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Job Offshoring and Government Power

May 27, 2008

Blaming the corporate ideal of free trade and business leaders alone for the present situation of American workers is misplaced. American politicians, ill-conceived government regulations and lack of foresight along with the willingness to make sound adjustments are responsible for nearly all of the job losses the United States has seen over the last decade. The real culprit for loss of employment in America is the short-term mindset of ill-conceived inflexible economic policies that government has created.

capital.jpgComplicated tax laws, excessive regulation, thoughtless government intervention of small business, punitive and complex payroll rules and the spiraling cost of employee benefits create the desire for less regulation, less intervention and more favorable cost structures. The desire of politicians to create more and more regulation without weighing the cost, complexity and disadvantages of those regulations results in unintended consequences. Politicians draft new law that creates layers of law and regulation that are difficult, if not impossible to understand, let alone enforce. The U.S. government’s love for stacked regulations and lack of discipline has created an untenable situation for citizens and business alike.

The power given to multinational business by trade agreements and liberalized corporate regulation has allowed the rise of multinational business and the global economy. Business simply fills the gaps left by government regulation. The business world is interested in profits and hospitable business environments that allow for freedom and autonomy. Sovereign third-world nations now compete with each other in order to receive the advantages of corporate largess along with the benefits of better employment and a moderated wage scale. Instead of seeking lower costs from innovation and higher productivity, corporate business has opted for cheaper labor and fewer regulations. Outsourcing business functions has become a favorite method to trim costs and raise temporary profits.

federal-reserve-board.jpgEven government, unable to manage affairs internally, has outsourced government accounting functions to the likes of corporate Deloitte, the Federal Reserve and the Internal Revenue Service.

Job offshoring is a symptom of a disease. The disease is ill-conceived inflexible government regulation. Business looked for a way out and found it with sympathetic politicians that created a new world with legal loopholes in the name of prosperity and big money. Once business developed a taste for autonomy, outsourcing became a natural expression of that autonomy. Outsourcing occurs when business decides that profits are more important than global location or human principles. Unreasonable, difficult and expensive government regulations have played a large part in job offshoring. Once power is relinquished, getting that power back is virtually impossible by peaceful means. The corporate world has been empowered beyond rule of nations and now exists solely for corporate power on a global scale.

The idea of business is to make a profit. If higher profits can be derived from sending work overseas, the principles of business suggest that reality. Offshoring is not inexpensive. However, it is less expensive than hiring workers in the United States and abiding by U.S. government watchdogs and regulation. No discussion would be complete without the mention of the impact of unions in the U.S. work force and economy.

What the United States is now encountering is a painful adjustment period. The old American lifestyle is all but vanished in favor of oppressive regulation across the board as taxes are continually raised to support the interest of a burgeoning administration. Creative accounting tricks are the norm for the U.S. government and business alike. Dishonesty rules on a massive scale that has nothing to do with business and everything to do with empowerment and the perception of control.

The burden of government regulation coupled with out-of-control spending has consumed any productivity gains possible in the U.S. economy. Free trade agreements, such as NAFTA, have simply empowered business to do what they do best outside of this country. Extended unemployment benefits and retraining has been promoted, yet remain grossly payingtaxes.jpginsufficient for symptoms of the diseased economy created by politicians. Instead of encouraging a renaissance of new small business growth, the U.S. government fearfully draws up more regulations and mandates in an effort to corral the existing workforce. The power ascribed to the Internal Revenue Service is an effort to milk every penny out of the economy in the interest of perceived legal government architecture. The government has tied itself directly the U.S. banking system as it seeks to control and track every penny in search of the almighty tax dollar to support growing government and enlarged policies.

oppression.jpgPerhaps business is not fleeing the nation’s “free enterprise system”. Business is fleeing oppression, something citizens cannot easily flee. Government programs that seek to help people hurt by other government programs are an easy sell to people convinced that the world owes them. Unfortunately, the U.S. government compounds the problem without providing real relief or empowering the individual to rise above the crisis. Instead, government chooses to manage the crisis. The U.S. government has no wealth of its own other than what comes from taxes from the people and business. Business is running the other direction as the U.S. government mindlessly seeks to survive by further invading the freedoms of its citizens through taxes and regulations. The burden imposed on those that are still productive lowers the ability of business to compete in this country. The end result can only be a financial economic train wreck.

politics.jpgSensible Americans should consider insisting that Congress remove the burden of unnecessary government regulation in the United States and stop supporting trade agreements that empower foreign business interests and unelected foreign bureaucrats. Politicians that refuse to comply should be removed from office. The United States government lives in fear. It fears change and loss of power. This is evident by the layers of law and regulation in place that can never be changed, only superseded and enhanced. This is evident from the broken and ill-conceived system of taxation that is unique to this country alone. This is evident by the house-of-cards accounting games that Americans are expected to play if they choose to participate actively in the U.S. economy. The inability to solve real problems and to reform or eliminate old ones has resulted in the destruction of what America holds most dear: freedom and common sense. The only thing we have to fear is fear itself. America does that very well.

— This is reprise of a very relevant article written recently this year. E.J. Manning is dealing with family business this week. —

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