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Metalworking (rec.crafts.metalworking) Discuss various aspects of working with metal, such as machining, welding, metal joining, screwing, casting, hardening/tempering, blacksmithing/forging, spinning and hammer work, sheet metal work. |
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#1
Posted to rec.crafts.metalworking
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Where does China get their leather for shoes?
I was at a shoe store recently and a quick check of a few shoe boxes
indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? During college I worked nights at a local beef packing house. One of the jobs I did at that PH was spreading beef hides out and throwing rock salt over them to start curing. That operation only processed about 300 head a day but that is a helluva lot of shoes. I wonder how much of our leather goes to China to be turned into shoes and sent back to the United States. I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL |
#2
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Where does China get their leather for shoes?
TwoGuns wrote: I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? During college I worked nights at a local beef packing house. One of the jobs I did at that PH was spreading beef hides out and throwing rock salt over them to start curing. That operation only processed about 300 head a day but that is a helluva lot of shoes. I wonder how much of our leather goes to China to be turned into shoes and sent back to the United States. I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. You might consider that if the US taxed fuel instead of labor the equation might change a little The products you consume might be made a little closer to where you live Go figure. DL |
#3
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Where does China get their leather for shoes?
jim wrote:
TwoGuns wrote: .... I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Yup! You might consider that if the US taxed fuel instead of labor the equation might change a little The products you consume might be made a little closer to where you live It's the damn unions! No American business can _afford_ to pay people $30.00 an hour for work that's worth 10. And yes, they're doing it because it's cost-effective. They're probably exporting the leather as well, although it'd be more likely to go to Mexico to be made into sandals. ;-) And of course, if we could get ahold of some of those Navy reactors that they're using on all those aircraft carriers, fuel costs would plummet. Cheers! Rich |
#4
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Where does China get their leather for shoes?
On Sat, 05 Mar 2011 12:23:56 -0800, the renowned Rich Grise
wrote: jim wrote: TwoGuns wrote: ... I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Yup! You might consider that if the US taxed fuel instead of labor the equation might change a little Oh, hardly. It costs pennies to move a $100 pair of shoes around the world by sea. Current 'emergency' increases due to bunker fuel costs are less than a nickel US per shoebox volume. Triple that ($200/barrel oil?) and it's still nothing. At what level would it make a difference? 5% of retail? That's gasoline at $100 a gallon or something like that. Other things will die first. The products you consume might be made a little closer to where you live It's the damn unions! No American business can _afford_ to pay people $30.00 an hour for work that's worth 10. Or $10 an hour for work that can be done even better for $1.50. And yes, they're doing it because it's cost-effective. They're probably exporting the leather as well, although it'd be more likely to go to Mexico to be made into sandals. ;-) And of course, if we could get ahold of some of those Navy reactors that they're using on all those aircraft carriers, fuel costs would plummet. Fuel costs are pretty much insignificant in this equation. Ships are very cost-effective. Railways less so, but that's more because of the domestic labor component (high to begin with, and higher because of oligppoly-fed unions). Cheers! Rich Best regards, Spehro Pefhany -- "it's the network..." "The Journey is the reward" Info for manufacturers: http://www.trexon.com Embedded software/hardware/analog Info for designers: http://www.speff.com |
#5
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Where does China get their leather for shoes?
On Sat, 05 Mar 2011 19:37:12 -0500, Spehro Pefhany
wrote: On Sat, 05 Mar 2011 12:23:56 -0800, the renowned Rich Grise wrote: jim wrote: TwoGuns wrote: ... I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Yup! You might consider that if the US taxed fuel instead of labor the equation might change a little Oh, hardly. It costs pennies to move a $100 pair of shoes around the world by sea. Current 'emergency' increases due to bunker fuel costs are less than a nickel US per shoebox volume. Triple that ($200/barrel oil?) and it's still nothing. At what level would it make a difference? 5% of retail? That's gasoline at $100 a gallon or something like that. Other things will die first. Okay, here's a real spot price: http://www.joc.com/maritime/containe...irst-time-year Less than $2K ever-shrinking US dollars for a 40' container Hong Kong to Los Angeles. Probably would hold 12,000-15,000 pairs of shoes, or 0.13-0.17/pair. Doesn't even make a dent in the sales tax at retail. Best regards, Spehro Pefhany -- "it's the network..." "The Journey is the reward" Info for manufacturers: http://www.trexon.com Embedded software/hardware/analog Info for designers: http://www.speff.com |
#6
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Where does China get their leather for shoes?
