Some Thoughts on America

There are quite a few reasons America has fallen from it’s once “mighty steep”. In this essay I hope to discuss a few reasons that I see relevant to the situation. One is the Bush administration and the globalization that it has pushed for and outsourcing a by product of it; I will provide some thoughts on both sides of the argument. The second is the financial crisis that has occurred and why I think people are as much to blame as the banks are or more. And finally, the most critical issue in my opinion, the one that most people do not really think about: that is the Puritan belief that has held America hostage from the very beginning. I got my inspiration for this little essay from mister.old.school’s thread: The End of The United States: The Bush Administration (can be viewed here: www.abovetopsecret.com...&flagit=338704).If anyone wants to know, my degree will be in Business Management with minors in Economics and English (mainly literature). I graduate in two months or so and I think I have a decent perspective and maybe even a new view to the situation.

I personally believe that globalization isn’t a bad thing, and neither is outsourcing; they can be good, and if used correctly, they can be awesome tools. I will try to come at globalization and outsourcing from both sides of the issue. However, if these tools are used incorrectly, it can turn into something of what we have now. The main goal of globalization, in my opinion is to unite cultures, cut costs, and to hopefully provide an overall better quality product. Ideally that is what is supposed to happen. It’s a good idea, but right now, almost unfeasible to fulfill with the results many businesses foresee. An example of how globalization could be used to help people is with hospitals. I know that some surgeries can run in the $100,000+ range in the states. However, with globalization, you can go to Thailand and have the same surgery for a fraction of the cost. This is a result of free markets forces and how they actually can work. Paying an outrageous fee in the U.S.? Just go to Thailand and get your surgery done. If anyone is interested in this, this is the hospitals website: www.bumrungrad.com... I believe this hospital has something like eight RN’s or so per floor while here in the states it might be one if you’re lucky. An example of how outsourcing is good is thus: sending x-rays, blood work and other medical tests too other countries, I’m going to use India in this example, and having those tests done while the doctor here sleeps. The doctor then receives the results back the next day and passes them on to the patient. These are two good examples that I can think of how globalization and outsourcing can work for the good of all.
However, there is a darker side to globalization, the one we are most familiar with. This is an ever increasing and disturbing trend, and you can attribute it to the Bush organization, and that is the outsourcing of America. I don't have stats, and I'm taking my best educated guess that from the tail end of Clinton's presidency to now, outsourcing has jumped at a staggering percentage; in the business world, outsourcing is our "friend". Upon a review of an article on E-Commercetimes.com by Alison Diana, Outsourcing by the Numbers (11/12/03):

“Corporate America is outsourcing an increasing number and variety of jobs to foreign shores, a trend that few industry experts predict will slow, let alone reverse, in coming months and years.
"Offshore outsourcing is just one small part of a (US) $5 trillion global outsourcing market. This market is growing by more than 15 percent per year, and the offshore component is certainly among the fastest growing," Michael Corbett, president and CEO of New York-based Michael F. Corbett & Associates, told the E-Commerce Times. "We are at the earliest stages of a fundamental transformation from regional economies to a single, integrated global economy. Just as companies now compete globally, workers need to realize that they, too, are competing globally."

The main thing we have seen from the late 90’s to now is outsourcing and a move towards a global economy; I’m sure that even if you haven’t been directly effected as a result of outsourcing, you’ve either been effected by it indirectly or someone you know has been effected. There use to be an emphasis in the U.S. on loyalty. Some members on ATS might have worked in those times (40’s-70’s/80’s or so) and can relate to what I’m talking about. An article from September 19, 2005 entitled Rethinking Company Loyalty; Lauren Keller Johnson writes:

"Few business leaders would deny the importance of organizational loyalty; perhaps fewer still believe they can achieve it the way they once did. After all, the lifetime contract expired long ago, and your people—especially your best people—are more likely to display loyalty to their careers than to you, their employer.
The very nature of the relationship between employers and employees has undergone a fundamental shift: Today, workers not only don't expect to work for decades on end for the same company, but they don't want to.”

Some companies in Japan still use the loyalty method, giving some employees the option to work for the company for life. In doing so, the employees are given all the necessities and in some cases their children will take over the job at the parent’s retirement. However, in Japan, this concept has changed some over time. There are now three options to choose from, the above mentioned and then two more that are still somewhat loyal to the company but allow for more job movement. In America loyalty was never to that effect, but nonetheless there was a sense that you’d get your pension when you retired and your company would take care of you. I’ll give the example of my Dad and what I’ve observed over the years. Back in the early 90’s when I was still young I would never hear any discussion over him moving to another job or anything of that nature being discussed; my parents always let us hear everything so that we always knew what was going on. Fast forward to the mid to late 90’s, that’s when all the rumors and downsizing, or outsourcing, started to occur at his job. How he made it out with a job is a mystery, but I suppose his skill level might have had something to do with it (he can work on live electrical stuff, breakers, transformers, ect.); but for years the discussion was over what would happen if he did lose his job, or was “forced” out. My Dad’s worked for his company for 35 years or so and has been there a lot longer than others with the exception of a few others. From talking to him and some of the others at his work, they distrust management in full. The thing is, he, and the other employees have pretty much given their all to the company, and now that retirement is coming around, it’s not like it was in the past where you expect to get your pension and be taken care of, instead they may get quite a bit less than what they should get, all to cut costs. But this is the other side that comes with globalization and outsourcing. Me, I take a manager’s prospective on these issues. I assume that I will one day be in a position where I will have to make these decisions. Preferably, if put in that position, I would like to choose to keep my employees over firing them and earning a small profit from outsourcing their jobs, but I don’t know if that will be the case. From a business standpoint it makes sense more and more to outsource. It doesn’t always work the best, but it saves on the bottom line, and that’s the most important thing in business, turning a profit. I know some people will disagree with me, but, that’s what business is all about, that and pleasing the shareholders; employees are a secondary thought.

