Shares drop for products made in U.S.

The Philadelphia Inquirer ^ | Thu, Dec. 07, 2006 | Bob Fernandez

[A. Pole]

U.S.-made products are losing market share to imports across a wide range of core industries in the United States, according to a new study.

Among 114 product categories, U.S.-based producers boosted their domestic market share in only three categories between 1997 and 2005: heavy trucks and chassis, computer storage devices, and computer chips. Imports gained market share in 111 categories.

The survey from the U.S. Business and Industry Council, a nonprofit group in Washington of small and midsize manufacturers and a critic of U.S. trade policy, used Census Bureau data. The survey excluded inexpensive consumer products found in Wal-Marts, Targets and dollar stores. Toys, clothing, sporting goods and other products in those retail stores are typically blamed for the soaring trade deficit.

Instead, the study focused on industrial and engineered products, such as wireless equipment, plumbing fixtures, tire cord, navigation and guidance systems, power boilers, and heat exchangers.

Alan Tonelson, a research fellow at the council and author of the study, said yesterday that the study showed that the United States "is failing to pass the test of global competition." He said the country appeared to no longer be a place where many manufacturers want to invest in advanced factories.

A spokesman for the National Association of Manufacturers, the main trade group for manufacturing companies, said yesterday that there was a "mixed picture" for U.S. manufacturers and dismissed Tonelson's study as too pessimistic. "Manufacturing is still the heart and soul of the U.S. economy," spokesman Hank Cox said. U.S. manufacturers are losing market share, but the entire market is growing, allowing them to expand, Cox said.

"To be sure, U.S. manufacturing companies have a lot of problems," Cox said. "But to have Alan Tonelson and Lou Dobbs running around waving a bloody shirt, saying 'we've been sold down the river' does not help." Dobbs, a CNN commentator, has criticized U.S. trade policy.

The last recession pounded the manufacturing sector, causing it to shed about three million jobs. Profits at U.S. manufacturing companies have rebounded modestly in recent years. But job losses from earlier in the decade appear permanent, as factory employment has remained stuck at 14.3 million to 14.4 million since mid-2003.

"The reality is that until there is a change in the trade situation, there won't be new manufacturing jobs," said Daniel Meckstroth, chief economist with the Manufacturers Alliance, a nonprofit educational and business-research organization. The group is free-trade-oriented.

Meckstroth said the number of U.S. factories declined every year between 1997 and 2005, falling to 334,700 from 374,600. Meckstroth said he expected the factory level to stabilize this year. He said the nation's trade deficit as a share of the economy, now at about 6 percent, is unsustainable.

Many economists have said a weaker dollar might help manufacturing companies. But Tonelson said he believed import penetration rates would keep rising even when the U.S. dollar was weak. "Anyone who thinks that a major U.S. devaluation will be a cure-all for U.S. manufacturing is really kidding themselves," he said.

Tonelson also said it was unlikely that U.S.-made products were capturing a higher share of foreign markets, which would offset losses at home.

"It does not make sense to suppose that U.S. products are doing better in foreign markets than in their home U.S. market," Tonelson said.

[WilliamofCarmichael]

"If Honda, Toyota, Mazda, and Nissan can all establish manufacturing plants in the US and produce a quality product while making a profit, perhaps its time to stop blaming government and labor and take a look at the corprations, themselves, and the people who run them."

Worth repeating!

OK, "free traders," so how come so many U.S. corporations say they have to move domestic goods manufacturing off shore and then import the stuff for sale here to be competitive (Outsourcing offshore is necesary! say the "free traders").

Besides, say the "free traders," we benefit from other countries outsourcing jobs to us.

And of course that's right -- but they make and sell their stuff here. They are doing what our guys say is virtually impossible. Why?

If our guys were selling their stuff over there and not exporting it back here for sale -- that'd be great!

(Yes, we sell tons of stuff in Europe. I'm talking mostly "cheap labor" China and other "emerging nations.")

