Only an ignoramus would condescendingly sniff that the manufacturing that has moved or is starting up overseas is nothing but “snapping together plastic and metal parts.”
The fact is that we are running a huge trade deficit in advanced technology products, not just cheap toys.
It is luddite nonsense to conclude that because a particular manufacturing plant becomes more productive and uses fewer workers that these excess workers should become burger-flippers when we see around the world high-tech manufacturing expanding in other countries.
We are placing our own necks in the noose because idiot free-trade purists are spouting comparative-advantage dogma to justify the decline of the United States from a high value-added manufacturing country to an exporter of little other than raw materials and processed food.
The fact is that the “comparative advantage” being gained by other countries is not the natural advantages represented by Scottish sheep or Portuguese wine that were in mind when the theory was postulated but rather the managerial and technological knowledge base which is moving overseas and gaining an absolute advantage because of foolish choices and foolish attitudes on the part of many here.
Take away Boeing, Caterpillar and a few other companies and our ability to compete in export markets in high value-added manufactured products is quite disappointing. We are on the way to being principally an exporter of farm products and other raw materials.
Under the free-trade, open-borders mentality we are stupidly importing a huge population of millions of new workers with an average IQ of no more than 90. As more and more high-tech manufacturing is based overseas, the engineering and managerial expertise will continue to follow and the American workforce will be increasingly unfit to mount a challenge.
In the modern world it is not theoretical unique “comparative advantages” supposedly differing by nation that account for the success of an economy and an opportunity to realize a high standard of living, but rather the brainpower of the workforce and the ability by governments to provide a environment conducive for that brainpower to compete. There is no natural geographic location for that type of advantage. You are stuck in a mindset of the past.
Our worst enemy is our own tax and regulatory policy and political attitudes and brain-dead dogmatists regurgitating misapplied theories.
A so-called "trade deficit" is nothing but an accounting fiction; it's the way certain books are kept regarding international trade. The technical name for it is a Current Accounts deficit, which is -- and must be -- exactly balanced by a Capital Accounts surplus. When you plot the data from the two accounts as a graph, you get two lines -- one above the X-axis, the other below it -- that are exact mirror-images of each other. When you add the corresponding points together, you get "0" -- proving that trade is balanced (as it must be, unless one party to the trade is taking or losing something by dint of physical force).
A Capital Accounts surplus means that foreigners are taking the U.S. dollars they hold from the sale of their consumer items in the U.S., and returning them to the U.S. in the form of investments (i.e., "capital accounts"): buying real estate, or factories, or stocks, or bonds. Is it good to have foreigners investing in the U.S.? Yes, it is good. It's called "FDI", or "Foreign Direct Investment", and the U.S. has the highest FDI in the world . . . meaning, lots of foreigners who hold U.S. dollars regard the U.S. as a good place to invest (and which fact also proves the lie that investment dollars necessarily flow to countries with low wages -- they don't. Investment dollars flow to countries with high productivity; mainly because the investor wants to get his money back with interest!).
Here's a schematic of two kinds of trades, showing that a "trade deficit" is an accounting, bookkeeping fiction, and a complete economic myth:
Scenario 1) U.S. consumers purchase Chinese-made textiles for $1 million. The Chinese now hold $1 million dollars -- they can't spend them in China, so if they are to be spent at all, they have to be spent back in the U.S. They reciprocate the trade and purchase $1 million of U.S.-made pharmaceuticals. International accounting practice would call this a "balanced trade": consumer good for consumer good. The "Current Account" side of the ledger is "0".
But suppose the trade happens like this:
Scenario 2) U.S. consumers purchase $1 million worth of Chinese textiles. The Chinese now hold that million dollars. In return, they purchase some land in the U.S. for $1 million. The American seller of the land now has that million dollars and uses it to purchase $1 million U.S.-made pharmaceuticals -- he has entrepreneurial plans to start a chain of drug stores. The trade is still clearly balanced: we gave China a million dollars; China re-spent it back in the U.S., just as it did in the other trade example. But international accounting practice would now claim that we have a million-dollar trade deficit: the Chinese used the million dollars to buy a capital good -- land -- so the "Capital Accounts" side of the ledger now reads "+$1million"; and since the U.S. spent a million dollars on a Chinese-made consumer good (textiles), the "Current Accounts" side of the ledger now reads "-$1 million". Have we lost anything from this kind of trade? No. Add together the Current Accounts side and the Capital Accounts side and they'll NECESSARILY equal zero. I.e.: balanced trade.
