Yesterday's Lou Dobbs

Guess where Perot "giant hypocrite sound" Systems is setting up operations?:

Company Ross Perot Built Is Now Hiring, in Mexico, by Elisabeth Malkin, NY Times: Remember Ross Perot’s “giant sucking sound”? The Texas billionaire and onetime presidential candidate railed against the North American Free Trade Agreement in the early 1990s, arguing that it would create a “giant sucking sound” of good American jobs pulled to low-wage Mexico.

But things change. Last week, Mr. Perot’s Texas company announced that it was hiring — in Mexico. The Perot Systems Corporation, which manages information technology for companies, is setting up a technology center in Guadalajara where it expects to employ 270 engineers by the middle of next year. ...

Perot Systems, based in Plano, Tex., had sales of $2 billion last year and employs 20,000 people in more than 20 countries, 6,000 of them in India alone. ...

Back in 1992 and 1993, Mr. Perot’s anti-Nafta harangues made him highly unpopular in Mexico... But a dozen years into Nafta, Mexicans are willing to let bygones be bygones. And so, it seems, is Mr. Perot...

Comments

[dryfly]

Mark - everybody likes a sucking sound.

[evagrius]

Ross Perot, founder of EDS- the company that sold 18 California counties CalWIN and the state of Colorado its Benefit Management System- both boondoggles.

Yes. Perot "sucks".

[cm]

Well, people are entitled to change their mind. This is the land of the free. Enterprise.

[ninjaplease]

"Guess where Perot "giant hypocrite sound" Systems is setting up operations?"

So he's a hypocrite because he claimed that NAFTA will cost American jobs, and 10 years later, after economists have helped setup a system where there is a great disincentive towards domestic investment & domestic hiring by corporations and he decides to take advantage of this incentive?

How about we get rid of the incentive? The hypocrites are the ones who are STILL PROCLAIMING that this game is "good" for the American worker. Some how a silver lining is always found, yet just out of reach of the average joe worker-- he just needs more education is all, you know for that service job.

[crack]

Mr. Giant Sucking sound is involved in Perot Systems, but The Son Of Mr. Giant Sucking sound is the founder.

[evagrius]

crack;

Thank you for the clarification. I'da thought being in Texas, he'd be called Ross Perot Jr.

Not much different than the pere, though.

Perot Sr. made a ton off government contracts. He's one of those whose dependence on government largesse resulted in great personal wealth, unlike those Cadillac welfare mommas.

[save_the_rustbelt]

Perot has to compete in the environment others have created. As they say in Texas, don't do no good to shut the barn door after the horses have run away.

Dryfly, are you being naughty? Tsk, tsk.

[Ken Houghton]

So let me see (ignoring the possible suggestion of sexuality above):

(1) Ross Perot ran for president and opposed NAFTA, not necessarily in that order.

(2) Ross Perot did not and does not run Perot Systemshis son does.

(3) Perot Systems is, 12-14 years later, setting up a technology center in Guad-lahara (Tom Lehrer reference) that will employ approximately 1% (270/20270) of the company's workforce.

(4) Approximately 30% of the company's workforce (6/20) are currently based in India. This is considered a throwaway in the article.

(5) Combining (3) and (4), the workforce in Mexico will be approximately 1/30th of the workforce in India.

(6) The article is framed as if the writer gives (to borrow a phrase from my favorite Christian rocker) "a flying f*ck" about jobs going to "low-wage" countries.

(7) India, where Perot Systems is long and firmly established (I need to throw "uncut" in to match dryfly) is not exactly a high-wage country.

(8) Conclusion: Why would this be considered interesting, or newsworthy, at all?

[save_the_rustbelt]

If Perot senior needs defending, early EDS developed the systems that allowed many of today's modern social service systems to function, so he gets some credit for that.

[cm]

I hope dryfly is not referring to sucking thumb.

[evagrius]

"If Perot senior needs defending, early EDS developed the systems that allowed many of today's modern social service systems to function, so he gets some credit for that."