Spehro Pefhany wrote:
On Sat, 05 Mar 2011 19:37:12 -0500, Spehro Pefhany wrote: On Sat, 05 Mar 2011 12:23:56 -0800, the renowned Rich Grise wrote: jim wrote: TwoGuns wrote: ... I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Yup! You might consider that if the US taxed fuel instead of labor the equation might change a little Oh, hardly. It costs pennies to move a $100 pair of shoes around the world by sea. Current 'emergency' increases due to bunker fuel costs are less than a nickel US per shoebox volume. Triple that ($200/barrel oil?) and it's still nothing. At what level would it make a difference? 5% of retail? That's gasoline at $100 a gallon or something like that. Other things will die first. Okay, here's a real spot price: http://www.joc.com/maritime/containe...irst-time-year Less than $2K ever-shrinking US dollars for a 40' container Hong Kong to Los Angeles. Probably would hold 12,000-15,000 pairs of shoes, or 0.13-0.17/pair. Doesn't even make a dent in the sales tax at retail. A shoe box is .25 cubic feet There are 2500 cu ft in a container That's 1000 boxes if packed full Ocean voyage is the cheapest part of shipping Costs in the neighborhood of $5 for shipping from factory to store per pair of shoes |
#7
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Where does China get their leather for shoes?
On Sat, 05 Mar 2011 06:39:03 -0600, jim "sjedgingN0Sp"@m@mwt,net
wrote: TwoGuns wrote: I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? Actually No. Pigs are only sacred to those who own them :-) Cows are sacred only to the Hindu. But as to numbers shod, I suggest that a substantial percentage of the population in Asia does not wear shoes. They wear sandals which are largely, today, made from plastic although in times past everything from straw to wood was used. |
#8
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Where does China get their leather for shoes?
TwoGuns wrote:I guess it is cheaper to use expensive fuel
to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL :-) Leather??? I'm pretty sure most shoes now-a-days are made of plastic of some sort. ...lew... |
#9
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Where does China get their leather for shoes?
Lewis Hartswick wrote: TwoGuns wrote:I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL :-) Leather??? I'm pretty sure most shoes now-a-days are made of plastic of some sort. Made from plastic cows. The rest is used for their imitation beef in the food they ship us. -- You can't fix stupid. You can't even put a Band-Aid™ on it, because it's Teflon coated. |
#10
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Where does China get their leather for shoes?
In article
s.com, TwoGuns writes snip But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Are they are made of faux leather? If so, faux must be an endangered species in China. Perhaps the World Wildlife Fund should investigate! -- Chris Holford |
#11
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Where does China get their leather for shoes?
In article ,
Chris Holford wrote: In article s.com, TwoGuns writes snip But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Are they are made of faux leather? If so, faux must be an endangered species in China. Perhaps the World Wildlife Fund should investigate! I wear ecco soft slip-on shoes that are made in India, but are made of leather. I imagine that the leather is made outside of India, so the sacred cows are safe. I've read that the way the population of sacred cows in India is controlled is by selling the cows to Pakistani companies. Joe Gwinn |
#12
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Where does China get their leather for shoes?
The Pakis strap on bombs, and send the cows
back to India? -- Christopher A. Young Learn more about Jesus www.lds.org .. "Joseph Gwinn" wrote in message ... I've read that the way the population of sacred cows in India is controlled is by selling the cows to Pakistani companies. Joe Gwinn |
#13
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Where does China get their leather for shoes?
I'm going to start a new oversight organization.
Save The Faux United. We'll have business cards printed, and publish alerts, and fund raise. Our business card will have our logo (the initials / acronym) in large letters, and spelled out in very tiny print. I'll greet everyone with "I'm saving the world; STFU." -- Christopher A. Young Learn more about Jesus www.lds.org .. "Chris Holford" wrote in message ... Are they are made of faux leather? If so, faux must be an endangered species in China. Perhaps the World Wildlife Fund should investigate! -- Chris Holford |
#14
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Where does China get their leather for shoes?
