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It's Over
By: Chris Tell at: http://capitalistexploits.at/
At a "pitch fest" a few nights ago, while sitting listening to the companies present their stories, and questioning the founders, one particular company struck me as a glaring outcast.
I'll tell you why they were an outcast, but first...
After just a few pointed questions I discovered that this company was struggling to achieve revenue growth, and they were a long ways off from profitability. Here are a couple of reasons why:
- High staff count all located in the developed world.
- Huge OPEX relative to many of the companies which operate in their space, which was almost entirely driven by point 1 above.
Later the same day I called my insurance company and got through to a call desk. I spoke with "Jacindra". After prying a bit I find she's in Manila. The reason the company I mentioned above is struggling to compete and become profitable is because they are providing a service not distinctly different than their competitors, yet they are paying multiples for things like labor. They are shouting from the rooftops that they're "local", but you know what, that's not scalable, and further more I don't care.
Do I care if Joey, a "local" in some developed world country loses his job to Jacindra in Manila? No. I congratulate Jacindra on dragging herself out of poverty with the aid of technology, and I thank her for the fact that the product I'm receiving is likely cheaper than it would otherwise be.
I hope "Joey" adapts to this change and finds a way to produce more value than he's currently worth, possibly in a completely different field. Change, especially if you're on the rough end of it is tough, but remember we'd all be still sitting in caves if it weren't for innovation and technological change.
General Electric, Caterpillar, Microsoft, Wal-Mart, Chevron, Cisco, Intel, Stanley Works, Merck, United Technologies, and Oracle cut their workforces by 2.9 million people over the last decade while hiring 2.4 million people overseas.
I see it every day... people losing jobs, having to retrain, change strategies and find ways to create value. "Cubicle jobs" are over. Sure there are still large swathes of "cubicle dwellers", but it's over, done, finished... I'm telling you.
Every day more and more people realise it. It's unfortunate for those who refuse to acknowledge it, even though its been staring them in the face for over a decade they've somehow managed to remain blind to it.
I've had angry people pop out of the woodwork when I've written about why education is broken. I suggested that the large educational institutions revenue models are fatally flawed and will see a sea change in the coming years, causing many in the industry to be forced to adjust.
I can understand the anger. Nasty surprises threatening the status-quo always get people angry when they're benefiting from the setup.
If you're sitting in a job which can be outsourced your clock is ticking. First cheaper labour, then better technology together with cheap labour, and shortly robots. You will be replaced, it's just a matter of time. This is a good thing.
Don't cling to the past, or the present too hard. Things you cling to tend to disappoint. The world is dynamic not linear, yet humans love to think in a linear fashion. This is how bubbles are created. This is how WhatsApp sells for more than the entire market cap of one of the world's fastest growing economies. Humans love certainty and certainty only exists in a linear framework in textbooks, it never exists in nature and it never exists in economics for long.
You've probably read about the massive protests across major EU cities by local taxi drivers. Why are they so angry? Because their ability to charge hapless pedestrians 2 blocks for $10 is coming to an end. GOOD! Once again an inferior product or service is being eroded by technology. Uber is single-handedly destroying them by providing greater efficiency and productivity at a lower cost.
Regulating and legislating who can give me a ride and act as a taxi impresses me as ludicrous, but that's the way much of the world operates when Government gets involved. It destroys entrepreneurship, it destroys productivity and as a result it does the very opposite of its stated purpose. Ultimately it causes a build up of waste and excess which would not exist without it.
When Mark and I were in Mongolia a couple of years ago we noticed quickly that every vehicle was a taxi. If you stood on the road and held out your hand someone would stop. Why? Because they can make a few bucks by picking up a "fare". Regular folks, on their way wherever. Why not? All Uber has done is to make that exact premise more efficient and add a little "flare" to it.
This is an illustration from an old newspaper. Those are British weavers destroying textile machines in the early nineteenth century. Like the taxi drivers of today, and the cubicle workers, they were angry at technology. Should government have legislated against textile machines so that today we would still be struggling to find decent clothing? Think of the colossal waste of resources, of all the men and women who would be weaving clothing for the world's population, of the poor quality fabrics and massive losses in efficiency.
I humbly suggest their time would have been better spent figuring out how to leverage the technology to provide a better service or product. The same people exist today. Humans don't change. Circumstances change, technology changes but human nature never changes.
