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China Businesses United States

Foxconn Sees New Source of Cheap Labor: The United States 430

Posted by samzenpus
from the times-they-are-a-changing dept.
hackingbear writes "Foxconn is planning to build manufacturing plants in the U.S., probably in cites such as Detroit and Los Angeles. 'Since the manufacturing of Apple's products is rather complicated, the market watchers expect the rumored plants to focus on LCD TV production, which can be highly automated and easier.' Foxconn chairman Terry Guo, at a recent public event, noted that the company is planning a training program for US-based engineers, bringing them to Taiwan or China to learn the processes of product design and manufacturing."
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Foxconn Sees New Source of Cheap Labor: The United States

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  • by Anonymous Coward on Thursday November 08, 2012 @11:14PM (#41928097)

    Americans may have invented a lot of the manufacturing processes used for consumer electronics, but China and other Far Eastern countries have a big edge on us now. Let's put our egos aside and learn what we can from the Chinese.

  • by mosb1000 (710161) <mosb1000@mac.com> on Thursday November 08, 2012 @11:15PM (#41928107)

    Chinese companies are more willing to be self sufficient and train workers than American companies, who are constantly whining that the government should do it. And theyre from a communist country where the government is much more powerfull. Good job, assholes.

  • by Fishead (658061) on Thursday November 08, 2012 @11:19PM (#41928137)

    Gimme a break. Unions are the only thing that defends the middle class from the rich shareholders that demand ever increasing dividends.

  • by Jackie_Chan_Fan (730745) on Thursday November 08, 2012 @11:20PM (#41928139)

    You're right, unions ruined everything, including child labor and slavery. Oh the good old days, when you could lock your workers in a factory, and watch them burn to death. (Actually happened)

  • by godrik (1287354) on Thursday November 08, 2012 @11:21PM (#41928153)

    Not sure how it works in the US. But in Europe a typical valid answer is "if management did not treat the workers like shit, they would not be unionized."

  • by Jackie_Chan_Fan (730745) on Thursday November 08, 2012 @11:22PM (#41928163)

    Yes but detroit is a shit hole of desperation and low wages

  • by sgt scrub (869860) <saintium@@@yahoo...com> on Thursday November 08, 2012 @11:32PM (#41928245)

    I guess high priced oil is working in our favor for once. Considering the majority of their market is here, they might even be realizing consumers with money buy stuff. Who'da thunk.

  • by Kaenneth (82978) on Thursday November 08, 2012 @11:35PM (#41928265) Homepage Journal

    The right to join and form a union is important; but I reject the idea of 'Union Shops', where you are required (if not literally, at least practically) to join, and pay.

    It's like flag burning and gun ownership; I have no interest in them now, but if you try take away my right to do so, I will just to protest.

  • by girlintraining (1395911) on Thursday November 08, 2012 @11:48PM (#41928369)

    You jabber on about how unions are bad, how they destroyed this country, but you couldn't be more mistaken. The reason we became a world superpower was because of unions, not in spite of them. When the industrial revolution first made land fall, people left the farms to move into urban factories. There was no health care, no OSHA, no retirement or social security, no educational system, and no child labor laws. Workers would get chewed up by machines and that was that. No lawsuits, no nothing -- your livelihood was destroyed. Quite possibly, you later died of starvation. All of the problems that are present in China today were there at the start of our industrial revolution as well: Corruption, environmental contamination, worker abuse, long hours, low pay, and massive wealth inequity.

    Then the unions came, and with it; OSHA, social security, public education, child labor laws, overtime compensation. And you know what happened then? Civilization didn't collapse. In fact, it prospered: The roaring 50s. A single man could now drive a car and live in a house he paid for, in full, and support a wive and two kids, working only 40 hours a week. It was the first generation to grow up with public education, and that literacy reflected in every area of american living; Anyone could invent something new and sell it. America became the land of opportunity. Immigrants flocked to the stars and striped by the millions. The middle class grew, and upward mobility was something just about anyone could achieve. For the first time in modern history, hard work nearly guaranteed a comfortable living. And work hard we did. When Europe was devestated by the world wars, it was american industry and ingenuity that pulled their ass out of the fire, and I'm not talking about the unparalleled capacity to produce ships, tanks, guns, and planes either. We didn't just build our own country -- we rebuilt a dozen others as well in post-war reconstruction. And after all that, you know what we did then? We went to the fucking moon.

