To the best of my memory, I’ve made no comment here about Arizona’s new and controversial immigration law. However, having a check for citizenship at the time of employment strikes me as a sensible measure; much closer to the heart of the issue than just picking people at random (or not) on the streets. If they can’t get jobs when they get here, there’s no incentive to cross the border in the first place.
But that is completely beside the point of this thread, and of my original post in it. I was simply trying to point out that when you say…
…it’s a partisan snipe. You don’t seem to care about how much of a physical or financial burden is placed on business in support of a goal you approve of, i.e. curtailing illegal immigration.
I understand that the purpose of business is to maximize profit. That’s what I would aim for. I also understand that that means keeping on only the minimum number of employees needed to do that (more accurately, spending the least it can for the most productive activity, which usually translates to a minimum number of employees) .
A business does best when it operates with as few employment expenses as possible. But here’s the paradox. Most companies likely do best when they have low employment expenses while other companies have lots of employment expenses.
Company A does best with a small number of employees earning low wages, provided Companies B, C, and D, who employ A’s customers, have many high paid employees. This situation doesn’t strike me as stable.
Everybody’s incentive is to reduce the number of employees. This ends up as a race to the bottom when competitors keep cutting back in order to compete. We end up with a situation where a company has cut employment costs to the bone, but it no longer helps because the people who employ their potential customers have done the same.
If everyone is unemployed, who’s going to buy your products? This paradox isn’t really anybody’s fault. It’s just the result of companies doing what’s best for them at the time they do it. Sometimes they’re doing the only thing they can do to survive.
Whether or not it’s anybody’s fault, it is what happens. I’m not blaming anyone. I’m not even sure that I have an answer, but it seems to be a real problem that needs some sort of solution. What? I sincerely don’t know.
However, as an afterthought I will add that CEOs getting million or billion dollar bonuses regardless of performance is not excusable and is not explainable as a business necessity.
You may call it a partisan snipe, I call it the truth. Is there really any question that most of the paperwork burden imposed upon business nowadays is the result of Democratic lawmaking?
Perhaps you missed it, but I said I didn’t think that for an employer to check a potential new hire’s citizenship would be a burden.
No offense intended, but what business is it of yours - or of anyone other than the stockholders of the company itself - what a company’s CEO is paid, or under what conditions?
What you seem to be suggesting when you say that large bonuses in light of poor performance is inexcusable, is that government should somehow be stepping in to keep CEO salaries contained within certain government-set boundaries, and in my opinion it would be outside the proper role of government to begin to meddle in, and try to set compensation policies, for private business. I would view it as one more step in the direction of private enterprise being taken over by the government, and history is replete with the misery that results when government controls the means of production.
As a shareholder in a company, however, I have an expectation that the CEO and Board of Directors are going to act in good faith in managing the company in the best interests of the shareholders. Not necessarily in the interest of lining their own pockets. I would very much be interested in knowing why the CEO is earning a 100 million dollar bonus while my stock tanks.
IOW, my purchase of a companies stock constitutes an agreement subject to certain laws and it is the role of the government to enforce those laws.
But to expand on what IdahoMauleMan said, I wonder how many SDMB posters have a 401k or own shares of stock?
What about the part where you said it makes no sense to do exactly what the government is proposing to do?
Businesses do not have the information to hand to fill in the 1099s. That is not because they are inefficient, but because they currently do not need the information. It would be inefficient if they did have the information - right now they would be wasting their time collecting and keeping it.
Yes, the change is to try cut down on fraud to be better able to afford healthcare reform. I am a supporter of healthcare reform, but this is not the way to help pay for it. In a typical government snafu, the cost outweighs the benefits. It is expected to bring in only about $2bn per year. Looking at the 50 employee company that I used to run, I expect the number of extra 1099s would be about 50, so 1 per employee. It will take maybe an hour to collect and fill in the information, giving a cost of about $50/form.
If these numbers can be extrapolated nationally, then we have a cost of $50 per worker. With about 150 million in the US workforce, that gives us a cost of $7.5bn to collect $2bn. Brilliant.
This is clearly wrong. And I’ll repeat what I said in my earlier post…that people who believe as you do above have obviously not ever had P&L or revenue responsibility, or have ever had to hire/fire a large number of people in response to real-world market conditions.
