S. economy is on a firmer foundation than China.

  146. 146
    trollhattan says:

    @Martin:

    Are you suggesting they couldn’t return iMac production to Elk Grove? Why not?

  147. 147
    slag says:

    @Doug Danger: Can I just say…from my perspective, you’re taking this whole Apple persecution complex a little too far. Apple is being used as an example because they have a big name. Putting pressure on them is one mechanism for putting pressure on the whole system. Whoever is suggesting that we boycott Apple in favor of other companies with similar labor practices is probably very much in the minority.

  148. 148
    barath says:

    The slow inexorable rise in oil prices, coal prices, etc. will put a damper on this. China’s economy depends upon cheap oil to export stuff and cheap coal to keep the lights on. Both are in increasingly short supply. And we’re just at the beginning on a long, multi-decade slide because we really truly have tapped all the good reserves. Which is why we’re getting into big fights over sludge like tar sands which is expensive to refine and even at best will produce a few percent of the world’s supply.

    As cheap energy goes away, we’ll have to start making more stuff here, and this trend will reverse.

  149. 149
    Julie says:

    @trollhattan: Wow, that is douchebaggery on a level I hadn’t quite imagined. Thanks for the link. Now I can make my unofficial boycott ($100+ dollars for a gym bag? It better be made of *gold*…) official, I guess. I try to avoid Whole Foods, too, and the downtown PDX locations of both are right across from each other, so that will make it nice and easy.

    (I really don’t want to have to boycott Barre3, though, and they used to have a marketing agreement with Lululemon, so I guess I’ll have to do some searching on that front. Boo.)

  150. 150
    Martin says:

    @Linnaeus:

    then that leaves me wondering why, if all of the means to do high-tech production are here in the U.S., isn’t that potential being developed? The same folks who say we need to move production to China because of time-to-market challenges are the same ones who won’t fork over the cash that we need to develop U.S. infrastructure. And you have to wonder why. I’m sure China’s huge population is a part of it, but it’s also the highly disciplined work environments and the Chinese government spending the money that the very same corporate entities try to stop here.
    __
    The Rouge plant worked, in its original incarnation, for about 30-40 yrs., then Ford decentralized its production. If the economic logic of keeping Rouge in its integrated form were compelling enough, Ford would (hypothetically) have kept it that way. But it didn’t.

    US companies are willing to fork the cash over, but they aren’t willing to individually build out the national infrastructure on their own dime. I mean, I’m happy to pay my taxes, but I’m not willing to pave my street all by myself – I expect that cost to be shared.

    Part of the problem in this discussion is that we’re taking Apple as being perfectly representative of the industry. They aren’t. They’re a high-margin business, with low-margin competitors. Apple’s 5 Manhattan retail stores turn more in profits than Amazon does. Than Dell does. Apple will spend the money because Apple has the money to spend. Consumers will pay more for their products, and Apple turns those profits into capacities that competitors can’t meet which make their products more desirable.

    But how does Apple fix the education infrastructure problem? Are they supposed to open universities of their own? We’ve got world class universities, but politics and economics from top to bottom prevent them from expanding technical education. And how do they expand that education enough to meet demand. We’re not talking about a few universities, but dozens needed to sign on. I don’t see how you can achieve that enormous amount of lobbying, when China will do it for you.

    And Rouge River decentralized in part due to density (it’s hard to cram that many workers in that small of a space – just ask Foxconn), and in part due to government tax breaks and incentives. There’s a reason why the Big 3 spread their plants across half the states in the US – they were paid to at a time when they were on top and assumed they could absorb the long-term costs (combined with increasing short-term thinking). China does the opposite – they pay industry to centralize to make worker mobility easier. We make it harder, because we’re also subsidizing the real estate market, each congressional district, and so on.

    Seriously, how many discussions have we had here about Boeing moving jobs from Washington to South Carolina, or any industry moving jobs from place A to place B, mainly due to tax incentives, earmarks, and so on. How does spreading jobs out to the 50 corners of the nation make things more efficient? We make these decisions because they benefit A company, or A congressman, or A state, not because they benefit THE united states. We still have this attitude that it’s a zero sum game within our borders, because post WWII it was. It’s not any more, and what benefits SC or Exxon Mobile very well may hurt the nation as a whole.