    Even Adam Smith in Wealth of Nations pointed out that one of the essential duties of government is to provide for the safety and well-being of its citizens. In other words, the work force. America's investment in its labor force resulted in economic gains far in excess of anything even the largest mega-corporations of today can match. And then it all went wrong.

    It started with the Boomers. Having been given everything by their parents, they didn't understand the price paid by their predecessors. They assumed that this temporary equilibrium, this golden age, was a permanent feature of America. They felt entitled to it, instead of thankful. And when they seized power in the 70s and 80s, they cut social security, education, defunded OSHA, deregulated... and for a time, it was good. But in the shadows consumer debt piled up. The cost of an education skyrocketed, and illiteracy creeped back in. Our scientific and technological progress peaked, then rapidly deflated as the careers of scientist, engineer, inventor, were removed from public prestige and replaced with ridicule and scorn.

    Today, our media holds illiterate opinions as equal to the most established of scientific truths. Our children are unable to afford an education, and we're witnessing the lowest graduation rates from all levels of education that anyone alive can remember. Our economy is in ruins, the middle class is rapidly evaporating, and the few wealthy compete amongst each other to auction off our civil infrastructure and institutions. The bridges and roadways our grandparents built with pride that enabled our economy to prosper grow increasingly deficient, falling into rivers or eating tires and vehicles. Our railway and roadway networks are so badly mangled that the idea of bringing back blimps has been floated a few times as a way of getting goods around. Our air space is managed by state of the art technology... or it was, in 1965.

    No, unions made us a super power. And we're going to lose that status because we took what they gave us for granted.

  • by Zeussy (868062) on Thursday November 08, 2012 @11:48PM (#41928373) Homepage
    Oh yes, it's all the unions. Even though Germany has unions [forbes.com], pay's it auto works more, and their car industry is profitable, makes more cars, with large amounts of exports.

    Unions done wrong fuck the system up. Builds adversarial us (the workers) vs them (the management) mentalities. Unions done right, can and does work very well. It is collaborative, where everyone works together to make the company better, struggle through the bad times etc. This collaboration works both ways, if the company is hitting hard times, the board, management should be taking paycuts themselves, stopping bonuses. They have failed to lead the company into a properous position. Before they have the cheek to ask the workers to cut their salaries, they should be severely cutting their own pay first. Put their hands up in the air, and claim "Yes, we fucked up", so how can we get through this? The CEO has taken a paycut of 80% sacrificing $25 million saving about 300 jobs, can you guys cut 15% until we get through this?

    Both Germany and Japan after the second world war had written into their constitutions by Eisenhower, MacArthur and their aides various protections and rights for workers to bargain and act collectively. They both have become some of the biggest players in the automotive industry, and this is not by coinicendence, it is by design.
  • Re:Gotta post AC (Score:4, Insightful)

    by girlintraining (1395911) on Thursday November 08, 2012 @11:55PM (#41928431)

    the largest plant is going to be in the south. Most likely northern Alabama or possibly Louisiana. How do I know? I work in one of the State Governors office and there has been Foxconn AND Pegatron groups in and out since at least, roughly, Christmas 2011

    How ironic (and fitting) that a land where people who still to this day wish for the good old days of slavery and cotton farms to return will soon be working in the modern equivalent of the cotton farm.

  • by hessian (467078) on Thursday November 08, 2012 @11:58PM (#41928457) Homepage Journal

    But in Europe a typical valid answer is "if management did not treat the workers like shit, they would not be unionized."

    Europe's a mess. I'm sorry for not kissing your ass like a guilty American, but I've been there recently and over the last 20 years a lot has changed. Not for the better. Good luck to you all.

    Back to the topic. There are valid answers and then there are truthful ones.

    The truth in this is complex:

    1. Some employers treated their workers like shit, especially when the workers were from ethnic groups who came into the country in such huge numbers they reduced their average value to near nothing (Irish, Mexicans).
    2. Many employers treated their workers like shit because the workers, like 90% of humanity, were disorganized, lazy, slovenly, etc. and did a bad job.
    3. Most employers treated their workers well for the same reason most employers do today, which is that happy people paid at market rate and overseen by decent people will in turn produce the best labor.

    And then there's every total union, like the Soviet republic, where the workers were so not treated like shit that the economy fell apart.