A business does best when it has the most valuable employment expenses possible, not necessarily the least. And by most valuable, I mean the expenses that create the highest risk-adjusted return.
That can mean having more, less or different types of employment expenses.
A few real life examples off the top of my head
Hiring more salespeople for a product that is taking off, and needs to penetrate as many markets and regions as quickly as possible.
Outsourcing or minimizing low value-added work like filing or document storage, that is best done by 3rd party firms with expertise in this area
Investing in ERP development by hiring a high-end, six-figure professional with experience in finance and logistics to do a combination of things: manage 3rd party programming firms whilst bringing some of their expenses back in-house, work with my internal finance and manufacturing organization to improve SKU management, procurement and customer service, and take the load off the existing employees who do not have expertise in this area.
So “employee expenses” have been increased, decreased and changed depending on the situation in the 3 different examples above.
Again, I want to emphasize that I am not criticizing people who do not have expertise in this area.
But this (so-called) debate is exactly representative of what goes on in the halls of government. People who have absolutely no idea what private-sector, for-profit businesses have to go through on a day-to-day basis dream up “solutions” to problems that they know nothing about, and then have the power to enforce them with the barrel of a gun.
Their solutions are invariably a pander to a special interest group (a union, the AARP, the oil or steel industry) that distorts the playing field and creates all sorts of Unintended Consequences.
Going from the SDMB at least, SA’s statement there seems pretty damn spot on. I can only imagine that less intellectual Democrats than those on the SDMB are even worse.
The national debate has been about why these businesses haven’t been hiring and the Republican assertion is that it is because of Obama and his policies.
Speaking as someone that has been involved in the process a few times. Big businesses are more than capable of acting in unison to pressure the government to pass rules in their favor. The bigger they are the more persuasive their arguments become. There is a commonality of interests among large multinational corporation just as there is a commonality of interests among wealthy small business owners.
Not quite AS stupid as it was back then.
I totally agree that economic downturns will hurt the least educated the most and economic upturns will help them the least. You bring up a good second point, the world only need so many people to major in medeival history but there is almost no end to the number of engineers our economy can use.
When its just about one company failing, there is no such thing as too big to fail but when our financial system is hanging on by a thread financial institution’s failure can mean the collapse of the entire global financial system. We discovered that our financial system is not quite as rubust and diverse as we once thought it was.
Yeah, I never understood that either. The problem isn’t free trade its the circumvention of normal market dynamics by countries like China who don’t allow their currency to rise to their natural value (because it would hurt their export based growth). Seriously if China let their currency float, the cost of Chinese production would double (as would their ability to buy raw materials but their low cost labor advantage would shrink considerably).
What makes it especially dense is that about half our trade deficit is oil. Cutting us off from oil is the sort of thing you do to your enemies during a war and here we are using a largely oil driven trade deficit (how much do you think we export to the middle east?) to justify protectionism.
I agree that our trade policy could use some improvement but almost all of the desired improvement comes in the form of domestic improvement. Make ourselves energy independent (I don’t care is you drill in Alaska, set up nuclear power plants or create algae farms for the alcohol they piss out) and you cut the trade deficit in half. The other half of the trade deficit seems to be withering on the vine during this recession (how many new large flatscreen TVs have you seen being bought recently?) and staunching the outflow of engineering jobs.
Keynes had a theory about trade deficits… They’re bad. And you can blame the exporting countries just as much as you can blame the importing countries. They are both complicit in the creation of the imbalance. In the China context, I would say that China is MORE culpable because they are engaging in mercantalism (a lot of developing countries do this but China is now the world’s second largest economy, enough already). China is now our second largest trading partner ahead of even Mexico and Japan and our largest trade deficit (by far) is with China) Canada is still our number one trading partner but their trade surplus is not THAT large and it is almost entirely accounted for by petroleum products.
If you have an Iphone, look at the back. Manufactured in CHINA. If China is exporting Iphones then wtf is there left to make in America if we are going to make frikking Iphones in China?
You don’t think your company engages in competitive behaviour? ROFLMAO. I have represented the largest companies in the world and they ALL engage in competitive behaviour. They never admit to anything illegal but they definitely do things like pay supermarket retailers for eye level shelf space or take losses in certain markets to capture market share.
Yeah, so is everyone else. Its necessary, not sufficient.
