GEORGE TEMPLETON
COMMENTARY
By George Templeton
Gazette Columnist
Outsourced
We
thought we could help the world without hurting ourselves. Markets
grow when competition replaces poverty, but sometimes profit becomes
more important than value. To create or consume, that is the question.
It
was 35 years ago. We had a new president, Ronald Reagan. It would be
12 years before the election of Bill Clinton, the man that Republicans
incorrectly blame for lost jobs. It would be 27 years before irrational
over-exuberance and banking deregulation led to the Bush
Administration’s financial disaster and 8 more years until Donald Trump
blamed it all on the Carrier Corporation.
Moving
I
was on the opposite side of the earth, moving manufacturing to Petaling
Jaya, Malaysia. It seemed distant in those days because there were no
cell phones or internet. A telephone connection to America was like
contacting Mars by ham radio. Communications used a TWX machine. You
placed your message into a discarded bathtub to be sent. It overflowed
with hundreds of messages and new messages, on top and ever coming,
would be sent ahead of yours.
It
was like that at the grocery store. Lines were a novelty. You could
not stand there waiting for your turn because it would never come.
Instead, you had to behave like everyone else, elbow yourself to the
front, and along with half a dozen other people wave your money at the
cashier. When she grabbed your cash, you were next. You bought fresh
chicken alive. You did not pay for refrigeration or worry about
out-of-date meat. There was only a single can of beer in shoppers’
grocery carts because it did not come in six packs. There was a shocked
look on the cashier’s face when I bought the beer for the company
party. She thought she had met Satan incarnate.
Colonel
Sanders chicken was just like in the USA, but waiters, fancy
tablecloths, silverware, beer, and a quart bottle of sweet hot sauce to
be slavered over everything in copious quantities were features not
found in America’s fast food version.
Natives
took their left-over dinner to the roadside and sold it cheaply without
license or regulation. It eliminated the problem of hunger and built
community, but page two of the newspaper was an ad for worm medicine.
In America we could eliminate food stamps this way.
Malaysian
cooking was a delight, lacking the overemphasis on red meat so common
to the American diet. A chicken dinner at a restaurant was a drumstick
and a large plate of coconut rice. When you ordered satay, the fiery
hot sauce was served separately in a tiny bowl. In America we have
chili cook-offs, but we are missing the amazing pallet of curries.
Our
plant was air conditioned but birds lived within the air conditioning
ducts. Their nesting materials, gathered from the company cafeteria,
hung from never cleaned vents. Bird watching and song was our reward
for sharing our table and a grain of rice from our plate with them.
Lunch choices included expensive American sodas and potato chips instead
of much cheaper papaya, mango, pineapple, and fruit juices.
Streets
crossing modern high-speed freeways created huge traffic jams that tied
up the police. Because of that, drivers could run red lights, straddle
the center line, and go off-road or on the wrong side of the road
without apprehension. You could get where you were going without
expensive overpasses.
Hollywood
movies led the envious to believe that Americans were wealthy. Natives
could not afford air conditioning in their petite homes. The limp
newspaper did not rustle when its pages were turned. It kept the
electricity bill low.
A
television set on display at the department store drew crowds who gazed
through the window to take in what they had never seen before. It was
showing Grizzly Adams, an American TV show, but government
censored the bear. Malaysians were spared the sex, guns, and violence
of banal American TV.
As
I walked around town, I looked for a garbage can so I could throw candy
wrappers away, but there was none. Political correctness called for it
to be thrown on the ground. It was swept up and raked into large piles
where monkeys played. These were set on fire every weekend eliminating
the need for waste disposal.
The
Malaysian “Superman”, a creation of their own film industry, must have
weighed 105 pounds but otherwise was just like America’s 1952 version.
When I rode the train to Butterworth and took the ferry to Penang Island
my 140 pound body barely fit in the frugal quarters.
In
the jungle, daytime temperatures reach 110 F with near 100% humidity.
Temperatures rarely go below 85 F. I waited in the steamy night at
eight pm to catch a taxi to Kuala Lumpur. The lights at the guard shack
attracted clouds of hungry jungle bugs that were periodically fended
off with cans of insect spray. As I waited there, I noticed that the
telephones were not politically correct. Their ring was constant,
annoying, lacking cadence, and persisted until the phone was answered.
There were thunder-storms every day. Unregulated taxi drivers picked up
soaked riders before servicing your call. The wait to catch a cab was
hours.
In the guard shack there was a painting of a snow-covered cabin in the
Alps. The workers knew what snow was, but did they really? In a world
where everyone drives on the “wrong” side of the road, did I really
understand what culture was?
Participating
A
power transistor that cost twenty dollars in 1965 now costs twenty
cents. It leads to slim profit margins and low cost electronics for
American consumers. Big companies need more profit than bank interest
to convince them to take a risk. Sunset products are preferred by some
users, but grow incompatible with new manufacturing technology. They
provide the stepping stone for countries to modernize and develop a
middle class that can afford to buy American products. A USA head count
reduction is part of the justification for relocation programs, but
when companies make more profit they can afford to invest in new jobs in
America.
Our
overseas plants were competing with one another, so they needed to be
productive. They had to become self-sufficient. That night the
production crew was holding its weekly unpaid overtime Participative
Management meetings. It would extend their working day to 10 pm.
There were millions of dollars in complicated computer controlled
systems that required workers to engage in dialog with the apparatus and
make quick decisions. Our broad customer base and small order size
meant that there would be a change in process every fifteen minutes.