On Mar 5, 5:41*am, TwoGuns wrote:
I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? *During college I worked nights at a local beef packing house. One of the jobs I did at that PH was spreading beef hides out and throwing rock salt over them to start curing. That operation only processed about 300 head a day but that is a helluva lot of shoes. I wonder how much of our leather goes to China to be turned into shoes and sent back to the United States. I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL http://www.tannerscouncilict.org/ict%20stats2008.pdf |
#15
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Where does China get their leather for shoes?
On Sat, 05 Mar 2011 03:41:09 -0800, TwoGuns wrote:
I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? During college I worked nights at a local beef packing house. One of the jobs I did at that PH was spreading beef hides out and throwing rock salt over them to start curing. That operation only processed about 300 head a day but that is a helluva lot of shoes. I wonder how much of our leather goes to China to be turned into shoes and sent back to the United States. I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL The Blue Heron paper mill in Oregon City is closing -- they've been operating under the protection of the bankruptcy court since 2009, but this year the price for scrap paper jumped up, and things just didn't pencil out anymore. Back in 1776, we fought a war with the British, in no small part because they were trying to prevent us from manufacturing our own goods: the business model was that we'd send raw materials west, they'd make them into manufactured goods (and make out like bandits), and we'd buy those manufactured goods. Now, we're _giving that away_. Republicans say "anything that makes money for rich people is good". Democrats say "we'll all be college educated managers and teachers in 20 years" (but don't do the math on _who_ we're going to manage). No one seems to get the point. Sigh. -- http://www.wescottdesign.com |
#16
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Where does China get their leather for shoes?
Tim Wescott wrote:
Now, we're _giving that away_. Republicans say "anything that makes money for rich people is good". Which specific Republican said that? Can you back up your claim, or are you just tantrumizing like the unionists? "GIMME! GIMME! GIMME! GIMME! GIMME!" Anything that makes money for "rich people" makes money for _everybody_, if the government doesn't confiscate it first to hand out to the union bosses. Where do you think the jobs come from? Government? Who pays the bill? China? Hope This Helps! Rich |
#17
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Where does China get their leather for shoes?
On 3/5/2011 12:29 PM, Rich Grise wrote:
Tim Wescott wrote: Now, we're _giving that away_. Republicans say "anything that makes money for rich people is good". Which specific Republican said that? Can you back up your claim, or are you just tantrumizing like the unionists? "GIMME! GIMME! GIMME! GIMME! GIMME!" Anything that makes money for "rich people" makes money for _everybody_, if the government doesn't confiscate it first to hand out to the union bosses. Where do you think the jobs come from? Government? Who pays the bill? China? Hope This Helps! Rich well, I hope that anyone who reads the above can connect the dots, it is so patently false that it does not require refutation. "anything .... makes money for everybody" - One thing that makes money for rich people is hedge fund trading. Tell me how that personally helps you? how does currency exchange trades help you? You said that "anything" makes money for "everybody" - how could this be true - and don't tell me that the rich will buy stuff with the money, that is manifestly untrue |
#18
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Where does China get their leather for shoes?
On Mar 5, 5:41*am, TwoGuns wrote:
I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? We have shut down a lot of our mining industry for things like steel and copper because of EPA regulations so I can understand why we ship in a lot of steel. But shoes? Does China have so many cattle that they can put shoes on the feet of their one billion plus population and have enough leather left to send millions of shoes to the United States every year/ Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? *During college I worked nights at a local beef packing house. One of the jobs I did at that PH was spreading beef hides out and throwing rock salt over them to start curing. That operation only processed about 300 head a day but that is a helluva lot of shoes. I wonder how much of our leather goes to China to be turned into shoes and sent back to the United States. I guess it is cheaper to use expensive fuel to send raw leather to China and use China's CHEAP LABOR and use some more EXPENSIVE fuel to ship Chinese shoes back to America. Go figure. DL In your rant you forgot to add..."....by AMERICAN companies." And yes cheap oil allows many "dumb" things to happen. Americans used to wear buffalo coats ..... well until the cheap buffalo were gone. How dare they disappear! FWIW...most people in the world either do not wear shoes or wear something that you and I would have thrown out long ago. And in many places, any protein including leather is tomorrow's lunch. TMT |
#19
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Where does China get their leather for shoes?
