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What's the future hold for the US economy? Manufacturing.
invite response
2011 Aug 3, 1:39am 16,143 views 65 comments
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millenium generation
The MGs are hooked on their Facebook, Iphones, and Zynga crap, unable to comprehend real industries that matter in Silicon Valley... Semi, Storage, Servers and Software.
Indiana Jones
2011 Aug 5, 3:11pm
Check out this link from Democracy Now! Not only is the corporatocracy outsourcing to China for cheap labor; they even get cheaper labor ($0.20 an hour) using the huge domestic prison population to make all kinds of stuff. It makes sense now why they put so many people in prison for minor offenses.
http://www.democracynow.org/2011/8/5/new_expos_tracks_alec_private_prison
Democracy Now!
Thats a Great Fuck Head Liberal TV program!
Reminds me of how the liberals managed to pretty much destroy our economy back in the 70s with their policies. Result ? The Japanese and Europeans managed to replace our industries.
spudbuddy
2011 Aug 6, 12:02am
Manufacturing also produces a multi-level knowledge base.
A society that makes things shares all the spinoffs of research, development, invention, not to mention of course, the total amount of employment created by production.
I think a society loses not only financially, but also a lot of pride when they stop the process of creating truly home-grown brands.
Historically, Spain went down the tubes (in spite of all the New World's stolen wealth) when they blew it all on fantasies and enchantments back in the 16th century, figuring they could just buy everything from someone else.
They wound up making nothing (except bulls.)
Interesting - how this affects particularly, the middle class.
Perhaps a by-product of this development is that weird notion that middle-class was "supposed" to become truly white-collar...just sitting in a cubicle and poking at a keypad.
God forbid we wear grease-stained blue collars anymore.
But at one time, that was the real backbone of the economy.
Germany has avoided this mistake, largely because its workers can afford to pay domestic prices (what a novel concept) - and has of course, also maintained its manufacturing knowledge base.
What I can't figure out, is how a whole nation swallowed the idea that this knowledge base wasn't important, anymore?
But then...that kind of thinking fits in perfectly with so much of what has warped our economy out of shape. Wealth isn't created anymore, just intercepted.
Just like that Catcher in the Rye, the Big Wall Street Mitt grabs every hopeful attempt....
MisdemeanorRebel
2011 Aug 6, 4:24am
Historically, Spain went down the tubes (in spite of all the New World's stolen wealth) when they blew it all on fantasies and enchantments back in the 16th century, figuring they could just buy everything from someone else.
They wound up making nothing (except bulls.)
BINGO. The Elites and Middle Classes in Spain were only interested in obtaining land in order to live the life of a Nobleman. They imported everything from Holland, Italy, etc with their New World Gold and Silver. Eventually the economy was hollowed out as no investment or tariff was there to advance or protect domestic industry. Same shit happened in Mexico.
Wherever policies that emphasize landed wealth and unearned income trump an industrial policy based on production, you see a few very rich but many poor people.
China has stiff tariffs, as does Malaysia, South Korea, Japan and all the current or former Asian Tigers.
Unjailed Traitors have a hard time finding a free trade country that developed from the 3rd world that is larger than a single city in a strategic location by highly trafficked waterway. That is, it doesn't work for "real" countries.
We "Started" to lose in mfg long before RR came to office.
Right around the time we embraced "Free Trade" in the early-mid 70s after nearly 200 years of robust tariffs.
We "Started" to lose in mfg long before RR came to office.
Indeed. It first started with the electronics industry. In 1967 the US made something like over 65% of the electronics sold internationally. In the 30's-50's RCA was one of the biggest corporations on earth. As mentioned before, I collect vintage tube powered radios. ALL of them were made in the US. So too is basically everything else you can think of: appliances, toasters, TV sets, clothes, shoes, and light bulbs to name a few.
We lost our electronics industry primarily due to cheap Japanese products. Just like it is now, US companies either couldn't compete with cheaper Japanese goods or they simply shut down their factories and shipped the work overseas. We basically haven't been in the consumer electronics biz for the better part of 40 years.
You've got to remember that by the time Reagan got elected the Japanese car industry was wiping the floor. Their cars were 200% better than anything Detroit spewed out. I distinctly recall how truly awful my Dad's 82 Buick Riviera was. That thing was in the shop more than it was on the road. The Camry we replaced it with ran forever with no problems.
