The Hightower Report
Hello, Vietnam!; and Fee-Brained Airlines
Several of America's top high tech giants are now breaking with conventional thinking on the offshoring of their factories and jobs, asking a heretofore unthinkable question: "Who needs China?"
"Let's invest in new, state-of-the-art factories," they declare excitedly. "We'll launch a bold new initiative to train tens of thousands of teachers who, in turn, will educate the high tech work force of the future, generating a wave of jobs and making our American corporations the most competitive in the world!"
Wow, what vision; what a boost to America's middle class possibilities!
Uh ... America? Who said anything about the USA? No, no, the high tech powerhouses are not decamping from China to reinvest in our country – instead, they are shifting their production to Vietnam. It seems that the millionaire chieftains of Silicon Valley now deem the price of China's low-wage workers to be too high, and their wandering eyes have settled on Vietnam, where the per capita income is less than half that of the Chinese people.
Thus, on Oct. 29, Intel CEO Paul Otellini stood in a packed auditorium in Ho Chi Minh City and hollered out, "Hello, Vietnam." He was there for the dedication of Intel's sparkling, billion-dollar chip factory, which has a clean room the size of five football fields and employs 4,000 workers. Also, Intel is trying to realign Vietnam's educational system to be more corporate-friendly, pouring money into the training of 87,000 teachers.
Hewlett-Packard is another world-wanderer moving to Vietnam, having built a facility there for outsourcing its software engineering work. Wouldn't it be nice, in these times of middle-class decline in America, if the high tech honchos who benefit so lavishly from our country were to move more of their investments and jobs here?
Why do airline executives hate their customers? Not so very long ago, airlines boasted about flying "the friendly skies." These days, a more apt rendition of that happy slogan would be flying "the abusive skies."
For example, what does a ticket cost? The airlines won't come clean on even this basic question. We do know that stated ticket prices have been steadily rising, with double-digit increases in the past year.
But that price is merely the starting point for today's airline hucksters. The real gouging is in the frenzy of fees that airlines have invented, many of which are not even disclosed to us and most of which are simply unwarranted. Last year, airline fees totaled nearly $8 billion – a consumer subsidy siphoned right out of our pockets into the corporate coffers.
Take the "ticket change" fee. If something comes up, forcing you to change a flight from the one you've booked, you're hit with a service fee of $150, plus you must pay the difference if your new flight is priced higher (which it will be). What a rip-off! This rebooking "service" is done by computer, costing the airline more like a buck-fifty, rather than a hundred and fifty. Also, notice that airlines themselves routinely cancel or delay our flights, forcing us into inconvenient and thoroughly unpleasant travel changes – yet they don't pay us $150 for their changes.
American Airlines, however, has generously offered to cut its rebooking fee in half – if you pay a "flexibility" fee of $19 when you book your flight. Then, any changes you need to make later will only cost you $75. Yes, it's a fee to reduce your fee!
These nasty gouges are infuriating and unnecessary. Southwest Airlines, though, refuses to charge for any service that has historically been free to customers – and Southwest has consistently stayed profitable.