Advantages Of Outsourcing? Mind Blown!
We need to talk about outsourcing. If after this, you still feel that outsourcing is bad for America, then you’re a bozo.
Let’s talk about outsourcing. Alright so first of all the thing that you need to understand right off the bat is if we did not have outsourcing, outsourcing of manufacturing, and services then the United States would have a much much much lower standard of living.
Our lifestyle, we are living like kings. The poor in our country are living at a standard way higher than royalty lived in other countries just a couple centuries ago. I think everyone understands that, we live in a very abundant time but here’s the thing, when I outsource, when I hire somebody in the Philippines, or if I buy a product that’s manufactured outside of the United States, everyone thinks that that’s bad for America but it is actually a huge blessing for america. I’m going to explain.
I’ll use a real example here. I have hired many graphics designer in the Philippines. I pay them a tenth of what I would need to pay somebody here in the United States. That’s money that I am spending and sending to the Philippines and if you just think about it logically and you haven’t thought the whole picture through, then you think “oh you’re sending money outside of the United States and that’s gotta be bad for America”. Ok two principles we’re gonna talk about here.
2 Important Principles in Outsourcing
One is that money is the exchange of value. I’m not just sending out money and not getting anything back. We’re gonna talk about the exchange of value and then the second thing we’re gonna talk about is what is it that I’m actually sending? The money itself has no value. It’s, what’s being exchanged that has that great great value.
Let’s just look at the whole picture about the United States that we’ve got a certain amount of money. We’ve got a certain amount of money in the United States and if I send some money to the Philippines to pay this graphics designer, does that amount of money decrease? well sure it decreases. But guess what? our government can print money if we run out. If the value, if we go down and money, then the value of our money goes up and then the federal just print more money. They’re printing more money than we have and so that causes inflation so by me, sending out money to the Philippines, that actually causes inflation to slow down. A solid working economy is not based upon how much money exists in that economy but it depends on how much money is being exchanged.
So if I have a hundred dollars and it just sits in my bank account or sits in my wallet, then that doesn’t help the economy whatsoever. But, if I have a hundred dollars and I go and spend the $100 and the person who receives it, they go and spend that $100 and then that person goes and spends it, and spend it, and the next person spends, the next person spends it. Ten people spend it. That’s a thousand dollars moving around in our economy and it still exists. It can be continued to be spent. So the more spending there is within our economy, the better it is.
Now when I outsource and I hire somebody in the Philippines vs in the United States that leaves a lot of money in my pocket that I can go and spend so that helps out the economy and the more and more people outsource, the the more and more money there is in the economy being spent.
So outsourcing helps our economy.
Ok back to that second point about money is the exchange of value.
I’m giving value and my Filipino staff that they’re giving me value is that an equal exchange of value? I would say, I’m paying way less for the amount of value that I’m receiving. I might send over $400 or $500 for an entire full-time month of work.
They’re giving me full time work eight hours a day and we’ll talk about how big of a blessing that is for them. It’s obviously a huge huge bless for me so from the standpoint of the United States of America for me to hire a graphics designer here in the United States, I need to pay them 10 times the amount. So I’m sending out a value of say $400 or $500 and I’m receiving 10 times that amount in value in return. That’s the power of outsourcing and that’s why outsourcing is such a huge blessing for America.
We can send out value and it’s considered a fair exchange of value to receive 10 times back. So, not just looking at the amount of money that we have in the United States and if we send out a little bit of money to another country that money goes down, that’s now what happens if we look at it as value, this is how much value we have in the United States. We send out a little bit and we get 10 times that amount back, our value just increases the standard of living in the United States goes up when we outsource.
The Usual Perception
When I outsource and hire a graphics designer, in The Philippines, another complaint I’ll hear is “oh now there’s one less job in the United States you know, they’re out of work”. Let’s say there’s this amount of jobs in America. If I have to lay off a graphics designer in the United States and hire somebody in the Philippines, that doesn’t decrease the total number of jobs in the United States. It just shifts the number of jobs.
There’s been many, many, studies done on “does outsourcing reduce the number of jobs in America” and the answer is it does not.
It stays the same. The jobs just shift. So when I hire somebody in the Philippines for graphics design job, that graphics designer either need to become an entrepreneur and start hiring his own graphics designers in the Philippines. He has that same opportunity. He could outsource or that graphic designer can just get a job in a different sector.
Now, I’ve been outsourcing for six and half years I’m obviously very opinionated about this and you watching this video probably have some strong opinions as well. If you disagree with me but you shouldn’t but if you do, send me a message. We can carry on this conversation.
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