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BERKELEY, Calif., Oct 1 (Reuters) - The United States has nothing to fear from rapidly growing technology markets in China and India, Bill Gates, chairman and chief software architect of Microsoft Corp.  said on Friday.

 

"China and India are the big change agents for the years ahead," Gates told students at the University of California Berkeley. "We have to go into the risky new areas. That's what's going to allow the United States to stay at the forefront."

 

Outsourcing of manufacturing and high technology jobs outside the United States has become a key issue in the U.S. presidential campaign.

 

"It's a little scary to me that people are thinking of this as a zero sum game," Gates said, referring to criticism of outsourcing and growing overseas tech markets.

 

"We're at the start of a process where the whole world is getting into this virtuous cycle," Gates said.

 

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I think if anyone knows what their talking about when it comes to technology its Bill Gates.

The issue with China is they have a billion people to build $200 tvs and cheap textiles but only 100,000,000 to buy high end US products like computers and diet Coke. THe vast majority of their citizens are living below any reasonable international poverty standard.

 

In the short term, US companies are making some profits by selling manufacturing technology to the Chinese. The concern is the mid term balance of trade which doesn't look good for our manufactuing sectors.

The issue with China is they have a billion people to build $200 tvs and cheap textiles but only 100,000,000 to buy high end US products like computers and diet Coke. THe vast majority of their citizens are living below any reasonable international poverty standard.

 

In the short term, US companies are making some profits by selling manufacturing technology to the Chinese. The concern is the mid term balance of trade which doesn't look good for our manufactuing sectors.

Here's the question nobody asks when it comes to outsourcing American manufacturing jobs.

 

Do you want to pay 200 dollars for that new TV or 800?

 

The cost of American labor has gotten so high that it is no longer possible to produce cheap electronics here. Employers really REALLY ( dont laugh at me its totally true ) dont want to move their factories overseas but they no longer have a choice if they wish to stay competitive.

 

If the jobs stay here then companies have their labor costs go up 4-5 fold and so will prices. Gone is the day when American made labor can produce the cheapest goods. No policy or politician will ever bring it back. You can make it tougher on companies that outsource by closing tax loopholes ( which is the sole element of the Kerry platform I agree with) but thats not going to solve the problem.

Here's the question nobody asks when it comes to outsourcing American manufacturing jobs.

 

Do you want to pay 200 dollars for that new TV or 800?

 

The cost of American labor has gotten so high that it is no longer possible to produce cheap electronics here.  Employers really REALLY ( dont laugh at me its totally true ) dont want to move their factories overseas but they no longer have a choice if they wish to stay competitive.

 

If the jobs stay here then companies have their labor costs go up 4-5 fold and so will prices.  Gone is the day when American made labor can produce the cheapest goods.  No policy or politician will ever bring it back.  You can make it tougher on companies that outsource by closing tax loopholes ( which is the sole element of the Kerry platform I agree with) but thats not going to solve the problem.

I was thinking about the same thing with soldiers. Why send people from the US around the world when we could hire cheaper in those countries and they already know the areas, terrain, etc.

 

The challenge is avoiding widespread unemployment in this country. Intersting that we don't mind high paying programming jobs moving off shore and fight to keep out illegal migrant workers from Mexico. We are protecting $5.15 temporary labor jobs and encouraging $50,000 jobs over seas.

 

I guess the programmers can pick tomatoes for three months a year and support their families.

 

It is a concern. Nuke is correct, we have a thirst for cheap products. I have helped many companies relocate and outsource off shore and see first hand that many are just trying to survive. We are turning into a service economy. This is a serious issue and we need to develop ways to compete on a global basis or we lose.

I was thinking about the same thing with soldiers. Why send people from the US around the world when we could hire cheaper in those countries and they already know the areas, terrain, etc. 

 

It is a concern. Nuke is correct, we have a thirst for cheap products. I have helped many companies relocate and outsource off shore and see first hand that many are just trying to survive.  We are turning into a service economy. This is a serious issue and we need to develop ways to compete on a global basis or we lose.

Maybe we should do the same with police officers too? :rolly

 

 

Seriously though, Theres only 2 ways to reverse the flow of jobs overseas.

 

Make it more expensive to locate overseas... Ways to do that? Tarriffs, closing tax loopholes are 2 ideas that spring to mind but the last time we really got big into protectionism was in the late 1920's and we all know what happened after that.

 

 

Make it cheaper to employ people here. Ways to do that? Take away health care, 401K and any other fringe benefits and slash salaries.

 

Seems to me we're stuck between a rock and a hard place on this one. Any ideas anyone?

From my experience (I am in the electronics field), China is great at copying things, but terrible at creating new electrical technologies. Maybe that will change soon, but in the last 10-12 years that is kinda how it has been.

Maybe we should do the same with police officers too?    :rolly

 

 

Seriously though,  Theres only 2 ways to reverse the flow of jobs overseas.

 

Make it more expensive to locate overseas... Ways to do that?  Tarriffs, closing tax loopholes are 2 ideas that spring to mind but the last time we really got big into protectionism was in the late 1920's and we all know what happened after that.

 

 

Make it cheaper to employ people here. Ways to do that?  Take away health care, 401K and any other fringe benefits and slash salaries.   

 

Seems to me we're stuck between a rock and a hard place on this one.  Any ideas anyone?

One trend that helps keep jobs in the US is increasingly demanding consumers. When you want a custom configured whatzit in two days there is no time to get it from China. We have to continue to dominate in technology.

 

I forget now which Congressman from downstate Illinois is head of the Small Business Committee but in the short run he's trying to get the large multinationals to use US based suppliers for some of their overseas needs and charge it to advertising.

 

Example: Motorola builds a plant in China. They were buying machine tools from a shop in Des Moines. Obviously the shop in Des Moines would have an impossible time being competitive even before transportation is factored in. Now if Motorola could be convinced that a big advertisment in the Des Moines Register about how Joe's Machine Shop won a $2,500,000 contract with Moto-China to supply machine tools would increase all their business, it could be a win-win.

 

Nuke, mentioned controlling health care costs. I know more and more Republican business owners who see their health care costs and wonder if a single payer system wouldn't help them to compete. It's tough for the small business with 8 ot 10 employees to offer decent benefits at decent prices.

 

Police need to be here.

 

I was joking before but I just thought of this, we are already training 100,000 Iraqi's to be soldiers in their country, couldn't we continue to offer command and control plus weapons and let them bleed? In a way isn't that outsourcing cheaper workers?

I was joking before but I just thought of this, we are already training 100,000 Iraqi's to be soldiers in their country, couldn't we continue to offer command and control plus weapons and let them bleed? In a way isn't that outsourcing cheaper workers?

Hard to call it outsourcing when its their own country. If were recruiting conscripts from other nations, like the Soviets did, to fight our wars then you could call that outsourcing.

Hard to call it outsourcing when its their own country.  If were recruiting conscripts from other nations, like the Soviets did, to fight our wars then you could call that outsourcing.

Do we have command and control of them, or are they under the direction of Iraqi leaders?

So what, Gates is a little worried, he won't be able to exploit customers as much in the monopoly market Microsoft operates in, what a shame.

Do we have command and control of them, or are they under the direction of Iraqi leaders?

I really cant say for certain. I haven't been in country over there for better than a year now.