I ran a family business for years and I hired and fired people all the time. I hired people whenever I was busy enough that adding another person was going to earn me more revenue than that new person was going to cost me. When someone cost me more than I paid them, I fired them. It was really simple. If I was running that business today (You couldn’t pay me enough to do it, they should make Gitmo detainees run family businesses, I had to go to law school to get out of it), the future of health care reform three years from now would mean next to nothing in my hiring decisions. I can adjust three years from now if thats what it takes. The thing that would keep me from hiring employees today is the fact that the economy sucks. If you remove that from the formula the Republican’s have nothing left.
This is all utter bullshit. IF they pass a law three years from now that increase your costs, you can fire people three years from now. You don’t pass up profit today because of something like that. The problem is that there is no profit to be had. What sort of loans do you take out that you have no idea what interest rate you are paying until sometime after you take out the loan? Is there a law right now that prevents people from unionizing? WTF are you talking about?
I agree, I don’t think that this administration has introduced crippling uncertainty into the picture. Its the economy, and little else.
Yeah if you are a Republican that wants to blame a Republican recession on Democrats.
Most unsuccessful businessmen work like dogs too. There is not a perfect correlation between hard work and success in small business.
You know that Obama is pushing a small business bill that exempts small businesses from this requirement right? You know who is stonewalling the passage of that bill? The Republicans. You know why? Because it contains some of their ideas but not all of them. Heck it even includes some of the Republican BAD ideas in an effort to make them happy. You know how many Republicans supported it? Guess. C’mon, it’ll be fun.
You sure you ran a small business with $500,000 in machining tools? Because this is the sort of stuff my accountant tells me without charging me a dime.
It was tax legislation that was based (to some degree) on the ubiquity of computers and accounting software to prevent the heavy leakage we have seen in the tax system.
Or you are trying to blame Democrats for a Republican recession.
Well I thought they might have been making an argument for countervailing power. Unions 2.0.
Yes, and why should countries be any more loyal to their companies? Is that any less naive and quaint? These companies play countries off against each other (just as they play states off against each other). Why shouldn’t the countries get together and play the companies off against each other? THe concept of government collussion is always met with derision but the concept of
We created the global economy that created all those jobs but that’s not likely to carry a lot of weight. We are going to have to resolve ourselves to the fact that our children won’t be competing against the children next door for jobs, they will be competing against the children in China and India for jobs. Not just manufacturing jobs but pretty soon it will be engineering jobs then jobs in finance and investment banking. Legal and medical jobs. Everyone in this country will be competing with the Chinese and Indians for jobs and the Chinese and Indians will cost from 60% to 80% less. And apparently there is nothing we can or even want to do about it.
You have no idea what you are talking about. There is a regulation that has been on the books and pretty tightly controlled by the folks who regulate government agencies (That’s right government agencies are regulated, they have to comply with more regulations than almost any private industry I can think of) and one of the regulation is the Paper work reduction act and it make all government agencies are very VERY concerned with how much paperwork is created. I believe legislators are exempt from these requirements. And there is a reason its Democrats that require paperwork, the Republicans don’t care.
Are you kidding me? Everyone I know has a 401K and almost everyone I know has a taxable securities account. And all of them think that CEOs get paid too much.
There’s been a lot of “well you SDMB folks don’t have any REAL world experience, you ivory tower types don’t really have the necessary basis for your opinions” in this thread and its a bullshit argument. If you can’t support your position with arguments then your positions suck.
An HOUR to fill out a 1099? Are you kidding me? My accounting program spits them out at the press of a button. The real pain in the ass is collecting tax ID numbers but after you have that, you’re pretty much done.
Which is what I was trying to say with my caveat:
“more accurately, spending the least it can for the most productive activity”.
I still don’t think that I’m so clearly wrong. Companies start outsourcing, for example. Others have to outsource in order to compete, and pretty soon you lose a lot of well paid production jobs, everybody’s working in lower paying service industries, and you have no customers left (at least not after their credit runs out). So you have to cut back even more simply to stay in business, etc.
I’m not blaming businesses for this. I’m not saying that more heavy handed government solutions will solve anything. I don’t know what the answer is. Unfortunately, I’m not convinced there even are any good solutions. But just because we don’t like the solutions proposed so far or don’t think there are solutions doesn’t mean that the problem doesn’t exist.