Socialists vs Capitalists
I previously wrote an article about these two distinctly different mindsets, in which I said:
The first is a group who believe that the world, its peoples, resources, skills and wealth are one giant pie. They essentially believe that individuals don’t have a right to their own bodies, efforts and thoughts. In their vision the pie does NOT increase or decrease in size, but what happens to the pie is that the slices get shifted around between various groups of people within the world. Their major concern is with how much of the pie they personally get relative to others. The aggregate amount is not as important as the relative amount.
What is preferable for them is getting less pie, provided others are getting twice as little. They will opt for this rather than receiving twice as much, where others are receiving four times as much. They couch this view of the world, and distribution of aforementioned skills, wealth and resources etcetera in platitudes such as “equality”, “fairness” and “justice”.
This group of people will typically support “free healthcare”, “free education” and any other “freebies” that they will not directly have to pay for. They will be ardent supporters of bigger, more intrusive government, as this is the only avenue they see available for the execution of their perfect world. Articulating it as such would be difficult for many of them, as it exposes their view of the world as one completely lacking in freedom of the individual.
The second group of people realizes that there is an existing pie, but are not overly concerned with its size or distribution, since their thoughts typically revolve around building their own pie and adding to the size of the existing pie. They don’t see the pie as a stagnant concept, but rather something that they themselves can participate in forming and shaping.
This second group believes they have the right to their own bodies, efforts and thoughts. They accept that there are others in the world that will have a greater slice of pie than they do, but since they obtain their value and self-worth from building the pie, this concerns them little. They understand that the journey and not the destination are what matters.
Since they have courage and a belief in their own abilities they find the idea of relying on others to support them through “free” anything to be immoral, and although not all will articulate it, they are distrustful of anyone purporting to “help” them, especially when it comes at no cost. They choose to slog their way through the world on their own merits, and give back by creating wealth and opportunity for themselves and others.
The robots are coming... invest in what's coming tomorrow, because it's likely better than any of us can imagine.
- Chris
"Do what you can do best and outsource the rest." - Tom Peters
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When a government disintegrates there'll always be warlords to fill the void and capable of organizing their own crimes.
Yes, but I highly doubt that had this been the prevailing social formations that we'd have the massive build up of weapons (nukes) that we have today; and keep in mind that a LOT of the shit that we see today in the hands of our "civilized" gangsters is likely going to end up being used/consumed- that is, the full measure for how fucked up the "civilized" formations will be seen in hindsight is yet to come to light.
Small does of pain on a regular basis OR huge doses infrequently (and mostly occurring randomly). Would like to be able to say that it could be otherwise...
It's obvious that capitalists chase cheaper labor and in a global economy they chase it to the point where it looks more like slave labor. This county will be the example where everything breaks down to the point where slave labor can return to this country and in the end we will have a level playing field for all of the slaves.
As a doctor I should be OK but in the USA the patient is not the consumer, the insurance company is. I can deliver excellent care but if I don't do it cheaper than the guy who can barely speak English I'm toast. The only option is to try to do consierge medicine but as a specialist that doesn't work very well.
It make me happy to be old.
Me, too, lasvegaspersona; me, too.
Go fuck yerself, globalist pig.
Chris I used to design microchips in silicon valley it's considerably more difficult than whatever it is that you think that you do all day (chasing imaginary fiat?). My question to you is what the fuck are people supposed to do to justify their existence in this world other than hunt down conceded assholes like you with a guillotine?
Why all the anger dude. If you have the need to justify your existence, go help someone in need. Forget the concept that your self esteem is related to your job.
Remember Ross Perot's "giant sucking sound" quote?
If you have a guiillotine than I will volunteer to help push it from place to place.
Sorry, but Jose already has a lock on that job at 1/2 your rate.
And Chang will throw Jose under the bus for half that...
.
In 1960 Robert Triffin saw that having the world's reserve currency meant that you would have to be a net importing nation and would be forced to give up manufacturing. To get your money out into the world you would have to run a deficit.
Insight would have led one to see that this chronic deficit would eventually cripple the currency with debt. This factor combined with thechnical progress is where we are now. Only when the dollar goes the way of the austral will the USA be able to compete on a level field. We will still have to deal with technology.
We have a long hard way to go.
Every time I read something like this, I come away with the same question. After everything is automated robotics and all the workers are sent home, just who the hell will the customers be that will have money to buy what the robots produce?
The FSA and govt employees.....Pretty much like it is now..
John Galt my butt!!! Who is Henry Ford??
And outsourcing another 2.0 million jobs to third parties overseas.