[oceanview]

"He said the country appeared to no longer be a place where many manufacturers want to invest in advanced factories"

of course not, why would they. when you can go to china, pollute as much as you want, and hire slave labor.

[Mase]

Your chart's figures fail to subtract the IMPORTS that these "so-called" manufacturers rely on for their asserted production and profits.

I'm sure you can show us that manufacturing profits are not what these companies say they are and can break out for us, in detail, just how deleterious these lower cost INPUTS are to the health of American manufacturing.

I'm also not impressed with the contention that you blindly swallow...that these are in fact "American manufacturers" anymore

I see you've still been unable to explain away the fact that we make more today than at any other time in our history -- other than your usual obfuscation and data dump two stepping. Your portfolio of explanations rivals that of Clinton himself.

...with the bulk of its members...concluding that the big guys are fronting for the importers...and have co-opted NAM to be an import lobby.

Is there any organization in this country you're not intimately familiar with? I said earlier that Tonelson believes he's omniscient but he's just a piker compared to you. Now, if only you had his minions.....

[1rudeboy]

OK, "free traders," so how come so many U.S. corporations say they have to move domestic goods manufacturing off shore and then import the stuff for sale here to be competitive (Outsourcing offshore is necesary! say the "free traders").

Why don't you ask them? I suspect (only) that they do it to try and get some sort of a government (local, State, Federal) handout. Non-free traders are susceptible to that sort of thing.

[Irisshlass]

It is all about where the PROFITS go not where the product is made

That is it..it is all about the profits.

What are you saying? Everyone in America needs to quit their jobs and become shareholders?

[expat_panama]

Great post ---here's a graph that I just put together:

[Hydroshock]

I disagree, but be that as it may, the republicans in the midwest and the east did not. THere are not enough free traders to win elections nationally.

[1rudeboy]

By "them," I meant the companies.

[expat_panama]

Dang you beat me! --my Chinese-built keyboard is just too damn slow.

[1rudeboy]

How does your, "It is all about where the PROFITS go not where the product is made" square with your "If a company is outside it shouldn't be called an American Company?"

A U.S. company overseas brings its profits back here (as well as taxes to the U.S. Treasury), right?

[steve86]

People should not complain about walmart, people should buy shares in Wallmart.

Why? WMT shares have gone nowhere in the last seven years (actually down). What makes you think that higher share prices lie ahead?

[Irisshlass]

Yeah right. Just like the Republicans just won the House and Senate again without the Reagan Democrats.

[Irisshlass]

A U.S. company overseas brings its profits back here (as well as taxes to the U.S. Treasury), right?


Oh really? Where are the profits except in the pockets of a few shareholders.

[1rudeboy]

If you have an analytical study that points to the reasons the Republicans lost Congress, feel free to post a link to it here. Otherwise, a discussion of your opinion on the Election is probably best suited for another thread.

[1rudeboy]

Oh really? Where are the profits except in the pockets of a few shareholders.

So basically, your complaint is that the profits are not flowing back to you?

[Mase]

Keep in mind...this is the same Federal Government which now refuses to publish M3 numbers.

Did they also quit publishing RP and Eurodollar information? Why can't you add that information to M2? Or, does that extra work take too much wind out of your conspiracy theory?

[Toddsterpatriot]

Among 114 product categories, U.S.-based producers boosted their domestic market share in only three categories between 1997 and 2005

Our economy must have suffered since 1997. Nope, GDP grew 27%. Source

[1rudeboy]

I didn't bother to respond to that assertion at all, as I think he was just trying to change the subject.

[Hydroshock]

People vote their pocketbooks. Free trade is a pocketbook issue. And free trade is increasingly falling out of favor with voters.

[Irisshlass]

To: Hydroshock
George W. Bush won without the Reagan Democrats. Twice.



39 posted on 12/12/2006 10:26:20 AM PST by 1rudeboy


YOU are the one that brought it up where is your analytical study to back up with you said? Maybe you need to go to another thread.