The $205.4B Gulag
gouldasks.substack.com
gouldasks.substack.com
Some of those jobs still exist but most of that work has been outsourced to China and Mexico and Indonesia and the Philippines. There seem to be a fair amount of high-end prototyping shops but very little mass production activity, particularly of the basic components that go into tech devices. That's because:
> ""PCB [printed circuit board] manufacturing and assembly is a very low-margin business and is largely located in Asia. It comes down to access to low-cost labor, a vast ecosystem of factory infrastructure, and flexibility. It is hard to replicate the ecosystem in the US today," said Kundojjala. "
https://www.pcmag.com/news/silicon-usa-technology-made-in-am...
The primary reason Apple and others pushed for oversea production via NAFTA trade deals, WTO membership for China, etc. is to cut labor costs. Paying kids with high-school education relatively high wages was seen as too onerous, so the factories were shipped overseas. While I worked in electronics, this exact same thing happened with the similarly-sized garment manufactuing industry.
Now if you're wondering why there's an epidemic of homelessness and poverty in California, and it's become the state with the largest income gap in the USA, well, that's why.
Because companies moved low skill labor elsewhere because it is cheaper there?
Even the developer world has seen this trend - why pay US wages to developers if you can get the same labor at one-fifth the price in India?
The result of course is the minting of more American billionaires, the conversion of domestic property markets into gambling casinos and rental emporiums, and most troublingly, the loss of much technological know-how to other countries. Radio Shack used to provide electronics hobbyists, whose day jobs were simple electronics assembly, with products; that ended and they tried to become a retailer of Chinese-made products before going out of business.
It's basically the story of the greedy investor class who killed the goose that laid their golden eggs.
I have a section in The Big Bucks about "PCB manufacture": it used to be [1970's] outsourced on a piecework basis to people in my neighborhood [SV] who did it in their garages. Some of the very old timers around here still remember it. It was before my time.
The electronics companies would deliver the boards & the parts, and the neighbors would stuff them. One of those companies was Apple, I believe.
If you were really good they might have you solder.
No one decided that, it's just a fact.
On the other hand, it's true that companies with lower costs will tend to outcompete others, so moving to China is sort of dictated by the market.
I would still say it's good to call attention to the problem even if there's no real solution for consumers.
https://i.ibb.co/TqdYf4y/image.png
Literally the opposite.
Foxconn was trying to kick workers OUT of factory which had to shutter due to covid - the riot was over lack of compensation + bonuses. Which is about Foxconn who is infamous for mistreating workers in plants across east Asia, hence Apple doing +1 shift with Foxconn doesn't change anything, see Indian plant riotting over similar issue. Mac Studio still assembled by Foxconn. Root of problem is TW business culture, the shit practices in PRC are learned from OG TW base manufacturers who hasn't changed much, Gigabyte isn't spared.
Citation needed. There's a reason Honhai / Foxconn / TW businesses have decades old bad rep in East Asia, in terms of working conditions, mistreating workers, withholding compensation and passports. Much of the China-bad meme of rampant gulag capitalism applies and were imported from TW by TW business culture (granted at invitation of PRC), from gutteroil to tofu construction, distant fishing slavery etc. Poor TW workers rights get exported abroad (i.e. Indian plant) where they're generally invited and hence have leverage to mistreat. If anything, from my experience, working conditions in PRC manufacturing sectors comparable to Foxconn are now generally better, more abide by rights and laws simply because PRC nationals can be easily held accountable vs. Foxconn getting immunity from local gov due to cross strait cooperation perks, or whatever regional equivalent to draw Foxconn investment. Labour issue will persist regardless of where you buy from, because likely you'll still be buying from the same global manufacturing company known for not having scruples.
Yeah, "magic".
This inability to pay rent isn't as much because wages got lowered, it's mostly because certain cities decided that they didn't want any more housing, in order to appease land owners and drive up housing prices to astronomical levels. But it's also unethical to pay somebody for a job if they can't use those wages to live.
Fortunately I'm not aware of any police violence against the grad students yet, but there has been plenty of UC police violence in the past against striking workers.
This is not an identical situation to the delayed bonuses discussed in the article. But as tech heavy as HN we may not be as in touch with a workforces that get squeezed on basic ability to survive, such as assembly in China or grad students in California. (Or dare I mention the farm workers that put all the food on our table...)
Perhaps you have identified graduate school students as aspiring members of the petit bourgeoise because only individuals with such aspirations would rationally pay for graduate school in today's system.
Please make sure to provide factual options that can be corroborated.
As a thought experiment: imagine that these grad students were offered a deal, where their pay is doubled, their job responsibilities are unchanged, but they are removed from the students roll, no longer can qualify for PhD degree (though they can still and in fact are expected to publish just as much as before), and their job title is now “lab technician” instead of “graduate students”. How many of them do you think would have taken the deal? My belief is that basically none of them would consider double the pay to be worth it.
