I would be interested in seeing more of that data. A few questions I would have:
1.) Were any of the Chinese engineers educated in the US? (before being trained at MPS)
2.) Was the system architect and product planner part of the China team or a foreign national?
3.) was there any added cost in cultural/language barriers and was it made up for by having people work round the clock?
I don't think there is any doubt that there are some really great engineers coming out of China. The question is if they are themselves driving the new ideas or executing the plans of others. If it is the former situation, then yes, everyone should be worried, including MPS. Because who's to say they won't take their show on the road and create their own company? If it is the latter situation, where the 50 engineers are cranking on a system design laid forth by others, then it's just a design based form of outsourcing. This is also a concern given the salary dispairities but in all reality is just ANOTHER sector that has fallen prey to low prices and "business decisions".
I have no doubt that the situation where the newly trained engineers will begin leaving and forming their own companies will eventually happen; I know this happens in all situations (ie. People leaving National back in the day to form LT) but I think it will happen in greater numbers than expected. The nationalism (wanting to work for a Chinese company) and ambition is high, as is the potential for rewards.
THAT is the handwriting on the walls for the US-trained engineer and the executive teams that are comfortable with outsourcing without realizing the implications. It is only on the day where the investors decide that the executive team and headquarters could contribute to cost savings by moving overseas will everyone realize it's much too late.
The costs of using such engineers are often calculated by economists without regard for basic economics common sense. Problems include:
1. By moving the income of technology generation overseas, the income of the target consumers is reduced as net outflow of cash increases.
2. By concentrating training of offshore engineering staff for short term cost reduction, the long term effect of loss of expertise onshore is ignored. This is becoming painfully obvious to universities where the number of US born students studying technical subjects has dwindled to a trickle.
3. The laws and ethics associated with the culture in the off-shore facility are different than those in the US. As such, it is quite common for technology "leakage" to impact long-term viability and profits for the company training their future competition.
4. This also, to some degree, applies to H-1 visa workers. The treatment and pay of these workers is critical to ensure maximum loyalty during their 7 years in the US. Some companies see these workers as a cheap short-term replacement for expensive US citizen engineers, and play games with pay and employment (some companies I am aware of employ a lot of H-1 engineers but only via contracts with some shady "employment agencies"). The result is employees who have felt cheated when working in the US, and return to their country of origin with the corporate secrets of the companies that employed them. At that point, the writing is on the wall. I was informed of one well-known company that found that its parts system had been compromised with sub-standard and un-authorized-source parts by one such worker after he was sent home.
This is part of a China nationalized espionage effort to take our best technology and use it to drive their economy and the finance and operations people who run things in the US these days can't wait to help them by handing it to them because reducing costs today means bonuses today - what happens later well.. Who cares?
Not only are the Chinese engineers less expensive, the software tools they have - which are the best and latest in the world are all free for the most part - stolen and pirated mainly from US companies too. When the "expensive" engineers in the US ask finance for 80K $ of design tools –well hey…” the China guys never ask us for this”. Well of course not buckwheat, it’s all stolen and "free" over there. But make no mistake when companies who are saving today start having to compete with themselves in China when it’s all stolen by a local company there and the market for manufacturing is there. Who do you think they are going to buy from? The "expensive" us company or the knock off copy from China? Once they steal the rest of our stuff they won’t need us any more but hey... We still have bright futures here in hedge fund management and being a lawyer!
Sometime this year, we taxpayers will again receive an Economic Stimulus payment. This is a very exciting program. I'll explain it using the Q and A format:
Q. What is an Economic Stimulus payment?
A. It is money that the federal government will send to taxpayers.
Q. Where will the government get this money?
A. From taxpayers.
Q. So the government is giving me back my own money?
A. Only a smidgen.
Q. What is the purpose of this payment?
A. The plan is for you to use the money to purchase a high-definition TV set, thus stimulating the economy.
Q. But isn't that stimulating the economy of China?
A. Shut up.
Below is some helpful advice on how to best help the US economy by spending your stimulus check wisely:
If you spend the stimulus money at Wal-Mart, the money will go to China.
If you spend it on gasoline, your money will go to the Middle East.
If you purchase a computer, it will go to India, Taiwan and China
If you purchase fruit and vegetables, it will go to Mexico, Honduras and Guatemala.
If you buy a car, it will go to Japan or Korea.
If you purchase useless stuff, it will go to Taiwan.
If you pay your credit cards off, or buy stock, it will go to management bonuses and they will hide it offshore.
Instead, keep the money in America by:
1 spending it at yard sales, or
2 going to ball games, or
3 spending it on working girls, or
4 beer or
5 tattoos.
(These are the only American businesses still operating in the US .)
Conclusion: Go to a ball game with a tattooed working girl that you met at a yard sale and drink beer all day.
Senator Kay Bailey Hutchinson says we have a shortage of engineers in the states. Whose hot air is she breathing? All she'll do repeating this line is create a surplus of engineers, supress our salaries and drive the next generation of students away from engineering, creating a new shortage.
Thanks to Obama, our currency is going to suffer near hyper-inflation (making the Carter-era inflation look tame in comparison). Gold is already above $1000 per ounce and should soon hit $2000. This kind of inflation will reduce the real cost of American salaries.