Sorry rustbelt- read the Wikipedia on CalWIN, the latest incarnation by EDS of social service systems.

The early systems have allowed a Big Brother mentality to really go hog wild. Of course it's only the poor. Who cares about the government intruding into their personal lives?

[save_the_rustbelt]

"Sorry rustbelt- read the Wikipedia on CalWIN, the latest incarnation by EDS of social service systems."

Perot didn't create the welfare state, he just made parts of it work. How do you pay benefits without info processing?

Perot hasn't owned EDS since the late 80s or early 90s, General Motors owned it for a while and then spun it out.

[evagrius]

Perot didn't create the welfare state, he just made parts of it work. How do you pay benefits without info processing?

I don't think he made any parts work. He made money off of it though. I seem to have read he was still involved in EDS in the late 90's in some capacity.

The info processing you mention is far more complex than you think. Go to a local welfare ooffice and obtain the applications. Computerization made the process both easier and more complex. Now, it's so complex it barely functions and this has nothing to do with the basic eligibility of clients, it has to do with a system trying to process too much information because, as I've stated, Big Brother wants to know everything about the poor- not the rich.

[Lafayette]

ninjaplease: "The hypocrites are the ones who are STILL PROCLAIMING that this game is "good" for the American worker."

Unfortunately, it is ... you're simply not looking further than your nose.

Most of the work that was "sucked south" was wrote assembly-line work, the product of which came back in the US at a cheaper price and therefore contributed to everyone's enhanced purchasing power. Meaning they purchased more with less money.

What you don't like is the fact that assembly-line work did not stay in the US and caused some unemployment. Well, like they say ... T.S.

Job protection leads to exorbitant Comp & Ben, the sort that is sinking GM. The head of GM once said (in the 50s), "What is good for GM is good for America". Well, those times are over and gone ... forever.

Wake up.

[Ken]

What? everyone's enhanced purchasing power. We used to buy domestically. we now buy from china. the subassembly is cheaper but we dont pass that savings on. The consumer doesnt pay lower prices. Ou profits are higher!

Tech advances in chip technology drove prices lower but when has inflation fallen?

[JohnDewey]

Was Al Gore right about Ross Perot years ago? He implied Perot opposed NAFTA because it it destroyed a key Perot family economic advantage. Perot's son was set to reap huge profits at the Free Trade zone established at the family's Fort Worth Alliance Airport. As I understand it, NAFTA eliminated the need for a free trade zone for Mexican-U.S. commerce.

Here's a passage from Bill Turque's "Inventing Al Gore" about the televised NAFTA debate between Gore ad Perot:

"Gore also asked Perot about the free trade zone operated by Perot’s son at his Texas airport, which was promoted as a gateway to business in Mexico. “If it’s good enough for him, why isn’t it good enough for the rest of the country?” Gore asked. Gore’s strong performance and Perot’s meltdown changed the dynamic of the NAFTA debate. The pact passed the House 234-200."

[Peter Schaeffer]

Lafayette,

Check out http://en.wikipedia.org/wiki/Charles_Erwin_Wilson. What he actually said was "because for years I thought what was good for the country was good for General Motors and vice versa".

A few other points. Before NAFTA the US ran trade surpluses with Mexico and Canada. Now we don't. That's not progress. Wages for production workers are now down to the 1959 level. That's not progress. Wall Street bonuses are at record levels. Everythings OK, right?

[lonesome moderate]

The NYT article itself seems to be behind a paid firewall, but an International Herald Tribune copy is available, at least for the moment. http://www.iht.com/articles/2006/11/13/business/perot.php

[Lafayette]

"The consumer doesnt pay lower prices. Ou profits are higher!"

No, "their profits" are higher, meaning the Chinese.

Consumers are getting more mileage out of their buck. They would also get more savings, but apparently Americans have unlearned how to save.

If Walton is making profits it is because its supplier costs are lower. That is the name of the game, comparative advantage. Go reread Ricardo.

The only constant in life is change. America is leaving the Industrial Age for the Information Age. That transition comes at a cost, and that cost is related to industrial jobs.

