Bain Capital buys profitable American plant, ships it to China; soon-to-be-jobless workers train their overseas replacements

In the Guardian, Paul Harris reports from Freeport, IL, where a profitable, competitive auto-parts plant has been bought out by Bain Capital, who have literally shipped the factory to China, and who have extended the "kindness" to the American workers who will lose their jobs of a few extra weeks' worth of work training their Chinese replacements. Mitt Romney owns millions of dollars' worth of equity in the Bain fund that is shipping good jobs overseas, and stands to make a tidy profit from this.

"I understand business needs to make a profit. But this product has always made a ton of money. It's just that they think it is not enough money. They are greedy," said Tom Gaulraupp, who has put in 33 years at the plant and is facing the prospect of becoming jobless at the age of 54.

Mark Shreck, a 36-year-old father-of-three, confessed he was one of the few workers not surprised at the layoffs, as this is the second time his job has moved to China. "I feel this is what companies do nowadays," he said. Freeport mayor George Gaulrapp

The Freeport workers have appealed to Bain and Romney to save their plant. The local town council, several Illinois politicians and the state's Democratic governor have all rallied to their cause. "This company is competitive globally. They make a profit here. But Bain Capital decided to squeeze it a little further. That is not what capitalism is meant to be about," said Freeport mayor George Gaulrapp, 52, pictured.

The anger towards Bain and Romney is palpable. Romney has become the target for the emotions of a community who built lives based on the idea of a steady manufacturing job: a concept out of place in the sort of fluid buy-and-sell world from which Bain prospers. "I didn't have a clue what Bain was before this happened," said Cheryl Randecker, 52. "Now when I hear Romney speak it makes me sick to my stomach."

'I'm sick to my stomach': anger grows in Illinois at Bain's latest outsourcing plan


  1. “That is not what capitalism is meant to be about,”… Sorry, but this is EXACTLY what capitalism is meant to be about, making profit for the owners…

    1.  Capitalism is about making a few people, the capitalists, filthy rich. You don’t do that without making a lot of other people dirt poor. Poor people — however they’re made — are a feature of the system, not a bug.

        1. A temporary room for the night and shower for a homeless person in Portland, OR costs $18 per night. 

          The only thing that matters is purchasing power against the local cost of food, water and shelter.

          1. Instead of reports of per capita income, I’d like to see an indicator which tells us what the ratio is of income to average annual expenses.  That would give a better yardstick to judge wealth/poverty by.

        2. US economic policy is a huge driver of economies worldwide — free trade agreements etc. have a lot to do with how impoverished non-US countries are.  The US exports poverty.  Although lately we’ve started importing it too (see OP).

        3.  And what is your point? That if these homeless people could only travel abroad, they’d live like kings? Their “income,” as you seem to qualify it, is only relative to the cost of living in their immediate location. And in that sense, it’s paltry and typically not enough to LIVE off of, hence the whole homeless part.

        4. Depending on how you look at it a lot of homeless people (or more accurately panhandlers/beggars) make more in a day than a person working for minimum wage at 8 hours a day.  And as a bonus they rarely pay taxes.

          (As as a side note:)

          I lost my job to outsourcing to Mexico… More or less as these people did, it wasn’t because we didn’t turn a profit, it was because we didn’t turn ENOUGH of a profit. I feel their pain, I truly do. I’m early 30’s and no kids yet, so it’s not that financially hard on me, but I went more than a year looking for work. Lets just say I now understand the difference between not working, and not being able to find a good job. Needless to say I hauled my ass into a temp agency and found some work, something to help pay the bills. If someone can stand on the street corner for 10 hours a day they can do some light industrial…yes yes I know homeless, no car…(unfortunately where I live that is only true about 30% of the time for panhandlers.) So excuse me while I glare at my local beggar doing their own form of financial redistribution.

          1.  A lot of homeless have physical and mental problems. Hardly any place hires non-homeless people with mental problems, let alone a homeless person with those problems.  Standing on a street corner for 10 hours a day is about all they can do.

        5.  I can’t believe the first thread in reply to an article about a huge corporation destroying a company and f@#king up a lot of people’s lives turned into blaming homeless people…

      1. Maximizing profit to the extreme that is possible – even if it means putting people out of work HERE (for X dollars per hour) to put people to work THERE (for X-N dollars per hour).
        In other words, ‘just how tightly can we squeeze this rock to get every last little drop out?’

    2. Scuse me, are you suggesting that capitalism isn’t the most unselfish, patriotic G0d-fearin’ ‘Merican institution in the world, son? Why do you hate Baby Jesus? Those venerable job creators brought you into this employment and they can take you out of it!

      1. Taking us out of it is an empty threat. It seems to be in their interests to cause our numbers to increase. That’s why whenever I go by a Bain plant wearing these funny glasses I found I see “MARRY AND REPRODUCE” written on the walls.

    3. Eh, make enough people dirt poor and there’s no one to buy your stuff, or a Hugo Chavez comes along and expropriates everything. Not really an effective long-term game plan. Capitalism can be useful, but left to its own devices (ie – without a democracy keeping it in check), it definitely eats its own head.

          1. Boy, this place would really start to be pretty cool if that would happen.  I’m sure I’d have to do a lot more farming and stuff but at least I’d get outside a little more.

    4. Capitalism isn’t “about” anything.  Economic systems are not “about” anything.  They’re just systems that are as good or bad to rich and poor as the governments who regulate them.

    5. Came here because of the same quote. Thing is, I don’t even blame capitalism and the (supposedly free) market system. I blame people and politicians – mayors included – for confusing capitalism with a framework for society, a political system. It’s not. It will never produce anything but cheaper smartphones, pretty cars or Byzantine financial products. Because it can’t.

    6. You’re definitely right that capitalism is about this sort of thing, but very wrong about capitalism being just about profit for the owners.  The idea is that all boats rise.  Whether that is accurate or not is up for debate, but to say that capitalism is just about profit for owners, or that it makes a few people really rich and everybody else really poor, is too simplistic for a useful discussion. 

      Capitalism has created a strong middle class in this country and in Europe, mostly.  Obviously, capitalism has a dark side too.  It’s fine to state the bad, but ignoring the good leads to bad dialog.  If dialog is the goal.

      1.  Capitalism has never been favorable to the general working class! The whole point of capitalism is to produce and sell the most product at the highest possible price with the lowest possible cost of production, while concentrating the proceeds.  That’s what it is.

        Does that even remotely sound like it would be favorable to employees/workers? I hardly think so.

