or Connect
AppleInsider › Forums › Mobile › iPad › Apple's new iPad constrained by Retina display supply, 'sound labor practices'
New Posts  All Forums:Forum Nav:

Apple's new iPad constrained by Retina display supply, 'sound labor practices' - Page 2

post #41 of 65
Quote:
Originally Posted by auxio View Post

And there it is. I agree - the people who mindlessly cry worker's rights abuse would definitely claim that signatures were obtained at gunpoint (or similar). So take it one step further and have a 3rd party which, verifiably, has no economic interest either way collect the voluntary signatures.

I believe that workers will in fact sign up voluntarily. I don't think they should be allowed to.
post #42 of 65
Quote:
Originally Posted by auxio View Post

Also have those who've only ever lived off of inherited trust funds and investments stop blaming said tree-huggers for the world's economic problems. The rhetoric from both sides has grown tiresome.

Silly, those who've only ever lived off of inherited trust funds and the tree-huggers are the same people
post #43 of 65
Quote:
Originally Posted by DrDoppio View Post

I would propose hiring more people to work shorter shifts -- it has been indicated previously that there is no shortage of labor. There won't be any reduction in supply, problem solved.

At a higher input price?
post #44 of 65
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

If there is reduced supply due to labor shortages, how will reduced supply lead to workers being laid off?

Who said anything about a labor shortage?

Please take the trouble to actually read the posts. Thanks.
post #45 of 65
Quote:
Originally Posted by DrDoppio View Post

I believe that workers will in fact sign up voluntarily. I don't think they should be allowed to.

If there's reasonable limits on the number of hours one can work in a week, in a single shift, and a minimum amount of time between successive shifts, then it shouldn't be a problem. But yeah, I realize that's asking a lot...
 
Reply
 
Reply
post #46 of 65
Quote:
Originally Posted by Buckeyestar View Post

Where is all the righteous indignation for workers in the US who are similar situations?

Well HOPEFULLY, if we are nice to the Chinese, the righteous indignation and human rights pressure will be coming from China in the future. WE won't be able to ship them cars made with child labor for $.99 an hour.

Face it; WE used to be the champions of justice, sending investments and schools instead of bombs.

Now we send troops to Australia to somehow threaten China with a whopping 2,500 men, and China buys shipyards, funds schools, and builds hospitals in the Caribbean.

Now it's our turn to be the bombers not bridge builders -- and the Chinese will make movies about heros who beat up douche bags with thick American accents plotting to destroy the world, or at least pollute a drinking well in the village.
post #47 of 65
Other companies like Samsung have much better labor practices: they tell journalists “no comment” and make sure not to invite audits/investigations. Problems that are covered up don’t sell ads for “journalists,” so they aren’t real problems

Quote:
Originally Posted by Fake_William_Shatner View Post

Now it's our turn to be the bombers not bridge builders -- and the Chinese will make movies about heros who beat up douche bags with thick American accents plotting to destroy the world, or at least pollute a drinking well in the village.

It’s sad to see times change, but as long as SOMEONE is making movies about beating up douchebags, I guess it’s still a world I can live in.
post #48 of 65
Quote:
Originally Posted by anantksundaram View Post

At a higher input price?

Why, yes, if they have to.
post #49 of 65
Quote:
Originally Posted by anantksundaram View Post

Who said anything about a labor shortage?

Please take the trouble to actually read the posts. Thanks.

The original article said that there was reduced supply doe to labor shortages:

Quote:
Demand for Apple's new iPad remains strong, but production of the device has reportedly been limited by ... a new focus on employees at Foxconn that has resulted in worker hours being cut.


Please take the trouble to actually read the articles. Thanks.


So, you predicted that the current labor shortage would lead to worker layoffs? How does that make any sense?
post #50 of 65
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

I have heard that while labor costs re cheaper in third world hellholes, other costs, such as energy, are higher than they are here in the US. I have heard that companies are bringing back production to the US due to overall favorable economics.

if true, the problem may fix itself. What if it became true that the US was the very best place to manufacture, despite the need to pay workers a somewhat larger amount?

What other factors would need to be in place? Keep in mind that labor economics, while important, are only one piece of the puzzle.

There are few situations where overall economics of manufacturing are more favorable in the US. The few situations are related to specialized skills. But that advantage is never permanent. I can get synthetic chemistry (once a specialized skill), molecular biology (also once a specialized skill), CNC machining, rapid prototyping (also once a specialized skill) all done cheaper AND faster in China. Imagine that, Chinese suppliers can deliver machined parts, synthetic DNA and synthesized compounds all faster than most suppliers in North America, even given their distance. The quality is generally rather good too, once you try out a few vendors to filter out the bad ones (which does not take long). More and more Chinese vendors are setting up sales offices in N.A. or simply relying on their web storefront for transactions. So the process is really, really convenient.
post #51 of 65
Quote:
Originally Posted by stelligent View Post

...The quality is generally rather good too, ...

