Corporate citizenship?

I didn't say they don't sell perishable foods. I specifically said "fresh" and frozen "Poppers" and "Bagel Bites" hardly qualify as "fresh". From what I can see the only portion of their product line that might qualify as "fresh" is their Boston Market line.

The claim of Heinz's outsourcing is the the exact same claim that others cried about when Stanley was going to move their headquarters to the Caymen Islands or Bermuda or wherever they were headed.

Stanley didn't get their raw materials or make most of their products here in the states either but the minute they announced they were moving off-shore people cried about how they were doing it just to avoid paying taxes.

Those same people now defend the Heinz Corporation for doing the same thing.

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Well I never fault companies for going off shore, I think it should be done more often so I can't speak for their duplicity.

But let's say you still don't consider frozen food fresh, do you concede that there are logistical issues that dictate that they be produced locally?

Incidentally this is what Suzy was trying to say:

Quote:

Currently, 60% of the sales of the H.J. Heinz Company are outside the United States and to accommodate those customers by providing facilities closer to those markets, the company maintains a number of overseas facilities that provide products for consumers in those markets. This allows Heinz to pack the freshest ingredients, tailor its recipes to local tastes and deliver the finished products in a timely and efficient manner. In the United States, Heinz makes its flagship ketchup in factories in Fremont, Ohio; Muscatine, Iowa; and Stockton, California.

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Craven de Kere wrote:

But let's say you still don't consider frozen food fresh, do you concede that there are logistical issues that dictate that they be produced locally?

If cornered I doubt Heinz could justify it on a basis of logisitics. Frozen, canned and bottled foods are shipped globally everyday. A more plausible reason is strictly political and cultural. Europeans will buy end products made from locally produced materials before they'll buy imports out of a sense of nationalism (you see this all the time with French Farmers going on strike over this issue..) even if it costs them more at the register.

Quote:

Incidentally this is what Suzy was trying to say:

Quote:
Currently, 60% of the sales of the H.J. Heinz Company are outside the United States and to accommodate those customers by providing facilities closer to those markets, the company maintains a number of overseas facilities that provide products for consumers in those markets. This allows Heinz to pack the freshest ingredients, tailor its recipes to local tastes and deliver the finished products in a timely and efficient manner. In the United States, Heinz makes its flagship ketchup in factories in Fremont, Ohio; Muscatine, Iowa; and Stockton, California.

I understood the Heinz issue and I don't really have any problem with what Heainz Inc. is doing. But I could just as easily substitute "Stanley" in the paragraph above (and take out the comments about "freshest ingredients") and post it on this board as a justification for Stanley to move their corporate HQ off-shore and you'd find 70% of the leftist contingent on this board arguing that Stanley is nothing but a bunch of corrupt thieves intent on ripping off the US taxpayer.

If the argument doesn't hold for Stanley it doesn't hold for Heinz either and that's why the argument as a defense of Heinz (and by implication, Kerry) are hypocritical nonsense.

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fishin' wrote:

If cornered I doubt Heinz could justify it on a basis of logisitics. Frozen, canned and bottled foods are shipped globally everyday.

True, but this is usually premium or luxury items. I don't recall the statistics of what % of end product consumed is produced locally for foodstuffs but I do recall that it's pretty high.

I've worked in a couple of multinational food companies (Akinomoto, Danon, etc) translating their corporate documents and contracts and many of their products would simply not be on teh market if not produced locally.

Frozen canned and bottled foods are indeed shipped around the globe, biut the costs involved and the duties paid often make this prohibitive.

Quote:

A more plausible reason is strictly political and cultural. Europeans will buy end products made from locoally produced materials before they'll buy imports out of a sense of nationalism (you see this all the time with French Farmers going on strike over this issue..) even if it costs them more at the register.

IMO this is the exception rather than the rule. In the overwhelming majority of the world price wins (remembering that the overwhelming majority of the world is not first world).

Quote:

If the argument doesn't hold for Stanley it doesn't hold for Heinz either and that's why the argument as a defense of Heinz (and by implication, Kerry) are hypocritical nonsense.

Oh I agree, I part company with the left with what I consider to be their illogical railing at corporations. Hating corporations is not at all a part of my leftist leanings (and I lean left on most economical issues).

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Once again, Kerry doesn't own heinz or, apparently, have a controlling interest in it. Kerry's main goals were to eliminate the tax incentives that actually help finance the move when companies take their factories overseas, (how wrong is that???) while at the same time give incentives to companies that open factories here, in an effrot to make the choice to keep work in America an easier one.
If I'm selling baby food to the Polish, why not put my factory in Poland?
Multinationals such as Heinz produce abroad largely to serve foreign markets. Nothing Heinz did was wrong. Heinz establishes foreign subsidiaries to serve local markets. In fact, even if Heinz exported to the United States foreign goods that could be made more cheaply overseas, a legitimate practice it does not pursue, the company would be providing welcome benefits to American consumers.

