High relative American labor costs are a primary driver in the decision to locate jobs abroad, but it is not the only reason. High corporate income taxes, incomprehensible and complex regulations, restrictive union work rules, government monopolies on functions that the private sector could easily assume, legal expenses and economic uncertainty also play a role, as does an absence of qualified technical workers in the U.S.
As a consequence, our economy has grown increasingly dependent on the service and information sectors, where jobs tend to be lower paid and less stable than the manufacturing jobs we have abandoned over time.
The larger problem, I believe is one that is invisible: the absence of new dynamic industries that were never created, severely curtailed or ultimately located abroad because of the aforementioned costs of doing business in America. Hence: lower demand for domestic labor, shrunken consumer markets, educational needs both uncreated and unfulfilled, lower wages and a greatly reduced wealth multiplier effect.
I do believe that Americans would be willing to pay higher prices for a wide array of goods currently produced in places like China, but that opportunity will never materialize as long as we continue to treat business alternately, as a necessary evil, and a cash cow to be milked dry by politicians eager to buy votes with others' money and to create dependency in place of self-sufficiency.
I do believe you're wrong -- and why should we?