Friday, January 28, 2011

A Real-Life Example of U.S. Tax Policy Driving Jobs Offshore

An executive in the health care industry sends in the following.  First, there is this article on how Swiss medical technology is "gobbling" up world market share

Swiss medtech (is) one of the fastest growing industrial sectors in the country, with an average growth rate of 6%–8% per year for each of the past 15 years. From 2006 and 2008, for example, it grew between 25% and 30%.


Now the executive commentary:

The artical absolutely minimizes the real reason why Swiss Medtech is growing - it is a tax shelter for US medical companies.  Major medical companies in the U.S. put up useless boards with useless people in Switzerland, with useless "decision-making" in order to meet the requirements for Swiss MedTech and answer US IRS rules sufficiently.

From Chinese parts manufactured and shipped back to the states to now setting up 20 and 30-senior level "leaders" in Switzerland to appear to make decisions for a US company, all for the savings of US taxes.

Just another rant on how our US tax system is inefficient, does not create value-added jobs, and ultimately wastes money.

Saturday, January 22, 2011

The Fallacy of "Green Jobs"

Every time I hear a politician talk about government spending to create "green jobs" I can't believe the illogic of the argument:
  1. If "green" energy works, it will take the place of "old" energy - oil, coal, natural gas, etc.
  2. So if green jobs go up, old energy jobs go down.  Best case there is a one-for-one trade off a lost carbon energy job for every green worker who gains a job.
  3. If green energy really is more efficient, it means that the total energy needs of the U.S. will be supported by fewer people, so green energy means a net loss of jobs.
But at the end of the day "green jobs" is just a code word for government spending boondoggles that do nothing to help the employment picture, or create more energy, or bring energy costs down, but some people go along with it because it "sounds good".

Monday, January 17, 2011

Dumb Move. First They'll Steal Your Technology, Next They Will Crowd You Out

Lesson 1: don't trust the Chinese.  Lesson 2: they will stab you in the back (see Lesson 1).  But GE, thought to be a well-run company, apparently doesn't know: GE to Share Jet Technology with China

Name one - any - company that is happy with their joint development efforts with China.  Name one that hasn't had their technology boldly ripped off?  Name one who has made money in the long run.

Wednesday, January 12, 2011

Literary Quote of the Day

The world breaks everyone, and afterward many are strong in the broken places. But those that will not break, it kills. It kills the very good and the very gentle and the very brave impartially. If you are none of these you can be sure it will kill you too, but there will be no special hurry.

- Hemingway, "A Farewell to Arms"

Tuesday, January 04, 2011

Business Quote of the Day

The most dangerous negotiation is one you don't know you're in.

- Jim Camp