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Now that's different than if Heinz had everything made there (with cheap labor and no taxes), to sell here at top prices. Get it?
That's my beef with these corporate tax breaks. Don't tell me we're saving money on $100.00 sneakers that cost $2 to mass assemble by giving Nike tax breaks and sweat-shop labor!

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Nike does not assemble any shoes.

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suzy wrote:

Once again, Kerry doesn't own heinz or, apparently, have a controlling interest in it.

Then that should be the argument (and it's a true and factual one) - not this nonsense about Heinz selling fresh foods.

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Fishin', I think both are valid arguments, as related to this subject.
Craven, what? The shoes are being assembled for Nike, aren't they?

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Yes, but not BY Nike. Nike is a marketing company and is responsible for the inflated prices but not the manufacturing.

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It appears you are mistaken, Craven. Nike is responsible for the whole kit and kaboodle, as evidenced here:
Bob Herbert summed up the significance of Nike with bitter eloquence: "Nike is important because it epitomizes the triumph of monetary values over all others, and the corresponding devaluation of those peculiar interests and values we once thought of as human."
http://rwor.org/a/v19/905-09/908/nike2.htm
(Freedom of Speech case): The case arose out of the growing public controversy over globalization, specifically the use by U.S. apparel and shoemakers like Nike of overseas factories and assembly plants. In 1998, environmentalist Marc Kasky filed suit claiming that Nike had engaged in unfair business practices by making false statements about conditions in its Asian factories on at least six occasions. Copyright © 2003 OneWorld.net
http://www.organicconsumers.org/corp/nike_o629013.cfm
These shoes are labelled, or "branded", and designed by a multinational corporation in the US, engineered in Taiwan and South Korea, manufactured in China, South Korea, or Southeast Asia, and mostly purchased, worn, and disposed of in North America (Katz, 1994,
pp. 160-204; Ross, 1997; Ryan & Durning, 1997, pp. 26-32; Vanderbilt, 1998, pp. 76-113). The shoes are assembled in a Tangerang factory or similar Asian factories. Most of the assembly is done through the labour of children and women cutting, gluing, and sewing under sweatshop conditions of high temperatures (100 degrees F) and toxic fumes from
solvent-based toluene glues and paint. Their average wage is about 15 cents per hour over their 65 hour work week (Klein, 1999, pp. 365-379; Sage, 1999).
http://www.curricstudies.educ.ubc.ca/wcourses/cultmediastudies/research/nike.html
Thursday, 22 February, 2001, 13:55 GMT
Nike admits abuse at Indonesian plants (now surely you don't think they'd admit abuse if they had nothing to do with manufacturing?)
http://news.bbc.co.uk/1/hi/world/asia-pacific/1184103.stm

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suzy wrote:

It appears you are mistaken, Craven. Nike is responsible for the whole kit and kaboodle, as evidenced here:

No Suzy, I am not mistaken. That there screed is.

suzy wrote:

Bob Herbert summed up the significance of Nike with bitter eloquence: "Nike is important because it epitomizes the triumph of monetary values over all others, and the corresponding devaluation of those peculiar interests and values we once thought of as human."

Perhaps, but I had a less philosophical statement:

Nike does not manufacture the shoes.

Now in that thar screed the author is taking an understandable liberty. Though Nike subcontracts all the manufacturing and owns no share of the factories at all the author is holding Nike responsible.

Now whether that's justified or not I won't bother to argue but the fact does remain that Nike markets shoes and does not manufacture them.

They do not handle "the whole kit and kaboodle". For a very very basic essay on running shoes, the market and manufacturing see:

http://www.unc.edu/~andrewsr/ints092/vandu.html

I'll quote a few relevant portions. Note that ownership of the factories and other such data is publically available. So you can always check your dounts on this matter.