Cont'd

Another thing that I hear a lot of people, on ATS and in general, talking about is the banking situation. It is pretty much fact that the banks were extremely negligent in giving out loans, however, I don’t feel that is the only problem. I know the banks are a major reason for the situation we now sit in. The sub-prime loan was a great way for banks to make money, however, when they started giving loans to just anyone, they sealed their fate. Consider this: it is harder, maybe was harder now given our current circumstances, to get an apartment then it was to get a house. But, I’m going to go a different direction with this topic and place the blame on the people as well. Time and time again I’ve seen it, people abusing credit like it is cash. Instead of retyping this info, I’m going to pull it off one of my other posts instead and it goes as follows:
Have you ever really looked at what the credit companies are doing to you? They aren't stupid. I recently figured up some numbers for a friend because he was paying only $20 of on what he owed on his credit card, by the way, the minimum is $15. This is a Paypal credit card that we're dealing with and just to find out the information on the card alone was hard enough; you have to actually pretend to sign up for it to get the rates and numbers on it.

Let’s run through this:

Ok the total is $1270 that my friend has to pay off. I forgot to mention, that he thinks it is better to pay it off monthly to get a higher credit score, which isn't really correct, but anyways, back to the numbers. So if he stays on this course of paying $20 per month, it will take him 63.5 months to do this, which equates to 5.29167 years, so quite a long time. And with my friend, he actually could take that long.

The average rates are as follows:

Acct type 1: 13.74%
Acct type 2: 16.74%
Acct type 3: 19.74%
Acct type 4: 22.74%

And if you are delinquent you're hit with a 31.74% rate.

I'm not sure which account type is his so I figured them all even though I'd bet that it is #4.

Here's some of the jargon that I took down from the site itself, I may have interpreted it wrong, it is difficult, and if some one knows that I'm wrong, by all means please explain it to me.

The jist of what I read:

Grace period for repayment of the balance for purchases is 20 days if previous balance is zero (0) or paid in full, otherwise, none.
If you are late, and have a balance over $1000, you are then slapped with another charge of $35.
Transaction Fee: 3% of account balance and no more than $75.

Finance charges:
Periodic rate to account balance subject to finance charge of $1.
Periodic rate = 22.75%
Balance subject to finance charge
Each day adds more finance charges.

Now for the numbers. I used a TI BAII plus to do these numbers; they're not perfect, but it gives a good idea of what the final charge can/will look like. (All info figures are based off of the $1270 mentioned above as well and my friend paying $20 per month on it).

Acct type 1: $2367.90
Acct type 2: $2729.24
Acct type 3: $3133.20
Acct type 4: $3585.54

Delinquent: $5735.51

So you can see that he's paying quite a bit more.

Now, on:

Acct type 1: he would be paying 46.4% more than what he owes
Acct type 2: he would be paying 53.5% more than what he owes
Acct type 3: he would be paying 59.5% more than what he owes
Acct type 4: he would be paying 64.58% more than what he owes

Delinquent: 85.34% more than what he owes.

If you want to figure out yours, or this one, or anyone’s, you need:

Present value (PV)
Time (N)
Payment (PMT)
Interest rate (I/Y)

And you are solving for Future Value (FV).

At least that is how I solved it.

