Re: Drop Outs are Killing the Economy
That is not entirely true, regulations and taxes could have easily been put in place that took away the savings from using low cost foreigners at the expense of American jobs. Unions, as much as I despise them, also could have done more to stop jobs from going outside of the country but greed got in the way of that.
The latter is economic theory that lower production costs create lower prices, but as usual economic theory is as close to real life as a comic book. Instead companies kept prices the same, or even raised them to make a greater profit. From there as corporate greed grew more and more the outsourcing continued to grow more and more and the jobs in the US became fewer and fewer. So now I ask what good does it do to outsource jobs to create unemployment which in turn makes it impossible for people to buy goods? Simple answer is that doesn't even begin to work and now we are feeling the effects as an entire nation.
This then trickled into other fields where outsourcing never should have been possible. I'll focus on my field of the legal sector. Document review jobs have been sent to India where people who don't speak English, much less say Legal English are reviewing documents to determine their relevance. In an article from the ABA magazine there was a quote where one of these Indian "lawyers" didn't even know what the word Esquire meant. This has since invaded other fields where an advanced education is needed. The downside here is that the ABA has focused their lobbying power towards allowing this to continue, only protecting partners at huge firms while effectively turning their back on 90% of the next generation of lawyers.
From what I remember in Finance, larger risk equals larger reward. Yes short term it makes sense to make the 3-4% from the government, but this really fails long term has inflation outpaces the rate of return banks get from the government. I'd also wonder how many of those losses came from small business enterprises compared to what came from large corporations with poor business models. If we don't encourage small business now all we are doing is aborting the next Microsoft before it even gets off the ground. Success for the banks in the long run will lie in a balanced portfolio of safe ventures and high risk ventures. With this broken model however as soon as inflation out paces the government interest rates we'll start seeing more banks collapse and have an even bigger problem down the road than we do now. It scares the hell out of me that Ivy Leaguers running these places seem to have forgotten the most basic lessons from Intro to Business.
That is not entirely true, regulations and taxes could have easily been put in place that took away the savings from using low cost foreigners at the expense of American jobs. Unions, as much as I despise them, also could have done more to stop jobs from going outside of the country but greed got in the way of that.
The latter is economic theory that lower production costs create lower prices, but as usual economic theory is as close to real life as a comic book. Instead companies kept prices the same, or even raised them to make a greater profit. From there as corporate greed grew more and more the outsourcing continued to grow more and more and the jobs in the US became fewer and fewer. So now I ask what good does it do to outsource jobs to create unemployment which in turn makes it impossible for people to buy goods? Simple answer is that doesn't even begin to work and now we are feeling the effects as an entire nation.
This then trickled into other fields where outsourcing never should have been possible. I'll focus on my field of the legal sector. Document review jobs have been sent to India where people who don't speak English, much less say Legal English are reviewing documents to determine their relevance. In an article from the ABA magazine there was a quote where one of these Indian "lawyers" didn't even know what the word Esquire meant. This has since invaded other fields where an advanced education is needed. The downside here is that the ABA has focused their lobbying power towards allowing this to continue, only protecting partners at huge firms while effectively turning their back on 90% of the next generation of lawyers.
From what I remember in Finance, larger risk equals larger reward. Yes short term it makes sense to make the 3-4% from the government, but this really fails long term has inflation outpaces the rate of return banks get from the government. I'd also wonder how many of those losses came from small business enterprises compared to what came from large corporations with poor business models. If we don't encourage small business now all we are doing is aborting the next Microsoft before it even gets off the ground. Success for the banks in the long run will lie in a balanced portfolio of safe ventures and high risk ventures. With this broken model however as soon as inflation out paces the government interest rates we'll start seeing more banks collapse and have an even bigger problem down the road than we do now. It scares the hell out of me that Ivy Leaguers running these places seem to have forgotten the most basic lessons from Intro to Business.
Instead of business....
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