    Apple’s challenge is that they are the sole consumer electronic company that is based in the US. That’s it. There are no others. Everyone else is in Japan, South Korea, Germany, Taiwan, etc. Apple’s carrying the ball here. HP is so gutted as to not be helpful. Dell isn’t any better. Intel is the only other tech company that has any kind of infrastructure need that can help carry that ball. MS and Google and the like are all software. They need skilled workers, but their businesses scale much better and other than cubicles and lots of bandwidth, they don’t need much else.

    I mean, if you want to support US workers, buying anyone other than Apple is worse than buying Apple, because they employ ZERO US workers. Apple at least has some and is trying to increase that number, but it’s hard. Their last assist for US workers came from Samsung, of all people.

  151. 151
    Paul in KY says:

    @Villago Delenda Est: Problem with a 2 year old Maserati is that it is always in the shop. That’s why they need enough loot to buy 2.

  152. 152
    Ruckus says:

    Treating workers like zoo animals would probably be better than how they are treated now. Someone feeds you, cleans up after you, free health care, no actual work.

  153. 153
    gene108 says:

    @Brazilian Rascal:

    And that makes them so happy that management has to install nets to catch them when they leap from the ramparts in excess joy.

    People could stay back in their villages and farm rice, but they choose to come to these factories / cities because of better economic opportunities.

    For whatever it’s worth the $1.30/hr seems to be an attractive wage right now.

    I’m just trying to point out that someone in a country, whose average per capita GDP, a generation ago was below $1,000 per person per year, would probably find making nearly three thousand dollars a year a good living.

    I think some people in the U.S. don’t have a good handle on how truly poor the rest of the world is.

    The working conditions are another matter entirely.

    You could pay someone more, but if the working conditions suck out your soul, it doesn’t matter what you make.

    There are plenty of well paid entertainers, who flame out because of the demands that sort of work puts on a person. Might not be the greatest analogy, but money doesn’t make up for soul crushing work.

  154. 154
    Martin says:

    @Tissue Thin Pseudonym (JMN):

    The funny thing is that you almost, sort-of seem to get this and then lose the thread. You say that it is important to have spare capacity and that we don’t because of an MBA mentality. That’s exactly correct but you then miss that this, too, has to do with labor costs. It’s a fuckload cheaper to have spare capacity in China, because you don’t need to pay people to sit around, and if you do need to pay them, it isn’t costing you much.

    But my argument is that labor costs isn’t the driver of these things. Cheap labor has nothing to do with why we produce so few engineers in this country. It has nothing to do with the profit driven mindset among executives. Sure, it’d cost more to idle US workers, but it’s not like the $2T in cash US companies are sitting on would be at risk.

    Chinese companies aren’t profit-driven, they’re revenue driven. They’ll spend pretty near every penny they take in to grow. They’ll increase the wealth to their population by paying higher wages out of increasing revenues, rather than delivering returns to their investors. Nobody here is unaware of that problem in the US, but I think we’re unaware of how an attitude that shifted back toward revenues would benefit workers. Now, they’d keep idle workers as long as they could afford to because it would give them a competitive advantage at bid. It’s smooth out the employment situation for everyone, and boost wages. And that would, at least along that dimension, help our competitiveness.

    But look at the quote directly attributed in the article:

    Mr. Jobs even suggested it might be possible, someday, to locate some of Apple’s skilled manufacturing in the United States if the government helped train more American engineers.

    Again, he’s saying it’s an education problem, not a wage problem. If wages were the issue, he wouldn’t even consider that. Seriously, 1% of the cost of an iPhone is assembly wages that Apple pays. Even if that goes to 5%, it’s not a dealbreaker for Apple. The US simply doesn’t have workers to pay.

    There are 2.6 million engineers in the US. There are more elementary and middle school teachers in the US than there are engineers, and quite a few of those engineers had to be imported to the US on H1-B visa. There are more truck drivers in the US than engineers. Honestly, how many times does it need to be said that the US is woefully under-educating the population in the areas where we are demand growth. If you want more manufacturing and tech jobs, you need more engineers. Full stop. Right now we’re importing them, and we’re still losing those industries. That’s the bottom line. That’s where all of this starts and ends. If you don’t have the engineers to set up production lines, to design products, to work out manufacturing issues, do testing, and so on, then there are no manufacturing jobs. Period.