        The reason why there *WAS* such a strong middle class is that union membership became essentially standard for all manufacturing workers in the mid 20th century.

        Without unionization, workers can’t possibly avoid being exploited, since there are a lot of workers, and any one of them is essentially interchangeable with any of the hundreds of applicants vying for their job.

        I posit that collective bargaining and unionization is at the very least as significant as capitalism in the rise of the middle class.

      2. Capitalism has created a strong middle class in this country…

        And then destroyed it.

          1. Umm, I’m going to assume you mean the compulsive desire to acquire consumer goods.  Because I’m pretty sure the metaphysical premise didn’t destroy the middle class.

      3. The economy is global now, so the rising boats are spread all over the world, not just the US. A positive side effect of offshoring is that we are supporting the Chinese middle class, lifitng people out of poverty. You’d have to take a less nationalistic, more “citizen of the world” type view to say that it’s worth it for an American worker to be unemployed but a Chinese worker (or multiple workers for the same salary!) to have a job.

        1. Its a pity we couldn’t have done it without destroying our middle class and giving the bills to the poorest citizens to pay off as the owners relax on their estates.

      4. I don’t know how you managed to write “that it makes a few people really rich and everybody else really poor, is too simplistic” right after the propaganda of “all boats rise”. An editing error?

      5. Capitalism combined with a government that moderates and regulates it’s extremes is able to create a strong middle class. Unregulated capitalism run by Ayn Rand types only create an oligarchy.

    7. I disagree. This may be about semantics to some extent, but I’m a European, a socialist (or social democrat, depending on how you shuffles your labels…) and I don’t think that’s what capitalism is necessarily about at all.
      Sure, early 21st century North-American Chicago-school disaster capitalism is.
      But capitalism as a model is any system that allows people to accumulate capital, and then use the capital to return rents without having to work (swap time) for their income. Inherently, this is a good thing – it allows some people to get leisure, it creates inventives for unpleasant tasks to be automated away from human drudgery, and it allows people who have an idea to borrow the money (in return for rent in the form of interest) from those who have accumulated capital, in order to get their idea off the ground.
      Corporations are likewise a good idea – they spread risk, and allow for co-operaion in ways previous structures did not.
      It’s a big but – look at how nervous 18th century lawmakers were of the new corporate beasts – they hedged them with all sorts of protections and restrictions, as if terrified of letting the genie out of the bottle (for example, they restricted them to operate for only X years, or only in geographical area X, or only in a particular business etc etc). And that’s where we have gone wrong – corporations, and mechanisms for accumulation and concentration of capital are useful tools, but they are dangerous tools (like, say, a buzz saw, or an inoculation of live virus) and they must be vigorously and carefully regulated if they are to be our servants not our masters. Regulated, that is, by big government. Which is why North Americans would call my worldview “socialism”, whereas in Europe I’m a mainstream centre-left social democrat.

      1. …this is a good thing – it allows some people to get leisure, it creates inventives for unpleasant tasks to be automated away from human drudgery…

        I wouldn’t call those good things. Humans have pretty thoroughly demonstrated that insufficient work and excess leisure are physically and psychologically destructive.

        1.  This has got to be the first time I have really, really, really strongly, perhaps even violently, disagreed with something you’ve said.
          Jay’s comment was basically spot-on, beginning to end.

        2. I totally disagree. Leisure is what lets people explore new things. For example, many projects and companies are started by college students because they have time not spent working for someone else. Leisure isn’t sitting around twiddling your thumbs.

          And don’t get me started on automation. It’s what lets one person do the work of more than one person. How could that possibly be bad in and of itself?

          1. Leisure is what lets people explore new things.

            And the overwhelming majority of human pursue the Kardashians and Doritos.

            And don’t get me started on automation. It’s what lets one person do the work of more than one person. How could that possibly be bad in and of itself?

            Besides the fact that it puts three people out of work and out of money?

          2. “And the overwhelming majority of human[s engaging in leisurely activity] pursue the Kardashians and Doritos.”


          3. @Antonious:disqus  :

            We are very far from the “society of leisure” that was confidently predicted in the 1970s. Contrary to the hopes raised at that time, technology has not liberated us from work. As Federico Campagna writes in his article “Radical Atheism”, published on the Through Europe website. “In the current age of machines … humans finally have the possibility of devolving most productive processes to technological apparatus, while retaining all outcomes for themselves. In other words, the (first) world currently hosts all the necessary pre-conditions for the realization of the old autonomist slogan ‘zero work / full income/ all production / to automation’. Despite all this, 21st century Western societies are still torn by the dusty, capitalist dichotomy which opposes a tragically overworked section of population against an equally tragically unemployed one.”

        3. Only if you take a narrow view of leisure as idle time, which is not, I think, the type of leisure referred to here. 

          If you consider leisure as time left after fulfilling basic human needs then you would realize that leisure is essentially required for education and scientific inquiry.

          Division of labor and leisure were required for the scientific revolution.

          1. leisure is essentially required for education and scientific inquiry.

            Education and scientific inquiry are not leisure. I certainly wouldn’t describe any of my schooling as leisure.

          2. It’s just semantics. I think the word leisure has different connotations depending on the context. In common parlance it connotes idle time or time for recreation or pleasure. I would definitely agree that in today’s world, education is not something you do for recreation and pleasure.

            However, in discussion of social and economic history it can also refer to the idea that constructs like money, division of labor, automation, etc. allow individuals beyond just the landed classes or aristocracy to accumulate enough wealth to do something other than subsistence labor. Ergo, “leisure” to pursue education, scientific inquiry, etc.

          3. @Antonious:disqus : The pointy bits of my knowledge, like my degree, are indeed not the result of leisurely activity. Much of the surrounding background knowledge is, though: I’d be a much poorer data mangler than I am today if I didn’t read about and play with a lot of it in my spare time – for fun.

            Historically, there is a fair bit of scientific study that seems to fall into “rich people play with things they find interesting” – if that’s work or leisure is probably debatable. :)

        4. Er… yeah, I’m gonna go with Bertrand Russell over you on that one.

          That’s a nice “stop liking what I don’t like” attitude you’ve got going, below. “People shouldn’t do these things I deem pointless, they’d be better off in the work-house instead!” … really?

          And a nice puritanical “work is virtuous!” attitude, too. You know, if we brought a peasant from the middle-ages to the present day, and told him “there’s no longer enough work for everyone to be busy all the time!”, he’d probably reply “great! so everyone spends half their lives out on the common, with their families and a jug of ale, right?” — the bizarre notion that full employment is a good thing is an invention of the industrial revolution, useful in its time, but now obsolete.

