IN-sourcing, Round 2

Mike, all that coercion!

Wello, for one thing we could actually tax corporations for all their income. Or we could require them to have their headquarters staff live in the same country as the rest of their company. Or we could not give them any tax breaks if they don't hire here. (After all, they keep telling us that they need all that extra money to "create jobs" - perhaps they'd actually create some here if they were held accountable for the funds...)

sounds nice to people on the left. It wins votes and it might even work for an election cycle or two. But coercion always misses the point that people and corporations are free to move to avoid the coercion, and they do. People try to make their lives and companies better and freer. So they send jobs overseas. Along, I imagine, comes Mike The Liberal Jewish Brother In Law who might sayeth something like this

“Thou shalt have thy corporate HQ where thy workers toil. Except for Heinz Ketchup, of course.”

And the evil corporate chieftains say, “Up yours. We’re out of here.” And they pay some more accountant and tax attorneys to form some more shell corporations and subsidiaries, and they have some more splits and mergers, and they change some more names. And they take their capital where it will get the most work done.
And who pays the marginal costs of your tax-and-coerce policy? The little people, mostly. The very ones you wanted to help. You really can’t regulate your way to prosperity. Is prosperity your goal?
Or, you could try this.
Look into all the layers and layers of regulations piled on top of employers. Carefully analyze each one in terms of cost/benefit. Get rid of the bad ones. Or better yet, wipe the slate clean and start over. Quite a bit of this would be state not federal, including the most egregious to my industry here – workman’s comp insurance puts a 40% burden on top of every wage earner. Want to raise the minimum wage? How about exempting wages below some arbitrary figure, let’s say $8 per hour, to workman’s comp? Unemployment insurance – why should it be mandatory-one-size-fits-all-across-the-board? Why not make it optional? Same for FICA.
Hazardous materials notifications – sounds nice and tries to protect workers from toxic chemical exposure. Only one problem: no one reads them. I’ve been on plenty or worksites and I have never seen one solitary soul other than me read the stupid things. (They’re incomprehensible anyway, at least to this humble national merit scholar college graduate. No doubt the carpenters understand every word.) So let’s do away with them. They cost corporations money and serve no useful purpose.
EEOC? Scrap it.
Davis Bacon? Scrap it.
OSHA? More difficult call. Occupational safety is important, and it’s an area corporations need to take the lead in. But the OSHA system as it exists is a pile – a BIG pile – of crap comprehensible only to experts. OSHA specializes in bayoneting the wounded and pointing fingers of blame. Workers need help, mostly protecting themselves from their own carelessness, and OSHA isn’t the best way to do it.
Then there’s the whole sexual harassment thing. Employers probably exaggerate the threat to themselves in their own minds, but it’s a factor that, at the margin, contributes to out-sourcing. Let’s reform it, put some common sense into it.
Let’s set a goal of reducing the cost of federal regulations to employ Americans by 2/3, and then we’ll challenge corporations to increase wages across the board by half the savings.
Then there are the kinds of regulations that strangled the CCEC arena project. I’m not advocating the fed’s get involved in building permits and such, but it would be great to have the bully pulpit calling for more liberty and less paperwork. Maybe leaders could help places that are pro-common sense (What’s that? It’s the opposite of whatever King County, Washington is doing.) get the word out.
Eliminate corporate subsidies.
Eliminate corporate taxes.

Then we can start on bringing the cobblers back to New England.

Comments

[Mike the liberal Jewish brother-in-law]

Please do NOT quote me with statements I didn't say.

[pedro]

Sorry about that. I thought the biblical style made it obvious it wasn't a real quote. I edited it this morning. OK?

[pedro]

Dissect The Left adds this nice little tidbit from Talon News (http://www.talonnews.com/news/2004/march/0304_manufacturing_jobs.shtml):
"The external overhead costs from taxes, health and pension benefits, tort litigation, environmental regulation, and rising energy prices add approximately 22 percent to U. S. manufacturers' unit labor costs relative to their major foreign competitors. The absolute value of the excess cost burden, nearly $5 per hour, is almost as large as the total raw cost index for China."
That 22% figure is about HALF the cost of workman's comp insurance alone in Florida.
Some one tell me this -- if you were contemplating starting a little factory from scratch, why on earth would you build it in the most expensive and litigious nation on earth?

[Herve Leger Australia]

The first thing I did when I returned to the States was to call on Rachel. Her mother answered the door. Rachel no longer lived there. She had married a medical student she’d met in college. “I thought she wrote you,” her mother said.