  • by JWSmythe (446288) <jwsmytheNO@SPAMjwsmythe.com> on Friday November 09, 2012 @12:00AM (#41928469) Homepage Journal

        Actually, they could set up in *any* metro area in the US. Pay minimum wage. Make all the employees part time, so they don't have to pay benefits. 2 20hr/wk employees are cheaper than 1 40hr/wk or salary employee. They can maintain a barely OSHA compliant workplace, and items that are too expensive, they can just absorb the cost of fines. Their customers have financial and political leverage, so I'm sure lots could be ignored, especially if they're going to take a few thousand people off of the unemployment rolls, even though they'll make less working.

        Pretty much, they'll act just like Walmart. A whole bunch of employees who fall below the poverty line.

  • by HornWumpus (783565) on Friday November 09, 2012 @12:02AM (#41928481)

    Slaves make incredibly shitty workers. They only work hard enough to not get whipped. And you have to pay someone to stand behind them with a whip all day. The hard collar for draft animals basically ended slavery's economic viability. The rest was just social inertia.

    That is one of those inconvenient truths that some people don't want to hear. Free people, with lives and expenses, have a far greater labor efficiency then slaves.

  • by WarSpiteX (98591) on Friday November 09, 2012 @12:06AM (#41928513) Homepage

    I'm afraid you're exactly right.

    When you start globalizing and opening yourself up to competition with countries that have no labour or environmental laws to speak of, you by default undercut your own industries to the point where they are not competitive.

    Free trade with developing countries is a horrendously bad idea for this reason. Tarriffs can be a mitigating factor - to a point, of course.

  • by Anonymous Coward on Friday November 09, 2012 @12:20AM (#41928621)

    Though union leaders screw over the members occasionally, it's no where near as bad as what corporate executives do. In fact, unlike corporations, unions have government watchdogs. Union leaders are fiduciaries for their members, so both the members and the government regularly investigate and sue malfeasance. Corporate executives are principally fiduciaries for the corporation, and it's difficult for either the government or shareholders to ensure accountability.

    The notion that unions are corrupt, their members slothful knuckle-draggers, is political spin by the GOP and the business community which has unfortunately become common wisdom. Of course there was egregious corruption (and still is, but nothing like 50 years ago). But it wasn't just the unions, sadly. Union corruption is just more memorable. We can identify with stealing cigarettes from a truck, or scotch off a boat. Most people find it hard to wrap their heads around sophisticated corporate embezzlement schemes.

  • by HornWumpus (783565) on Friday November 09, 2012 @12:22AM (#41928625)
    History fail.
  • by jd2112 (1535857) on Friday November 09, 2012 @12:30AM (#41928689)

    Yes but detroit is a shit hole of desperation and low wages

    Foxconn will fit in perfectly there.

  • by DNS-and-BIND (461968) on Friday November 09, 2012 @12:32AM (#41928697) Homepage
    Way to totally ignore any negative experience regarding unions...at all. They're the reason our jobs left. I know a fellow here in China from Carolina doing furniture manufacturing. His company told the unions that the price had to come down, they were getting killed by competition from overseas. Union wouldn't budge one inch. Guess what happened? Closed down the factory and moved it lock, stock, and barrel to China. Surprise! Reality.

    Let's also totally ignore the union thugs who came out to bust Cesar Chavez and his workers. Let's ignore the unions that refused help after the hurricane because keeping their own power was more important. Let's ignore the fact that in some states, you can't even work without being forced to join a union. Let's ignore all the union bosses in prison [google.com] (I didn't even bother to cite specific links as Google is continually populated with new stories on the topic). Let's ignore the racism and sexism of the white male union rank-and-file.

    I can't help but notice all the union achievements you list are 50 years old. Once upon a time, there were genuine problems that unions solved. That time has passed.

  • by zill (1690130) on Friday November 09, 2012 @12:32AM (#41928707)

    And theyre from a communist country

    You keep using that word. I do not think it means what you think it means.

  • by tsalmark (1265778) on Friday November 09, 2012 @01:08AM (#41928891) Homepage
    I'm torn as to which metaphor should have the honour of bludgeoning you, the buggy whip or the ostrich head. Progress marches on: keep up or stop for tea with Ozymandias.
  • by Formalin (1945560) on Friday November 09, 2012 @01:15AM (#41928927)

    Yeah, if I was looking to exploit workers and skirt regulations, I'd pick a backwater state, too.