Of course, and what no one is talking about, is the fact that brawn is being replaced by brain in the New Economy, meaning that women are just as capable as men for most of the jobs being created. Therefore men will be confronted by more female competition for any given information-worker job.

So, machos, had better be careful ... or they are likely to become extinct if they do not know how to adapt. (For instance, learn how to wear a skirt. ; ^ )

[evagrius]

Lafayette- I'm getting really tired of reading the cliche about the Information Age, the New Economy and so forth.
I can't help but think the U.S., ( especially, but also Europe) is flying headlong into a situation that one day will not be so rosy.
It's one thing to have the Chinese manufacture kitschy googaws- it's another when really essential products are only manufactured there.
It's one thing to have video games created in India, say, it's another when finances are processed there.

There's some naivete in all this, some assumption of superiority, some smugness.

I hope the "West" doesn't wake up to find that nothing works because the parts haven't come from China, the software from India or the machines from China etc;

The argument that it's too spread out or that they won't give up profit etc; is really useless.

I'm not advocating protectionism, just a little bit more insight and prudence, ( and don't tell me the "market" is prudent- not when there's a profit to be made).

[JohnDewey]

evagrius: "I'm not advocating protectionism, just a little bit more insight and prudence"

evagrius: "It's one thing to have the Chinese manufacture kitschy googaws- it's another when really essential products are only manufactured there."

That certainly sounds like a protectionist argument to me.

Why would you believe that essential products will only be manufactured in China? The U.S. is still the number one producer of:
- motor vehicles;
- agriculture products;
- medical equipment;
- semiconductors;
- gasoline;
- aircraft;
- plastics and chemicals;
and much much more.

U.S. durable goods manufacturing has grown by more than 6% in each of the last two years.

The U.S. GDP continues to grow, and is currently greater than that of Japan and China combined. China, with 1/6 the world's population, will eventually catch up. But that's many decades away. And so what if they do? Why should we expect to permanently outproduce a nation with 4 times our population?

[JohnDewey]

Peter Schaeffer: "Before NAFTA the US ran trade surpluses with Mexico and Canada. Now we don't. That's not progress."

Why do you feel that a trade surplus is a good thing? If a nation has a trade surplus it must also have a capital deficit. I know that you understand balance of payments accounts and why this is true.

Why would it be good for the U.S. to be investing more in foreign countries than those foreign countries are investing in the U.S.?

Germany has the largest trade surplus in the world. It also has an unemployment rate of 11.3%. How are those related? Germany's protectionist laws allow inefficient companies to survive, inhibit foreign takeover and revival of german firms, and prevent German from the economic growth that always accompanies free trade.

[cm]

JohnDewey: If memory serves, the Pentagon not too long ago commissioned a study stating its concern that much of critical (?) semiconductor products are manufactured in China, and the US may in a time of crisis not be self-sufficient in producing its military equipment. I must say I buy that. Not that it necessarily is so, but the concern thereof. Without knowing I can easily imagine that a lot of (taken for granted) small-time products military suppliers are using come from sources that in the end source from abroad.

On Germany, it's more complex than that. For one thing, unemployment there is measured by a more inclusive standard than in the US, and (actual) US unemployment may be much closer to that than you think (BTW, German unemployment is not homogeneous; it is about 8% in the west and 20% in the east). And I submit that the unemployed in Germany in the aggregate have a higher standard of living than those in the US. E.g. they, as well as welfare recipients, have "free" healthcare (essentially paid by those who have a job, plus tax transfers; and of the same level and quality). There is substantially less street begging in Germany, and GDP is (so far) not inflated by hedonic adjustment. And Germany does not print the world's still de-facto reserve currency. That is, it actually has to trade exports for imports (a strange concept I admit).

[ninjaplease]

"and prevent German from the economic growth that always accompanies free trade."

hhahahahahaahahahahahahahhah

tell me another one dude.

[James G]

Germany's unemployment came about because it absorbed something like 16 million suddenly unemployed East Germans. I'm not sure if any other country in the world could have done that without completely collapsing their economy.