...It helps to keep in mind a few simple points. First, manufacturing is extremely cyclical. The manufacturing component of the U.S. industrial production index fell by 5.5 percent a year in 1974-75, then rose by 6.6 percent a year for the next four years. In 1980-82, manufacturing fell by 3.1 percent annually for three years, then rose by 4.8 percent a year for six years. Manufacturing then dropped 2 percent in 1991....
...Unfortunately, it looks as though indefensible assertions about the supposed long-term disappearance of U.S. manufacturing are going to become a familiar political complaint over the coming year (as well as a promising source of special interest campaign funds). This rerun of the old "downsizing" story will again bore us with many more efforts by bumbling business writers and their slumbering editors to trump up some sort of "public agitation." If the rhetoric gets too annoying, ask the authors for a few facts. They just hate that.
The $550 Billion/year trade deficit...slated to grow to $1.5 trillion....
Yup, when the CATO-rhetoricians assertions get too tendentious...just ask them why the trade deficit has not ended. They just hate that: "Pay no attention to the man behind that curtain!!!!!!!"
This is the best compilation of policy correctives to restore U.S. competitiveness to date. Ronald Reagan would have adopted this in a heartbeat (indeed, many of these things are lifted right out of policies he implemented with both trade restrictions and R&D subsidies)...and NOT waited to do the right thing until after getting re-elected.