A Plan to Save American Manufacturing

TradeAlert.org ^ | Wednesday, December 31, 2003 | Kevin L. Kearns, Alan Tonelson, and William Hawkins

[hedgetrimmer]

This reply belongs to someone else:

No it doesn't. You said "It's actually you who is advocating socialism ". How so? Its you who say Congress advocating socialism in the many bills they propose doesn't matter.

[XBob]

383 - "but he still didn't want to cut any programs without some grand and glorious Blue Ribbon Commission Study of all departments of Government. "

Reagan actually did that, and they came up with hundreds of billions in savings on waste and corruption.

I cant remember who it was, that headed it, but he was pretty famous at the time, and it was an excellent study.

And it was promptly ignored by the Reagan administration, Reagan, and congress, by both parties.

Anyone remember the name of it/him?

[XBob]

383 - Ah, I found it - the Grace Commission.

http://www.uhuh.com/taxstuff/gracecom.htm

1984 report.

Most excellent and most ignored.

"Following your directive to identify and suggest remedies for waste and abuse in the Federal Government, the President's Private Sector Survey (PPSS) offers recommendations which would save:

$424 billion in three years, rising to
$1.9 trillion per year by the year 2000. "

[XBob]

385 - "Sorry, but the Government IS subsidizing outsourcing and offshoring through the Import/Export bank and other programs designed to facilitate overseas investment. The insulting and demeaning part about it is that the American Taxpayer is financing his own unemployment. Those are the facts. If you have others, please post them.

Npo the government is not subsidizing outsourced jobs. That is sheer paranoia. That is not the function of the import/export bank. You are trying to apply a simplistic definitioin to them that has nothing to do with their function. As always you post no facts to support this because they do not exist. It's sheer fabrication on your part. "

nmh - dummie - you got it bass ackwards again - just like marx and free trade - how can you be such an arrogant ignoramus, and remain so stoooooooopid.

I am not going to go do the research that give companies tax breaks and subsidises their moves overseas, it is there - but you get off your lazy ignorant butt and find it yourself.

You are a fool, and wasting our band width.

[XBob]

391-"I already have a job and doing quite well."

I read that, you seem to think you are secure - LOL.

Well, just tell us where and what you do. I have a number of contacts who will fill it, or even export it for you.

[superloser]

Here I thought you were the tariff pusher ... oh well ...

I am. I'd use tariffs to reduce taxes on business across the board. All business taxes are paid by the consumer in the end anyhow. Better to pay them up front and know what they are then have them back-loaded and hidden.

I believe we need a moratorium and during that time raise the bar on standards. Family ties shouldn't be the end all criteria. They need to have something to offer.

Music to my ears. My Congresscritter is getting tired of me advocating that to him by now, I bet.

Why are you so down on progress and raising the bar for folks to being more prosperous?

I'm not. I just think that what passes for "free trade" these days is anything but.

Permitting an American company to uproot and fire American workers simply because they can find $1/day labor somewhere else isn't free trade. Its labor arbitrage.

Permitting a foreign company access to our markets and granting our companies access to their markets without tariffs *is* free trade. I draw that distinction.

Our multinational corporations are simply engaged in labor arbitrage, a race to the bottom in terms of costs.

True "free trade" in the traditional Adam Smith style would work like this:

American made products go to Canada tariff-free. Canadian-made products go to American tariff-free. Workers on both sides produce the best products they can. Competition between the countries will wind up with each country using its own resources to its best advantage. Everyone wins in this scenario. Canada makes cookies better than we do, so they specialize in that. We make widgets better than they do, so we specialize in that. We trade, everyone is better off.

Do you agree? That's the situation we'd like to see, right?

But.....wait! This is the REAL scenario:

I can just shut down my factory here, fire everyone, let the Government take care of them, tell them "Sorry, guys, but bugger off" and move my factory to Canada then take advantage of the "free trade" to move my products into America!

Nuh-uh. That's labor arbitrage, not free trade. That's my objection, but the "free trade" treaties don't distinguish between who owns the company and who doesn't.

In the latter situation, its what we have with China, only the terms of the deal are much worse. The Chinese Government owns 51% of the factory and KEEPS IT and ALL the technology therein! Yikes! We've just armed a competitor!

I also refuse to support mercantilist nations -- period.

Your "outcomes" are based on personal opinion, not facts.