Quote:

Nike currently enjoys a 47% market share of the domestic footwear industry, with sales of $3.77 billion. Nike has been manufacturing throughout the Asian region for over twenty-five years, and there are over 500,000 people today directly engaged in the production of their products. They utilize an outsourcing strategy, using only subcontractors throughout the globe. Their majority of their output today is produced in factories in China, Indonesia, and Vietnam, but they also have factories in Italy, the Philippines, Taiwan, and South Korea. These factories are 100% owned by subcontractors, with the majority of their output consisting solely of Nike products. However, Nike does employ teams of four expatriates per each of the big three countries (China, Indonesia, Vietnam), that focus on both quality of product and quality of working conditions, visiting the factories weekly. They also developed their code of conduct in 1992 and have implemented it across the globe, as its goal is to set the standard for subcontractors to follow if they wish to do business with Nike. However, due to a manufacturing network of this magnitude, they have faced numerous violations involving factory conditions and human rights issues, which have been widely publicized. They have responded to these issues through the Andrew Young report, the Dartmouth Study, and Ernst & Young's continual monitoring, but are still approximately two years away from completely addressing these problems throughout the globe.

Nike does not operate these factories. They have the ability to regulate them through the power of the contract alone and while I'd agree that in many cases they have done a substandard job of policing their subcontractors the fact remains that Nike does not manufacture, it's all 100% outsourced. Blame 'em for not lifting their subcontractors to a higher standard, that would be fair. But it's also true that they do not manufacture, they license and market.

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Okay, Craven, fair enough. I stand corrected.
You've strengthened my point, which was:
"Don't tell me we're saving money on $100.00 sneakers that cost $2 to mass assemble by giving Nike tax breaks and sweat-shop labor!"
So Nike is a huge outsourcer!
Whether or not Phil Knight assembles his own sneakers at home was not the point; however, as one who employs contractors myself, I am not allowed to absolve myself and my business from responsibility if they screw up royally, nor should I be. I am responsible for oversight of their work for me, and their work is a reflection of me and of my business. Although my contractors do get paid a living wage, so there's another difference. As contractors, those people are hiring others to assemble sneakers for Nike. Nike pays their wages, albeit indirectly.
It's apples and oranges.
But for the purposes of this thread and the topic we were discussing, you've made my point.

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suzy wrote:

Okay. I'm speaking specifically of multi-nationals.
The sleaze bags who move operations (and jobs) overseas to avoid paying taxes in the country in which the majority of share-holders and executives live and where they make their profits.
Not families, nor mom & pops or nazis.

Okay. I can see how outsourcing goes against your personal interest. But as a pure matter of logic, one nation's outsourcing is another nation's insourcing. Therefore I don't see how it makes a manager a sleazebag when he outsources jobs out of one country and insources it into another country. I'm not calling the boss of BMW a sleazebag for moving jobs from Munich, Germany to Spartanburg, North Carolina; and I'd prefer it if you didn't do it the other way round either.

But regarding your conclusion, I don't think we're so far apart after all. My suggestion would be that if we are to have corporate taxes, the tax base ought to be proportional to the value you add in each of the country involved. If BMW produces 70 percent of its cars in Germany and 30 percent in America (I'm making these numbers up), then it pays German corporate taxes on 70% of its income and American corporate taxes on 30% of its income. Sound fair to you?

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Well, we are getting into the issue which interests me, and where I can gain some traction.

One historical event which was of seminal importance to workplace safety regulations (and to New Deal policies) was the New York city Triangle Shirt-Waist Building fire (doors had been locked from outside to reduce worker time-loss...many young female employees leapt to their death).

Those regulations were put in place as a counter to not simply the lack of ethics of the two owners of that enterprise (there were many other such examples in NY city at the time) but as a counter to certain human propensities which manifest often enough to be of community concern.

It seems to me how we think about corporate culture and regulation must, to be inclusive of what we know, acknowledge that the propensities towards selfishness and status-attainment and even 'criminal' disregard for others, are forwarded through assuming corporate behavior will be benign.

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Thomas writes:

Quote:

Okay. I can see how outsourcing goes against your personal interest. But as a pure matter of logic, one nation's outsourcing is another nation's insourcing. Therefore I don't see how it makes a manager a sleazebag when he outsources jobs out of one country and insources it into another country. I'm not calling the boss of BMW a sleazebag for moving jobs from Munich, Germany to Spartanburg, North Carolina; and I'd prefer it if you didn't do it the other way round either.

Right on! The purpose of business is to make a profit. The country benefits by the jobs it creates and the affordable goods and services enjoyed by its customers. When domestic policies and practices make that impossible on the domestic front, the business cannot be blamed for moving some or all operations overseas where labor is much cheaper and perhaps regulations are less restrictive. That takes jobs out of the country and that is bad. Conversely, the products that come back to the country have to be transported, stored, stocked, sold, maintained, and/or serviced, etc. and that creates jobs in the country. And that is good.

If a business has to go out of business because it cannot make products or provide services that people can afford to buy, there are no jobs created period.

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suzy wrote:

So Nike is a huge outsourcer!