How does one know things are working correctly? One machine can take
the place of twenty workers, but it can also make costly mistakes twenty
times as fast.
My
first thought was that unpaid overtime would not go over very well in
America; however this was compensated. Our company fed its employees,
provided transportation to and from Klang by bus, and set up the same
number of holidays as in America, but that had a complication. It was
necessary to make a place inside the plant to allow religious
celebration during normal working hours. It contained idols, burning
incense, and piles of broken coconuts that were used in religious
observances.
Government
conducted regular audits to guard against abuse. They had to do this,
because the newspaper published regular accounts of firefights with
Communists who wanted to upset the apple cart. I felt uneasy when we
were stopped by what looked like 12 year olds armed with 30 caliber
machine guns and hand grenades.
Our
media televised how we made things in foreign sweat shops. Our plant
in Petaling Jaya ran the air conditioning at 80 degrees. Americans
found it hotter than the production crew who had grown accustomed to the
year round heat. Almost sixty years ago I had a summer job in an
Arizona factory that lacked air conditioning. I turned boxes that came
lengthwise on a conveyor belt sideways so they would fit into a gluing
machine. We won’t make America great by bringing back jobs like that.
Some
things were sent overseas that weren’t perfect, but when your operation
on the opposite side of the earth supplies the entire world, you want
equipment that works. We had reconditioned everything. Our apparatus
was actually in worse condition when it was used in the states.
Malaysia
is a melting pot of nationalities and religions, like what America is
becoming. It seemed that the Chinese ran the country, but the
government discriminated against them. The newspaper said, “Wanted,
male Bumiputera between the ages of 21 and 30, must have a degree from
Oxford”. The dominant religion was Islam, but Hinduism, Buddhism,
Confucianism, Shinto, Taoism, Christianity, and strands of ancient
indigenous religion existed. The plant was once shut down when a worker
saw a ghost through a microscope. That problem was cured by an
exorcism.
Culture
shock occurs when the past meets the future. In Malaysia it was where
modern skyscrapers abut old architecture. It was fifty gallon barrels
of giant N-Nitride bi-directional, tri-state integrated circuits, but
the nearest 100 watt soldering iron had to be ordered from Singapore and
would take a month to arrive. In America, it is immigrants who have a
dream to share with us. It is discovering that we depend on the rest of
the world. We are only one of many players in the game. They will
become competitors as well as collaborators. It is not winning or
losing as Donald Trump seems to see it. There are benefits from the
game well played and rules that stimulate competition.
Economic Honesty
It
is failure to understand complexity that makes Republicans see
dishonesty. What are open borders? Are they travel, trade,
immigration, or all of these? How do we deal with agriculture versus
manufacturing, big business versus the working man, competing
communities, and personal reality instead of statistical abstraction?
Trade
includes intellectual property, the environment, and health. It can
bring war or peace. The 640 employee, 164 country World Trade
Organization (WTO) writes trade rules that must be consistently
applied. They require consensus and government approval. However, our
president can issue orders to protect an industry, our economy, or
national security.
Will
isolationist backlash increase American prosperity? When Donald
rambles that he would quit the WTO and impose a 35 percent tariff on
Carrier products built in Mexico, he would replace Adam Smith’s unseen
hand with his own. That isn’t free enterprise. It is a knee-jerk
response to opportunities stereotyped as threats. It appeals to
justifiably angry people who remember the good old days when they
purchased a new American car every year.
Trade
grows our economy. When the pie becomes bigger, it is not so important
to worry about the size of our piece, but if we are starving we might
need to grab a slice immediately. The Peterson Institute for
International Economics has warned that Trump’s promises would cause the
US economy to lose more than 4 million jobs and plunge the world into a
recession. The pro-labor Economic Policy Institute claims that Trump’s
proposed tariffs won’t help American workers or the economy. Trump’s
money will come from tax cuts for the wealthy and big business.
Republicans refer to the Laffer curve to argue this point, but it is not
in college economics books. That curve is like a hill where maximum
revenue occurs at the high point. At first, revenue increases with
taxes, but as you pass the peak of the hill, revenue declines with
further taxation. The problem with this model is that the hill has many
holes. There are income taxes, payroll taxes, sales taxes, property
taxes, capital gains, dividends, carried interest, estate taxes, and
corporate inversions. Donald Trump and his economic team of wealthy
financiers and billionaire friends don’t experience the same tax reality
as we do.
A Solution
Universities
and big business have adapted to globalization, but blue collar workers
lost their jobs because of outsourcing, automation, and union busting.
They have a stake in globalization. Trade deals that prioritize
creating over consuming, unions with apprenticeships, and
vocational-technical education with a path to a PHD, will create
American jobs. We should not give favors to companies who send jobs
overseas, ignoring the fate of communities and their workers.
n Friday, FBI Director James Comey sent a letter
to Republican members of Congress informing them that he had obtained
emails that may be relevant to the investigation into Democratic
presidential nominee Hillary Clinton’s use of a private email server.
The details were vague, and information is still slowly trickling out as
to what these emails might contain and whether they were even sent or received by Clinton herself.
t turns out pot is a stronger economic driver than 90 percent of the industries active in Colorado.
ith two weeks to go before Election Day and victory 
oughly
45,000 newly registered voters in Indiana — almost all of whom are
black — may not be allowed to vote next month after state police
targeted the state’s largest voter registration drive, forcing it to
shut down its operation.