And this is why the Fed prints a trillion dollars a year - to distribute to the unemployed.
AND this depreciates the dollars earned and held overseas, bringing some of it back to feed the unemployed. The snake eats its own tail. Is this really stable? I dunno. Probably not.
Just wanted to add to your numbers:
Information Services:
http://research.stlouisfed.org/fred2/series/USINFO (2.65 Million down from 3.7 Million) All Employees: Information Services
Manufacturing:
http://research.stlouisfed.org/fred2/series/MANEMP (12 Million down from 19.5 Million) All Employees: Manufacturing
Creating jobs in a mature market should be required to pass a certain "taste" test. It should be pointed out that while America is creating jobs it is costing a huge amount. I'm referring to the massive government deficit which I feel is the fuel driving our still rather weak growth. Is it sustainable, and just as important are these the right kind of jobs and will they last?
When a job that falls outside the description of government worker fails to make economic sense it becomes a form of working welfare with the taxpayer picking up the tab. We as a country and as a society have paid dearly for each unsustainable job created through government incentives and partnerships, because of the nature of many of these jobs we might even call them temporary. More on this subject in the article below.
http://brucewilds.blogspot.com/2014/04/creating-real-jobs-remains-proble...
Doesn't Patriarchy, Matriarchy and Tradition not to mention conservative Values all depend on us thinking that things are permanent, systematic, stable, institutional, all worked out in creating the worlds best country with the most modern ideas.
"...Don't cling to the past, or the present too hard..."
Seems likely the post WWII generation Trusted the Government, pulled together as a team, and didn't watch the government closely as the propaganda machine "Ramped Up". So now we have crazy baby boomer Yuppies that were corrupted by the world most powerful "old boy network".
Late Add:
- Mercenaries are Capitalist
- Capitalist Love Mercenaries
- US Constitution is our Principal Document
- Capitalist seem content to trash the Constitution
- Capitalist Control the Whitehouse & Congress
- We are now a Nation of Secrets anathema to the Constitution
I work for a plastics manufacturer here in the US. Actually any more the projects I prepare for capital approval, the Chinese ones have extremely thin margins that we just run up front and if it is well accepted we run in house, because it is so much cheaper.
I stopped reading when robots were interchanged with cubicle jobs which were interchanged with customer service.
But I love ZH i read everyday.
There have already been AI programs that write pretty good newspaper copy. Jus' sayin'.
"Also, who in the world wants to speak to someone across the world who doesn't even speak your language natively nor has a halfway recognizable dialect? Nobody."
Funny how that works. I just sponsored a kid in Manila who was scratching a living making paper bags 16 hours a day for pennies. I asked her what she wanted... she told me to get a job as phone support. I sent her to learn Spanish in the Consulate in Manila, a total immersion course for 6 months.
Now she works 12 hours a day 6 days a week for Comcast in the billing dept and makes four times what she made folding paper bags. She sends 1/2 her check back home to the Province to her family.
I changed someones life in a positive way for about $600.00
Funny how that shit works.
Are you gonna do her job?
Someone in US would do it for $10 to $15 an hour. She and you helped make that impossible.
The usual career path for a girl from the provinces when I was in the PI was to either be a domestic or stand on the street and yell, "Hey Joe, want to go short time?" When the fleet was in the population of Olongapo increased by about a third. The really young ones, barely nubile, would dive off boats into the Shit River for coins the sailors would throw.
The usual career path for a girl from the provinces when I was in the PI was to stand on the street and yell, "Hey Joe, want to go short time?" When the fleet was in the population of Olongapo increased by about a third. The really young ones would dive off boats into the Shit River for coins the sailors would throw.
Great, so you got Comcast some cheap labor for pushing its products that are totally about disposable income (in a country where disposable income is a bit hard to come by). Yeah, this is sustainable...
FYI - My wife is from Manila- I know a little bit about the country.
Seer, you are a mite harsh on the person helping another person improve her life. Untold millions labor as she did, spending sixteen hours and more on mindnumbing tasks to feed a family. It is not about the benefit to Comcast, but the benefit of helping someone's family. There will always be the Comcast's of the world, but to help someone half the world away???? Not so much.
As far as what depths a person can go because of hunger, we will see it here when the financial storm hits. There will be those who prey on the weaker; same as it ever was, same as it ever was......
It's about reality. Contrary to our technology-will-save-us-all belief/paradigm, NONE of what we are doing is sustainable. THAT is the reality. Think about all the folks in places where the corporate model has built up and then moved out from. MOST tend to crumble as a result; and, you want to talk about hardships?