As somebody who benefits, indirectly, from their work, since their work benefits all of society, I'm much happier with them improving the working conditions and continuing to work, rather than quitting and losing that investment in their specialized knowledge.
More importantly, the main reason people negotiate with one another is that they hope to achieve better outcomes than they can with either a default of no action, or unilateral actions. Imagine that the grad students sit down to the negotiating table with the people determining they pay. They ask for higher pay, and the other side says straight up “no”, and offers no concession whatsoever. What then? At this point, the only option available to the students is threatening some form of quitting, as they don’t really have any other means of leverage.
The point here is that even if they do negotiate, they must be ready and willing to quit if they want these negotiations to go their way, and if they aren’t (and they very much aren’t, as people who are willing to quit grad school simply do exactly that), they’ll keep making a pittance in terms of cash benefits.
Potentially even including violence against strikebreakers.
There can be other threats against people responsible for salaries and work conditions directly.
The nihilist attitude towards human decency at work in the tech industry is so gross. As someone outside looking in, as tech plateaus and consolidates, it will be amusing to observe this flip. All of the former FAANG people will be crying the same way the IBM, DEC, HP hotshots of yesteryear did.
You can’t have meaningful solidarity between people who aren’t similarly situated, and who have differing incentives.
Exploitation of workers is at the core of both circumstances. Downplaying/ignoring one set of circumstances because it is lesser on the scale of abuse is the more remarkable point of view, in my opinion.
I would be surprised if it is more than a rounding error, but open to being shocked.
https://lao.ca.gov/Publications/Report/4014
Homelessness is far higher than a rounding error, it's 5% of UC students, 10% of CSU students, and 20% of community college students.
I live in a town with a UC campus, and come across packs of students living in their cars. They do everything they can to have minimal impact and hide from view. It makes me terribly sad, and shocked every time I see it.
I fight as hard as I can against the people causing all the suffering amongst those who aren't super wealthy, but their ability to understand other humans can not see beyond the comfort of their own yards. In contrast, they complain viciously about a building that they can see. A very strange sort of sight.
[0] https://oshi-la.org/wp-content/uploads/2021/03/cts-state-of-...
A 2017 study found:
- 5% of UC Graduate students had experienced homelessness.
- 26% of UC Graduate students had experienced food insecurity.
As an example, there was a googler famously living out of a moving truck, because he wanted a short commute and couldn't live right next to the campus in MTV. That was his choice, I don't think anyone would argue google doesn't pay people enough to afford rent.
If you can save $1000/month in rent by adding 200 hours of commute, why is that OK? And once you add in the extra thousands of miles of car travel, and having to pay for a car rather than being able to bike or take a bus, and it doesn't actually save any money...
Here are the estimated costs of living for various campuses, by three different methodologies:
https://twitter.com/weinberz/status/1596299620266962944?s=46...
The highest cost of living is where there's no escape to cheap housing by adding long commutes.
The people running these towns with high cost of living could add plenty of more housing, enough to reduce the cost of living, but have been spoiled brats about it. The level of entitlement among homeowners about not even seeing an apartment is absolutely astounding.
The reality is that Apple systematically robs value, specifically the value delivered by foreign slave labor. This same process occurs in graduate schools across the United States. Universities rob graduate students of the value they deliver to higher education. It’s just done in a white-collar patina with lies instead of force.
The “oh they’re in training” is nonsense. They will not obtain even an adjunct position after a PhD. It would be one thing to have a true apprenticeship with a guaranteed job, but that isn’t how this scam works.
It is all grist for the mill.
Not even close my friend. I would trust that instinct. People working 6-7 days a week, doing labor, in a factory, in shit conditions. Desperately clinging to each paycheck that comes along.
Vs academic bureaucrats in one of the most Labor sensitive institutions in the world, who can’t afford the Bay Area…? The most expensive region of the US to live in. Not. Even. Close. Just a reminder, employees at UC Berkeley are entitled to a pension after five years.
Police violence against UC Berkeley staff? Seems highly doubtful.
As far as not being able to afford rent in the Bay Area, hard to disagree, that is a real problem that impacts quality of lives in a very negative way. Hopefully, with all the brain power at Berkeley, people begin to more honestly and openly contemplate the actual source and solution to this deep problem in the Bay Area’s housing supply not quite matching demands of UC Berkeley staff. Asking bold questions for a campus like Berkeley like.. what policies and stubborn attachment to specific world views might be contributing to the constriction of such supply and demand conditions?
Not sure what instinct you are referring to here. And just a reminder that when there's a strike, the people who go out to support are those with the least pay, or those who are already in unions. Trying to split grad students off from the rest of the labor force is not something that I am trying to do, if that's what you are implying.