I think there are some good stories out there. GM and Ford are now in my opinion making some really good products. GM is now back to being No.1. They both make competitive small cars that people- especially people in urban areas- want to buy.
To be honest I make it a point to not buy anything new if I can help it. Almost all new items are junk- plain and simple. Today I bought a 60's vintage Osterizer blender. Its built like a tank, weighs a ton and is totally plated in chrome. Its built like things were typically built like. It makes anything made today- even the "fancy" brands look like disposable crap. And sadly, that's about the only way you can buy American made anymore.
Right around the time we embraced "Free Trade" in the early-mid 70s after nearly 200 years of robust tariffs.
That's odd, I seem to remember NAFTA being signed by Bill Clinton in the 90's. Perhaps you are talking about GATT which the US initiated and pushed hard for. That was 1947. What "Free Trade" agreements were made in the 70's?
This can be quite a topic.
We're always going to have some manufacturing because of a number of factors. Proximity, dependency and of course preference.
When I worked in retail it was like the OP said but I worked for the same things but later on. Many goods there are made in China and other countries. When I worked for a work clothing company there was really no assures that a product came from anywhere. If you wanted US made it would take a large order and it would have to be manually picked from the source and take much longer.
Make no mistake we can make anything in the USA. But it comes with a price. Everything we want to add onto the price of manufacturing gets added into the cost of selling it. Health insurance for employees, ergonomics for employees, environmental friendly packaging, community relations etc. It's like the concept of an environmentally friendly cleaner. Look at what is the primary vs the secondary. We ask for too much from some businesses these days.
And of course the consumer generally wants things dirt cheap.
The reasons why other countries can be cheaper are multifold. To use China as an example it is a unitary state. There is no local/state or provincial government to deal with (UK is the same way) It makes it simple once you enter the country but at the same point it can also mean that other areas of the country might not be cheaper. In the USA laws vary wildly on the state..gambling and same sex marriage come to mind immediately.
China and Taiwan also have the Hukou system which is weird to say the least
http://en.wikipedia.org/wiki/Hukou_system
it is attempting to prevent massive influxes of unemployed people to cities (picture grapes of wrath). The permit system can actually prevent people from sending their children to school in areas they work. In a sense one might argue that they are illegal within the own country and thus the wages are lower. In looking at the currency some argue that it is fixed but at the same point when we took ourselves off the gold standard it contributed highly to the OPEC embargo.
It should be noted that much of what is made is not really designed in those countries. There is no Ivy league in Asia. The Asian way of teaching predominantly is instruction. Asking a teacher/professor a question or implying something is wrong is unheard of.
Sometimes inventors have odd ideas of their inventions. Thomas Edison supposedly hated the idea that the phonographic record would be used for music. He wanted it to be used to have audio books for the blind and to teach people foreign languages. But the money in it was in the music and that is what it is known for.
Countries generally HAVE to make goods at first because they might not have the method or means to buy goods. Heck you start with a bartering system then establish the concept of credit. Much of the gains that the developing world is making are marginal. By that I mean it is a one time gain. A family only needs one fridge, one washer, one drier, one microwave etc. The gains of more are less the more that they have.
Once an economy develops more and more actually consumption can go down. I would say the most dependable consumption is food followed by energy and then maybe followed by clothing.
"Today I bought a 60's vintage Osterizer blender. Its built like a tank, weighs a ton and is totally plated in chrome. Its built like things were typically built like. It makes anything made today- even the "fancy" brands look like disposable crap"
But that is also a paradox. If you make products that last forever then you aren't going to sell them again to the same customers. If you make products that break down you STILL aren't going to get the same customers since the quality was poor.
The problem with mass production of any good is that the more people have that given item the less it is worth. Microwaves at one point were a metric for how developed a country was. Now they are so cheap people in public housing have one.
The Heritage Foundation issued a paper that illustrates what amenities that poor people have vs those better off
www.heritage.org/research/reports/2007/08/how-poor-are-americas-poor-examining-the-plague-of-poverty-in-america
The objective isn't so much to illustrate that people are not "poor" but that our standard for "poor" is higher than most of the planet.
