Depot Dazed

What exactly is outsourcing and how in the world could health care reform play a role?

Wikipedia has an informational page about Outsourcing that is a good source of general information concerning this: “subcontracting a service, such as product design or manufacturing, to a third-party company.” This definition, used in the first sentence of the page, shows how much this process does to help ‘Big Businesses’. Subcontracting is something that few small businesses can afford to do in order to get their products out to the public for sale. Additionally, many small businesses are family owned and operated, contribute to their local economy, and therefore, the business owners do not wish to outsource jobs. Quality control becomes an issue as well. When a business has been built on family pride, there is a great deal of psychological investment in quality of the product. This is a feature of small businesses that is frequently lost with the big corporations. The bigger the business, the farther away from the product are those people who make the decisions that affect quality control.

“The decision whether to outsource or to do inhouse is often based upon achieving a lower production cost, making better use of available resources, focusing energy on the core competencies of a particular business, or just making more efficient use of labor, capital, information technology or land resources.” In short, to make more in profits!

Outsourcing can be done within the boundaries of the United States OR it can be done in other countries. If services/jobs are outsourced within the United States, all companies have a fairly even playing field. The application of outsourcing without the boundaries of the United States is where a potential for ‘unfair advantage’ exists. Unfair advantage for the United States worker, that is!

If anyone is unaware of the vast number of U.S. jobs that have flown away to land in foreign countries, it does not take much effort to find information on the internet. EarnMyDegree.com hosts a webpage that begins by identifying many of the types of jobs that are currently being outsourced and some jobs that may be considered safe from outsourcing. Suffice it to say that the analysis of likely to be “safe from outsourced” jobs are all focused on services that required ‘either face-to-face or hands-on contact. Doctors, nurses, teachers, physical therapists, dental assistances, child-care workers, etc. are all likely to be safe from the threat of outsourcing. However, they are not safe from the negative effects of outsourcing.

What negative effects you ask? How can businesses saving money which can result in lower overall costs to consumers be bad? How about the number of unemployed people, the number of people having to use government services, the loss of competition (just how long do you think those prices will stay low when their is no competition?), and the loss of those small businesses that have been the centers of communities since the founding of this country?

Articlesbase.com has a Feb. 5th 2009 article Concept of Back Office Outsourcing Jobs in the Insurance Sector that provides an example of how outsourcing is being marketed as a good thing. In this instance, the argument is presented that Auto Insurance Companies do not have the time to handle everything efficiently, and that good customer service demands that jobs be outsourced to countries such as India where a .. “good outsourcing company can help their clients in many ways to keep track of their records, which usually get piled up in a normal office scenario, in the areas of book keeping, accounting, financial reporting, content digitization, etc. with perfection”. Further noted in the article is “Now a days many of the Auto Insurance companies abroad have started outsourcing their back office jobs to Indian companies as a strategic idea to cut down costs and they get easy access to intellectual caliber of the people in India.” While those may all be good arguments, where does the loss of jobs for citizens of the United States come into play? Where does the loss of federal, state and local tax revenue come into the equation? It is clearly a case of “Big Business” looking at their profit margins rather than striving to be good citizens.

Another discussion on outsourcing appears in The New York Times where an article in their World Business Section August 11, 2008 (by Heather Timmons) Cost-Cutting in New York, but a Boom in India can be found. This author looks at the ways in which Wall Street businesses is cutting some of their overhead by outsourcing many jobs, including research, to companies in India. Ironically, many of the U.S. companies noted in the article are also those firms which have recently received U.S. taxpayer support. This leaves us in a situation where U.S. taxpayer money is now being used to outsource U.S. jobs creating further job loss in the U.S. and effectively serving to cut (or at best, hinder the growth of) the very same tax base that helped those Wall Street companies stay afloat and paying all those bonuses to those those they are keeping state side.

One of the most telling lines in that New York Times article is on page 2: “There’s a huge amount of grunt work that has been done by $250,000-a-year Wharton M.B.A.’s… Some of that stuff, it’s natural to outsource it.” Okay, I give up. Why do managers of very large, very profitable businesses have $250,000-a-year M.B.A.’s doing grunt work? Is this how they manage the rest of their business? If so, it is a miracle we are not in worse shape economically than we are right now. Don’t we have enough people in our own country to do ‘grunt work’ without having to send it overseas? If you’re going to outsource, why not outsource it to companies right here in the good old U.S.A.?

Perhaps the largest reason why U.S. jobs are migrating overseas is because of the cost of health care! The United States is the only industrialized nation that does not have a universal health care system. Health care in China runs an average annual cost of approximately $7.00 per person (NO THAT IS NOT A TYPO). Of that annual cost, 40% ($2.80) is paid by the central goverment, 40% ($2.80) is paid by the provincialgoverment, and 20% ($1.40) is paid by the individual. India has a universal health care system hosted by state/territorial governments. By purchasing an outpatient card, the individual receives free outpatient care. Hospital treatment is calculated based upon an individual’s income level, with costs waived for those below the poverty level. More examples and further information on these can be found at wikipedia’s universal health care site.

Given the fact that employer provided health care is not an issue in those countries where U.S. jobs are being outsourced at a rapid pace, maybe it is time for our elected officials to get a clue. Universal health care or at least the public option, could keep U.S. jobs in the U.S. Maybe we would not have so many citizens out of work. Just something to think about.