I've drawn then all back to so-called "free trade."

As an example, Mexico blames NAFTA for the mass exodus north. Our media blames NAFTA for the mass exodus north. Interviews with illegal aliens blame NAFTA for the mass exodus north. I'm not sure how much more "fact" is needed for that.

So, when I see a policy that is causing other things that I can't abide, I start looking for ways to ditch that policy. If the results of a policy cause things that are obnoxious, the policy has to go. At least, that's how I see it. All things are interconnected. What is the link that makes it so? Find the root cause and eliminate that. Everything I'm seeing from calls for more Government handouts to the trade deficit can likely be handled by the judicious application of tariffs. History says it works and I'm not one to argue with history! America was built from behind tariff walls.

And so was Japan. China is and so is India as well.

The guys losing their jobs due to this so-called "free trade" (which is really just labor arbitrage) are winding up demanding additional Government programs. I hate Government programs. I don't want to see any more expansion of Government. I don't want to see more tax money blown because enough yahoos got together to vote themselves into my wallet.

So, I wind up back looking at tariffs again.

Its a cheap solution to a more expensive problem since Government programs don't go away, never expire, and just consume more of the country's resources, and are very VERY hard to fight -- ever since they were deemed Constitutional (which they're not, no matter what USSC says)

Now, before you hit the reply button, I do believe strongly in "creative destruction" of industry. The buggy whip makers all found jobs making cars when their industry was eliminated.

If we kept manufacturing here, sure, it would be automated, but there would be jobs assembling, maintaining, selling, and designing the robotics to do the manufacturing. We destroy one job only to create another that people can jump to. The jobs created through that process are generally higher paying than the ones destroyed. Everyone wins!

Shoving the whole thing to another country eliminates the "move to another industry" part of the whole progressive "creative destruction" process.

This is why the "buggy whip" analogy doesn't quite apply. The last part of the equation is missing when a company offshores.

A lot of free traders on FR miss the "creative destruction" process and how it runs from start to finish. Everyone wins if the process is allowed to go. Short-circuiting it or lopping off the end of it creates a distortion in a natural process, one that is *Government Sponsored* and therefore -- evil!

Okay, I have to ask ... any particular reason why you chose "superloser" as a moniker?

My first ten choices were already taken so I pulled out an old name I used to play Netrek under. I could have picked _Clueless Twink_ which is another I played both Netrek and Yahoo! Chess under. But, I like ironies so this suits me fine :)

[raybbr]

You have mail. answer now!!!

[Paul Ross]

My answer is find another way to make a living! Government has NOTHING to do with moving mfg. jobs to a country that will do it for less

This is a flippant response to a serious problem. The de-industrialization of this country is a serious problem. The loss of critical technology is a serious problem. The loss of the jobs which those endeavors used to provide, and the economic strength concomitant with a skilled, well paid labor force is a serious problem.

And as FReeper Chimera stated elsewhere, which warrants re-posting:

"Let me one more time raise a cry in the wilderness of the "free trade" obsessive devotees here on FR. And that is, not only are we losing our current capabilities in industry and technology, capabilities hard won and built with the blood and sweat of prior generations, we're losing the future. I walk into classes in the university to teach fundamental engineering principles and see faces that are 90% foreign nationals, whereas when I sat in those same classes as a student going on 30 years ago, 80% of them were American. We are not only losing the physical infrastructure of manufacturing and technology, we're losing the home-grown intellectual capital. The best and brightest students today can see well enough what's happening. They see trial lawyers making millions suing companies out of business, they see government regulators promulgating layer after layer of bureaucracy and forcing individuals and businesses to pay it, they see CEOs making tens of millions of dollars a year in salaries and bonuses laying off ordinary workers in droves and closing plants and offices and research laboratories and selling them for scrap or sending the work overseas. So what do they do? Flock to the law schools and business schools and political science departments to get a piece of that action.

The "free trader" response to this, of course, seems to be something along the lines of "Good! If workers and professionals today can't make it in the global economy, screw 'em, let them work at McDonald's, or Wal-Mart. Get re-trained (like a Ph.D. in EE or physics can be any more educated) and become a nurse or electrician. We'll be OK as long as we can import what we need." But I say, there may come a time when those we are importing from may not wish to sell us what we ask for, for their own reasons. Say we become dependent on China for military electronics, and maybe the Chinese decide that it might be better for them that we not have that hardware. So then the free traders say, well, good, there's a demand now domestically, so the free market will provide that domestic industry. Only it can't, because we've put out of business and destroyed the lives and careers of the very people who could re-invent those industries, or kept them viable in the first place, if only business and political decisions had not been made which ended up destroying them. You just don't have basic and high-tech industries spring full-grown overnight."

