Time To Address US Wages

In a previous post, I said I'd discuss this subject so...here goes.

Most people in the United States are overpaid for the job they're doing. How do I know this and on what basis is this statistic founded? Very simply; we now compete with the world for our jobs and many of those jobs have left the United States. When we said (back in the 1980's and 90's) that we were a global economy and had to think that way, we never even considered our wages were not competitive with the rest of the world.

You can fight my logic on this, but if we want to have the jobs that have moved to other countries, one of the things we have to do is make the finished product competitively priced with comparable quality. In order to do that, labor costs here will have to be closer to what they are in other countries. Notice I didn't say they have to be the same.

I believe we can achieve an objective of comparable quality with lower labor costs (than today) by doing the following;

1. Being willing to work for a lesser wage.
2. Removing some labor expenses for employers.
3. Removing or limiting liability damages/expenses for employers.

This might require us, the labor force, to accept a lower standard of living for at least a period of time. Unfortunately, the competition is already doing this. I'm not saying we all need to be willing to move into huts with outhouses, but we may have to forego the "mcmansion."

Maybe we phase out automatic payment of Social Security Income for different groups if they don't have a financial need for that income. Maybe we cut back on the amount employers have to pay into Medicare and Social Security. Maybe instead of Medicare paying for every type of healthcare issue, it only covers emergencies and major medical.

Maybe we move to a "loser pays" legal system so that frivolous lawsuits would be reduced. I.e. the loser in a liability suit pays their own legal expenses AND that of the party that wins the suit.

These are just suggestions and you may have better suggestions.

My statement of most people being overpaid may be offensive to some, but I walk into numerous offices each day to see people playing solitaire or shopping online. Granted, many people are hard-working and there's nothing wrong with a little down-time, but we have gotten to the point where we have flat screen tv's in many households, at least two cars in the driveway and our toughest daily decision is figuring out which fast food restaurant will get our lunch dollars. Meanwhile, workers in other countries build the tv's, furniture and toys we play with.

Consider that whenever we want to buy something, we think we should get the lowest price, but then we think our own pay should be higher than whatever it is today.

Reality; the United States is not the emerging economy it once was. India, China and others are taking over that spot. Somebody has to make the goods and services these people will want to buy. Why shouldn't we be able to produce those goods and services? Eventually, they'll be wanting to watch movies at home, take lavish vacations and eat like pigs. Start now and we can be the ones raking in the dough when they start buying the toys en masse.

What do you think?

Conservatives?

Not too long ago I heard a radio commentary where the guy said conservatives seem to be for everything except conservation.

My immediate reaction was to say out loud; my idea of conserving is turning the light off when you leave the room, recycling whenever and wherever possible and using hand-me-downs. I say what's wrong with buying a used luxury car that gets better gas mileage than most cars that were on the road when I was growing up? I say, go ahead and buy up all the "electric" cars you want, but those electric power plants will have to be powered somehow, many by coal.

I'm all for reducing, recycling and reusing, but for crying out loud, do we have to take it to the point where we denigrate anyone who's fortunate enough to enjoy some luxuries? For years when I was growing up, I saw those who were considered conservationists, driving Range Rovers, lived in pretty nice houses and wanted for nothing. These people were driving gas guzzlers, didn't ride bicycles anywhere (unless they first toted them on the back of the SUV) and had the lawn service using every chemical (enviro-friendly or not) to keep the yard green.

I'm all for taking care of the beautiful earth that God has blessed us with, but you should see my yard when I leave it to nature; the entire lawn and plants die off due to a lack of water, weeds take over and the soil quality is more like rock.

So yes, I consider myself a conservative and yes, I drive a big car. But gee, my business allows me to provide a service to people that saves them running some errands and thereby saves time, gas and money. Some of us conservatives are for conservation, but we just don't think that means we all have to go back to the days of horse and buggy.

Response to Comment on Taxes...

Comments submitted anonymously came through to my email notification, but for some reason they didn't show up on the blog, so I will post them now with my responses.