          1. Almost everyone in the US spends almost every bit of their leisure time watching television and sucking down HFCS. They’re physically unhealthy, anxious and depressed.

        5. Oh, I wonder how all those hunter-gatherer-cultures with 14-hour work-week coped.

          Bunch of physically and psychologically devastated scoundrel, for sure. 

          No, it’s only devastating because modern society agreed to determine worth only by paid work and material possessions. 

          1. Oh, I wonder how all those hunter-gatherer-cultures with 14-hour work-week coped. Bunch of physically and psychologically devastated scoundrel, for sure.

            A) Their ‘work’ consisted of laborious physical exercise, not sitting in a cubicle. B) They died at 35.

            Once upon a time, when you were finished ‘work’, you repaired your house, worked your subsistence garden, made your own clothing, etc. Now, you sit in front of the television and eat carbohydrates.

          2. @antinous your information is incorrect. Go look it up. Also, your argument is tautological. It’s society that’s teaching people sit on their asses and watch TV, it’s not something inherent to humans.

            In your world, people have to be manages to walked like dogs for their own good.

            Frankly, your world disgusts me.

      2. But capitalism as a model is any system that allows people to accumulate capital, and then use the capital to return rents without having to work (swap time) for their income. Inherently, this is a good thing

        Disagree.  Rent seeking is exactly the problem.  People should get paid for doing useful stuff, not for sitting on gigantic piles of money.  If we had fewer rentiers there would be more people working and thus less work to do.  I’m confused how you haven’t noticed that gigantic piles of money attract more money in a capitalist economy.  It’s not a stable system.

        Corporations are likewise a good idea – they spread risk, and allow for co-operaion in ways previous structures did not.

        The Egyptians built the frickin’ pyramids using sticks and rope as tools and you’re claiming that corporations allow for previously unseen forms of cooperation?  Manhattan Project and Apollo program were not private ventures.  Government still tops out the list for encouraging new forms of cooperation.  Also, regarding risk spreading, I think you’re missing something there…something about the year 2008…  Besides spreading risk, corporations also “spread” moral accountability which creates all sorts of problems.  That’s what gets you Pinkertons pulling guns on striking workers in the 30’s and it’s what gets you heap-leach gold mining today.

        It’s a big but – look at how nervous 18th century lawmakers were of the new corporate beasts – they hedged them with all sorts of protections and restrictions, as if terrified of letting the genie out of the bottle

        I’m not sure this is really historically accurate.  British East India company had an army and served as the de facto government of India and that’s pretty much the first corporation ever.

  2. Bain are doing their jobs as job creators. For the Chinese, yes, but let’s not forget the important thing here. Or get distracted by the lost jobs, which are clearly a result of Obama’s policies.

    1. Oh, yes, clearly. Obama’s policies allow greedheads like Bain ship our jobs to China. Think, man.

      1. I love it. Obama points to Bain shipping out American jobs to move their stock up a couple of cents and Romney points right back stating that Obama let him do it.

        1. Father: “Son, did you steal my weed?” Son: “Yeah, dad but it never would have happened if you didn’t leave it laying out.”

  3. Isn’t this the cost of our current economic system? (capitalism?) How else are they going to increase their profits to please their stockholders?

  4. Wait, is Bain going to make a “Tidy profit” – meaning that maybe the plant isn’t so competitive – from this or is this move only going to “Squeeze a litte” more profit out of this factory?  It can’t be both.  

    I understand the animosity towards organizations like Bain, but at some point we have to understand that China is very good at building things efficiently.  If we don’t want to lose jobs then we have to do things better/cheaper than China or do different things (Services).  

    I’m not sure that being a father of three qualifies someone as an expert on how to efficiently operate a business.  That’s more of a personal issue with the style of writing that includes irrelevant emotionally charged details …

    1. “…but at some point we have to understand that China is very good at building things efficiently.” 

      Yes, things move along quite nicely without those pesky labor and environmental laws, unions, and human rights.

      1.  Exactly!  the problem is not capitalism, per se.  It’s that politicians and regulators and diplomats in the US don’t have the stomach to try to hold other countries to better labor standards.  And why not?  Because our consumers have come to expect that they should be able to buy  everything cheaper and cheaper and cheaper.

        1.  They could also punish companies that ship jobs overseas, instead of giving them tax breaks for doing so, after the tax breaks they give them to start up their business here in the first place.

          Instead of ‘supply and demand’ only applying to products – government can make it work for jobs as well. If a company isn’t willing to supply jobs in the U.S., then they should be gotten rid of to make way for a company that will.

          1. Stop talking sense! There’s a whole world view trying to hold itself together over here and Romney’s only got so much masking tape!

        2. Wonder what an iPad would cost if it were manufactured and assembled here. I’m sure someone has a guess.

          1. Apple says that it would cost $40 more to make an iPhone in the US. They claim the problem with building them in the US isn’t labor or environmental costs, it’s access to the rest of the manufacturing ecosystem in China. 

          2. @boingboing-dd4f47919d6a0fa34d4f059f618c44e7:disqus Of course, as is true of the transplant auto manufacturers, the supply chain would follow the assembly plant. Build an iPod facility in Alabama and watch the component manufacturers build all around it . . .

          3. According to Business Insider (forgive me if it’s an illegitimate source), the Bill of Materials for an iPad2 is $325.60

            The Median Hourly Rate for assembly line workers in the U.S. is $12.68 (from

            According to Phone Arena it takes 5 days to assemble an iPad.

            Assuming the assembly process for an iPad is compact (no downtime) and the “official” Chinese workday is 12 hours with two 1 hour breaks, we can calculate the cost in terms of American manufacturing

            ( 10 Hours x 5 days x $12.68 an hour ) + $325.60 in parts = (10 x 5 x 12.68) + 325.60 = $959.60

            This is almost certainly inaccurate, since a single iPad most likely takes much shorter than 50 straight hours of assembly.

          4. Chesterfield: That’s it? Even with extra distribution costs? Have no reason to doubt u. Anyway, saving money is as American as Apple pie: “About $90 million in tax abatements over the next decade have appeared to entice Apple to build their next datacenter in Sparks, NV, along with a business office and shipping center in Reno.” More lost revenue for Cali.


            It is hard to estimate how much more it would cost to build iPhones in the United States. However, various academics and manufacturing analysts estimate that because labor is such a small part of technology manufacturing, paying American wages would add up to $65 to each iPhone’s expense. Since Apple’s profits are often hundreds of dollars per phone, building domestically, in theory, would still give the company a healthy reward.