TwoGuns wrote:
Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? Not all Indians are hindu. There are muslims, christians, and sikhs. I'm trying to remember the book I read this in but where a hindu can't butcher a cow, a muslim can do it for him or something like that. Wes |
#20
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Where does China get their leather for shoes?
On Sat, 05 Mar 2011 14:47:26 -0500, Wes
wrote: TwoGuns wrote: Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? Not all Indians are hindu. There are muslims, christians, and sikhs. I'm trying to remember the book I read this in but where a hindu can't butcher a cow, a muslim can do it for him or something like that. Wes A practicing Hindu will not touch anything that is made from a cow or cause harm to a cow, so there is no question of a Hindu requiring a Moslem to slaughter a cow. By the way, if the person in question is a Hindu, or follows one of the off-shoots of Hinduism, then it is highly likely that he is also a vegetarian and doesn't eat meat anyway. |
#21
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Where does China get their leather for shoes?
On Sat, 5 Mar 2011 03:41:09 -0800 (PST), TwoGuns
wrote: I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? snip Long response but so is the story When examined in depth this is a very long running but highly illustrative saga dating back to at least the late 1950s and early 1960s. To avoid possible libel action, I will call the exemplar company "The Sepia Shoe Company" founded in the late 1870s and originally domiciled in St Louis Missouri, because of the large numbers of packing houses and the resulting supply of cheap leather. The company survived two world wars and the depression, but in the late 50's/early 60's began moving production operations out of St Louis to rural areas, particularly those south of St Louis. Much of this was driven by the economic development activities of those rural areas, which offered land, labor, and financing at very attractive, i.e. taxpayer subsidized, rates. The financing allowed the construction of state of the art buildings and purchase of the latest shoe manufacturing technology. After about 10 years [mid 70s], the new equipment was becoming obsolescent and worn out, the local hourly employees were getting restless wanting higher wages, the local ED tax abatements were expiring, and fat early years of equipment tax depreciation were ending. Most fortunately for the Sepia Shoe Company, the mantra in Washington was "trade, not aid" at this time, and Brazil was heavily in debt to the Wall Street knee knockers. Brazil also had large leather surpluses, and additional hides and finished leather was available at very cheap prices from Argentina. The production operations were quickly shifted to Brazil, largely financed by local [Brazilian] economic development funds, state of the art buildings constructed, and the newest, most productive shoe machinery purchased. Unemployment was high, and any wage was better than no wage. As Brazil was under a military dictatorship at this time, no labor problems were anticipated as unions were forbidden. http://en.wikipedia.org/wiki/Brazili...ary_government It was at this stage that the domestic shoe industry became important, at least locally, and may have decided at least one Senate election when one candidate [IIRC an incumbent] was photographed wearing Gucci loafers [Italian made at that time] with a distinctive metal decoration on the instep, while making speeches about protecting the domestic shoe industry to the local "great unwashed" of Missouri. One new wrinkle with the establishment of international operations was the extensive and active use of transfer pricing. Sepia Brazil did not sell directly to Sepia USA, but rather to an intermediary we will call Sepia Aruba. [It is still not clear who actually controlled Sepia Aruba.] The grift worked like this. The shoes and other leather goods, e.g. belts, were produced cheaply by Sepia Brazil, and sold cheaply to the international marketing and distribution arm Sepia Aruba, generating little profit in Brazil by Sepia Brazil, not enough in many cases to cover the financing costs, and certainly not enough to justify any raises for the local employees. Sepia Aruba then sold the shoes and other leather goods to Sepia USA at a very considerable markup, so little profit was generated in the US by Sepia USA sales. By a strange coincidence there was and is no corporate income tax in Aruba, so huge pools of untaxed and unregulated capital of unknown ownership/control quickly accumulated. In the mid 80's control of Brazil was returned to a civilian government and the financial dealings/arrangements of the military dictatorship [1964-1985] were reexamined, and serious questions began to be raised about the failure of several international operations in addition to Sepia Brazil to charge arms-length