  155. 155
    Linnaeus says:

    @Martin:

    US companies are willing to fork the cash over, but they aren’t willing to individually build out the national infrastructure on their own dime. I mean, I’m happy to pay my taxes, but I’m not willing to pave my street all by myself – I expect that cost to be shared.

    Sure, that cost should be shared. When I said “fork over the cash” I should have been more specific – I meant to include such things as taxes.

    And that’s the irony. Companies claim that they need to move to China because of the better infrastructure there, but often support policies and politicians that undermine the very tax base that we would need in this country to do the things that these companies supposedly want here.

    Case in point: Here in Washington, we don’t have a state income tax. That means the state relies heavily on very regressive taxation that is very vulnerable to economic downturns. The most recent one continues to play havoc with the state budget. One of the effects of this is that our institutions of higher education have had to deal with consecutive years of serious cuts in state funding, which they then try to make up with higher tuition (and potentially pricing students out). There was an initiative back in 2010 to create a “high-earner” income tax on individuals with an AGI of $200,000 or more and on joint-filers with an AGI of $400,000 more. Property taxes and our business & occupations tax would be reduced, but the state would still come out ahead. Revenues would have gone to education and health care.

    What did Boeing, Microsoft, and Amazon do? They (and their CEOs) opposed it, and donated to the campaign to defeat it. It may have gone down to defeat anyway, but it’s hard not to see the disconnect between what these companies say they want and their unwillingness to contribute to the shared cost to get it. They’d prefer someone else bear the cost.

  156. 156
    kwAwk says:

    I was wondering if anybody else had read this.

    We think that putting our kids to work doing some simple janitorial work is akin to beating our kids. But these folks in China are our competition…

  157. 157
    Martin says:

    @trollhattan:

    Are you suggesting they couldn’t return iMac production to Elk Grove? Why not?

    All the components that go into an iMac are made in Shenzen. They’d have to create an entire production chain from China to California for the sake of one product – which shares components with the stuff still assembled in Shenzen. It’d be moving assembly to Elk Grove purely for the sake of moving it to Elk Grove. And if iMac demand fell off and MacBook Air demand went up (which is happening, BTW), then they’d have to either shift workers back to China or shift some MacBook Air to ElkGrove, ramp up those tools, and so on.

    For a company that responds the way that Apple does, these become really expensive problems to solve. And when Apple runs into really expensive problems like this, they’re more likely to cancel the product than solve the problem, because truth is, the iMac isn’t sufficiently instrumental to the company to get distracted with all of this stuff. This is really a peculiar characteristic of Apple rather than a broad trend in US business. At Apple, all problems gets solved in the executive suite. The CEO knows about everything that the company controls. So the possible results here really becomes no jobs in Elk Grove because it’s too much of a complication to move that work, or no jobs in Elk Grove or Shenzen because Apple just kills the product and focuses on other things. Either way, Elk Grove would get nothing.

    That shouldn’t be taken as representative, though. Apple is probably unique in this respect for a F500 company (at least they are as far as I’ve been able to see, and I’ve looked pretty hard). That’s not going to change at Apple because that’s a big part of why Apple is no longer on the edge of bankruptcy like they were a decade ago. That is to say, if Apple had tried to keep jobs in the US during their demand ramp, they’d probably today look more like HP than Apple, and that’d benefit nobody. And it’s a fucking shame that HP doesn’t look more like Apple. But that’s what happens when you get rid of the engineers, no? Haven’t I been banging that drum all along?

  158. 158
    Martin says:

    @Linnaeus:

    What did Boeing, Microsoft, and Amazon do? They (and their CEOs) opposed it, and donated to the campaign to defeat it. It may have gone down to defeat anyway, but it’s hard not to see the disconnect between what these companies say they want and their unwillingness to contribute to the shared cost to get it. They’d prefer someone else bear the cost.

    No, I don’t disagree there. But the problem with where tax dollars got invested existed long before the anti-tax movement really cranked up.

    But their reasoning on how the taxes impact education is a bit convoluted (from my discussions with some large engineering/manufacturing CEOs). Their argument is that the US education system has gotten too egalitarian with respect to the needs of industry. That is, the tax dollars they contribute are more likely to create not-in-demand psychology degrees than engineers – and Boeing and Microsoft and Amazon don’t need more people demanding $40,000 a year jobs with none of the skills they want. And they’re 100% right on that point. The US is seriously broken on how best to convert tax dollars into education that will serve as a strong investment in the economy to generate more tax income.