            But such calculations are, in many respects, meaningless because building the iPhone in the United States would demand much more than hiring Americans — it would require transforming the national and global economies. Apple executives believe there simply aren’t enough American workers with the skills the company needs or factories with sufficient speed and flexibility. Other companies that work with Apple, like Corning, also say they must go abroad.

    2. There are emotionally charged details because there are real people being hurt here. This isn’t just figures on a spreadsheet – it’s another rung down the ladder toward reducing America to the status of a third-world nation.

      Yes, we could make things cheaper. How? Eliminate the minimum wage and use prison slave labor. Is that the kind of country we want?

      Bottom line…if your primary love is growth and profit, your country and community will come a very poor second.

      1. It’s worse than that – the reason we have such a ridiculously high prison population is because they’ve bypassed the “making products cheaper” and gone straight to a service industry with the prison industrial complex. Your incarceration IS their product. The next step isn’t prison labor, it’s gladatorial games.

    3. The key thing in this example is that it is not a matter of  “the Chinese building things more efficiently”.

      They are dismantling the same exact operation and processes, the same system,  then populating it with people who are able to work much more cheaply.

      You would think Congress would do something about this sort of thing… D’oh! Sorry, forgot who’s running Congress.

    4. It’s not a matter of China being more competitive. It’s that globalization globalizes capital without globalizing labor, giving capital the option to take its ball and go whereever it can take advantage of the most exploitative conditions.

      1. Sheesh. I wish “capital” were that thoughtful. In all likelihood the plant won’t survive long in China either. It will turn out that unforeseen (by Bain) labor conditions will cause longer lead times and higher landed costs than they had in the U.S. Just a guess, but this isn’t my first rodeo with global sourcing.

      2.  If only it was possible for the labour to be as mobile as the capital. Unfortunately, nationalism decrees that labour must stay in the nation where it’s born, unless the labour can meet steep entry requirements.

    5. “China is very good at building things efficiently.”
      They have a huge workforce, their pay scales don’t even come close to what we have in the west, they avoid paying royalties by ‘ripping off’ designs, labor and environmental concerns don’t bother them, and their quality control has a long way to go. (I spent quite a bit of time there in China as a US-based manufacturing rep).
      It drops the per-unit price down to the point where even the long-range shipping costs (conex boxes on a ship across the pacific) don’t raise the total costs above a fat profit margin.
      RIGHT THERE are the reasons so many factories have out-sourced overseas.

    6.  Actually, the competitiveness has nothing to do with the profit you can make from the company. It’s the genius of private equity, LBOs, and debt financing.

       – Take one company that’s making money, fully funded it’s pension plan or whatever, and has no debt. That company’s stock is flat as a pancake. It’s a loser. It’s not expected to grow much more, so there’s no interest for speculators. As far as the market is concerned, that company is the boring kid in the corner that no wants to talk to.

       – Enter a PE shop. They gather some investors and borrow… oh say, 100+ million dollars to purchase the company and take it private. As collateral for the loan they put up the entire stock of the target company. They also agree to insane rates from the bank.

      – Once they’ve purchased the company, it’s time to juice that sucker up. They immediately borrow as much money as possible against the assets of the company. Part of that is paid out in dividends to the PE shop, part of that can be put into the company to MAKE IT GROW. Think of it as shoving steroids and growth hormone into a feedlot steer, that bovine is either going to keel over dead or get way big and tasty.

       – Next, borrow more money. Keep on borrowing. (Debt financing is great because of the tax advantages.) Pay more dividends to the PE shop, pay more management fees, and try to expand the company as much as possible.

       – An expanding company looks great to the market. “These guys are going places,” folks think. Stock prices soar. More happy faces for the PE firm and their investors.

       – Now, PE firm dumps the company. Either takes it public, or sells it to another entity. More profit. Or the company collapses (either before or after the sale). All that debt and growth is risky, you know…

       – You don’t need many successes for this to be a profitable enterprise. Consider that the PE firm didn’t put up that much money originally, they borrowed most of it, and they borrowed it against the target. When it all goes bust they walk away without hardly a scratch.

       – Sure, some factories may have gotten closed, or jobs lost, or moved or whatever. Who cares if a pension plan was looted or underfunded or whatever? That’s moocher talk, my man. Sure, PE firms sometimes destroy jobs. They also sometimes create them (although that’s less common given the successful company vs. imploded bankruptcy ratio). But at the end of the day, that’s not the point. The point is to make money for the PE firm. Anything else is just noise.

    7. If it is any consolation, China is on a path to disaster, although nobody in Wall Street or Washington has seen it yet.  The one child policy has created such a demographic bomb that it’s hard to see how they’re going to get around it short of mass suicides.  In the short term they are unstoppable, but all of those chickens are going to come home to roost eventually.  The utterly exploitative labor conditions mean that there won’t be any safety buffers for the people either.

      1.  Well, there’s another part to the outsourcing equation that U.S. companies often don’t see. Once you move your expertise there, they wind up becoming the only ones WITH that expertise. When you have a company like Foxconn making all your electronics, they can make those same electronics with their expertise for anyone they want, and now you have to compete with a country that has no qualms about copying anything it wants to. You’re also at their mercy for the stuff you formerly made in your own country.

        1. Hmm. It never occurred to me before that CJ Cherryh’s Foreigner series was a metaphor for the US and China.

    8. Actually, China isn’t as good at building things cheaply as they used to be. Companies are going so far into the interior to get cheap labor that their lead time are through the roof. So, they look to Vietnam, Mexico, or the American South as low-lead time, cheap labor markets. Frankly, I suspect that Bain is making a mistake here unless they plan to produce for the China market.

      Of course, as the Chinese market has been slowing down there is a massive glut of steel there, so that input is dirt cheap at the moment . . . 

    9. There is a difference between Price and Cost. 

      You know the price of goods made in China, fine, but do you have any idea the scope of the cost?
      Since they have NO obligation to the human rights of their slave-force and their crumbling environment, naturally! And that says nothing of the terrible quality of Chinese goods, cutting corners on safety, durability, and everything else.

    10. Wait, is Bain going to make a “Tidy profit” – meaning that maybe the plant isn’t so competitive – from this or is this move only going to “Squeeze a litte” more profit out of this factory?  It can’t be both.

      No, you’re wrong, it certainly can be both.

      I think you’re confusing Bain’s “tidy profit” with the profit the company may or may not already make. The two are not the same.