Anonymous wrote:
I agree on much of what you have proposed. JOBS, I believe, is very important; no question about it. I think that putting people to work should be the main priority. I also agree that if more people are working, the more revenue the country brings in. Jobs also helps self-esteem. I believe that it makes people feel that they contribute to society and it is important that the message get across that all need to contribute.

I resepectfully disagree with you on one point. I don't believe that the only reason that companies went overseas was to avoid taxes. I believe they went for that AND cheap labor (that is discussion for another time). If I understand you correctly, you advocate for lowering corporate taxes to entice them to come back. I am not sure I agree in that GE was owed money because of the tax breaks already given. This may be an extreme case. Oil companies are making record profits and getting assistance from the Federal Government. I would also refer you to a 60 minutes piece done several months ago in which the owner of the Horizon Oil rig moved the company overseas to a post office box in Europe and now pays no U.S. income taxes. I hope this is not getting off the mark but wouldn't lowering taxes not make a difference because being offshore, they don't have to pay any taxes?

My response
You are right that companies didn't only leave America because of taxes, but taxes and regulations are a huge impact on businesses in America. There are numerous compliance issues businesses must deal with here, that don't exist in many foreign countries. Cheap labor is another reason for companies leaving and I would love to discuss that further another time.
I agree that the GE scenario of not paying taxes seems extreme and unfair. However, I call that a failure of the current tax system to apply taxes to all entities if all entities are supposed to be taxed. I don't necessarily blame the company for exercising all of its rights under the tax code. It also emphasizes how The Fair Tax would resolve this; i.e. a consumption tax would mean that corporations purchasing goods and services from other businesses would pay taxes on those goods and services, not based on the net income of the business. As for the idea that it wouldn't matter if businesses were here or not because being already "offshore" they pay no US income taxes, it actually would benefit them to return here because US would be a tax haven. Yes, there'd still be issues of labor to resolve, but it would be a good starting incentive. And for those thinking of leaving, it would deter them from doing so if the decision to leave was based on income taxes.

Anonymous wrote:
Would you agree that with all the rhetoric of cutting federal jobs would add more people to the unemployment lines resulting in more jobs needed to make up for the losses. Would you also agree that language of the government "goinng back to 2008 spending levels," makes no sense? It suggests that things cost the same as they did three years ago and does not take into account price increases? I know it is off topic but just wondering what your thoughts on that were.

My response
I agree that cutting federal jobs adds more people to unemployment if there are not private sector jobs for them to fill. I guess the question I have is; if we don't need those positions (and please don't tell me the jobs being lost are all law enforcement officers and firefighters), aren't we just using a different form of welfare? Again, shouldn't we focus on increasing private sector jobs?
As for "going back to 2008 spending levels," I say why stop there? We're talking about government spending, not yours and my grocery bills. The unfortunate reality is that if we keep spending more, there's no plan to pay that money back. Sort of like me saying; "I've maxed out my $10,000 credit card and even though my income has gone down, I want the credit card company to give me another $5,000." Since that makes no sense, why do we accept it from government?

Anonymous wrote:
Again, I think your idea of more people going back to work would be one way to help increase revenue. More also has to be done because there are more people in the country. The population has not remained neutral. I think there is much more that needs to be done. I think this arguing on both sides does no one any good. It appears that it is like children fighting that if neither one can get their way, they call each other names; ridiculous! I also believe that there are people in society that need our help and we need to help them.

My response
I'm not for all the name calling. What I fail to give into though, is the idea that increased government spending on numerous programs is good. We keep spending more and it is NEVER enough. As recently as the last 2-3 years we were told TARP and Stimulus HAD to be done to save the economy. Well, it didn't save the economy. It saved some government and auto worker jobs for a while. Then they did "Quantitative Easing" and that wasn't enough.

I agree that there are people in society that need help and we should help them. I don't believe it is the job of our government to offer so much help that it means people can continue to procreate, overeat and generally do nothing at the expense of someone else. To those who're handicapped beyond working capability, I say I will help you. To those capable of working and are living free at the expense of the taxpayers, I say; get to work and make yourself useful, like helping the handicapped.