    We’re telling these tech companies to pay more taxes *and* hire more H1-B visas. They’ll pay more taxes if the need to import engineers would go away, but we won’t use more tax dollars to solve that problem. It’s fucking stupid, and it’s happening in every. Single. State. They’ll donate hundreds of millions of dollars in cash and equipment to engineering programs. They’re eager to partner with universities, but they can’t carry the US education system on their back solo, and none of the money they’re contributing either directly or through taxation is having any effect on policies that are funneling students away from technical degrees.

  159. 159
    pseudonymous in nc says:

    @mattH:

    I take it you are excited to see company towns, 12+ hour work days, the ability of companies to wake workers at all hours of the day, regardless of contracts, to get the work done? For minimum wage?

    The way I take it is that people who point out that this is a stage that has been part of the industrialization process since the first cotton mills. The fact that it’s now happening so rapidly in China potentially means that what took the best part of a century to happen in the West will take a couple of decades over there, and perhaps we’re already at the point where it’s happening.

    It’s not a question of being “excited” about it, but acknowledging that this is not fucking new. What the US (and the industrial developed world in general) has to address is how to deal with the consequences of other people doing what they did a century ago. A race to the bottom is (I hope) politically unacceptable and economically unwinnable. So it’s time to try something else.

  160. 160
    pseudonymous in nc says:

    @Martin:

    That is to say, if Apple had tried to keep jobs in the US during their demand ramp, they’d probably today look more like HP than Apple, and that’d benefit nobody.

    Or to put it another way: the Asian supply chain is putting pretty damn cheap technology on the market, and it’s up to the people in the countries where those products are sold to use that technology in ways of greater economic value than actually putting the damn things together.

    It’s not much different from building a shoemaking industry off the back of a less profitable leather tanning industry, or a shipbuilding industry off the back of a less profitable steel industry.

  161. 161
    Doug Danger says:

    But how does Apple fix the education infrastructure problem?

    I dunno – maybe the first substantive effort to change the textbook marketing industry since Huey Long gave away textbooks for free to poor kids?

    Except Apple’s doing it to get people to buy things to create textbooks with. Huey was doing it to get the votes of the poor in order to enable his friends. Kinda like Bush was famous for.

  162. 162
    Linnaeus says:

    @Martin:

    Their argument is that the US education system has gotten too egalitarian with respect to the needs of industry. That is, the tax dollars they contribute are more likely to create not-in-demand psychology degrees than engineers – and Boeing and Microsoft and Amazon don’t need more people demanding $40,000 a year jobs with none of the skills they want. And they’re 100% right on that point. The US is seriously broken on how best to convert tax dollars into education that will serve as a strong investment in the economy to generate more tax income.

    It doesn’t surprise me to hear that. Microsoft recently created a pretty sizable scholarship fund for UW. It’s not coincidental that Microsoft representatives will have a hand in selecting who gets these scholarships, for the reason you mention: they want to make sure that the scholarships are being used to pay for technical degrees and not psychology.

    Which is fine in that context; private funders attach conditions to scholarship funds and other donations all of the time. In the context of the broader public education system in a democratic society, though, you have to deal with a number of priorities and values at once. Business and industry is certainly welcome to make its needs and desires known, but it’s only one stakeholder of many. I’m sure lots of my tax dollars go to things I don’t need or use, but I accept that as part of paying my share to make a society function. So there remains some questions, e.g., how do respond to the needs of stakeholders in public ed without giving too much control or influence to any one of them? I can appreciate that an engineering/tech CEO would like to see more of her/his tax dollars going to educate people who can work for the company, but in a free society with democratic institutions, people will make different choices – not everyone can or will be an engineer. There’s also the larger question of what we really want from education, especially higher education. How do we balance education as means to make a living (which it is) with education as a means to develop the whole person (which it also is)and do so in a democratic manner?

  163. 163
    Martin says:

    @pseudonymous in nc:

    Or to put it another way: the Asian supply chain is putting pretty damn cheap technology on the market, and it’s up to the people in the countries where those products are sold to use that technology in ways of greater economic value than actually putting the damn things together.