      The company already makes a profit. This is stated in the article, so let’s choose to assume it for the moment (and show that everything else still logically follows). When Bain bought the company, they bought it for a price that already takes into account the existing profit. So if they were to just hold on to it for a few years and sell it again, they probably wouldn’t make any money out of the deal, even though the company itself is profitable.

      But if they can figure out a way for the company to be more profitable, e.g. by shipping it to China, then the company itself will be worth more and Bain will have made itself a tidy profit on the difference between what they bought the company for and the company’s new worth.

  5. Showing my age here, but … whatever happened to companies where the management did stuff like, oh, make long-term investments in the company? Like keeping the workforce healthy and happy? Trained and educated? It used to be that very successful companies did more than pay lip service to the idea that their employees were their most valuable resource.

    Reading articles like this is beyond depressing, it’s maddening. Seeing perfectly good companies gutted, jobs sent overseas that are already profitable here in the U.S. … And knowing that the candidate who embraces this crap while mouthing platitudes about “Job Creation” has a good chance of becoming President???

    1.  Those managers were bought out several years ago when they got a little long in the tooth and stood in the way of extra profits.  Seriously, the management structure you’re thinking of is based upon owner-managers who actually start companies and know their workers and are concerned about the long-term vitality of their company.

      I hate to say it, but the hooker-with-the-heart-of-gold Pretty Woman pointed this out a number of years ago quite succinctly.

    2. Those managers didn’t show Wall Street or the Board the short term profits they needed to get their annual bonuses and were pushed out for the “hard nosed manager that is willing to make the tough decisions”.

      Wall Street can’t look beyond the next quarter.  Washington can’t look beyond the next election cycle.  That’s why there is such pressure from both for short term results and screw long term thinking.  Washington used to be able to handle long term planning, but the people who were able to do that have been pushed out by demagogues who play better in the 24 hour news cycle and have an easier time finding corporate backing (often being just puppets for said corporations in the first place) for their election campaigns. 

      It has been depressing to see so many smart moderates lose their primary battles against corporate funded yes men who are willing to just tow the party line. 

      1. If Wall Street REALLY couldn’t look beyond the next quarter, then wouldn’t every single company be liquidating everything and firing everyone in the name of maximizing profits next quarter? Sure, there won’t even be a company left for the quarter after that, but next quarter sure would be profitable.

        1. Well, I have worked for IT companies like that: every time they didn’t make the year’s predicted earnings per share, stock price dropped and they had to show they were ‘doing something’.

          Something meant cutting costs, so another round of workers laid off. Rinse and repeat: company now a shadow of what it once was – but a corporation is very hard to kill and bits of it still have a horrible unlife.

    3. I have a rule of thumb which is that when a company gets so large that it needs managers to manage the managers, it’s too big.  At that point it risks losing sight of the very things you point out – a concern for the company itself, not just the bottom line.  
      And the other half of the equation is a world where staying with the same company for more than a few years is seen as career suicide – hence no long-term view of anything.  Combined with a political system than sees no further than the next election and we’re pretty much screwed.

  6. One of comments to the article struck me as odd.   Something about Bain and political contributions.  So I decided to search around a bit to see what the heck the guy was talking about.

    Turns out there is a grain of truth:  Bain affiliated contributions have gone mostly to Democrats.  PACs might be another story.

    That might explain some of the mixed reaction amongst Democrats to talking about Bain.

    Can someone with a better tuned BS meter give some insight?  Most of the postings were from sites I’ve never heard of and seem rather partisan.  But this one at least points back to raw data:

    Sorry, for the side trip.  Just having a WTF moment.

    1. It’s called hedging your bets and playing to the winning side. Baine doesn’t NEED to give as much to Republicans. If they win, Bain wins. It’s just making sure that it win’s if the Democrats win too, because many of them will owe it favours.

      Or at least that’s my guess.

  7. Would this be a story if a New York plant was moved to California? We already view America as “one economy”, it is time to start viewing the world as “one economy.

    This is sad for the American workers and good for the Chinese ones. It is also good news for the customers who will get cheaper goods. What we need here is more government sponsored training programs to help the American workers transition to new jobs.In the long run we benefit from free trade with China as our companies can employ more people because we can sell to China and there will be more and more Americans employed by Chinese companies or companies funded by Chinese investments. The cost of goods will continue to decrease so that lower-income Americans will enjoy a higher quality-of-living.

      1. The US sells billions of dollars of goods to China every year: Power generation equipment, cars, aircrafts, plastics, chemicals….

      2. Haven’t you been paying attention…
        “”We’re going to aggressively protect our intellectual property,” Obama said. “Our single greatest asset is the innovation and the ingenuity and creativity of the American people…It is essential to our prosperity and it will only become more so in this century. But it’s only a competitive advantage if our companies know that someone else can’t just steal that idea and duplicate it with cheaper inputs and labor.””

        This is why we spend millions and make secret treaties to protect the ideas, not the making of things here.  We can all just think up the next pet rock and be rich!

    1. Romney, however, is running for President of the United States of America, and so in that context, borders matter.   Please keep trickling… we’re not quite feeling it down here.

    2.  This only makes sense if  that mythical ‘one world’ you spoke of protected their workers to the same extent as ours are protected so that there is a level playing field.   Until then, well, we’re playing a suckers game, and it looks like you’re one of the ones (probably intentionally) confusing things for people.   Stop playing the game for the wrong side dude.

    3.  “cheaper goods”.  yes.  that’s the most important thing.  nothing like consumer goods that last maybe a few weeks and then go to landfill.  nothing screams “quality of life” like disposable everything.

      i’m not against free trade per se but the idea the whole “cheaper is better” thing drives me crazy.  i would argue that our cultural belief that cheaper is better is  a major driver of the race to the bottom.

      1. I wouldn’t call a Lenovo laptop or an iPhone disposable. They quality of Chinese manufactured merchandise is improving.

        1. Agreed.  It’s not 100% garbage.  But there’s a lot of it.   I was specifically arguing with this line:

          The cost of goods will continue to decrease so that lower-income Americans will enjoy a higher quality-of-living.

          I don’t know if an iPad is the top priority for lower-income Americans.  And, just in general, I think our consumers’ expectation is being set by marketing like “guaranteed lowest price!”.   Finally,  how much of a human’s quality of life is determined by the price of goods anyway?  Quality of life is probably more strongly influenced by things like the quality of healthcare and the quality of education and the quality of your relationships with other people.  Cheap imports don’t really help there.

    4.  Cool! When everyone’s good jobs (and yours) go to China, they can take comfort in the fact that next year’s iPhone will be cheaper, adjusting for inflation. How you pay rent, doctor’s bills and mobile internet on a part-time minimum wage job will depend entirely on your creativity and stick-to-it-iveness! Shame you won’t have anything left over to spend in the local economy.