[ I hereby nominate Chimera's observations as the Opinion of the Week]

[nmh]

What you don't like is reality. There is no other option but to DO something else when your product/service is no longer competitive with your competition.

It is the only logical thing to do and what makes the U.S. a leading power. Most people are innovative and rise to the occasion. Maybe you are not in that category but others are so step aside or don't be devastated when you are penniless. It is unreasonable to expect the government or anyone else to keep jobs alive that are done cheaply and BETTER elsewhere. You are suggesting a government controlled economy - like Marxism. That is a major component - something for everyone and each collects based on need. Might as well acknowledge what you are seeking.

OTOH, I prefer an economy based on supply and demand. This encourages a "better mousetrap". The U.S. has always strived to be superior. While you strive for inferiority, protected by laws and competition kept at bay through tariffs. Sorry but I can't buy into that nor will business people so I don't worry about your fantasy coming true. Just as unions are dying, and for the SAME reasons you are seeking for other lines of work, so will mfg and IT jobs continue to be done elsewhere. If you're not up to the challenge - fine. As I said others are and doing well.

[nmh]

391-"I already have a job and doing quite well."

I read that, you seem to think you are secure - LOL.

I am secure and doing well.

Well, just tell us where and what you do. I have a number of contacts who will fill it, or even export it for you.

I don't need import or export people. I also don't get personal on FR. Lastly don't need or want anything to do with YOUR contacts and other gloom and doom people with an attitude.

[nmh]

nmh - dummie - you got it bass ackwards again - just like marx and free trade - how can you be such an arrogant ignoramus, and remain so stoooooooopid.

That's what I like about folks like you. Can't back up your assertions with facts so you resort to juvenile name calling. YAAAAAWWWWNNNNN.

I am not going to go do the research that give companies tax breaks and subsidises their moves overseas, it is there - but you get off your lazy ignorant butt and find it yourself.

Because what I am talking about government is NOT subsidizing hence there is NO research to point to to support your paranoia. Yeah, call me lazy when you can't validate your paranoia.

You are a fool, and wasting our band width.

More name calling? YAAAWWWNNNN. Wake me up when you have something to say that's worth reading.

[nmh]

This reply belongs to someone else:

No it doesn't. You said "It's actually you who is advocating socialism ". How so? Its you who say Congress advocating socialism in the many bills they propose doesn't matter.

I see what you are saying. Sure many in Congress are socialist however ever bill they propose doe not get passed. The one you pointed too hasn't passed either. I was restricted my focus to what has passed and what is going on now, not what MIGHT happen.

[XBob]

411 - "Because what I am talking about government is NOT subsidizing hence there is NO research to point to to support your paranoia. Yeah, call me lazy when you can't validate your paranoia."

Sorry - but there are numbers laws passed by congress which subsidize the export of our industries.

"None are so blind as those who will not see"

Now get off your lazy, ignorant butt and do some research, or remain forever ignorant.

Sorry - but I don't think the stupidity can be overcome.

[gooleyman]

...the Grace Commission...1984 report...Most excellent and most ignored

-----
Holy Smokes did you say a mouthfull!! It was touted at the time as the be-all-to-end all and the liberals fought it every step of the way once it was done. Peter (I think that was his name) Grace was all over the TV talking head shows until he finally realized that he had done ALL that work and ABSOLUTELY NOTHING was going to be done with it. What a waste! Iran-Contra took over the headlines and I haven't seen much of him since.

My cousin never would say he would implement any of the suggesstions that would have come from his new commission we argued about on New Years Eve. All he wanted to do was study it. Typical hard-core Liberal.

Happy New Year!!

[XBob]

406 - "In the latter situation, its what we have with China, only the terms of the deal are much worse. The Chinese Government owns 51% of the factory and KEEPS IT and ALL the technology therein! Yikes! We've just armed a competitor! "

Forget it. nmh is not smart enough to figure this out, even when you explain it so directly and well as you have in this post - we are wasting our time.