"There will always be the Comcast's of the world"
Can CANNOT state that with certainty. I'd counter in with the FACT that the history of human activity has NOT been about big corporations: yeah, surprise; they've mainly developed as a result of cheap energy.
I'm more than empathetic. My wife and her family when she was growing up was extremely poor. I don't state these things lightly. Look up Green Revolution and let me know how all its wonders are going to end up leading all those "saved" from it.
Exactly. The global fascist agenda is about worker exploitation whereever they conduct their 'business'..... it will all fail in spectacular fashion eventually and the globalists know it. Just like the QE 'plan' to save the monetary system. But they are not concerned as they are pocketing their profits into safe havens such as precious metals and homes in various lands where they can run, hide and laugh at everyone who thought they were 'working in the interests of the people (and working people around the world)'. How would $25/gallon gas affect them negatively when they have pocketed millions upon millions? They have plenty of money to gas up the gulfstream and flee when the global trade ponzi scheme collapses... and they'll watch on TV all the working people go to war.
it's funny how quickly the capitalist class with confetti money forgets how quickly their privilege is built on simply collecting rent on society, living atop it like a massive parasite.
they justify this position, by offering the truth that they are providing a service of managing the social and economic order.
the thing is , when that order goes to shit for everyone underneath them, it's very easy to outsource their leadership as quickly as outsourcing an insurance hotline job. how? international or civil war.
there is no real funciton which caanot be substituted, and the unremoseful atttitude that this is a good thing whose costs are so insignificant as to justify dehumanizing human beings----is most frequently found amongst those who believe themselves irrepplaceable because of the entitlement of the privilege of being the capital controller.
i'm no marxist, but society is always replaceable. do you think gheghis khan cared about who owned what investments?
the replacement of the capitalist overcllasss is frequently celebrated in history, as in the 'american independence' of 1776. it happens more often than you realize so much so that you would think a wise and self aware capitalist would appreciate his responsibility to be a good steward over those under him, and to feel responsibility in seeing himself as PART of a system of human beings, rather than as a separate entity reveling in his ability to dehumanize those below him.
“Inflation is an unjustifiable redistribution of income in favor of those who receive the new money and money titles first, and to the detriment of those who receive them last. In practice the redistribution always works out in favor of the fiat-money producers themselves (whom we misleadingly call “central banks”) and of their partners in the banking sector and at the stock exchange. And of course inflation works out to the advantage of governments and their closest allies in the business world. Inflation is the vehicle through which these individuals and groups enrich themselves, unjustifiably, at the expense of the citizenry at large. If there is any truth to the socialist caricature of capitalism—an economic system that exploits the poor to the benefit of the rich—then this caricature holds true for a capitalist system strangulated by inflation. The relentless influx of paper money makes the wealthy and powerful richer and more powerful than they would be if they depended exclusively on the voluntary support of their fellow citizens. And because it shields the political and economic establishment of the country from the competition emanating from the rest of society, inflation puts a brake on social mobility. The rich stay rich (longer) and the poor stay poor (longer) than they would in a free society.” (emphasis added)
- Jörg Guido Hülsmann, Deflation and Liberty, ultimately from a 2003 essay
Yep, a lot of the comments here are far more thoughtful than the article itself. I'm all for innovation, free entreprise and personal accountability, but this author seems to be a pretty disconnected one percenter with no real sense of responsability towards his fellow men. Strongly reminds me of the bankster race.
This is certainly one of the more brain-dead articles I've read on ZH in quite a while.
The author could have saved a lot of the readers' time by just condensing the whole diatribe to "My Shit Don't Stink" and leave it at that.
All empires collapse, doesn't matter what they are predicated on (as long as their underlying premise is that of growth). Great view on this:
http://www.rexresearch.com/glubb/glubb-empire.pdf
The problem is government. Not the exchange of capital between free men.
I logged in to kick the tires, but found your comment quite suitable.
I doubt this thread will see much action, but excellent post none the less.
I looked long and hard at my career path in the early aughts (2000+) and realized that pay scales the world over will eventually equalize to some degree. If anyone cares, I work in professional engineering.
Lastly, I think it is amusing when some people think they are immune, which is an observation made by looking at attitudes, comments, and such. I don't get the impression the author of the OP has any concern for HIS (or HER) future place in the pecking order.
If he (or she) did, the tone would certainly be different.