      You clearly haven’t thought this through.

      1. Everyone’s job cannot go to China. If all US jobs vanished, the US would make nothing to sell overseas, and be able to buy nothing from overseas. Everything made abroad would literally be too expensive. What would happen next? People in the US would start working to make things and provide services that cannot be imported because imports are too expensive. Hey, where did all that employment come from!
        There is not a fixed amount of employment to go round. Everything that used to be done in the US that is now done abroad has to be paid for. Ultimately, it has to be paid for by something done or created in the US that is effectively swapped for it.

        1.  But who’re they going to work for? The companies who moved all the jobs to China? No jobs for anyone here there. Themselves? Yeah, but that means starting up their own business. Who’s going to loan them money to get started? The banks won’t loan anything as it is.

        2.  Tell that to Somalia. Yes, it CAN all just go away, and probably a lot quicker than any of us realize.

          We’re coming to a point where the only jobs left will be service jobs. Cashiers, servers, and other necessary ones like doctors. But when people can’t afford healthcare (or to get training as a doctor), that just intensifies the downward spiral.

    5. That seems like it is true on a macro scale, but it is not. Here’s why:

      When people lose their jobs, they are not only ‘low income’ because they are on unemployement, they are “under income”, because they had previously been paying bills at a higher level.  So what do they do?  They look for a job, and maybe they sell their possessions, most likely at a loss. Meanwhile, what happens to the people who had benefitted from their previous spending rate? Well, maybe some of them get laid off, and end up in the same boat.

      You should see that there is a “tipping point” where the number of people who are either working poor and unemployed rises to a point that throws an emergency brake on the economy, because they no longer can support a demand for goods, lower cost or otherwise.

      If they are even a little smart, they recognize that the TV set , the clothes, the shoes, the furniture and the car that they’ve had for 5-10 years will do.

    6. “In the long run we benefit from free trade with China as our companies can employ more people because we can sell to China….”
      ONLY WHEN our trade is balanced with them – where we can sell them as much stuff as we buy from them. Currently, it is waaaay imbalanced, we buy lots more from them than they do from us: 
      “US merchandise trade deficit with China was $307 billion over the 12 months ending in June 2012” – source:



      1. $307 BILLION DOLLARS.

        Is less than the net worth of the 7 richest men in the world. Perspective.

    7. When the jobs go to China, the products get cheaper not only because the cost of living is lower, but because they have poorer labor and safety standards that allow more productivity to be extracted from each worker at the cost of their health, safety and well-being. Whether they do this voluntarily is irrelevant. In the extreme, a person dying of starvation will voluntarily do horrible things for you if you can provide a meal, that doesn’t mean I will stand idly by and allow you create that bargain. 

      No, I will stop you.

      Instead of exporting a high quality of life, which is within our power (by holding imports to equivalent labor and safety standards), we’re exporting our labor abuses. Exporting production to countries that treat workers in a manner that is illegal here is morally wrong and should penalized using whatever democratic leverage we still hold.

      Sovereign countries have the right to employ whatever standards they wish, likewise we have a moral responsibility to demand acceptable labor and safety practices as a condition of allowing goods into the country, or dollars to flow out.

      You think Chinese manufacturers would forgo the entire US market because we demand daily and weekly work limits? Or sick days? Or maternity leave? Or safety standards? Nope, they’d employ the necessary standards required to keep those contracts as fast as they change production lines for new iPhone parts, which is to say, faster than any industrial complex has ever done anything in the history of mankind.

      There’s an incredible potency in the Chinese manufacturing complex and Americans are wielding that power. The question is what kind of minimum standards we will set for each other’s behavior and whether or not we have the courage to enforce them.

      1. I agree. Labour standards must be roughly equivalent between the US and the countries we trade with. They are not now, but from what I’ve read conditions in China are improving, though they are not nearly where they should be. However, there will still be offshoring even if China’s conditions improve due to the lower cost of living and labor supply which means a lower cost of labor, unbalanced labor conditions is just one factor.

        1. I think you underestimate the effect of rich nations demanding an equivalent level of treatment for workers. 

          Could you imagine the thunderclap that would ripple through the world economy if the US and EU decided to stop importing goods made in harsh conditions? We would be living in a different world with an entirely different economy. Entire industries would dry up and disappear. The other cost bases that you allude to when you say “just one factor” would all be radically different, often in complex and unexpected ways.I’m not savvy enough to speculate in complete detail, but I think that if you sit down and start unraveling the consequences, you’ll find that implementing such a move would necessitate a fundamental reorganization of power and capital flow.  

          1. Indeed. The collapse of export-oriented third world manufacturing industries (and the resulting unemployment, poverty and political turmoil)  would necessitate a fundamental reorganization of power and capital flow.   

            In principle, I’d like to see common labour and environmental standards across the globe… but I acknowledge that many countries would be left with no way of enticing manufacturing in such a world, and those societies would be condemned to destitution for the foreseeable future. I don’t know how to square this circle, and from what I can tell, no one else does either.

          2. To humanresource: In the medium term the countries that would have a hard time enticing manufacturing are the ones with a high cost of living/energy. 

            Labor standards certainly don’t require much material investment, rather investment in governance. Environmental standards are irrelevant because a carbon scrubber (or any other material good required to profitably abide by environmental standards) can be shipped to a factory where labor and energy is inexpensive. 

            This wouldn’t be a situation in which countries compete to provide the highest labor and environmental standards (a market) but rather the circumstance of a minimum set of standards (a legal framework).

            In the short-term I think you give less rich nations too little credit. Look at textile manufacturing, if unified standards were adopted there are south east asian countries with solid textile manufacturing bases and better labor condition than china (the primary player in the market). This would probably mean a boom rather than a collapse in these areas.

            In any case, human rights cannot be delayed because of economic effects, it makes sense to phase in major changes of course, but we have a responsibility to say no to products that were manufactured in harsh conditions and it’s unbelievably patronizing to say that all the humans in the world who are less rich than us couldn’t handle the shock of a change in the market that favors healthy working conditions.

            Ending slavery came with an economic penalty, but I doubt you would argue that the pain of the economic transition should have prevented or even delayed its abolition.

    8.  No, we don’t benefit in the long run.

      Money earned by workers: China
      Money earned by corporate owners: untaxed offshore bank accounts
      Worker Expertise: China

      This not only offshores the labor, it offshores our money, which is sucked out of our economy. The only way to get more back into the system at that point is to print more, which leads to inflation, which hits our newly-unemployed workers even harder. There IS no long-term upside to this for the U.S. – unless you’re the wealthy owners.

