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Does America Need To Make Things? TechCrunch Sarah Lacy on June 14, 2009
Well, we still are making things, just not the same things in the same way we used to. So we end up with 1000 smaller automobile manufacturing companies instead of a big three. The scene today has become diversification of manufacturing instead of monopolization. As, IMHO, indeed it should considering the advances in technology and productivity.
Of course there will be painful losses as the national workforce shifts around, because, after all, we are talking about people here, not widgets--WE, people, have different needs than machines and manufacturing!
In the final analysis once the transition stabilizes, employing not ONLY people, but more productive-technological-enhanced-better-educated people, and their availability balances out with available jobs in EVERY sector--via supply and demand, our sense of 'manufacturing' will stabilize. But, different types of businesses AND manufacturing. For a market for jobs not like it was...but much, much, much, bigger.
Let's say we open a large manufacturing facility in China. Underwritten by US investment, with some US management, but most of the employees are Chinese, the product: widgets are sold globally, the Chinese employees receive the wages, the product is produced efficiently and at low cost, and the profit...comes home to the US. The fact is there is an enormous amount of manufacturing in the US, just not the traditional heavy, smoke stack industries that drove the economy since the industrial revolution.
We, the United States, have an enormous technological base at this time, but this is closing as other nations seek the same modern industrial technology and employment compensation structure we already have in place. Make no doubt, that gap will close. I speculate that part of the current economic collapse is due to adjustment down of economic, manufacturing, the working knowledge/experience base, and technology factors, compared to the way the production and distribution of goods and services in-place since the WWI had developed, and now. The structure, expectations and processes had grown to a 'bloated' stage, and now is the natural reduction of that artificial state, a 'cancer' might be an accurate metaphor, the operation cannot be avoided. The transitions will be painful, but it must take place in order for for a new, more effective, efficient and profitable stasis to develop.
I know of absolutely no one...who wanted manufacturing to go some place else. The migration occurred because you cannot artificially economically sustain any industry. Tariffs are not the industry. The real bug in the bonnet comes when a business sector is so large that IT drives a good portion of the economy, or that with lacking sensible regulation starts 'hijacking', robbing the economy. To wit: automobile, coal and financial in the headlines now.
Unfortunately, due in no small part to modern almost instant communication and transportation and global expectations, those American workers and industries who did not anticipate change, were left behind. If you want a snapshot of the 'so-called' turning of 'our' back on manufacturing, return to small town and city development councils twenty years ago across the country. The mantra was: we MUST get more manufacturing jobs, facility reuse, develop industrial parks! They wanted it, it did not work out because they could only artificially support it financially. You cannot rob Peter to pay Paul, if Peter is broke, and Paul can't pay back.
So what do we have now? A retrained work force still the envy of the all the developed nations! And the cycle starts once again.
GHD
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