There is a world map online that shows some interesting details on which countries have universal health care, which are trying to obtain it, and which are avoiding it. Perhaps most interesting of all is where it is noted that both Iraq and Afghanistan have universal health care provided by U.S. war funding.

In a September 9, 2009 article for the Huffington Post by Mark Dorlester entitled Guaranteed Health Care in Iraq – But Not For You, more information comes out about how Republicans have historically behaved when it comes to universal health care. The Iraqi Constitution was carefully crafted to mandate universal health care and, in fact, notes: “Article 31 reads: “First: Every citizen has the right to health care. …” THE RIGHT! So, the U.S. can step in and demand that citizens of other countries have health care as a right, but it is a right denied to its own CITIZENS?

Here, in the United States we have people asking for this type of health care. Instead of providing it, our own government refuses U.S. citizens BUT forces the same thing down the throats of countries that have not asked for it?

I do not understand the difference in values here. The article above goes on to say: “In other words, the most senior members of the Republican establishment – and some Democrats like Max Baucus (D-MT) – have gladly spent more taxpayer funds to ensure health care as a Constitutional right in Iraq than they are willing to spend to give you any level of guaranteed coverage.”

I would certainly like to know exactly which of our elected officials voted to support and fund that war, then…ask them to explain why they feel citizens of other countries are more deserving of a Constitutional right to health care AND the taxpayer money to support it!

The author also provided a link to the full text of the Iraq Constitution…a very interesting read indeed!

The most logical reason, at first look, was the insurance companies. It seemed to reason that certain upper level people in insurance companies might get upset, particularly those with 6, 7, 8, and 9 figure incomes.

Then, I started looking a bit deeper. Could it be that the people who are most afraid are the ones who have used this issue for years as a way of getting elected are afraid that if health care reform comes to pass, it will be such a success that they will have to address other things for campaign issues. Darn, that could cause them to have to write new speeches, get new signs, maybe even shake a few more hands. Just something to think about.

The Roanoke Times recently covered a story on the Museum in the old Depot in Cambria. I had been thinking lately of some sort of historical reinactment to do in Cambria as part of a celebration. Thank you Mac Mitchell. You have given me the answer I have sought all this time.

Here’s what we need to do. We start in Riner where we have people bring in turkeys from where ever turkeys come from before they arrive at Kroger. Nope, not the Sarah Palen types of turkey that are headless. I mean, the walking, talking, strutting kind of turkeys….(nope, not elected officials either). Anyway, we get about 200-300 of these turkeys collected and sorta like that “running of the bulls” thing they do in Spain, we do a ‘running of the turkeys’. We bring that herd of turkeys all the way from Riner, through downtown Christiansburg and right up to the Depot as if they were being driven up to load on railcars.  What a sensation! I’ll bet people from miles around would come to watch the event. But, on second thought, maybe it would work better with elected officials. Naw…they’re not as colorful but the noise level would be about the same!

(Just some thoughts while I’m still working on the Water Sewer Ordinance update review:)

Where ever I am, what ever I am doing, I usually have some sort of audio, video, or readable news feed going on in the background. For some reason, I think better with noise in the background.

I have heard some really weird statements arise during the recent debates on health care reform. One of the funniest is the people arguing that they want to be able to choose their health care plan. If you are fortunate enough to work for yourself and have a lot of money, you are one of the few who can make that choice.

If you work for a large company that provides benefits, you have an illusion of choice. Large companies negotiate with Insurance providers for the best rates. Some companies change provides every few years in order to garner those savings. Employees seldom have any real say in what is provided and the costs. If you have ever wondered why you are suddenly paying more in premiums, or why services have changed, or why co-pays are suddenly different, this is usually the answer.

Big business wants to get the best deal, Insurance providers want to save the most money…you, the employee are caught in the middle and have very little to say in the matter unless you decide to change jobs. I have worked for companies where the doctor I had used for years was no longer on a provider list because the insurance program had changed. I have seen people have to wait for surgery because their doctor is having to argue with the insurance companies over whether the surgery is needed or not. In one instance, a friend with a long family history of cancer was told that surgery to remove a football sized tumor wasn’t needed because it did not ‘appear’ to be malignant. Sitting on top of a timebomb, my friend was fortunate to have a physician that kept pushing and pushing until the insurance company gave in. This is NOT an uncommon scenario.

Now that the health care debate is really going, all of a sudden, insurance companies are coming up with better rates, better options, and better coverage. Why haven’t they done it before now? Can they be trusted to police themselves? How can you be sure that it will not be GREED that stands between you/your family and the type of health care that you need.

If these companies were capable of policing themselves, why haven’t they already done it. They’ve had decades to do exactly that. Now, they expect us to believe that they can set aside corporate greed in order to best serve Americans?

Give me credit for a bit more sense than that. If it were consistent through human nature to ‘do the right thing’, we would not need police officers, we would not need laws, we would not need attorneys, and we would not need comprehensive health care reform. Unfortunately, GREED drives so much of our economy that the decisions made are often based on what is best for the Company, not what is best for the People.

There are plenty of other areas of commerce where GREED can continue to drive things, we do not need it in something as basic as health care. Providing health care for all is an investment in our future. Can’t we, as one of the richest nations in the world, afford to see that everyone has basic medical care? We send supplies and people all over the world to help other people, can’t we set aside fear and prejudice to help our own? Isn’t it the right thing to do?

Isn’t it the right thing to do to promote and encourage health rather than ‘fight disease’? Is it better to prevent a war than it is to fight in one?