    9. If that’s the case, shouldn’t that q.o.l. have gone up by now, instead of declining for everybody  but the wealthy? Also, the trade deficit just keeps growing and growing.

  8. it sucks to lose your job. I’m only employed part-time myself, but this is still the best system we have. if you are american, you’re still richer than almost everyone that has ever lived on this planet.

    1. This is also true of Sweden, Germany, Denmark and others. It’s possible to be rich without hollowing out your working class.

      1. Until the giant debt incurred because of the benevolent government programs built on the backs of taxpayers bankrupt the entire nation like oh, let’s see… Greece, Spain, Italy, and Ireland are about to experience.

        1. It’s like you missed my point, and then turned it up to eleven, to meet the demands of your own already decided political viewpoint involving government debt, which nobody else mentioned and isn’t relevant. Come back with your pre-formed opinion when the countries I mentioned are included on your list.

        2. Nice try, but Greece’s economy was growing before the 2008 recession.  Greece was just the weakest link in the chain when the crisis struck; the other countries you list have simply been the next ones up the line to go.  Talk about the 2008 economic crisis first (housing bubble, deregulation, overleveraged financial firms); *then* we’ll decide if government programs in Greece (or anywhere else) are relevant.

        3. The financial crisis in Greece is related to poor tax collection practices. When the U.S is giving out 77 grand deductions for Horse Prom and car elevators can we be far behind?

    2. Richer in plastic crap and electronic gadgets you mean.  In terms of shelter we seem to be doing OK except for the massive homelessness problems, made quite ironic by the fact that vacant houses outnumber homeless people in this country.  In terms of food we’re doing pretty badly; we make processed foods that are demonstrably bad for our bodies using technologies that deplete soil and massively pollute watersheds.  And in terms of general emotional well-being, try comparing mental health statistics between the developed and developing world.  You might be surprised.

    3. It’s the best system “we Americans” have, but it’s far from the best system – which you’d know if you looked around a bit at other countries.

    4. Uh no, pretty much every measure has shown that wealth has been on a steady decline for all but our richest.  You are much better off to be born in any number of other (more progressive) Western countries. 

  9. This is how Mitt is going to make jobs.  By taking away the benefits American workers enjoy he can force them to work for serf wages, just like their Chinese competitors.  This will lower costs for companies and allow them to keep jobs in the country.  As an added bonus, the people who own those factories will make money hand over fist and won’t have to worry about being taxed on it.  Then they give the money to Mitt for his re-election campaign and the circle is complete.

    You can’t compete with Chinese workers using people who have medical/dental benefits, retirement accounts, and living wages.  Not among people who count success by profit margin alone at least.  Sure it is self destructive in the long term, but since when has Washington or Wall Street cared about the long term? 

  10. Just think of all the things we would not have if the firehose of stuff from China was suddenly shut off. Then do a little thinking and preparing for that eventuality.

      1. Who knows these days, specialy such a greedy company like Apple, Vietnam is even cheaper than China, and maybe to avoid more negativ PR and make even more profit.

        1. Actually, Foxconn, which makes most of the Apple stuff already has set up a facility in Vietnam, where the minimum wage is about a third what it is in southern China.

          Laos and Cambodia better start training assembly workers for when Vietnam gets too expensive. 

          1. LOL, I was thinking more about all the crap silverware, underwear, dishes, appliances, body care products, little metal parts, tools, etc.  All the singing dancing crap of life, that stuff.

          2. @awjt:disqus Vietnam stands ready to make all of it. And if they don’t, someone poorer than they are does. China just better hope they got to a high enough level of internal markets that the race to the bottom doesn’t start undoing the development they’ve had to this point. Bullet trains are fine and dandy, but they have some real constituents now . . .

          3. What happens when we face Peak Cheap Labor? Companies start viciously competing over what little pockets of yet-unexploited workers are left?

          4. @dnebdal:disqus There will never be Peak Labor because labor costs drop as companies move to the next country. Hence the discussion about the eroding middle class in the U.S. The longer labor in Alabama and Tennessee undercuts labor in the North and East, the lower labor will be in those areas.

        2. Robotization is the new offshoring… Foxconn is planning to replace 500k workers with 1m robots.

      1. I like you, Dave.  If you take care of the home-made clothing and cleaning products, I’ll kill stuff for our families to eat.

  11. I wonder if the outrage would be less if instead of shipping the jobs to China, they replaced all the jobs with a robot?

    1.  Those strike me as entirely artificial categories set up purely for rhetorical purposes.  Maybe Ford paid more than prevailing wages, but he also imposed unreasonably invasive policies on his workers (I mean, hey, they were living in his Goddamn houses!).  Bottom-line: “traditional” 19th century laissez-faire capitalism created some of the worst working conditions, lowest pay, and most inhuman labor relations ever experience since before the US Civil War.

  12. It has struck me for some time that the driving force behind this type of globalization is the cheap energy afforded by cheap oil.

    What happens when the cost of the fuel necessary to move a container ship across the Pacific Ocean destroys the profit margin on Chinese goods?

    Oh, I’m sorry.  Long-term thinking is something I do as a little joke.

    1. Shipping companies start using sails (there is some experimentation with this), they start shifting to electrical generation from land-based sources when docked (already happening), they buy new boats with more efficient engines, etc. etc. THIS is the one thing capitalism will be good at. As bunker fuel becomes too expensive, competition will drive the shipping lines to figure out how to move ships faster for cheaper.

          1. @twitter-209007841:disqus : I think you’re confusing “3D Printers” with those replicator machines from “Star Trek.”

        1. You can’t really “fabricate” steel in any meaningful sense – the raw materials still have to be made and shipped.

          1. Although I kind of like the image of someone feeding raw ore into a consumer-grade 3D printer at home.

  13. I think it’s funny that someone assumes Chinese workers work 12 hour days with two one-hour breaks.

  14. This is just another example of how the conservative movement controls the public dialog.

    The current meme is that the wealthy, or more correctly, the fabulously wealthy, are the “job creators” and therefore deserve much consideration, deference, respect and of course ass kissing and reduced taxation.

    But if you even glance at the reality you realize that if there is any job “creation” (rather than job transfer) it’s in China. Oh wait. China? No that’s not quite right, or complete. The jobs are being transferred to and newly created in COMMUNIST CHINA!!!!! (Did I put in enough exclamation points?)