Of course it is, generally. There are exceptions, hopefully nothing fatal.
post #52 of 65
Quote:
Originally Posted by DrDoppio View Post

Why, yes, if they have to.

Higher input price will mean higher product price will mean lower demand for the product will mean lower demand for labor. Or cutting back on their more expensive Chinese workforce and moving production elsewhere, e.g., Vietnam, India. The question to you was whether you thought that would be a good thing.
post #53 of 65
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

The original article said that there was reduced supply doe to labor shortages:

Demand for Apple's new iPad remains strong, but production of the device has reportedly been limited by ... a new focus on employees at Foxconn that has resulted in worker hours being cut.

Please take the trouble to actually read the articles. Thanks.

So, you predicted that the current labor shortage would lead to worker layoffs? How does that make any sense?

Wow, talk about pulling that out of your..... hat. Your quote reminds me of the pathetic, selective cut-and-paste jobs that you see in movie ads when they quote critics that panned the work.

Since you are dissembling or have a comprehension problem, let me explain to you: The AI article, quoting Shaw Wu, pointed to two separate issues impacting iPads: (i) Retina display shortage for Samsung (which has nothing to do with labor shortage); (ii) Higher labor costs for Foxconn (which has nothing to do with the retina display shortage).

The article says (this is the correct quote, not your version of it: "production of the device has reportedly been limited by supply of Retina displays."

Neither I nor the article said anything about labor shortages. Run along and go bother someone else with your ridiculous posts.
post #54 of 65
Quote:
Originally Posted by anantksundaram View Post

Higher input price will mean higher product price will mean lower demand for the product will mean lower demand for labor. Or cutting back on their more expensive Chinese workforce and moving production elsewhere, e.g., Vietnam, India. The question to you was whether you thought that would be a good thing.

I assume we're talking about the cost of labor. The difference in input price should be negligible, since the labor supply is rather elastic, if previous reports are to be trusted. Also, why do you assume automatically a higher product price? The current profit margins (between Apple and Foxconn) surely allow for the same end-product prices with slightly lower profits. So, I don't believe production needs to be moved just to meet the currently discussed changes. I may be wrong though, having neither all the original data nor that much confidence with microeconomics.
post #55 of 65
Quote:
Originally Posted by DrDoppio View Post

I assume we're talking about the cost of labor.

Yes, the cost of labor.


Quote:
Originally Posted by DrDoppio View Post

The difference in input price should be negligible, since the labor supply is rather elastic, if previous reports are to be trusted.

If Foxconn is forced to raise its wages relative to competition in China -- because of external public pressures, i.e., not labor productivity or labor supply/demand -- that would have nothing to do with elasticity of labor supply. I am not following your argument here.

Quote:
Originally Posted by DrDoppio View Post

Also, why do you assume automatically a higher product price? The current profit margins (between Apple and Foxconn) surely allow for the same end-product prices with slightly lower profits.

Apple has margins to maintain, and its goal (as is that of every other for-profit business) is to maximize profits. Its market value depends on that. We can't presume to tell what margins Apple should or should not make. Why not then tell Apple to make zero (and Foxconn to pay its Chinese workers US wages)? Why stop at "slightly"?
post #56 of 65
Quote:
Originally Posted by stelligent View Post

There are few situations where overall economics of manufacturing are more favorable in the US. The few situations are related to specialized skills. But that advantage is never permanent. I can get synthetic chemistry (once a specialized skill), molecular biology (also once a specialized skill), CNC machining, rapid prototyping (also once a specialized skill) all done cheaper AND faster in China. Imagine that, Chinese suppliers can deliver machined parts, synthetic DNA and synthesized compounds all faster than most suppliers in North America, even given their distance. The quality is generally rather good too, once you try out a few vendors to filter out the bad ones (which does not take long). More and more Chinese vendors are setting up sales offices in N.A. or simply relying on their web storefront for transactions. So the process is really, really convenient.

I've heard that energy prices are lower in the US than in other manufacturing economies. The article claimed that the energy savings more than made up for labor costs, and that as a result, certain manufacturing was returning to the US.

If the article is correct, it would be easy to see a production increase in things like aluminum, or anything where the ongoing marginal costs (other than raw materials) consist of mainly energy and labor.
post #57 of 65
Quote:
Originally Posted by anantksundaram View Post

Yes, the cost of labor.

If Foxconn is forced to raise its wages relative to competition in China -- because of external public pressures, i.e., not labor productivity or labor supply/demand -- that would have nothing to do with elasticity of labor supply. I am not following your argument here.

