We Gotta Make Things!

Our current unemployment problems are largely due to the exportation of manufacturing jobs overseas.

A simplistic conclusion perhaps, but few will argue that the American manufacturing base is merely a shadow of its former self. Economic theory holds that efficiencies are gained by allowing the least-cost producer to emerge. Prices are lower for consumers and this is good.

Unfortunately, national security doesn’t factor into the equation, but it should.

Higher American wages that produced the great American middle class for several decades provided the earning power for consumption on domestically produced goods and enhanced our standard of living. Labor unions, in their zeal to lift the lowly worker up, did just that---but didn’t stop there. Empowered by their ability to shut factories down with strikes, they saddled American business with wage and benefit packages that greatly increased the cost of production.

American companies reacted by moving their manufacturing overseas. There, lowly paid workers can crank out the same products at a fraction of the cost, even with shipping and handling added in.

The result is not only idle factories and people, but a national vulnerability should hostilities arise in the future.

At the onset of World War II, factories producing consumer goods were quickly retooled to provide the implements of war. Tanks, planes and guns rolled off the assembly lines in a never-ending stream. How equipped would we be today for such a turnaround? How many of our critical components are made elsewhere---and perhaps by people who might be our enemy?

Check out this short video for the Ford Manufacturing Exposition—in 1934—what was “cutting edge” back then is rather ho-hum today, but therein lies a lesson, I think:



http://www.youtube.com/watch?v=91c7yNB5X3w

Remember that this exposition was held during the Great Depression. Times were much worse than they are today—and yet, investment and optimism for the future fueled the spirits of those who still very much believed in the so-called American Dream.

Just 77 years ago, but think how far we have come! What new innovations exist for the balance of THIS century?
Whatever they are, we need to create conditions that allow us to make those things right here in the good ol’ USA!

If you’d like my blog in your box daily, just let me know: tim.moore@cumulus.com