I think that responsibility also falls on the individuals as well. I have an example besides my friend that I will now use. My friend up there, hopefully, will figure out that his payments are going to have to be more than the minimum so his credit will be good but on to my other example, my uncle. This is a man that totally disgusts me with his spending habits; I don’t really have any other way to put it. He has personally told me that he owes at least $1million worth of debt; the sad thing is, he probably isn’t lying. I’ll give two examples of what he’s done; some of you might be able to relate to me because you might also have relatives like him. Case point number one: My grandma, whom he takes advantage of, lent him her credit card so he could get some painting supplies. He bought that, and a whole lot more, once reaching the cards limit. You might ask what he bought. Basically he went out to eat every night, Chili’s one night, Taco Bell; yes he actually put Taco Bell on the card, and a whole slew of other restaurants/fast food places. It took my grandma a couple of months to pay off nearly $10000 worth of charges and then finance charges on top of them. This is a guy who thinks a credit card is like cash, and it’s not; sad thing is, many other people do too. Case point number two: Recently my mom took my grandma to the store, my mom is the only one who does this, and my grandma couldn’t even buy food because she gave my uncle money for something and then he didn’t, more like won’t, repay her. I’m truly disgusted that he could do such a thing, especially to his mother, and come to find out, the night he got the money he went and bought Chicken Express. For a family of four like his, that’s at least $25 or more. I know my uncle might be an extreme case, but surely there are other people out there who know or are related to people like this. I put a lot of blame on people and their spending habits. Personally I have no credit card debt, I pay what I owe, and I don’t buy things unless I have the money on hand to pay off the bill, but I know that I am probably in the minority in this case. The banks can't be solely responsible for people not paying their bills, however they can be accountable for allowing people to just pay the minimum because they are greedy and want more money. Now, let’s say that the majority or a good part of this country does what's said above. Then you end up with a big problem. So while the banks should be held accountable, people are also to blame for not being responsible and not trying to work on their spending habits.

I now come to the most important part of the essay, and that is the Puritan belief that has shaped America. This is something that most people do not think of when they think of why Americans think like they do. It’s the notion of a “city on a hill”, the notion that we are better than everyone else; all this comes from the Puritan belief that was brought here over 400 years ago. The main focus of the discussion will be mainly focused on John Winthrop’s sermon, A Model of Christian Charity, and a small part from William Bradford’s, Of Plymouth Plantation and both writings I’m getting out of the Norton Anthology of American Literature, or NAL. Since there is less to talk about from Bradford, I will address him first and in more of a synopsis of what he is talking about. The reason I include Bradford as a Puritan is because of his belief in the Calvinist tulip:

Total depravity (Original Sin)
Unlimited election (Pre-destination; pre-selected for heaven or hell)
Limited atonement (Only for the elect)
Irresistible grace
Perseverance of the saints

Bradford and his follower’s hierarchy:
God
Minister
Christian Men
Christian Women
Strangers (People who did not believe like Bradford; also referred to as the “others”)
Natives

As one can see, from basically just landing in New World, the Puritans had a belief that they were better than others; this can be attributed to the belief in the Calvinist tulip. They followed the belief (typology) that they were like the Israelites and considered themselves, the chosen ones, God’s people. Bradford considers others that came over on the Mayflower, but who do not believe like Bradford and his followers to be “others” or “strangers”. The natives receive a similar designation, but it is worse in their case because they are “heathens” and godless people. Right away there is a separation of the Puritans from the other groups inhabiting the land, and even some from their own people. While Bradford’s Puritan notion set the stage for how we believe, John Winthrop drove it home; keep in mind though that Winthrop’s writing is a sermon, and yes it was written out because they use to be read rather than an outline and improvise. Winthrop is using the Geneva Study Bible to get his material from; it basically tells him how he should preach to the congregation. From the beginning of his sermon, Winthrop states,

“Secondly…to manifest the work of His Spirit: first upon the wicked in moderating and restraining them, so that the rich and mighty should not eat up the poor, nor the poor and despised rise up against their superiors and shake off their yoke" (76).

This can be read other ways, but, I’m reading it as a way to keep people in their places, especially the poor. However, to further show the notion that the Puritans believed they where better than everyone else, Winthrop goes on to say,

“Do good to all, especially to the household of faith” (77).

Winthrop states that by doing good deeds, his followers should expect [quote“to witness the improvement of [their] talent” (79). Talent in this case means money; a footnote from the NAL. However, the most important part of Winthrop’s sermon that concerns this essay is that of,

“For we must consider that we shall be as a city upon a hill” (86).

Part of his quote is coming from the Bible, but he is taking it out of context, but, that one line is the reason that we Americans believe as we believe; even Kennedy used it in one of his speeches.
The Puritan notion is the major reason that America has become what it is now. This belief system is now inherit in all people born in America, regardless of religion, the belief that Americans are better than everyone else and it all stems from the line “a city upon a hill”. This belief has grown from being a line in a sermon to actually being a way a whole country defines itself. I know many people on the ATS boards are from other countries, I wonder if they think the same thing as I am, that we Americans think we are better than everyone else. I myself try to keep a level head and treat everyone equal, however, there are times when I’ve said to myself that I was better; that I could do whatever the situation was better. From this “city upon a hill” belief, America and Americans believe they have the right to police the world so to say, to make the laws of what is right and wrong. Look at what’s happening in the Middle East, it is nothing new; we Americans are taking from someone we feel is inferior to us. And it is because of this belief, this thought pattern that we Americans believe we are better than everyone else, that we now see the process of globalization and outsourcing becoming more and more relevant because we don’t want to do the work because we think we’re too good for it. In the beginning of this essay, I stated that globalization and outsourcing can be a good thing, and whole heartedly believe it can be, but as Americans, we have to come down off of our “high horse” and realize that we are the same as everyone else and that we all must work together if we wish to succeed.

Source(s):

www.ecommercetimes.com...

hbswk.hbs.edu...