Some of the returning dollars from China, of course, are being used to finance our government's spendthrift ways: we offer Treasury bonds and the Chinese return our consumer dollars by buying them. At fault here is the U.S. government for spending so much, not the Chinese for buying what we offer. Stop the spending and China won't buy so many Treasuries. However, given the fact that we have a spendthrift government, it's still better that foreigners subsidize our debt than that we do it: every dollar that China uses to buy U.S. government debt is a dollar that an American doesn't have to: That China spends its dollars on buying U.S. debt means that Americans don't have to spend so many of their dollars buying U.S. debt -- it frees up dollars in the U.S. to be invested -- or simply spent -- on other things.
Higher productivity always, by necessity, drives out lower productivity jobs. Candle-makers lost out to the makers of electric lightbulbs -- TOO BAD FOR THE CANDLE-MAKERS. Do they deserve special consideration -- as in "protection" -- from the newer, better lightbulb industry? No. We all accept it and mark it up to economic progress. Would it matter if those lightbulbs were manufactured in the U.S. or in China? No. The candle-makers still lose out. Buggy-and-whip makers lost their jobs to the makers of automobile manufacturers. TOO BAD FOR THE BUGGY-AND-WHIP MAKERS. Do they deserve special consideration, special "economic protection" from the newer, better car industry? No. We all accept the demise of the buggy-and-whip makers and crack it up to "economic progress." Would it matter if those cheaper, more efficient automobiles were manufactured in the U.S. or in China? No. Buggy-and-whip makers still lose out, and deserve government proaction in neither case.
Same happened with agriculture in the U.S.: 200 years ago, 98% of the workforce was employed on farms, or farm-related jobs; today, it's about 2%. OH MY GOD!!!! WHERE DID ALL THOSE FARM JOBS GO! HELP!!!! THE U.S. HAS LOST FARM JOBS!! Did we lose farm jobs to cheap foreign competition? No. We lost farm jobs because of our own doing: higher and higher productivity per acre yield, due to mechanization, tractors, combines, chemical fertilizers, refrigerated railcars, better and faster transportation to market, genomic engineering, better pesticides, etc. We lost all those farm jobs because the economy no longer needs all those farm jobs. We grow enough for ourselves and much of the world on relatively few acres Hey!! What happened to those who were made unemployed by the higher productivity? In the long run, they re-educated themselves and re-trained themselves and learned to work in factories in the burgeoning manufacturing sector. Same thing will occur to those leaving manufacturing and learning to work in the higher-valued service sector.
The reason certain self-styled "conservatives" don't complain that the candle makers lost their jobs to the lightbulb makers is that the latter were American; so it's OK for an American to lose his lower-productivity job to a higher productivity job so long as the latter is also American. But if an American candle maker were to lose his job because cheap lightbulbs were being imported from China, and consumers preferred cheap lightbulbs (irrespective of their origin) to higher priced candles (irrespective of their origin), suddenly they cry "UNFAIR! We've lost jobs to foreigners!"
Additional, the notion that a service -- such as mowing a lawn -- is not really an economic good -- as opposed to the physical lawn mower itself -- is pure mercantilist baloney. "Services" are goods, and they not only add value to an economy, they often add more value than physical goods themselves.
As per the great law of Comparative Advantage, the U.S. should be concentrating on doing whatever adds the most value to its economy -- and to the world economy, as well. Designing new drug molecules, designing smartphones, and writing software are among them. Weaving textiles and physically manufacturing electronic goods are not.
Protectionism is poison to the entire country, with the possible exception of the specific industry chosen for special consideration -- it's just the same "bail-out" mentality displayed by many banks and insurance companies the last few years. You are blissfully ignorant of the fact that MOST -- yes, MOST -- of our cheap imports from China are themselves economic inputs into our own manufacturing. If you implement tariffs on those imports, you will drive much of our own manufacturing artificially out of business -- and only a few politically favored industries will be chosen by Uncle Sam to survive.
I can tell from your post that you don't understand the basic principle of comparative advantage, which is a fundamental law describing the way humans will freely interact with one another under a system of "division of labor." The only way to get people NOT to follow this law is by government coming in and preventing it from occurring by the use of force. When government does so -- as when it implements tariffs, quotas, or other protectionist, non-free-trade policies -- everyone in the U.S. is ultimately made poorer.