It's not about taxes

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I heard an executive from Coda Automotive, which makes electric cars, talking on NPR this morning about why the company is going to locate its manufacturing plant in Southern California. He talked about the quality of the workforce, about the demographics of the state, about the fact that Californians understand environmental issues ... all sorts of reasons to build a plant here. And he never once mentioned taxes.

That's not surprising -- for all the whining the California Chamber of Commerce does, corporate taxes aren't a major factor when businesses look at setting up shop in this state. We'd do a lot better to raise taxes to the level where we could afford to educate the next generation of workers. That's far more important in building a strong economy.

Comments

What is far more important in building a strong economy is having jobs here and the work done here in this country. Outsourcing (also known as off-shoring) is now at a record level. Recently, I read one of the writers on here urging Obama to get people back to work. I am not a defender or supporter of Obama but how can he do that when people's jobs are not here for them to get back to work and jobs are quickly leaving? I sense there a major blind-spot amongst many people regarding off-shoring. It's as if many people don't understand that it's going on. The blind-spot is especially obvious with those who accuse undocumented immigrants of taking jobs. I read two articles in the last week one talking about "Snapshot of economy about to get a lot bleaker" and the one below. Put the title in your search engine to read the full article.

(August 1, 2010) Washington - US Jobs Moving Offshore at Record Pace
Washington - Jobs are fleeing the US for lower-cost countries at an alarmingly higher rate. Information technology, finance, back-office staffing, call-center and manufacturing firms are setting up shop abroad amidst a record trade deficit, soaring unemployment—and a protectionist movement at home led by New York Democratic Senator Charles Schumer, The Post has learned. The US shed some 5.38 million manufacturing jobs alone between 2000 and 2009—2.4 million attributed directly to our trade deficit with China—Commerce Department data shows. New York state has been hard hit, losing 272,000 jobs in the same period.
The job-loss forecasts are frightful: Over 1 million back-office jobs will be lost to offshoring—jobs created by US firms abroad instead of here at home—between 2000 and 2015, according to The Hackett Group, a global strategic advisory firm. About 100,000 back-office jobs move out of the US each year, double the 2004-2005 level, the company says.

This morning I read on BBC that "India growth rate rises to 8.8%." India is one of the major off-shoring nations. India's GDP is growing while ours is declining. Does anyone think there's any correlation to this?

Posted by Guest Bárbara Chelsai on Aug. 31, 2010 @ 2:11 pm

Mam,

Off-shoring is not the only industry that is driving the numbers here in our country.. this is a huge market which has less dependence on the west and US compared to its peers in BRIC block. The 400 million middle class of India is as huge as the US and this is a huge market.. the mobile connections added per month is in millions(around 15 million every month). And about the software and IT offshorring.. yes ! off-late there is a plethora of companies that has come up giving quality IT solutions and this is bound to continue as long as we call it as a globalised economy... and as long as India can provide (or any other country for that matter) quality solutions and products in service and manufacturing industry.

Regards,
Rajiv

Posted by Guest on Aug. 31, 2010 @ 10:01 pm

Coda's main plant which builds it's batteries will be in Columbus, OH. Primarily because of tax incentives and state funding/loans. I'm willing to bet their assembly will leave the state as soon as feasibly possible as well. As it is the parts are made over seas. That will leave only th
e corporate headquarters in Santa Monica.

Posted by Guest on Aug. 31, 2010 @ 3:06 pm