Thursday, September 2, 2004

27. Outsourcing isn't recent trend

With labor being the most expensive burden on a company trying to make a profit, it is easy to understand the attraction of obtaining the cheapest labor available. Americans often act as though the adoption of the questionable means by which corporations obtain cheap labor, in this case the outsourcing of jobs to third world countries, is a recent endeavor. For some current generations of Americans this may be, but the issue for companies and corporations is, and has always been, about finding ways to reduce costs and increase profits. And, in the wake of profits, ethical consideration and human decency rarely stand in the way.

Early in our history, rather than outsource jobs, America imported labor. The South was built on slave labor, which created huge profits for plantation owners. Slaves were bought and sold, barely fed, barely clothed, kept ignorant and harshly punished to preserve their value to the plantation owner. The Civil War was fought for financial preservation, as the South fought to preserve slave labor against those demanding humanity and civil rights.

During the industrial revolution, the focus again became cheap labor- this time through immigration. Companies benefited as those looking for a new start immigrated to America- more than willing to accept low paying jobs. Of course, as we know, companies began abusing their power by working employees long hours in unsafe factories for low pay. And again humanity issues surfaced and, subsequently, unions were developed to protect worker rights (or human rights- depending on how you look at it).

The outgrowth of unions and fairly paid workers led to the middle class, which seized the opportunity to invest money and start their own businesses- to delve into the American dream. However, capitalism, the economical game of Darwin's "survival of the fittest," suggests that only those that create a product for profit will survive.

As competition in the marketplace increases globally, the cost of American labor becomes a hindrance which, again, has companies looking for cheap labor. Since American companies can no longer import slave labor or count on cheap immigrant workers, they have begun chasing workers across the world. And since Europeans, who always seem to be one step ahead of Americans in cultural philosophies, have realized there is more to life than working and are unwilling to give up their four weeks of vacation (although this may be changing as well in the global marketplace), American companies have begun utilizing third world labor, such as child labor and sweatshops.

Corporations have, from the beginning, made it quite clear that pleasing their wealthy investors is more important than saving American jobs. Thus, in some ways, the capitalistic economy that once enabled American prosperity is now operating against it. In the 1840s, Karl Marx proposed, "The need of a constantly expanding market for its products chases the bourgeoisie (modern capitalists, employers of wage labor) over the whole surface of the globe. It must nestle everywhere, settle everywhere, establish connections everywhere." And for Americans it means, more jobs are lost, more homes are foreclosed, and that the disparity between the "haves" and the "have nots" will continue to increase.

Although the ethics described here (slave labor, immigrant labor, and sweatshops) and employed by corporations is nothing less than appalling and disgraceful, many will argue that management owes its investors nothing less than "whatever it takes" to meet quarterly earnings projections. And, unfortunately, as companies like Enron, Wal-Mart and Pfizer has demonstrated, there are many other ways, equally atrocious, to define, and practice, "whatever it takes."

Nevertheless, in MBA schools across the country, the obligation to the shareholders is pounded, over and over, into the heads of students. The impact on communities in which the decision has been made to close factories is not discussed. A part of every MBA program should include Michael Moore's first documentary, Roger & Me, in which Moore visually explores the suffering endured by the people of Flint, Michigan after General Motors picked up and left. If nothing else, the film would serve as an examination into the humanistic aspect of business- outside the financial statements. We need to at least ask, from a sociological perspective, at what point the obligation to the community exceeds the value afforded to wealthy investors. And we need to ask how many families can be left in ruin in the name of corporate greed. Marx asked the same question in his time, and wished " do away with the miserable character of this appropriation, under which the labour lives merely to increase capital and is allowed to live only insofar as the interest of the ruling class requires it."

I am not suggesting Marxism for America, rather the ideology that capitalism is not perfect, especially in its treatment of wage labor. Greed is not good; too many people get hurt.

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