Regards,
Cooter
I've been predicting the 'evolution' of the robotic revolution since the 1980's. When you examine labor and costs, robots are much more cost effective, long term. With miniturization and the improvement in battery tech, it is a given that these puppies are going to be everywhere, all of a sudden, within the next 10-15 years. Drones are a prime example - robots that fly. You can buy them now at Walmart. Part of me agrees with Chris that this is going to be great - part of me is fearful of the misuse of the development of these useful entities. Time will tell, indeed.
How very defeatist of you. How about instead, we kick every douchebag CEO that thinks like you out into the town square to be hung? Ok, a little extreme I admit, but you are proposing we simply make the best of a corrupt pseudo-capitalistic economic system rather than fight to change it.
Also, who in the world wants to speak to someone across the world who doesn't even speak your language natively nor has a halfway recognizable dialect? Nobody. You completely glossed over the downsides of outsources which seems to me you're a profit-at-all-costs shill, the kind that infect our socialist Ivy League today.
With respect, but you, along with the article's author, have missed the source of the nonsense that is "outsourcing." That is the FedRes and their incessant theft via "printing."
In a normal economy productivity would rise and prices and wages would fall while purchasing power would go up--more goods per a given level of money (real money).
In the current economy, the banksters along with their Wall St. cronies have turned the economy into a zero-sum game. The banksters "print" and steal and Wall St. shuffles and leverages up "ownership," putting them a close second in getting the "printed" theft. All others must lineup at the trough.
As the "printed" lucre works its way thru the system, it forces people to more often think and act in the shorter so as to enable them to get their hands on the currency before its value, and therefore the value of their labor and product, drops. The inflation also diminishes returns on capital and reduces economic opportunities for work.
Outsourcing is just a way for companies to adjust to the shorter and shorter time-frames they find themselves operating in, along with the toxic environment of regs and taxes created by the banksters' puppets in DC. In an unfettered economy, one without the systemic theft of the banksters, there would be no need for outsourcing.
Or put another way: It begins and ends with the fraud, theft and counterfeiting by the banksters.
"Guillotine the banksters, save mankind and the planet."
Spot on!
It is not called capitalism if there's funny money involved.
No Doubt Ms. Tell has private security personnel, Door Security, Security Cameras, just like in Third World Countries, she hires her own police force since people are poor & desperate.
To protect her family from the Poor & the Lower Classes who she probably knows as well as the corruption of the 1%. Which is to say probably not at all.
Of course it is possible she believes everything that is reported on TV as well. She doesn't miss the real presidential debates since she can't remember them.
She doesn't remember why it took 100 years to get "Worker Rights, work place safety, holiday pay, overtime pay, or child labor laws"
It seems that
- Capitalist have a history of worker abuse
- Capitalist hate Social Security & Medicare even though people pay for these benefits
- Capitalist Love Monopolies
- Capitalist have overthrown US Anti-Trust Laws
- Capitalist have overthrown US Financial Standardization & Accounting
- Capitalist are Milking Uncle Sugar dry to the Tune of $trillions of Dollars (Think DoD)
Government, in all it's forms, is tyranny.
Thanks. Weird that people don't know how we got Union Rights or that people died in the mines without worker rights.
Really telling that GOP spokes persons avoid the topic of worker safety and worker pay provided by activists. There were no Unions for 200 years. You had Union Busters. You had people dying in the mines and drilling almost everyday.
What is our US History? It is Worker Rights.
Dig into it.
"Globalisation" has been very kind to the Western Fascist elite Government/Corporate complex, but no so kind to the Middle Class and working poor? The US is still the largest economy in the world (Chinese data notwithstanding) and, if the US Government really wants to serve "We the people", it is time for a large dose of protectionism. Of course, the Corporations will never allow that to happen and their political minions will, of course, support them, so long as their next re-election campaign gets funded.
The US Middle Class is being buried under a tide of Globalisation and illegal immigration, which is all aprt of the NWO plan. And they still comply, so the elites have won I guess? Americam Idol is still on and Cheesy-Twirls are still in WalMArt for a Dollar. Yawn...What a Shit Show?
I have long predicted that the consequence of "Globalisation" is that the living standards of those in The West will fall, and those inThe East will rise, until a point of equilibrium is reached somewhere in the middle. Which is what the "Progressives" and the NWO Elites want to see happen.
UM, except the Clintons who love the "Progressivism" but don't want to pay Estate taxes.
The hypocrisy of the "Elites" is boundless.. Come on Sheeples, what does it take. Never mond, BOHICA...