I’m one owner in a small “manufacturing” company (in a $3B - 5B market) who has been under pressure for several years to bring back my manufacturing to America. We have approximately 80 direct employees, and another 50 or so representatives across the country. By my estimation, we impact directly the lives of maybe 500 or more Americans. I would really like to see our products manufactured in America, however, the economics of it are just impossible. Several times we have looked at ways to do this and the net result is a product that costs between 1 1/2 and 3 times as much as what we currently sell; our customers simply would not pay that much more over our competitors pricing; the net result would be the loss of our business. The Trump era tariffs were simply an added expense, raising the cost of our product between 10 and 15% to our wholesale customers and unless laws are passed that require all of my competitors to purchase or manufacture their product in America, it is impossible for my company to “bring back” this manufacturing. What I am saying is that purchasing in countries like China, Indonesia, Vietnam, and the Philippines is necessary for my business to be viable. The alternative is for all Americans to pay significantly more for the products they purchase, or alternatively, for Americans to work for wages similar to those of other Eastern countries. As long as there are countries with willing,low paid laborers and adequate infrastructure, manufacturing won’t be coming back to America anytime soon. Of course if the government is willing to support my industry the way it did the the agricultural industry in the wake of increased tariffs, then perhaps we can change the conversation. I realize your article is a philosophical/political examination but it’s motivated me to express my personal experience. Thanks for insight,I look forward to reading your full article.
Well said sir. The beginning of America exporting jobs was in part a function of the UAW fully loaded labor cost getting in the $50/ hr range and at some point the labor arbitrage became compelling. With allowing China in the WTO and offshoring we made a major strategic decision that created in China a supply chain never before seen and incredibly powerful. We can’t go back in time. Mfg 2.0 or 3.0 in the US Ned’s to have the labor content as a percentage of cost to be low. Then the cost of labor will matter less. While the cost of labor in China has increased dramatically from a super low level it is hard to compete if have a high labor content with SE Asia. China completely dominates solar panel mfg. the only way to compete is with government subsidies
" In 1938 at the Colloque Walter Lippmann, the term neoliberalism was proposed, among other terms, and ultimately chosen to be used to describe a certain set of economic beliefs.
The colloquium defined the concept of neoliberalism as involving "the priority of the price mechanism, free enterprise, the system of competition, and a strong and impartial state"
There's nothing "liberal" about believing in unproven economic theories about the "free market" and "deregulation".
"Semiconductor shortages were not due to a reduction in production but a shift from using them in automobiles to using them in video games. By the time auto manufacturers realized they had overestimated the falloff in demand, the semiconductors they needed were being used to power Xboxes. Second, and relatedly: Some firms relied so heavily on lean manufacturing techniques that they lacked the inventory to cope with even a mild perturbation in their supply chains."
The semiconductor that is in an automobile is not the same as the one in an Xbox. You can manufacture the former in a number of countries, the latter (if you are referring to a CPU/GPU chip) can only be manufactured in Taiwan. Thus, you under-emphasise the effects of the 2020-2021 crypto craze in affecting availability of consumer electronics. You can blame some of it on demand shock from a shift to WFH but not all. Shipping needs to be examined more thoroughly as well, especially given how many vessels stood still just a few miles off the West Coast, unable to offload cargo, delaying production and manufacturing.
Not clear what post-liberalism is nor what resilience is. What I see looks a lot like protectionism. So what appears is crazy Trump protectionism and Biden and company protectionism. So mic for eco mic growth and enhanced productivity.
I’m one owner in a small “manufacturing” company (in a $3B - 5B market) who has been under pressure for several years to bring back my manufacturing to America. We have approximately 80 direct employees, and another 50 or so representatives across the country. By my estimation, we impact directly the lives of maybe 500 or more Americans. I would really like to see our products manufactured in America, however, the economics of it are just impossible. Several times we have looked at ways to do this and the net result is a product that costs between 1 1/2 and 3 times as much as what we currently sell; our customers simply would not pay that much more over our competitors pricing; the net result would be the loss of our business. The Trump era tariffs were simply an added expense, raising the cost of our product between 10 and 15% to our wholesale customers and unless laws are passed that require all of my competitors to purchase or manufacture their product in America, it is impossible for my company to “bring back” this manufacturing. What I am saying is that purchasing in countries like China, Indonesia, Vietnam, and the Philippines is necessary for my business to be viable. The alternative is for all Americans to pay significantly more for the products they purchase, or alternatively, for Americans to work for wages similar to those of other Eastern countries. As long as there are countries with willing,low paid laborers and adequate infrastructure, manufacturing won’t be coming back to America anytime soon. Of course if the government is willing to support my industry the way it did the the agricultural industry in the wake of increased tariffs, then perhaps we can change the conversation. I realize your article is a philosophical/political examination but it’s motivated me to express my personal experience. Thanks for insight,I look forward to reading your full article.
Well said sir. The beginning of America exporting jobs was in part a function of the UAW fully loaded labor cost getting in the $50/ hr range and at some point the labor arbitrage became compelling. With allowing China in the WTO and offshoring we made a major strategic decision that created in China a supply chain never before seen and incredibly powerful. We can’t go back in time. Mfg 2.0 or 3.0 in the US Ned’s to have the labor content as a percentage of cost to be low. Then the cost of labor will matter less. While the cost of labor in China has increased dramatically from a super low level it is hard to compete if have a high labor content with SE Asia. China completely dominates solar panel mfg. the only way to compete is with government subsidies
Yes
" In 1938 at the Colloque Walter Lippmann, the term neoliberalism was proposed, among other terms, and ultimately chosen to be used to describe a certain set of economic beliefs.
The colloquium defined the concept of neoliberalism as involving "the priority of the price mechanism, free enterprise, the system of competition, and a strong and impartial state"
There's nothing "liberal" about believing in unproven economic theories about the "free market" and "deregulation".
That's Conservative drivel.
"Semiconductor shortages were not due to a reduction in production but a shift from using them in automobiles to using them in video games. By the time auto manufacturers realized they had overestimated the falloff in demand, the semiconductors they needed were being used to power Xboxes. Second, and relatedly: Some firms relied so heavily on lean manufacturing techniques that they lacked the inventory to cope with even a mild perturbation in their supply chains."
The semiconductor that is in an automobile is not the same as the one in an Xbox. You can manufacture the former in a number of countries, the latter (if you are referring to a CPU/GPU chip) can only be manufactured in Taiwan. Thus, you under-emphasise the effects of the 2020-2021 crypto craze in affecting availability of consumer electronics. You can blame some of it on demand shock from a shift to WFH but not all. Shipping needs to be examined more thoroughly as well, especially given how many vessels stood still just a few miles off the West Coast, unable to offload cargo, delaying production and manufacturing.
Re: nudging markets in a better direction.
Do they know nudge theory is not supported by evidence? https://theconversation.com/nudge-theory-doesnt-work-after-all-says-new-evidence-review-but-it-could-still-have-a-future-187635
No. The problem with neoliberalism was seen from the start: if you can export goods then you can export bads. It is Macroeconomics 201.
Not clear what post-liberalism is nor what resilience is. What I see looks a lot like protectionism. So what appears is crazy Trump protectionism and Biden and company protectionism. So mic for eco mic growth and enhanced productivity.