Fundamental Concepts: Features and Benefits: Part 2
March 15, 2016 2 Comments
Continuing from yesterday, if you haven’t read part one, you should. These are some of the other things businesses look at when they think about opening new plants.
“Infrastructure: The US is tied together by a tight web of roads, ports, utilities, airports and railroads unmatched in the world. If you want to build a factory here, all you have to do is hook up to public utilities and pave a road from your parking lot to a public thoroughfare. That’s a tremendous advantage that much of the world doesn’t offer.
“Energy: Who here remembers $4.00/gallon gas? Remember dropping 60, 80, even 100 dollars or more, just to fill up the tank? Well, today you can fill up for 20-30 bucks. As much as I bet you like that, businesses like it more. […]
In fact, our infrastructure is so good that it’s cheaper for goods bound from China to Europe to be shipped from China to our west coast, loaded onto railroad cars, moved to our east coast, and reloaded onto ships bound for Europe, than it is to ship directly there by sea. Think about that one for a bit. That’s one reason you see so many container trains in America.
Note, that is not necessarily true for all business. For example, it’s not true for the crony green energy companies, or sometimes for the oil companies, or the big banks, and likely some others. But you know what, they’re big boys, they can adapt, or find productive things to do, instead of sucking at the public teat.
Labor: We’ve talked about labor cost, but as we agreed, that can’t be helped. American labor is the best in the world, and it shows. The problem is that labor is the only one of these things that employers think they have control over. If some other country makes them an offer that they believe balances out the USA’s advantage in stability, infrastructure and energy, and if that country has a much lower labor costs that top shelf American workers, that employer may see a high incentive to relocate, costing American workers their jobs. It would also seem that there is nothing that can be done about that, unless we curb…
“Regulatory expense. This is a big deal, and it is something that the Democrats are NEVER going to talk about. Regulatory compliance costs US companies just over 2 trillion dollars per year. Two trillion dollars. Even in Washington DC that’s a lot of money, it would retire the entire national debt in less than a decade. Hillary won’t talk about this. Bernie certainly won’t talk about this. No Democrat is ever going to mention the cost regulations impose upon American businesses and thus American jobs, because Democrats have only one solution to every problem: more regulation. It’s been said that when the only tool you have is a hammer, everything looks like a nail, and Democrats have been hammering away American jobs with their regulatory hammer for decades.
“It’s actually insane. Clinically insane. Something is seen as a problem. Pass a new regulation! Don’t bother to see if existing regulations already exist or if your new regulation contradicts them, Let the peons worry about that, just pass a new law. Look! We DID SOMETHING!! Cost? Who cares about cost? Full speed ahead.
“More regulations mean more money and more power for the Washington cartel. Meanwhile, out here in the real world, businesses are getting hammered until moving out of the country entirely seems like a good solution. That $2 trillion? That works out to about $10,000 for every working man and woman in the country. Wouldn’t you like to see some of that money come back into your paychecks?
I’ll give you just one example here. If I as an electrician walk into the panel room of an industrial plant, I (and the company I work for) am responsible for every code violation in that room. I don’t have to upgrade it to current code, usually, yet anyway. But I’m supposed to fix all violations of whatever version of the code. The problem is, if I don’t, I can lose my license. If I do, nobody is required to pay me for doing so, and they won’t. It’ll come out of my pocket. How’s that working out? Very few electrical contractors will do industrial work anymore. And a fair number of us, have simply retired, because the money, which isn’t bad, just isn’t worth the hassle, in any part of the market, anymore. How do I know that? That’s what I did when I hit 62. Know what? You’re not going to build that factory without skilled and experienced electricians, and we’re damned rare on the ground, not least because we’re just plain tired of the nonsense.
So there’s a quick overview of some fundamentals for you. And you know, I think the American people might just still be smart enough. If Ted Cruz would say this, I suspect many would respond positively to it. Problem is, he’s a lawyer, not a salesman. Ronald Reagan, who said much of this, was a salesman, and we’re still living off his legacy, but the till is getting empty.
Always talk about the benefit, not the feature. Essential advice for us all.