    Right. And we’re doing that, but not in manufacturing. We’re doing it in other industries. Is it enough to keep the nation employed? Sorta. But we’re leaving a lot of people behind with this industry shift, and they’re not coping or adapting well. I don’t mean that in a ‘they need to start pulling on the bootstraps’ sense, but we as a nation are doing a pretty shitty job of recognizing the change and backfilling services to help pull people along. In fact, if anything, we seem to be accelerating the ‘stick to your dreams’ message and turning out a lot of Starbucks baristas with 4 year degrees.

  164. 164
    Martin says:

    @Linnaeus:

    So there remains some questions, e.g., how do respond to the needs of stakeholders in public ed without giving too much control or influence to any one of them?

    Easy. Obama admin proposed that for-profit schools publish their job placement and salary information so that prospective students could gauge the value of the education they were about to plunk money down on. We lauded that effort.

    But we don’t make the same demands of public or not-for-profit schools. Why not? What is the job placement/salary/job title data for liberal arts majors? Is it worth paying $100K for that degree? If it is, great. But everyone is too scared to publish that data, probably because they know what it would look like.

    But lets put pressure on the educational institutions themselves to justify where they spend their money, what programs they prioritize, what they charge, and so on. If engineering degrees need to cost more, because they do cost more to execute, but the job placement/salary justifies the added tuition, then so be it. Students and parents will have a better sense of what they’re spending their money on, and they can make decisions accordingly.

  165. 165
    slag says:

    @Linnaeus:

    Business and industry is certainly welcome to make its needs and desires known, but it’s only one stakeholder of many. I’m sure lots of my tax dollars go to things I don’t need or use, but I accept that as part of paying my share to make a society function. So there remains some questions, e.g., how do respond to the needs of stakeholders in public ed without giving too much control or influence to any one of them? I can appreciate that an engineering/tech CEO would like to see more of her/his tax dollars going to educate people who can work for the company, but in a free society with democratic institutions, people will make different choices – not everyone can or will be an engineer. There’s also the larger question of what we really want from education, especially higher education. How do we balance education as means to make a living (which it is) with education as a means to develop the whole person (which it also is)and do so in a democratic manner?

    Nicely stated! Much nicer than I would have stated. This goes to the question: are we educating workers or citizens. Personally, I want both. And sometimes, that means industry has to accepts some tradeoffs in their workforce. And eventually realize that a 4 year degree in Computer Science isn’t as necessary as many seem to think it is.

    A lot of these people just don’t know how to hire people. And a lot of these people just don’t know how to handle the people they hire. They’re either nerds or business school grads. Ironically, some of them would probably benefit from a course or two in psychology.

  166. 166
    Linnaeus says:

    @Martin:

    Easy. Obama admin proposed that for-profit schools publish their job placement and salary information so that prospective students could gauge the value of the education they were about to plunk money down on. We lauded that effort.

    But we don’t make the same demands of public or not-for-profit schools. Why not? What is the job placement/salary/job title data for liberal arts majors? Is it worth paying $100K for that degree? If it is, great. But everyone is too scared to publish that data, probably because they know what it would look like.

    I suspect the difference is because 1) the for-profit schools explicitly advertise themselves as providing the means to get a job and 2) following from 1), the profit motive gives those schools an incentive to conceal data about job placement. A public university that is deemed an institution for more general education wouldn’t (hypothetically) have that incentive because it’s not solely in the business of worker/job training & education.

    That said, I wouldn’t be opposed to public/not-for-profit educational institutions providing more information about the jobs that their graduates get.

    But lets put pressure on the educational institutions themselves to justify where they spend their money, what programs they prioritize, what they charge, and so on. If engineering degrees need to cost more, because they do cost more to execute, but the job placement/salary justifies the added tuition, then so be it. Students and parents will have a better sense of what they’re spending their money on, and they can make decisions accordingly.

    That’s already happening at my institution. Changes in budgeting practices, increased scrutiny from the legislature, public-private partnerships industry, etc. are all combining to have this effect, albeit slowly. The university is also considering (but has not yet instituted) differential tuition for certain fields – as it is now, the liberal arts (broadly speaking) are subsidizing the science and engineering departments (at least at the undergraduate level) because they pull in more tuition dollars.

    Rick Scott’s remarks about not needing more anthropologists didn’t bother me as much as it did some people because although I know he was performing political theater, he was at least willing to say what universities won’t say. If higher ed institutions are shifting their emphasis to technical fields, they should say so and why openly. Then we can have a conversation about the gains and losses of doing so.