You have a point here -- but Foxconn isn't directly forced to raise wages, only to decrease working hours for some workers, while paying them the same wage per hour. In order to keep the same level of productivity, it may need to hire more workers at slightly higher wages, in what seems to be a monopsonic labor market.

Quote:
Apple has margins to maintain, and its goal (as is that of every other for-profit business) is to maximize profits. Its market value depends on that. We can't presume to tell what margins Apple should or should not make. Why not then tell Apple to make zero (and Foxconn to pay its Chinese workers US wages)? Why stop at "slightly"?

I stop at "slightly" because I see this as a balance between the interest of the shareholders and the interests of society, much like described in this article:

http://www.salon.com/2012/04/04/the_...older_fallacy/
post #58 of 65
Quote:
Originally Posted by stelligent View Post

There are few situations where overall economics of manufacturing are more favorable in the US. The few situations are related to specialized skills. But that advantage is never permanent. I can get synthetic chemistry (once a specialized skill), molecular biology (also once a specialized skill), CNC machining, rapid prototyping (also once a specialized skill) all done cheaper AND faster in China. Imagine that, Chinese suppliers can deliver machined parts, synthetic DNA and synthesized compounds all faster than most suppliers in North America, even given their distance. The quality is generally rather good too, once you try out a few vendors to filter out the bad ones (which does not take long). More and more Chinese vendors are setting up sales offices in N.A. or simply relying on their web storefront for transactions. So the process is really, really convenient.

There's one sustainable advantage to US manufacture - lead times for custom products.

I used to have a company which manufactured a safety product which was made to order. The variations were essentially infinite and demand was unpredictable, so stocking was impossible. Since the product needed to be available for a plant to run, replacements were often emergencies - it was not uncommon for us to ship a product within hours of receiving an order (at a hefty premium, of course). In many cases, the flight time from China to the US would have been enough to completely wipe out any potential cost savings since the customer had to shut down their plant while waiting for a replacement.

Of course, that situation only applies in a very tiny number of cases.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
post #59 of 65
This is starting to smell like the White iPhone problem. Maybe they should have waited a year.
post #60 of 65
Quote:
Originally Posted by DrDoppio View Post

I stop at "slightly" because I see this as a balance between the interest of the shareholders and the interests of society, much like described in this article:

http://www.salon.com/2012/04/04/the_...older_fallacy/

That article is every bit as misleading and biased as the argument they are trying to refute.

In reality, an officer of a company has a fiduciary responsibility to shareholders and must act in the best interests of the shareholders. While your article is correct that there's no 1:1 connection between 'best interests' and 'maximized profits', there is a very close connection. If a corporation wants to do something which harms shareholder profits, they'd better have a pretty good justification unless they want to face shareholder lawsuits.

There are, of course, exceptions. In some cases, companies are very open and public about their actions. Ben and Jerry's, for example, acknowledges that they buy 'green' milk which costs more money. Since they are public about it, shareholders would have a hard time suing. Similarly, if a company says "we're going to donate a significant percentage of profits to charity" in their incorporation documents, a shareholder can't sue.

Then, of course, you get into the much broader situation where the officers have to interpret what's best for the company. For example, a company may decide to donate money to charity because they perceive the PR value as being greater than the cost. A shareholder could try to make an issue of that, but unless the amount is very large and the corporate justification is very poor, the shareholder complaint won't go anywhere.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
post #61 of 65
I don't believe for a second that labor changes have slowed production for longer than it takes to hire and train new shifts. They have no shortage of applicants.

I do believe it's in the interests of anti-labor interests to make us believe improving the quality of life over there will reduce the quality of life over here.
post #62 of 65
Quote:

David Talbot? salon.com straight from the ashes of the communist utopia?

It all makes sense now
post #63 of 65
Quote:
Originally Posted by DrDoppio View Post


I stop at "slightly" because I see this as a balance between the interest of the shareholders and the interests of society, much like described in this article:

http://www.salon.com/2012/04/04/the_...older_fallacy/

The author of the article is being disingenuous. Corporate law in the US (which, btw, is at the state level; except for Sarbanes-Oxley, there's not much at the Federal level) is quite clear. The earliest, and watershed, articulation of the role of shareholder primacy goes back to a famous Michigan Supreme Count decision in 1919, called the "Dodge v. Ford" case, where the Court ruled (in a terrifically pithy decision): "...a business corporation is organized primarily for the profit of the stockholders, as opposed to the community or its employees. The discretion of the directors is to be exercised in the choice of means to attain that end, and does not extend to the reduction of profits or the nondistribution of profits among stockholders in order to benefit the public, making the profits of the stockholders incidental thereto."

Since then, just about every state has accepted some version of this as the standard, with the caveat that "business judgment" can allow firms to make some short-term trade-offs (but not go against long-term shareholder value creation)..