    The people there are so stupid they'll even think you're doing them a favour.

  • by Formalin (1945560) on Friday November 09, 2012 @01:24AM (#41928973)

    Precisely this. The last Communist in China was Mao.

    Authoritarian is the word.

  • by Anonymous Coward on Friday November 09, 2012 @01:57AM (#41929141)

    You'll never pick anything because people like you will never own a company.

  • by Electricity Likes Me (1098643) on Friday November 09, 2012 @02:07AM (#41929209)

    Also no one today was alive when the union movement got started. No one has in fact experience the actual violence and murder perpetrated against early unions who were lobbying for safer working conditions (such as not being forced to work in carbon monoxide polluted environments where people were routinely dying).

  • Not a surprise. (Score:4, Insightful)

    by kamapuaa (555446) on Friday November 09, 2012 @02:08AM (#41929223) Homepage

    This should surprise nobody. Foxconn has developed as a large international manufacturing conglomerate, and the US has by far the largest manufacturing economy, manufacturing 1.7 trillion dollars a year, compared to China's 1.2 trillion dollars a year.

  • by Electricity Likes Me (1098643) on Friday November 09, 2012 @02:09AM (#41929225)

    It's worth noting that union influence on an industry also benefits non-union members. When you're required to adopt good practices and certain wage levels, it drags the bottom up.

  • by Taco Cowboy (5327) on Friday November 09, 2012 @02:09AM (#41929235) Journal

    I don't know much about manufacturing, but what is it about an iPhone that we need 5+ years to learn to do here?

    1. Learn to earn as little as the Chinese workers.

    2. Learn to work 16 hours a day, standing.

    3. Learn to show up at work 3AM in the morning, on a 15 minute notice.

    Oh yes, they will give you a cup of tea and a biscuit when you show up to work at 3AM in the morning.

  • by phantomfive (622387) on Friday November 09, 2012 @02:39AM (#41929391) Journal

    In your other posts today you appeared to be awake and lucid.

    Why, thankyou.

    Yes, their entire central government is about to change this year, just like it did ten years ago, and just as has been planned for the last ten years.

    It's not about the current transfer of power, the risk in that has probably already passed. It's about the growing realization among the Chinese people that the corruption in their government goes to the top, combined with no built-in mechanism for effecting change nonviolently. We are seeing more riots this year than in the past, and frustration over the nepotism is growing (like the Li Gang case, or Ling Gu). The nepotism isn't going to change. People won't submit to authoritarianism and censorship forever.

    Now, I'm not saying the country is going to explode today, but it's unstable. There might not be a massive change for another five years, or it might take 60 years (like in the USSR). It's wise to be prepared for it, and a lot of rich Chinese are preparing by moving money out of the country, or by moving themselves out.

    the simple reality is a Chinese company expanding overseas

    Foxconn is Taiwanese, not Chinese.

  • by Turminder Xuss (2726733) on Friday November 09, 2012 @02:50AM (#41929441)
    The answer is not to get rid of unions in America, but to encourage them in China.
  • Re:Big mistake (Score:4, Insightful)

    by GPierce (123599) on Friday November 09, 2012 @03:02AM (#41929501)

    Of course, almost none of the liars' loans made by the brokers and banks fulfilled the requirements of CRA, but it makes a good story for those who want to excuse the thieves and blame it on the government.

    I know one former investor who lost $3M dollars (75% of his net worth) because of what the banks did to him - and he wanted to blame it on Obama (who wasn't even in office when most of the theft occurred). I wouldn't care that much if you need your deluded beliefs, but your delusions keep the crooks out of jail and that is a shame.

  • by icebraining (1313345) on Friday November 09, 2012 @03:28AM (#41929661) Homepage

    They're not going to pay minimum wage. Didn't you read TFS? They're just going to use machines, and employ a couple of engineers to watch over the production line, just like most other American manufacturers.

    The real cheap labor is not labor at all.

  • by dutchwhizzman (817898) on Friday November 09, 2012 @03:29AM (#41929665)
    Once you mandate union membership you lose the edge for the unions to actually be beneficial for their members. In effect, you'll be trading one bad overlord for another. Corrupt union directors will want to protect and grow their empire, not put their energy in representing their members. A union should be beneficial enough for people to want to join voluntarily. Several western European countries still have a healthy union culture, without being mandatory membership. These unions generally do a pretty good job negotiating collective things and have "free" legal representation in case an individual member has trouble with their employer. Union strikes are relatively rare, but tend to be influential enough to be feared by employers. In short, it's perfectly possible to have the unions make themselves useful without mandating membership.
  • by Lisias (447563) on Friday November 09, 2012 @04:15AM (#41929857) Homepage Journal

    Au contraire, Foxconn's suicide rate being lower than the average is due they got all that bad press for being Apple's supplier.

