Foxconn May Close Factories In China

ChiefMonkeyGrinder writes "Foxconn, the manufacturer whose clients include Apple, Dell, and HP, is on the verge of pulling out of China after a spate of suicides. The CEO has accused workers of killing themselves for financial compensation, and the company has stopped suicide payments to suicide victims' families. Foxconn's CEO also told investors that it is considering moving its production operations to Taiwan, and automating many parts of its business, a move which could see 800,000 workers lose their jobs."

Comments

Maths don't matter to reality!

[spleen_blender]

These suicides are well within the statistical expectations for a worker population that large. But People don't care about facts, just emotions.

Re:Maths don't matter to reality!

[dachshund]

These suicides are well within the statistical expectations for a worker population that large. But People don't care about facts, just emotions.

Really? Is it statistically common for groups of people from the same workplace to throw themselves off the same rooftops in large numbers? I mean, keep in mind that these aren't unrelated people slitting their wrists or taking pills.

I'm hardly the first person to make this point, but consider the last time you heard of a rooftop-suicide epidemic at a major corporation. Can't? That's because even given the huge number of people employed by corporations it's an unbelievably rare event. In fact there have been one or two such examples over the past few decades and they were treated as exactly the unusual and horrifying event that they are.

Re:Parallels to the Union movement last century

[MrNaz]

China is as communist as America is capitalist.

Re:Rewarding suicide is unwise

[timeOday]

Some are better than others, but all incentive systems have perverse incentives. Even something as simple as paying a real estate agent:

Pay them a fixed price: their incentive is for you to buy / sell ASAP, good deal or bad.
Pay by the hour: they could milk you forever.
Pay a percentage: buy / sell ASAP, since holding out for a better deal could easily double their work and still only increase their haul by a few percent.

Even in the simple case - a company paying salesman a percentage of what they sell - can easily turn bad for the company through infighting salesmen, lying to customers, and customers with buyer's remorse who won't come back.

Re:Parallels to the Union movement last century

[ultranova]

No, I was only addressing one half of the point which I thought might appeal more to the bleeding heart liberals. Tariffs are bad for us too. They might for a short time protect some of the union jobs in a specific industry but they are harmful for the wider economy because they deprive our industry and consumers of cheaper products.

Chinese products are cheaper because the workforce is abused. That's another way of saying that they aren't cheaper at all, Foxxconn has simply managed to succesfully externalize part of the cost to be paid by said Chinese workers rather than buyers. This is bad from the economic standpoint, since it encourages behavior where the total costs are actually greater.

An import tariff for such products is good because it forces the end user to pay for all the costs of the product, thus allowing free market to optimize resource usage. This is also the idea behind carbon credits and other such devices often derided by, ironically enough, free-market fundamentalists.

As an exercise, think about what would have happened to the USA computer industry if from the start we had laws that ensured that all computer components had to be made by unionized factories in Michigan.

All computer components should have all of their costs included in their final price, including but not limited to pollution, injuries etc. caused by the operation of the manufacturing plants. If necessary, if for example a factory operates outside US jurisdiction and gains a price advantage by polluting with abandon, tariffs should be used to enforce this.

Failure to do so will result in market failure. You cannot have a free market if everyone can simply steal from others - which is what externalizing costs is really doing. Free markets can only work if you are forced to pay for all the costs of whatever choice you make, and that requires tariff in a world with different jurisdictions.

There are, of course, ethical reasons to stop multinational corporations from killing Chinese workers in the name of profit, but I'm addressing the half of the point which I think might appeal more to the stone-hearted conservatists.