The most current version of this can be found in Section 2.01 of the "ALI Principles" (The American Law Institute's principles of corporate governance, which is the basis of corporate law in every state in the US). It says:

(a) Subject to the provisions of Subsection (b) and § 6.02 (Action of Directors That Has the Foreseeable Effect of Blocking Unsolicited Tender Offers), a corporation [§ 1.12] should have as its objective the conduct of business activities with a view to enhancing corporate profit and shareholder gain.

...but that....

(b) Even if corporate profit and shareholder gain are not thereby enhanced, the corporation, in the conduct of its business:

(1) Is obliged, to the same extent as a natural person, to act within the boundaries set by law;

(2) May take into account ethical considerations that are reasonably regarded as appropriate to the responsible conduct of business; and

(3) May devote a reasonable amount of resources to public welfare, humanitarian, educational, and philanthropic purposes.


As the previous poster pointed out, some exceptions are allowed (such as those noted in (b) above), but fundamentally, the Board and the Officers of a corporation are required by the law to maximize shareholder value (and be able to show that their decisions, in fact, reflect the furtherance of that objective.).
post #64 of 65
Quote:
Originally Posted by anantksundaram View Post

The author of the article is being disingenuous. Corporate law in the US (which, btw, is at the state level; except for Sarbanes-Oxley, there's not much at the Federal level) is quite clear. The earliest, and watershed, articulation of the role of shareholder primacy goes back to a famous Michigan Supreme Count decision in 1919, called the "Dodge v. Ford" case, where the Court ruled (in a terrifically pithy decision): "...a business corporation is organized primarily for the profit of the stockholders, as opposed to the community or its employees. The discretion of the directors is to be exercised in the choice of means to attain that end, and does not extend to the reduction of profits or the nondistribution of profits among stockholders in order to benefit the public, making the profits of the stockholders incidental thereto."

Since then, just about every state has accepted some version of this as the standard, with the caveat that "business judgment" can allow firms to make some short-term trade-offs (but not go against long-term shareholder value creation)..

The most current version of this can be found in Section 2.01 of the "ALI Principles" (The American Law Institute's principles of corporate governance, which is the basis of corporate law in every state in the US). It says:

(a) Subject to the provisions of Subsection (b) and § 6.02 (Action of Directors That Has the Foreseeable Effect of Blocking Unsolicited Tender Offers), a corporation [§ 1.12] should have as its objective the conduct of business activities with a view to enhancing corporate profit and shareholder gain.

...but that....

(b) Even if corporate profit and shareholder gain are not thereby enhanced, the corporation, in the conduct of its business:

(1) Is obliged, to the same extent as a natural person, to act within the boundaries set by law;

(2) May take into account ethical considerations that are reasonably regarded as appropriate to the responsible conduct of business; and

(3) May devote a reasonable amount of resources to public welfare, humanitarian, educational, and philanthropic purposes.


As the previous poster pointed out, some exceptions are allowed (such as those noted in (b) above), but fundamentally, the Board and the Officers of a corporation are required by the law to maximize shareholder value (and be able to show that their decisions, in fact, reflect the furtherance of that objective.).

This is generally correct. The salient point, however, is that most states' corporations laws define fidiciary duties as being limited to shareholders only.

Some states, with California leading the way, have adopted special corporate forms (the "B" Corp) that may consider societal stakeholders and communities as well.

Most importantly, however, is that nearly all states permit the Corporation to narrow its fiduciary duties even further in their governing documents. Therefore, in many cases, the officers of the corporation are only liable to the shareholders, and even then, only in cases of gross negligence or fraud.

What I am getting at is that it is not a Company's job to protect society, it is society's. It is rediciulous and not fair to an executive of a company to charge him with preserving society. How the hell is he supposed to weigh the benefit to his shareholders of producing a magnificent, shiny new product that will earny $1,000,000's against the potential of increasing air pollution by .0000001% in the production of the product?

He can't. His duty is to his shareholders.

The duty of protecting society is the government's. That is where environmental regs and labor regs come into play.

Edit Before people jump down my throad, I realize that an exception (as stated above) exists for companies that are able to profit off of their image of being socially friendly. Ben and Jerries, and more recently, Apple, have begun to "market" their concern for society and to actually create value for their shareholders by doing so. In other words, Apple can use this media fiasco to justify higher prices on the theory that the consumer is helping to finance improved working conditions in China, which in turn provides the consumer with value and causes the consumer to pay more for the product.
post #65 of 65
Thanks to both jragosta and anantksundaram for the informative posts. I agree that the social responsibility of Foxconn is limited in this case to following any new requirements of the law, and to addressing the recent slanderous reports in order to defend the public image of the company and its partners.
New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: iPad
  • Apple's new iPad constrained by Retina display supply, 'sound labor practices'
AppleInsider › Forums › Mobile › iPad › Apple's new iPad constrained by Retina display supply, 'sound labor practices'