Do Capitalists Understand Basic Economics? Disney Doesn’t Appear To.

The American Chamber of Commerce and many domestic employers are letting all Americans down and negatively impacting our economy by firing domestic employees and hiring foreign replacements. They threaten their own future profits and business prospects as well as the nation’s welfare.

The misuse of the H-1B visa program and other failings has for some time been used to get rid of experienced domestic employees who are seen as being too expensive and in turn hiring foreign workers at a lower cost. Not only is this kind of thinking going to hurt many Americans who have worked hard, achieved an education and been true to their employer for a number of years, but it’s going to impact the entire middle class.

How can these clever people make such dumb short-term labor decisions that will have such long-term impact on their own profits?  Disney is one of the most recent companies found doing this very thing, but what Disney doesn’t seem to understand is that the domestic employees they fire will no longer be able to afford to visit its amusement parks, see its movies nor take cruises on its ships, and neither will the underpaid foreign hires who replace them.  So with these firings they have lost many past and potential customers.  When this sort of decision is multiplied by many companies doing the same thing, the economy as a whole will take a big, negative hit and unemployment will increase.  Obama has caused the current recession/depression to last longer than it should have with his enormous spending and EPA and Obamacare costs, but now employers are adding their mistakes to the president’s, which will only add more drag to any possible economic recovery (which recovery, by the way, has not happened).  And Disney is taking these draconian measures at a time when its corporate income is fine; it’s not like they need to cut labor costs to make a profit.

Risking long-term earnings, stability and negative public reaction for short-term labor savings is not a good plan.  It hurts us all.