  167. 167
    Martin says:

    @slag: I don’t think there’s any argument that a broad education is valuable, but there’s nothing stopping us from having two education tracks – one for the workforce and one for citizens. We in fact have that now. You can go to any of a thousand community colleges and take pretty much any class you want from psychology to accounting to music to welding. That’s the education for the citizenry. It’s inexpensive, accessible, and unencumbered.

    There’s also the university system that is encumbered and relatively inaccessible (you need to be admitted, and you need to commit to 4 years) and it’s it’s relatively accessible. Yet this is where the majority of the workforce training now takes place, at least for technical jobs. Consider what was required to design and build a phone 40 years ago, the standard AT&T rotary dial or touch-tone phone. There’s nothing to that. The skill set needed isn’t much higher than high school, and could certainly be met at the community college – and often was. Look at a phone today. It’s totally a different market, well beyond the ability of a community college to reach. Hell, even things like CNC operator training is getting too much for the jr colleges to handle. And it’s not just there – compare a modern car like a Prius or Leaf to even a 1980s Civic. Radically more advanced. A modern Mercedes will have 40+ embedded computers in it. There are computers controlling the ABS system, the traction control, the movable headlamps and mirrors, the ignition and timing. Who’s designing, fabricating, and programming those? And then integrating them into the mechanical systems.

    Industry is changing a LOT, and it’s not just a problem of hiring or accepting tradeoffs. ⅓ of the degrees granted in China are engineering degrees. Fewer than 1/10th of the degrees granted in the US are engineering degrees, and a lot of those US degrees are foreign students that will take their education home. 80% of applicants to advanced engineering programs in the US are foreign students. 80%! And most of those are Chinese. How the fuck are we going to compete when the US is educating more future Chinese workers than US workers.

    This isn’t an isolationist rant. We don’t have the domestic PhDs because we don’t have the domestic bachelor degrees because we’ve starved the undergraduate programs in the US and turn away hundreds of thousands of potential engineering students each year. We’ve stalled the pipeline for domestic education at the front end and are now paying for it dearly at the backend.

  168. 168
    pseudonymous in nc says:

    @Martin:

    we’re leaving a lot of people behind with this industry shift, and they’re not coping or adapting well.

    No argument from me on that. Read the interview with Bill Clinton over at Esquire, and he talks about ways to build new industries and provide jobs in ways that aren’t just Silicon Valley at one end and Double Whopper, No Cheese at the other.

    But I think, like slag, that businesses have to step up and accept that on-the-job training needs to be part of their budgets, and need to stop fucking whining about it. Not prepared to provide job-specific skills, because you think it’s now the job of community colleges, and that prospective workers need to buy their way into the business? Boo fucking hoo. Get over yourselves and start hiring apprentices again.

  169. 169

    @Martin: In case anyone is still reading this thread now that I’m back home:

    But my argument is that labor costs isn’t the driver of these things.

    I realize that’s your argument. My point is that you’re wrong.

    Cheap labor has nothing to do with why we produce so few engineers in this country. It has nothing to do with the profit driven mindset among executives. Sure, it’d cost more to idle US workers, but it’s not like the $2T in cash US companies are sitting on would be at risk.

    This is nonsensical. If you’re paying to have idle capacity, that stack of cash is exactly what is at risk. Cheap labor really is why we have a lack of engineers, though you have to think historically to realize it. All of the reasons you cite may be the reason why companies manufacture in China now, but originally they went there for the cheap labor.

    Twenty to thirty years ago, China didn’t have hordes of industrial engineers ready to go. All they had were hordes of farmers to spare. The industrial engineering capacity grew alongside the rest of Chinese industry.

    And it still does depend upon cheap labor. Not just the cheap unskilled labor, though that remains more important than you acknowledge. It relies upon the fact that industrial engineers work for a lot less than they do here. Again, you mentioned the reason why this is important and then skipped right on past without realizing its import. Right now, one of the main problems with trying to produce more industrial engineers in the US is that we don’t have enough qualified people to train them. In order to get those people, universities would have to offer not only wages that are competitive with what private industry pays now, but that are competitive with what wages would be once their own huge demand descends upon the industry.

    In China, that’s not a problem. The fact that the engineers are paid so little means that it’s possible to have a ton of excess capacity. This not only allows a company that comes into China to hire 8,700 of them on short notice, but also holds down what it costs to teach more of them. In the US, a newly minted industrial engineer expects to make a ton of money right away. That’s what we have to compete with.