    These are the same people that freak out, requiring smelling salts and mass quantities of oxygen at the sound of the word “socialism.” Yet they’ve somehow got zero, I repeat, ZERO, problem with the hundreds of millions (I doubt that’s an exaggeration) of tech and industrial jobs created in and transferred to COMMUNIST CHINA.

    Which country currently has an active “manned” space program? Which country is both a technological and industrial giant that rivals the United States and will undoubtedly, repeat UNDOUBTEDLY, dwarf America in both technology and industrial capacity within ten years. CHINA. COMMUNIST CHINA. THE RED DEVIL. BILLIONS OF THOSE RED DEVILS. COMMIE RED DEVILS FED BY AMERICAN REPUBLICAN CONSERVATIVES because hacking away at the body and soul of America (“extracting”) is a conservative Republican get richer quicker scheme. Their holy grail.

    To American conservative Republicans  the American body politic is just a steer with 310 millions tits (they probably have pics of the defining parts). Well worth a tasty meal for the select few “job creators.”

    1. The US has a very strong cultural knee-jerk reaction against anything that smells of communism, but they also have an economical situation that moves ever further into the sort of oppression that has led to socialist uprisings in other countries … my worry is that because the usual safety valves (smaller-scale changes towards a more socialist-ish government) aren’t really working, there will instead be a violent revolt in a generation or two.

      With luck I’m wrong, and it will all work out peacefully. If not, I might live to see both sides of the cold war fall victim to their respective systems.  (And if I’m really, really unlucky, I might live to see that revolt fail.)

  15. I’m surprised that nobody has made note of the fact that Bain isn’t even the slightest bit constrained by their awareness of the PR nightmare this creates for Romney.  They could certainly have waited a few more months if they gave a shit about how this looks.  I guess they figure that the people that really care about this sort of thing would be voting for the other guy anyway.  Let’s make money NOW.

  16. In other words, Bain Capital is taking from rich American workers and giving to poor Chinese workers.

    Opposing that sounds a bit like Dennis Moore.

    1. No, Bain Capital is taking from economically marginal American workers and giving to poor Chinese workers.

  17. I’m a socialist, but I don’t see anything wrong with this business deal.   Supporting the poor doesn’t mean you have to support inefficient allocation of workers and capital.   Just redistribute some wealth with progressive taxes and basic government services like healthcare/education, and let the market handle the rest.

    1. Tell me more about these progressive taxes and basic government services like healthcare….

      1.  We don’t really have the necessary level of services in the US right now (like free college education and free healthcare) but politicians should get on that instead of complaining about outsourcing and promoting protectionist trade policy.

  18. If there is a profit margin to be made, why don’t these workers form a corporation or coop, buy the equipment they need, and get right back to work while pocketing the margins themselves?  There’s a lot of risk involved, but it’s not impossible.  They could also move to where the jobs are or go back to school and learn new skills.  America is still a free country. Having not lost a job, I just don’t understand the “it’s the end of the world” mindset people have when a factory closes.

    1. its called a lack of empathy, since you have not lost your job your unable to see why a man in his fifties would feel betrayed by the system that screwed him over.
      Most Republicans suffer from lack of empathy so your in line with your core beliefs i suppose.

    2. Sure, factory workers can easily afford to buy a load of machines and buildings and raw materials, I bet they’ve got the cash for that down the backs of their sofas! And it’s not like the auto parts industry is entrenched and difficult to disrupt, especially not when the company you used to work for just cut their prices!

      Oh wait.

  19. The wealthy and powerful keep making more and more outrageous grabs.  They don’t care about the future of this country when they’ve got their offshore investments and accounts.  When they finally tank the U.S. once and for all, they’ll just move to another country and start raiding THEM, or retire to a private island somewhere.

    Meanwhile, a frightfully large part of the poor and middle class population thinks that Romney and his ilk represent them, and that the system is actually working for them.

  20. Oy! The bullshit is being spread here too.

    Note a post which begins with “I’m a socialist” and ends with “let the market handle the rest.” A Social Democrat perhaps. A neo-liberal more likely and there’s not much difference between billionaire Republicans and neo-liberals except who signs the checks.

    Why don’t the workers just build their own factories? It’s not just the money. In case you haven’t noticed the very same Republicans that want to ship jobs away to the most oppressed and dominated labor markets (on Jack Welch’s wet dream factory barges) demand international treaties enforcing newly greatly expanded intellectual property laws – patents, software patents and “business methods.” Google felt it had to buy Motorola’s patent portfolio to defend itself from the IP onslaught of the other established “creative” giants. Oh, and copyright too because the long dead need to have a source of income.

    I think a good reason why China has come to dominate the cheap labor market is that they don’t give a damn about the IP of others (just like America didn’t when it had very little IP control). China does build copycat factories for their own market (the biggest in the world – that’s why Ruppert’s there). IP is very much a key factor and it’s why IP is central to the new international treaties that America pushes on other nations.

    And “retraining.” Yeah. That’s not another Republican meme to spit at a worker who’s worked a job for 25 plus years and been given the boot off the barge.

    Maybe, if you can make hir 19 again.

  21. This is a great plan for profits.  Let’s charge the same price for a product made by less experienced workers in a country with less stringent, health, safety and quality control standards who we can pay less.  Since the product will be inferior it will also wear out faster, so consumers will have to buy it more often, making us even more money.

    1. I was thinking that too, but the sad thing is that I guarantee that any benefits the workers are entitled to (severance pay, pensions, anything – not that they necessarily were entitled to those things to begin with) are directly tied to them agreeing to provide the training. 

      If they refuse and quit, they lose everything. And they can’t afford that, especially since they’re now faced with the likelihood of months or years of unemployment, so they have no choice.

  22. To jimmoffet,
    Why would investors go to a third world country with labour and environmental laws equal to, say, Europe, yet lacking equivalent infrastructure and levels of tertiary education? If the investment doesn’t come in, how is industry and mass employment to be built? I agree on phasing these things in somehow, its vital, but you originally referred to a sudden imposition, which would function not as a humanitarian p0licy, but as a massive, crippling economic embargo on the poorer countries. There’s nothing patronising about looking at the basic economics of the situation. Much industrialisation in the developing countries exists to export products to the developed countries, so the viability of those zones and the jobs they support is jeopardised by your proposal.

  23. If i worked at that plant i would tell them to stuff their extra few weeks training someone else to do my job. Partly out of pride, partly out of spite, but mostly to get a head start in the job market on all the poor fools who stick around. There’s going to be a lot of out of work people in that town soon.

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