Yes, I agree it is bad. Why? Becuase it is part of their strategy to attract as much manufacturing away from the US as they can. And we are not talking about shoes and Barbies anymore. Manufacturing MUST remain the backbone of the american economy. If China devalues their currency by 30 to 40%, it becomes a much easier justification for US manufacturers to relocate there. Not alot of relocations to France and England, you may note.
For example, 15 years ago, almost all power tools were made in the USA. I was in Lowes last week. 80% of the power tools were from China. Even such renowned US manufacturer’s like Delta, Milwaukee and Porter Cable now mostly outsource.
Door hardware. Every single lockset, even the fancy ones were from China or Mexico. I will order on line from the last remaining US manufacurer.
I was there to buy a carpet steam cleaner. Guess what, every last Dirt Devil and Bissell was from China, as well as the one Hoover model they had. I went to another store and found a Made in USA Hoover model, which I bought.
You see, the problem is not just that those products come from elsewhere, the problem is that many US factories are closing their doors. That means not just assembly workers, but the IT guys, the electricians and techies that keep the machine tools operating, that means the industrial engineers that modernized plants, that means the corner deli and the water delivery guy all lose out.
Another example:
GE to Pare Manufacture Of Traditional Light Bulbs
Demand Grows for Energy-Efficient Lighting
By KATHRYN KRANHOLD
October 4, 2007 4:48 p.m.
General Electric Co. will accelerate shrinking of its 128-year-old incandescent light-bulb business in response to global pressure to switch to energy-efficient lighting.
GE said it would close seven of the 54 plants and warehouses that serve its incandescent bulb business by November 2008 and lay off 1,400 workers. Over two years, GE will have eliminated 16% of its lighting workforce. GE previously laid off 3,000 workers in the unit.
(snip)
Mr. Campbell said GE is expanding its manufacturing of compact fluorescent lights, or CFLs, and other energy-efficient lighting products used in commercial buildings as part of the restructuring. GE manufactures CFL bulbs in China as part of a joint venture with Topstar.
GE’s entire compact fluorescent manufacturing footprint is in China. If they did not have an artificial exchange rate, then perhaps GE would have considered modernizing its plants and let US manufacturing lead the way in light manufacturing. Instead, 3000 manufacturing jobs and the communities that they are in will get hollowed out.
Hunter not only will force the chicoms to relent on their devaluation, he will also withdraw from the WTO if it continues to insist that the US cannot eliminate manufacturing taxes to compete globally.
How do you feel about the recent dip in the value of the dollar?
Similar story for other technology that has been sold off overseas for a quick buck. I was developing advanced sensor technology for nuclear power plants a few years ago and needed some specialty materials that used to be made by a high-tech firm in Oak Ridge. Turns out they sold out to a US conglomerate, which was subsequently bought out by a European firm. They took a look at the business units and right away closed down the US operation for this specialty material and moved everything, lock stock, and barrel (but no people) over to France. I could get the materials shipped here, if I wanted to wait two years, get an export license, and sign an agreement to share the technology. The sponsor pulled the plug on that project. Ironic that it was technology we developed here, sold out, and had to pay a steep price to get back.
This country is selling out a lot of its strategic capability to the highest bidder in the foreign marketplace, just to make a quick buck and put a few more pennies on the quarterly bottom line.
FReeper Paul Ross has a nice graphic that shows the amount of secondary jobs spawned and supported by manufacturing activity, compared with service industries. The manufacturing support jobs are, IIRC, something 7 secondary jobs to each manufacturing job. Service industries are lucky to have a 1:1 ratio. There simply aren't enough things you need to do to run, say, a dentist's office, compared to the things you need to do to keep an electronics plant going. Not to mention the difference in wages.