Group Actions
Engagement
  • Author Author: DaveYoung
  • Date Created: Date Created
  • Views 497 views
  • Likes 0 likes
  • Comments 2 comments
Related
Recommended

Entrepreneur Forum with Congressman Maurice Hinchey and Thoughts on Outsourcing

DaveYoung

imageI had the opportunity to meet with Congressman Hinchey (D-NY) last week at a Finger Lakes Entrepreneur Forum (FLEF).  A large portion of the conversation had to do with  a favorite topic of politicians: outsourcing.  He spoke of the challenges unemployment represents to families, the inherent problems with having a work force that doesn't include a significant manufacturing sector, and connected that to examples around upstate NY.  A pretty typical political opening on the topic,but thankfully this meeting was organized as a roundtable giving my fellow entrepreneurs (read: fellow loudmouths) an equal opportunity to talk.

 

One professional echoed the concerns of the congressman and further explained the logistical difficulty moving labor off-shore creates.  His example was that there used to be multiple sources for quick jobs or orders of 1,000 – 10,000 pieces per year.  A relationship would be developed and the flexibility start-ups need would be satisfied.  However now there is no flexibility, no relationship, and orders of 10,000 units per year is a drop in the bucket for most manufacturers.

 

He then brought up the very valid point that most of the companies involved with FLEF include a step somewhere in their business plan that states

 

"...Manufacturing will scale with significant cost savings thanks to volume and off-shore production/procurement..." 

 

The congressman didn't really have anything specific to say about this interesting situation.  Not wanting to let this one go I picked up where my colleague left off, asking:

 

“Recognizing the situation that was just described as a significant cause of outsourcing, if you had all of the power in the government yourself, what could be done to prevent the loss of American jobs?”

 

The response I got wasn't as specific as I had hoped, and he mentioned that difficult decisions have to be made by those that are deciding to engage in offshore work.  Since I wasn't exactly sure what he meant by that, I pressed the issue further.  I went on to offer an example from my own experience:

 

“I had to select a PCB from either China at $3 per board or the USA for $18 per board.  Clearly in that situation the answer isn't to simply spend the money on the local supplier and eat the $15 cost increase.  Is there another option other than making the clear financial savings represented by the Chinese supplier?“

 

Again I didn't get a solid answer from my question, but in his defense I don't think anyone could answer a question like that on the spot.  However it did open up a larger discussion about how important those outsourced jobs are, and if the American society can still thrive if we were to focus less on mass manufacturing.  We even went so far as to talk about the possibility of having the more skilled jobs such as R&D sent overseas.  The conversation was very interesting and even spilled out into the hall once our time had run out.

 

This made me want to open the questions I posed to the congressman for comments here.  I would be imageinterested if anyone has an answer to them:

  1. Recognizing the  growth plans of many small companies is a significant cause of outsourcing, if you had all of the power in the government yourself, what could be done to prevent the loss of American jobs?

  2. I had to select a PCB from either China at $3 per board or the USA for $18 per board.  Clearly in that situation the answer isn't to simply spend the money on the local supplier and eat the $15 cost increase.  Is there another option other than making the clear financial savings represented by the Chinese supplier?

  3. Are you concerned about the outsourcing of skilled labor like R&D, and if so, what specific measures would you like to see the government take to prevent the loss of skilled jobs?

 

What do you think?  Tell us in the comments section!  Who knows, maybe the politicians will read your comment and give you one of those red phones like NASA gets!

  • To me, the issue is not about outsourcing as much is it is about providing relevent education for people to find employment in challenging jobs.  Too many people want to be paid a lot of money for doing very little that is actually productive.  Education is more than learning to take tests, it is about becoming a functioning member of your society.

    If jobs are leaving your area you need to find out why.  Until you understand the problem, you cannot deal effectively with the issues relevent to the solution.  Political actions are almost always the wrong solution!

    If you cannot learn new skills, then you suffer from a disability.

    If you will not learn new skills, then you suffer from stupidity.

    If you only complain about the problem instead of finding a solution, then you have already determined your own fate.

    Jobs will always go to the places where the capability and cost of development result in the most cost effective product.

    Your personnal education is a lifelong pursuit.  College degrees are useless if they are not relevent to the needs of your society.  Just because someone has a Phd does not indicate that they are smart, usually it is just an issue of persistence and funding.

    We need to take the prosperity of the country out of the hands of the Politics and pursue a solution oriented approach.  We need to set goals for our children that challenge them, not coddles them.  If we tell them it is alright to fail before they learn that they don't know what they can do, then we handicap them for life.  That's OUR fault!

    You do not become a star athlete without talent, training and persistence.  The same approach applies to your personnal career.  Failure is not an option, you cannot quit and nobody should be there to pick you up if you fall!

    I was not the smartest kid in my school growing up, but I have done more and achieved more than any of the others because I refused to conceed that I could not do something I set out to do.  While "working harder" may not be popular, in many instances, it is indeed the correct answer, but you cannot infuse people with the desire to succeed if you set up your society to protect them if they fail.

    Darwin was correct, it is the fittest that survive.  When you support failure, you encourage failure.  All evidence so far verifies the fact that when a species stops growing, it dies off. Until everyone understands and accepts those harsh facts of life, we condem our future generations to obscurity.

     

    Sorry for the rant, but this topic really hit one of my raw nerves.  I am tired of the excuses, we know what we need to do, the issue is whether we still have the desire to do the right thing instead of the easy thing.  History will record our success or failure.

     

    Thanks

    DAB

  • I don't have an easy answer either.

    • Automation is cutting into just as many jobs, but it doesn't have a face is therefore less personal.  There is at least some small element to xenophobia in concerns about economic competition from foreign sources only.
    • The rest of the world realizes they must be competitive in engineering to be sucessful.  Some Americans think that being an industrial and innovative leader is birthright. 
    • The best way to prevent "loss of jobs" to other providers anywhere is to make yourself the best solution (in terms of consistency, quality, price, customer experience, etc) for your customers/employers. 

     

    I do not pretend that "just work harder" is the only answer.  It is the approach that's surest to work.  It's also the one politicians can't give.  

     

    In the post-WWII period US had an economy where the average person could earn more money than his parents.  In this generation only the innovative will earn more.  Others may earn less.  That's not a good thing, but there's no easy answer of how to recreate what IMHO was the post-WWII anomaly.  Thanks for raising the hard issues to your Congressman.