He thinks that somthing does not exist, therefore, he proves it doesn't exist by not looking.

You and I and others have literally whopped him up side the head with 2x4s and it still hasn't gotten through.

Let's quit wasting our 2x4s.

[superloser]

Forget it. nmh is not smart enough to figure this out, even when you explain it so directly and well as you have in this post - we are wasting our time.

I have to keep trying otherwise we will keep running down the same bad policy decisions. Just like I have to keep explaining the same things to my liberal relatives. Of course, they are down in California still in denial.

He thinks that somthing does not exist, therefore, he proves it doesn't exist by not looking.

The problem, IMO, is that "free traders" view wealth in terms of dollars and cents rather than in terms of owning the technology and factors of production. Being able to produce goods and services is much greater wealth than simply purchasing them. The Japanese are now the world's largest creditor nation and we are the world's largest debtor nation. The Japanese work hard at making sure they own outright all factors of production. We used to, but went looking for cheap consumer goods instead. BUT, sometimes people have to learn the hard way.

You and I and others have literally whopped him up side the head with 2x4s and it still hasn't gotten through.

True, but you still have to keep trying. I'm trying to be polite and see what facts they're using other than that we can print fiat dollars and give others little green pieces of paper in exchange for goods and they like that arrangement. Eventually, as is going on right now (Dollar below 87 on the Dollar Index) it comes a-cropper and the currency tanks as a result of trade deficits. In the Gold Standard Era, it meant that gold left the shores. These days, the currency tanks. Same difference; purchasing power drops signifigantly until the deficit is taken care of.

How we are going to even out the trade deficits without the ability to produce goods to exchange? How far will the dollar fall? Are we ready for $4/gallon gasoline if the dollar collapses? Nobody yet has been able to answer that question other than to say "print more dollars." Sigh.

[XBob]

To all except nmh, who is too lazy to read it:

416 - , SL - Here's where your job went, and many others:

http://www.h1bvisasucks.com/H1BDiscussions_solutions_nj.htm

this is just full of documentation about our governments and corporations screwing the American worker. Too full of interesting/amazing stuff to begin to post,

Like the state of Indiana offshoring its state program to stop offshoring jobs and save American jobs, to India.

Like a congressman from Washington state (home of Microsoft and Boeing) visiting India and promising to send even more American jobs to India, and to block attempts in the US to stop it.

Like the State of New Jersey offshoring the state unemployment office work to India.

Like many companies, including Bank of America (BAC ), Dell Computer (DELL ), General Electric (GE ), Merrill Lynch (MER ), and Siemens (SI ). [Apple Computer (APPL ), Bank One (ONE ), Boeing (BA ), and Eli Lilly (ELI ). ], firing American workers in the US and hiring cheaper foreign workers on H-1 and L-1 visas, here in the US:

"EXPLOITING LOOPHOLES. While many L-1s ease the intracompany transfers they're meant for, outsourcing has triggered a surge in their numbers. New L-1s jumped by 50% from 1998 to 2002, to 58,000, and climbed an additional 10% in the first five months of fiscal 2003, according to State Dept. data. Meanwhile, new H-1B visas plunged by 27% through 2002 and fell 17% so far in fiscal 2003. What's more, L-1s allow employees to remain in the U.S. for up to seven years and can include multiple workers. H-1Bs are issued to individuals, who are limited to six-year stays. There were 384,000 people working in the U.S. on H-1Bs in 2001, the last year available, and at 329,000, nearly as many on L-1s."

[XBob]

416 - Superloser - great post, however:

"Are we ready for $4/gallon gasoline if the dollar collapses? Nobody yet has been able to answer that question other than to say "print more dollars." Sigh."

I don't think you have any idea what a currency collapse means. $4 per gallon gas is not currency collapse. Currency collapse means $10,000 per gallon gasoline, like happened in Russia.

The Russian Ruble was worth $1.25, 20 years ago. That's what I exchanged in about 1980, at the official rates, to visit Russia. Now, the latest rate is 6,845.84 rubles to $1.

And this is what we are faced with if we lose this battle.

[XBob]

417 - bump - a very important web site.

[XBob]

Sorry, SL, I got the wrong column in the exchange rates, I got the contract value: Actual current exchange rate is 29.2307.

So, it is $45/gallon gasoline.