> Just a reminder, employees at UC Berkeley are entitled to a pension after five years.
This is false, grad students never earn a pension. Grad student researchers are who I'm talking about, the people who are currently on strike.
Even still, what good is a pension if you can't pay rent today?
I bring up grad student workers both because they are currently striking, but also because HN readers are probably more familiar with them, and can commiserate a bit more. It's not work that is as hard on the body as farm work, but desperately needing each paycheck in order to get enough food to eat, in order to pay rent and not end up homeless, living in terrible filthy conditions such as homes with mold, or in in insulated garages, or in sheds behind a primary house, with shared use of the kitchen and bathroom... those sorts of poor living conditions, barely able to be paid for are common.
If you had to wake up tomorrow, as either a foxconn iPhone factory worker, or a Berkeley graduate student, which would you pick? How different do you think those experiences are?
That’s the leverage.
Almost of third of workers are on disability, another third have minimum wage jobs and the rest have prospects. The business model in college is taking advantage of pride of tenured professors who don’t want to teach and pushing adjunct and temporary faculty.
A lot of people don’t get it and get stuck in the academic funnel. That Berkeley grad student isn’t breaking her body, but is sacrificing core working years, mostly to support the $$ faculty and administration.
Long term, especially in humanities, you won’t have tenured professors, just some assistant professors on two year contracts grinding a meager living along with with sucker grad students who either don’t get it or need the work to keep a visa.
Buy fewer electronics
Ask people to reduce their consumption and they have a tendency to lash out.
Almost every ad you see is trying to tell people how much better their life will be with a product and how much happier they'll be.
Engagement with China has gone very, very bad with Xi Jinping’s regime. He is absolutely the root of the problem and is doubling down in a bid to become Mao 2.
I'm software engineer at a Danish company that also manufactures a lot of industrial electronics. Our insight is that China is still the cheapest place to manufacture PCBs but it is surprisingly more efficient to setup pick-and-place robots here in Denmark to place the components onto the PCBs. The pick-and-place machines and assembly robots run all night now.
If we can figure out how to efficiently print the PCBs in Denmark/EU we will no longer have any critical reliance on China.
see my other post. It used to be part of a garage-shop economy here in Silicon Valley.
Back when you could do it in garages, things were a little simpler.
Dunno if their factories will be any less gulags, but given what kind of a place China is, perhaps they are.
No one is forcing these workers in China to take these jobs. The workers willingly choose to take them because they are an improvement over their status quo. The jobs pay more, and offer better benefits for them and their families, than they may be able to obtain elsewhere.
That's one of the great benefits of globalization. A factory job manufacturing cell phones may offer substandard wages in the US, but it's a big step forward for workers in a developing country. In this way both countries benefit.
Obviously everyone wants to continue to improve their lot, and a Chinese worker may BOTH realize that their factory job is better than they can attain elsewhere, AND they may suffer under poor conditions at that job. But they can always quit, and odds are someone else will immediately jump on that same job. That says a lot about the comparative quality of the opportunity. In the end these jobs, as flawed as they are, are still living millions out of even worse conditions every day across the globe.
You’d think, right? But part of the unrest leading to this point were two or three waves of breakouts of employees escaping lockdowns by jumping the fences and pushing past roadblocks set up by local authorities.
Then they started pressuring locals to work there.
They can get a job somewhere else but it won't be as good. Better to protest/strike at their current job than go somewhere else. Especially when you consider that there's no reason why their current employer can't pay more and improve conditions other than greed.
If there was more realistic competition in the area for workers then the pay and conditions would never have gotten to this point.
- keep working and earning money, which is why you migrated to the city in the first place. A lot of these migrant workers are bunking it with 4 - 8 other people in one anyway, so it's not like leaving work is some comfy place. But it's more profitable than subsistence farming.
- be locked into your apartment and get no money at all (but still have to pay rent). For the migrant workers who are the manufacturing labor force, that defeats the whole purpose of being in the city in the first place. Besides, they aren't living in comfy apartments.
- the government stop the zero Covid policy so that people can be normal. That's an option anyone but Xi Jinping can take, though.
I've seen some rural villages in Sichuan, and it is definitely subsistence farming. There is not really a feasible way to better yourself besides move elsewhere, so a lot of the parents go work in the city to get a pool of money to improve the lot of their family. Unfortunately, "move elsewhere" is not exactly feasible, either, because of the hukou system, which Mao created to prevent people from moving.
So I'd call it oppression, not exploitation. And it's not the factory owners who are oppressing them, so much as the government. The factory owners are actually providing a means of bettering themselves. (The factory owners might also be exploiting them, but the situation referred to is not an example of that.)