Mercury Rising 鳯女

Politics, life, and other things that matter

Posts Tagged ‘exploitation’

Mitt Romney Profits From Sensata Workers’ Pain, In China And America

Posted by Phoenix Woman on October 22, 2012

This is something Mitt Romney is hoping doesn’t get broadcast to most Americans:

Republican presidential candidate Mitt Romney started the “private equity” firm Bain Capital. Bain Capital makes its money by purchasing companies using “leveraged buyouts” that borrow huge sums using the purchased company’s own assets as collateral. They often use part of the borrowed money to immediately pay itself. Bain then cuts costs by doing things like sending jobs to China, cutting wages and manipulating tax rules to cut taxes owed, along with standard big-business practices like consolidating business units, taking advantage of economies of scale not available to smaller competitors, squeezing distribution channels for price cuts, and other practices that bring competitive advantages. (Please see So DID Mitt Romney Really “Create Jobs” At Staples? for a look at how this works.) Then, after reorganizing the purchased companies Bain “harvests” them for profit. (“Harvest” is Romney’s word, watch the linked video.)

Bain Capital purchased a sensor manufacturer that makes key components for our automobile supply chain, and named it Sensata. They immediately announced they closing a factory in Freeport, Ill., and sending the manufacturing and jobs to China to save money. (This is significant because China is engaged in efforts to dominate American auto supplies. See China Cheating Costs 400K Auto Parts Jobs and Why The Latest Trade Complaint Against China Matters. )

Bain/Sensata brought in Chinese workers and made the Freeport workers train them. Bain/Sensata is moving the equipment out of the Freeport factory and shipping it to China right now. The Freeport employees have set up a camp outside the factory that they call Bainport and are trying to stop the Bain trucks that are moving the equipment out for shipment to China. Supporters were arrested this week, trying to stop those trucks.

The Sensata employees have asked Romney to come to Freeport/Bainport and help them. Read on to learn about Romney’s response to the Sensata workers, and how Romney is actually making big money right now from shipping their jobs to China.

Of course, the Romney campaign announced that Romney would refuse to lift a finger to save the Freeport plant, much less assist the horrifically exploited Chinese Sensata workers who get paid the equivalent of 99 cents to $1.35 an hour, work twelve hours a day and seven days a week, and are
forced to live on site in the factory with no rights to speak of even as Sensata rakes in the cash and sticks American taxpayers with the bill:

Sensata enjoyed record revenues last year – this isn’t about making the “hard choices” necessary to save a failing enterprise. The workers in Freeport have been working 24 hours a day, in three shifts. They make $14-17 per hour, with benefits.

According to a report by the Institute for Global Labour and Human Rights, one of Bain’s first actions after buying Sensata was to set up “12 Sensata/Bain capital funds ‘organized under the laws of the Cayman Islands’ so as to avoid paying taxes.” They’ll get a small tax break for relocating the plant – the one Mitt Romney insisted did not exist during the first debate – and then use those offshore funds to defer taxes on some of the income the company generates.

American tax-payers, on the other hand, have paid $780,000 to retrain some of Sensata’s laid off workers in Illinois, according to the New York Times . One would be hard pressed to come up with a clearer example of capturing private gains while socializing the costs.

Instead, Romney campaign spokesman Curt Cashour tried to deflect the responsibility from Romney, Bain’s founder — the man who up to 2002 was the sole shareholder, owning 100% of the company per SEC filings) and a man who still gets a few million dollars a month from his Bain involvements — onto President Obama. Gee, how brave and principled of you, Willard. Not.

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The Infosys H1B Scandal

Posted by Phoenix Woman on June 22, 2011

Yet more proof that the “oh we can’t find these tech workers at home so we must import them” line is nonsense:

A giant Indian outsourcing company with thousands of employees in the
United States is facing an expanding federal investigation prompted by
claims from an American whistle-blower that it misused short-term
visitors’ visas to bring in low-cost workers from India.

Accusations that the company, Infosys Technologies, repeatedly violated the terms of business visitor visas were first raised in a lawsuit filed in February in Alabama by Jack Palmer, an Infosys project manager. Aside from Mr. Palmer, at least two other Infosys managers in the United States have submitted internal whistle-blower reports pointing to Indians on business visitor visas who were performing longer-term work not authorized under those visas, according to internal
documents
and current Infosys managers.

In May, Infosys acknowledged that it had received a subpoena from a
federal grand jury in Texas seeking information about the company’s use
of the visitor documents, known as B-1 visas, which are easier to
obtain. This month, N. R. Narayana Murthy, an Infosys founder, expressed
his concern about that investigation at a board meeting in Bangalore,
India, in his final address before he retired as company chairman.

“As I leave the board, I feel sad” about the subpoena, he said. “The
issue will be decided on its merits in due course,” said Mr. Murthy, who
is something of a legend in global business for building the company
over three decades from a $250 investment into an outsourcing powerhouse
with $6 billion in revenues.

The legal jeopardy isn’t the only one the divide-and-conquer-the-worker CEOs in both India are facing. Zoe Lofgren’s introduced a bill that would require US companies to increase the wages employers would have to pay H-1B workers, in an effort to ensure they do not undercut American tech industry workers as well as to eliminate the exploitation of overseas tech workers in the US; the measure targets Indian outsourcing companies. In addition, Congress last year added an extra $2,000 to the fee for H-1B visas, in another move aimed at the Indian outsourcing companies.

Posted in immigration, India, industry | Tagged: , , | 2 Comments »

 
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