or customary/usual prices for their exports sold to other divisions, and their failure to pay their local taxes, reasonable wages, reinvest in domestic facalities or even pay off the ED bonds. Time elapsed and more populist/nationalist governments were elected in Brazil and several tax evasion and financial manipulation investigations started, and wages increased through minimum wage legislation. It should be noted that Sepia Brazil had very few assets beyond the now dated buildings and obsolescent/worn-out shoe manufacturing equipment, and much of this was collateral for the local/Brazilian ED bonds/financing through the New York banks but guaranteed by the Brazilian people/government. By the mid to late 90's, the Sepia Shoe Company was abandoning Brazil, leaving the creditors of Sepia Brazil "holding the bag," as they transferred their manufacturing operations to China and India, again using local ED funds to construct state of the art buildings and purchase the very latest shoe manufacturing equipment. When "earnest money" was required, Sepia USA could easily borrow from international sources, which may well have been the funds amassed by Sepia Aruba, but because of the local bank secrecy laws there is no way to tell. If this is indeed the case, Sepia USA is paying high interest rates to itself for using its own [Sepia Aruba] money while deducting the interest costs as a tax-deductible business expense against their US and other taxable income. The transfer pricing dodge where a separate "trading and marketing" company [Sepia Hong Cong? Sepia Macau?] buys low (locally, from Sepia China, Sepia India) and sells high (to Sepia USA for US distribution), appears to still be operating but though Asian tax haven countries. I don't know about India, but the Chinese apparently learn from the mistakes of other, and require local participation/control and technology transfer. Vietnam is another area where shoe manufacturing is being transferred. As you can see this is not a "sudden" or "new" problem but one that has festered and metastasized over at least 2 generations of politicians and 3 company iterations, persistently aided and abetted by US governmental policy/neglect. -- Unka George (George McDuffee) ............................... The past is a foreign country; they do things differently there. L. P. Hartley (1895-1972), British author. The Go-Between, Prologue (1953). |
#22
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Where does China get their leather for shoes?
On Mar 5, 1:57*pm, F. George McDuffee gmcduf...@mcduffee-
associates.us wrote: On Sat, 5 Mar 2011 03:41:09 -0800 (PST), TwoGuns wrote: I was at a shoe store recently and a quick check of a few shoe boxes indicated that most shoes are not made in the USA. I can understand why some products are not made in the United States but shoes? snip Long response but so is the story When examined in depth this is a very long running but highly illustrative saga dating back to at least the late 1950s and early 1960s. *To avoid possible libel action, I will call the exemplar company "The Sepia Shoe Company" founded in the late 1870s and originally domiciled in St Louis Missouri, because of the large numbers of packing houses and the resulting supply of cheap leather. The company survived two world wars and the depression, but in the late 50's/early 60's began moving production operations out of St Louis to rural areas, particularly those south of St Louis. *Much of this was driven by the economic development activities of those rural areas, which offered land, labor, and financing at very attractive, i.e. taxpayer subsidized, rates. *The financing allowed the construction of state of the art buildings and purchase of the latest shoe manufacturing technology. After about 10 years [mid 70s], the new equipment was becoming obsolescent and worn out, the local hourly employees were getting restless wanting higher wages, the local ED tax abatements were expiring, and fat early years of equipment tax depreciation were ending. *Most fortunately for the Sepia Shoe Company, the mantra in Washington was "trade, not aid" at this time, and Brazil was heavily in debt to the Wall Street knee knockers. *Brazil also had large leather surpluses, and additional hides and finished leather was available at very cheap prices from Argentina. The production operations were quickly shifted to Brazil, largely financed by local [Brazilian] economic development funds, state of the art buildings constructed, and the newest, most productive shoe machinery purchased. Unemployment was high, and any wage was better than no wage. As Brazil was under a military dictatorship at this time, no labor problems were anticipated as unions were forbidden.http://en.wikipedia.org/wiki/Brazili...ary_government It was at this stage that the domestic shoe industry became important, at least locally, and may have decided at least one