  • by Anonymous Coward on Friday November 09, 2012 @04:19AM (#41929865)

    And theyre from a communist country where the government is much more powerfull.

    Communist in name only. Practically it is a capitalistic fascism, even to a larger extent than the U.S.

    Democratic People's Republic of Korea is the full name of what is commonly known as North Korea, just because it is called democratic doesn't mean that it is.
    Same goes with communism, mostly it is just a fascism with a red flag.

  • by mvdwege (243851) <mvdwege@mail.com> on Friday November 09, 2012 @04:36AM (#41929925) Homepage Journal

    And guess what else? Ever since the union-busting really took off, working conditions and the share of the revenue going to the workforce have declined.

    Smart people would notice the correlation.

  • by Combuchan (123208) <sean@nosPAM.emvis.net> on Friday November 09, 2012 @05:14AM (#41930031) Homepage

    The first page of this new york times article basically answers your question.

    http://www.nytimes.com/2012/01/22/business/apple-america-and-a-squeezed-middle-class.html [nytimes.com]

  • by ryzvonusef (1151717) on Friday November 09, 2012 @05:20AM (#41930055) Journal

    Genuinely curious, but how much water would a company like foxconn need, for making electronics?

    Could someone explain to me where water would come in the manufacturing process of LCDs?

  • by AmiMoJo (196126) * <mojo@@@world3...net> on Friday November 09, 2012 @05:57AM (#41930197) Homepage

    Way to totally ignore any negative experience regarding unions...at all. They're the reason our jobs left.

    No, they left because the companies didn't adapt to the changing market place. Look at Germany as an example. Strong labour laws and a strong manufacturing sector. They produce high quality products at reasonable prices because they didn't get into a race to the bottom with China, and all while paying a reasonable living wage. They even managed to absorb the East German economy in the process.

    What do you honestly expect workers who are told they must compete with 3rd world labour on wages to do? Default on their mortgage, get a second and third job, pimp out the wife? They were right, cutting wages to unrealistic levels is not the answer, and if you accept it you are even more screwed than if you don't.

  • by CAIMLAS (41445) on Friday November 09, 2012 @08:09AM (#41930611) Homepage

    Absolutely right. Michigan did end up going to Obama just the other day, after all.

  • by MagusSlurpy (592575) on Friday November 09, 2012 @08:25AM (#41930693) Homepage

    You must have never worked in a factory. You're right that they'll only employ a handful of engineers (actually, it'll be a handful of mechanics and maybe two engineers), but they will still need a couple hundred rednecks to load and unload trucks, make sure the parts hoppers are always full, and clear the backups on the line when a box goes into the heat shrinker sideways.

  • by TheRaven64 (641858) on Friday November 09, 2012 @11:30AM (#41932097) Journal

    It keeps being repeated because it's almost true. Manufacturing hasn't gone down in the USA, but manufacturing employment has. Just like in the first industrial revolution, the number of people required to manufacture goods has dropped considerably. China had a small short-term advantage because, for certain things, it was cheaper to use poorly-paid workers than machines, but even that's changing. Lots of people are talking as if Chinese factory workers are competing against American factory workers and winning because they're paid a fraction of the amount, but that's not really the case. 10-100 Chinese factory workers are competing against one American factory worker and a large automated assembly line. They were winning because they have lower capital costs, but higher operational costs. Now that companies like Foxconn have large amounts of capital to play with, they're starting to lose again.

    People keep talking as if bringing manufacturing back to the USA will make a difference for the local economy, but it won't. The mindset that a new factory will employ thousands of people and provide employment either directly or indirectly for an entire town is obsolete. This doesn't, of course, stop local governments giving companies millions of dollars in tax breaks to build a factory, and then acting surprised when it only creates a hundred or so new jobs.

    The first industrial revolution had a lot of social unrest because of the wealth-redistribution that the automation caused, concentrating it in the hands of the factory owners. This one is likely to have many of the same problems. Unfortunately, we didn't find a good solution last time.

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