    Chinese companies aren’t profit-driven, they’re revenue driven. They’ll spend pretty near every penny they take in to grow.

    I agree that this is a part of the problem, but it most certainly is a problem. The focus on profit is there for a reason: it’s how you prevent a lot of wasteful spending. The Chinese have only been able to focus on revenue to this extent for so long because of insane amounts of state support. Their banking system makes ours look like a model of stability, because the government forces the banks to make cheap loans to industry so that industry can continue to grow even when it’s not profitable. This is going to come back to haunt them in a big way, and is one of several issues that might prove large enough to wreck the miracle they’ve developed.

    I am also extremely skeptical that the question of educating engineers is anywhere near as simple as you are arguing. I agree that it would be better to turn out more of them than we are, but there really isn’t an easy solution to that problem. If the solution were that easy, it would happen. American students aren’t impervious to supply, demand and wage differentials when it comes to picking a major.

  170. 170

    @pseudonymous in nc: Here, I would argue that the government stepping in to provide more education is, contra Martin, a part of the problem rather than the solution. Business schools do exactly what he says he wants: they take in lots of students and allow companies a lot of leeway to come in and help design the curriculum. We don’t get the MBA mentality despite what American business wants; we get it because that’s what American business wants.

    What it produces isn’t a flexible workforce from which we can grow. It produces a workforce that is trained by rote to fill positions in the companies that want them now, in exactly the ways that those companies want them done.

    If we moved this model to the engineering school, it wouldn’t produce a pool of engineers that new startups or rapidly expanding businesses could draw from to help innovate. It would produce a pool of engineers who are already trained to do exactly what they are told.

    Ever since becoming a highly skilled member of a profession of which American businesses claimed that there was a shortage of people who could do the work, I’ve become extremely skeptical of any claim made that they can’t find enough skilled workers. If that were true, then I wouldn’t continually be turned down for a job because I’m *over*qualified.

    Contra Martin, American businesses aren’t really complaining that they can’t get a skilled enough workforce. What they are complaining is that they can’t get a compliant enough workforce. They don’t want creative thinkers. They want someone who has just enough skill to do the specific job they are hired for, and no more. They don’t want someone who will become bored at that job and then go look for another one. They don’t want someone with enough skill to demand a pay raise.

    Don’t take these complaints at face value. Watch what companies do, not what they say.

  171. 171
    THE says:

    I wonder about another factor here:
    Legalistic constitutional democracies like USA are ruled by lawyers. Law degrees make up a big part of the qualifications of the people in government.

    But if you look at Marxist systems like China, also former USSR etc. The government cadres are disproportionately engineers, and scientists including social scientists.

    e.g. Hu Jintao was educated as a hydraulics engineer.
    Wen Jiabao was educated in geology and is a geomechanics engineer.

    China is a technocracy, not a democracy. This has an impact on the culture.

    The US system is founded on theories of individual freedom.
    It needs lawyers to define and administer such a system.

    The Chinese system is founded on Marxist theories of scientific government.
    It relies on social scientists and engineers to operate it.

    China may may have partially abandoned Marxism as an economic theory. But Marxism still provides the theoretical foundations for the state and the rule of the Communist Party.

  172. 172
    Brother Shotgun of Sweet Reason says:

    @Martin:

    If you want more manufacturing and tech jobs, you need more engineers.

    Then why the fuck do we lay off the engineers when there’s a downturn in the economy. I’ve been hearing his desperate cry for engineers since the 1970s. You know what? Nobody gives a shit about engineers. North American Rockwell was famous for laying off its engineers for Christmas. I watched my company decimate its highway design staff when the recession hit.

    Engineers are nothing more than highly paid wage slaves. We go through a tougher BS degree than most other occupations and when it’s done, we get paid less and live at the mercy of the lazy fuckers who got an MBA.

    /Civil Engineer/

  173. 173
    Brother Shotgun of Sweet Reason says:

    @Tissue Thin Pseudonym (JMN):

    What they are complaining is that they can’t get a compliant enough workforce. They don’t want creative thinkers. They want someone who has just enough skill to do the specific job they are hired for, and nomore.

    This is the workforce that is guaranteed to piss off the client/customer, ruin your company’s reputation, and bankrupt you in ten years.

    Until then, though, your quarterly earnings will be just peachy.

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