Senate election when one candidate [IIRC an incumbent] was photographed wearing Gucci loafers [Italian made at that time] with a distinctive metal decoration on the instep, while making speeches about protecting the domestic shoe industry to the local "great unwashed" of Missouri. One new wrinkle with the establishment of international operations was the extensive and active use of transfer pricing. *Sepia Brazil did not sell directly to Sepia USA, but rather to an intermediary we will call Sepia Aruba. [It is still not clear who actually controlled Sepia Aruba.] The grift worked like this. *The shoes and other leather goods, e.g. belts, were produced cheaply by Sepia Brazil, and sold cheaply to the international marketing and distribution arm Sepia Aruba, generating little profit in Brazil by Sepia Brazil, not enough in many cases to cover the financing costs, and certainly not enough to justify any raises for the local employees. *Sepia Aruba then sold the shoes and other leather goods to Sepia USA at a very considerable markup, so little profit was generated in the US by Sepia USA sales. *By a strange coincidence there was and is no corporate income tax in Aruba, so huge pools of untaxed and unregulated capital of unknown ownership/control quickly accumulated. In the mid 80's control of Brazil was returned to a civilian government and the financial dealings/arrangements of the military dictatorship [1964-1985] were reexamined, and serious questions began to be raised about the failure of several international operations in addition to Sepia Brazil to charge arms-length or customary/usual prices for their exports sold to other divisions, and their failure to pay their local taxes, reasonable wages, reinvest in domestic facalities or even pay off the ED bonds. * Time elapsed and more populist/nationalist governments were elected in Brazil and several tax evasion and financial manipulation investigations started, and wages increased through minimum wage legislation. *It should be noted that Sepia Brazil had very few assets beyond the now dated buildings and obsolescent/worn-out shoe manufacturing equipment, and much of this was collateral for the local/Brazilian ED bonds/financing through the New York banks but guaranteed by the Brazilian people/government. By the mid to late 90's, the Sepia Shoe Company was abandoning Brazil, leaving the creditors of Sepia Brazil "holding the bag," as they transferred their manufacturing operations to China and India, again using local ED funds to construct state of the art buildings and purchase the very latest shoe manufacturing equipment. *When "earnest money" was required, Sepia USA could easily borrow from international sources, which may well have been the funds amassed by Sepia Aruba, but because of the local bank secrecy laws there is no way to tell. *If this is indeed the case, Sepia USA is paying high interest rates to itself for using its own [Sepia Aruba] money while deducting the interest costs as a tax-deductible business expense against their US and other taxable income. The transfer pricing dodge where a separate "trading and marketing" company [Sepia Hong Cong? Sepia Macau?] buys low (locally, from Sepia China, Sepia India) and sells high (to Sepia USA for US distribution), appears to still be operating but though Asian tax haven countries. *I don't know about India, but the Chinese apparently learn from the mistakes of other, and require local participation/control and technology transfer. *Vietnam is another area where shoe manufacturing is being transferred. As you can see this is not a "sudden" or "new" problem but one that has festered and metastasized over at least 2 generations of politicians and 3 company iterations, persistently aided and abetted by US governmental policy/neglect. -- Unka George *(George McDuffee) .............................. The past is a foreign country; they do things differently there. L. P. Hartley (1895-1972), British author. The Go-Between, Prologue (1953). Good read. And accurate. I could add many more industries to your discussion. Love the the Gucci angle. ;) TMT |
#23
Posted to rec.crafts.metalworking
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Where does China get their leather for shoes?
TwoGuns wrote:
Another question about shoes. India has around a billion people also and I assume a lot of them wear shoes. However isn't it national policy in India that cows are sacred? To some sects yes, national policy No, now in nepal (at least when I lived there) it was legally the same as killing a person. Accidental deaths were ok, and it was ok to eat the resulting meat. Of course leather can be made out of Pigskin or other skins but aren't those animals sacred also? No, and there are probably more water buffalos than cows any way, and they are not sacred. [They make better milk and yoghurt though) jk |
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