The other thing to keep in mind about manufacturing is that factory work is not always that sophisticated. Some honestly think those laid off from auto plants were somehow mechanics...they aren't. I had a great aunt that put together spark plugs decades ago (50's and 60s). Same action every 15 or so seconds..every day is the same..every week is the same..every month is the same. Stable work but there is no variance. I have a grandmother that worked for a beer company (go for the gusto!) again same thing..no variance (except the smell from when bottles cracked and that it was amplified in the summer)
Some of the reasons why we miss manufacturing is that at the time it did not appear to be that sophisticated and did not require (at first) standards. On the job training was enough. Now manufacturing is much more automated and sophisticated than before.
http://www.msnbc.msn.com/id/41349653/ns/business-us_business/t/despite-chinas-might-us-factories-maintain-edge/#.Tj6pXSwQ-Sw
Vicente
2011 Aug 7, 2:24am
Bah the point of heritage foundation is to paper over a huge and worsening wealth gap and propagandize poor to accept their place.
Regarding Spain, don't forget they spent a big bulk of their ill gotten gains from the cieglo del oro, on an ideological war called the Spanish inquisition.
Reminds me of Empire day in "The meaning of Life" To commemorate all those brave souls who selflessly gave their lives to help keep China British.
Also reminds me a little of both of George Bush's wars. I mean since we're going to loose them anyway, and I don't think the point was ever to win. Coulden't we just cut our costs by simply mugging everybody in the streets by some jackbooted fedral thugs and then giving the loot to Blackwater, and Haliburton. Saves those poor Iraqi's from getting shot and raped by the USMC. Put the army where it belongs, on the streets of America.
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I wasn't sure how to name this post. Thus I could only come up with a generic title. Its been something I have thought about for years. Its a combination of looking back to where we were and fast-forwarding to today.
All throughout high school and up past 2-3 years out of college ( the economy sucked in 2000-2002) I worked at a number of home improvement and small hardware stores. Most of the time I opened boxes of products and stocked shelves. I also helped customers. Thus I was familiar with a wide variety of items that ranged from hose washers, bird feeders, chain saws, drills, loose nuts and bolts, lawn mowers, plumbing, electrical components and a zillion other things. This wasn't ancient history. It was the mid 90's- 2002. I'd say around 75-80% of everything that came through the door was made in the USA. That isn't to say it was all super-duper high quality. If you wanted a good weedeater you bought a Japanese brand machine. Most of the domestic brands were junk. But putting that aside, almost all of what we sold came from the US.
Fast forward to now. Years after I stopped working retail and entered the tech biz I still turn things over to see where its made. These days it doesn't matter where you shop. ALL of the stuff is made in China. Even long-established US companies that had 100+ year old factories that gave tours have resorted to having all of their products made there.
I recall reading something a few years back that was shocking. Between 200-2007 40,000 US factories were shut down. That's right- 40,000. That number seems appalling. Then again, it makes sense. If all of the switches, screws, washers, chain saws, pipes, and paint brushes are made in China then it would make sense that all the US factories that made those things just a few years ago are now shut down.
Call me old-fashioned but I find that sad and depressing. One of my hobbies is collecting antiques. I collect basically what most people consider "junk". Old tools, appliances, furniture, and so on. ALL of these items were made in the US. Take apart an old radio and all of the tubes, capacitors, coils, resistors, rheostats, and chassis components were made by some US form somewhere. The same goes for anything else that was made up to the 1960's.
At the same time its also somewhat depressing to me that at least from what I can tell most other modern western economies have managed to retain some degree of what you could call " premiere" type industries. For example, fine watches are still made in Japan, Germany, France, Switzerland, and Italy. We on the other hand have NO watch manufactures left- the last ones were shut down in the 60's. In fact, Germany in particular seems to have done a good job of holding onto its manufacturing base and still makes a lot of things. a LOT for a much smaller country all considered. Their labor isn't cheap either. Yet somehow they've made it work while we in the US seem to have cut manufacturing dramatically.
Where am I going with this? How can the US expect to retain any sort of middle class or a significant foothold in the world economy if we continue to diminish our manufacturing output? You can't defy physics and the only true way to grow economically is to bring money in, which means selling stuff to other countries. If we continue to cut down what we export... how does this bode for the future? Is there any means to somehow reverse this trend?
Anyway, sorry for the downer post. I know there's some rather intelligent people here who can lend some opinion.