Indeed. And I would have it no other way. I hope more and more of our manufacturing is outsourced to nations that need it more than we do.

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"The purpose of business is to make a profit. The country benefits by the jobs it creates and the affordable goods and services enjoyed by its customers. When domestic policies and practices make that impossible on the domestic front, the business cannot be blamed for moving some or all operations overseas where labor is much cheaper and perhaps regulations are less restrictive. That takes jobs out of the country and that is bad. Conversely, the products that come back to the country have to be transported, stored, stocked, sold, maintained, and/or serviced, etc. and that creates jobs in the country. And that is good."
Foxfyre,
Good for who? The owners of the company? Do you really think that most comapnies go overseas to spare themselves our 'repressive taxation'? Do you think it might be, in large part, simply for reasons of even larger profits? How much do you suppose Nike makes? (billions), and yet their sneakers and clothing are still outrageously priced. Who's saving money? Nike, not consumers. Yes, that's their right, but I fail to see how and why our government should assist them in this. Nike isn't giving thousands of Americans the jobs or lower prices that they could if they weren't so eager to make outrageous profits.
More power to them, I guess, but I'd rather the US not assist them in their greed. Tax money pays for a lot of useful services for Americans and for presidents' who think it grows on trees.
well, I guess it kinda does, but... you know.
Thomas, that sounds fair to me, for the most part. But if America is subsidizing these companies in any way, then that's not good enough.
Craven, from what I've read in the past couple days, many of these people are not paid even a living wage. I abhor the idea of someone getting rich through the suffering of others. Go ahead and give them jobs, but pay them a living wage for working their asses off. Conversely, don't complain when there's not enough jobs here. At least somebody, somewhere is getting by or getting rich.
Blatham, "Those regulations were put in place as a counter to not simply the lack of ethics of the two owners of that enterprise (there were many other such examples in NY city at the time) but as a counter to certain human propensities which manifest often enough to be of community concern." Exactly! And ever it shall be...
so somebody has to care, and to THINK. The bottom line really isn't THE bottom line. There are things more important than the profit-margin.

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suzy wrote:

Craven, from what I've read in the past couple days, many of these people are not paid even a living wage.

Suzy, most of the world does not make what either of us consider a "living wage. But also important to remember is that these "sweatshops" often pay far more than they would get elsewhere.

I've lived in the countries where there are "sweatshops". Quite frankly most of these foreign "sweatshops" are a step up from the regional standards and in that context it's less exploitative than using an American perspective with little understanding of how it actually works in third world countries.

The multinationals usually pay a better wage (though still small to our eyes) than do the locals. The real injustice is the discrepancy between the living standards of the nations in most cases, not the "evil" of the corporation.

To not employ them just means that many fewer jobs and even lower wages (less demand).

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The most recent OECD data show that U.S. corporate taxes as a share of the economy are now virtually the lowest in the industrialized world.
Some of the corporate tax shortfall reflects the weak economy, but most of it stems in roughly equal parts from Bush's big corporate tax cuts enacted in 2002 and 2003 and the huge amount of offshore tax sheltering that corporations now engage in.
The 2002 and 2003 tax bills provided business tax breaks officially estimated to cost $177 billion in fiscal years 2002 through 2005, with $64 billion of that in fiscal 2004 alone.
While the exact cost of offshore corporate tax sheltering is unknown, reasonable estimates peg the cost at upwards of $50 billion a year.
The Hidden Entitlements
http://www.ctj.org/html/hemenu.htm

My new congressman has introduced this bill and tried for two years to get it passed:
Corporate Patriot Enforcement Act Introduced by Rep. Richard Neal (D-Mass.) in the House and Senators Harry Reid (D-Nev.) and Senator Carl Levin (D-Mich.) in the Senate, this bill denies tax benefits to former American companies that reincorporate offshore to avoid paying taxes.http://www.theorator.com/bills108/hr737.html
Representative Neal's legislation will not cure all corporate malfeasance, but it will make it less profitable, and it is a powerful first step in making sure companies pay their share of meeting America's basic needs. Most observers believe that the Corporate Patriot Enforcement Act would pass easily if the Republican leadership would allow it to come to a vote since it is hard to publicly defend the indefensible.
"In the midst of the war on terror, no corporate scandal is more egregious than American companies reincorporating overseas to avoid paying taxes needed to fight terrorism and protect our homeland. And Jim Maloney and Richard Neal have done a tremendous job bringing this issue to the forefront. Unfortunately, not even overt acts of corporate disloyalty to America can break House Republicans' undying loyalty to the special interests.
http://www.house.gov/frost/pr02/pr020717-corporatepatriot.htm

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