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The fraying of the U.S. global currency reserve system

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Re: The fraying of the U.S. global currency reserve system

#281

Post by confidantlake »

lettergram wrote: post #49
CoffeeDregs wrote: post #12

"Instead of drawing down our gold reserves, however, we gradually draw down our domestic manufacturing base and it gets replaced piece-by-piece in foreign countries." To me, this is the money shot. I hadn't seen this expressed before and it makes perfect sense. I'm baffled that we (the US) caused this to happen to the US. I'm (unhappily) registered Republican but I argued vociferously to a Dem friend in 2000 that our…

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

I am not so sure about the loosen regulations thing. The US had periods of time with virtually no regulations. Rivers caught on fire, people were maimed and died of industrial accidents at much higher rates, water was unsafe to drink, ect. The countries now without much regulation are usually poor, dirty and dangerous. I want to live in a safe, clean, healthy environment.

I agree with you on the tariffs. China should not be able to outcompete us because they pollute and use slave labor. Force them to compete on fair terms.

Re: The fraying of the U.S. global currency reserve system

#282

Post by pnutjam »

simonh wrote: post #255
lettergram wrote: post #49

Earlier quoted context omitted.

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

They aren’t slaves, they’re just people extremely happy to get a wage of $10k per year, which would be unobtainable for most of them any other way. The fact that this means they under cut US manufacturing wages by more than half isn’t really their fault. As for bringing back manufacturing home, you need to find two things to make that work. First massive subsidies and tariffs to drive up the cost of foreign imports,…

I say taxes aren't necessary. Just hold companies accountable for every step in their manufacturing chain. They need to audit and ensure factories address meeting or standards for the workers.

I don't mean wages, I mean safety, overtime, etc. Labor needs to be valued at home and abroad.

Re: The fraying of the U.S. global currency reserve system

#283

Post by oa335 »

etothepii wrote: post #27

"From there, paper currency and credit was added as a more convenient layer onto gold." It's not a universally accepted opinion but I take Martin Felix's view, articulated in "Money," that credit predates coinage. It's turned me off the article and as a consequence I can't read any more.

By the way, though I agree with your sentiment re history of money, his allusion to the progression of economies from barter to coinage to credit was really just an aside and not relevant to any other part of the article.

I did read the rest of the piece and found it very informative and enlightening, I highly recommend reading it, especially if you are interested in the nature of money.

Re: The fraying of the U.S. global currency reserve system

#284

Post by CountSessine »

8note wrote: post #205
cloudinshape wrote: post #138

Earlier quoted context omitted.

You have to square the circle. Wages in the US are artificially high because of the dollar's position, but the US needs to either a) match the wages of the countries producing similar stuff or b) increase productivity and value to the levels of countries like Germany. Since b) requires decades in factories, supply chains, trade agreements and most importantly training in actually producing things which means science…

There is also d) the owners take smaller profits

The average operating margin for the S&P 500 is 10.53% (although that may have been 2018). And economists are worried that even that is high - traditional manufacturers like Ford typically manage operating margins of ~5%. Workers are already getting 95%. And then everything after that like R&D, marketing, and capital amortization has to come out of that 5%. And then finally a bit is left over for earnings for the owners. You’re mistaking wealth for income. Surely the workers could use more wealth, but what we’re discussing is the price of goods and this is operating revenue and income. And workers already get the lions share of this.

If you’re going to make US manufactured goods cost competitive with foreign goods, much of it has to come out of that 95% operating revenue that is operating expenses, most of which will be employee wages. There’s no way around this.

Re: The fraying of the U.S. global currency reserve system

#285

Post by stjohnswarts »

CoffeeDregs wrote: post #12

"Instead of drawing down our gold reserves, however, we gradually draw down our domestic manufacturing base and it gets replaced piece-by-piece in foreign countries." To me, this is the money shot. I hadn't seen this expressed before and it makes perfect sense. I'm baffled that we (the US) caused this to happen to the US. I'm (unhappily) registered Republican but I argued vociferously to a Dem friend in 2000 that our…

This was actually one of the good things that I thought -might- happen with the Trump regime despite all the other negatives. Guess what, nothing happened :( . We're still losing the ability to make stuff which is very scary in a world that is becoming China vs. The USA . There is price that isn't easy to express in $ that goes with the national security lost through losing a manufacturing base.

Re: The fraying of the U.S. global currency reserve system

#286

Post by pjlegato »

pbourke wrote: post #173
PKop wrote: post #72

Earlier quoted context omitted.

>compete Have as your "goal" less the desire to "win" the global competition for corporate profits & corporate headquartering of multinationals in your nation simply on grounds of labor/profit competitiveness, and take a more nationalist view of, where necessary, having state run enterprises or "free market" competition within your borders but not complete free trade in a global sense. In other words, do no necessari…

This is an insightful comment that clarifies and distills some of my own thinking on the subject. The blind pursuit of efficiency optimizes for the macro numbers at the expense of gutting the structure of the labor market and lived experience of people. It’s far better to have a lower per capita GDP with a more equitable distribution of resources (such as a higher household income across quantiles) It seems clear tha…

In efficient, highly optimized economies such as the United States and most of the European Union, the border guards' job is to prevent people from entering and participating in those economies illegally.

In the countries with low GDPs and highly equitable distribution of resources -- North Korea, East Germany, Cuba, the Soviet Union, for example -- the border guards' job is to prevent people from escaping.

Re: The fraying of the U.S. global currency reserve system

#287

Post by stjohnswarts »

namdnay wrote: post #67
lettergram wrote: post #49

Earlier quoted context omitted.

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

Without a very strong (and therefore expensive) social security net, “Letting people work for whatever wage they can achieve” is slavery. See 19th century Britain Germany still has a strong industrial base, without a race to the bottom and with strong unions. So it is possible :)

In the traditional sense, it is not the same as slavery, not by a long shot. I do agree with unions becoming prominent again. Not everything has to be a bargain basement priced items. I personally try to hit something in the middle, and often look for an American made version (or European) it can be extremely hard though, and impossible for 99% of electronics.

Re: The fraying of the U.S. global currency reserve system

#288

Post by CountSessine »

namdnay wrote: post #67
lettergram wrote: post #49

Earlier quoted context omitted.

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

Without a very strong (and therefore expensive) social security net, “Letting people work for whatever wage they can achieve” is slavery. See 19th century Britain Germany still has a strong industrial base, without a race to the bottom and with strong unions. So it is possible :)

When someone is beating you, the least you can do is copy them. We could start by copying German worker councils (unions) - but no one in management or labour here wants that. Labour hates company unions and still dreams of building labour monopolies like they had in the 60’s and that’s exactly what worker councils were designed to prevent. And managers want to be able to bust unions which isn’t legally allowed with worker councils.

So I guess not?

Re: The fraying of the U.S. global currency reserve system

#289

Post by stjohnswarts »

ralph84 wrote: post #129
lettergram wrote: post #49

Earlier quoted context omitted.

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

China treats workers like shit and the environment like shit. The US wouldn’t win a race to the bottom and shouldn’t try. Instead companies who manufacture in China should be taxed at much higher rates to account for the negative externalities they benefit from otherwise.

we could if environmental and personal costs were factored into prices. The woudl take a lot of political will that I don't think we have though

Re: The fraying of the U.S. global currency reserve system

#290

Post by sgnelson »

lettergram wrote: post #49
CoffeeDregs wrote: post #12

"Instead of drawing down our gold reserves, however, we gradually draw down our domestic manufacturing base and it gets replaced piece-by-piece in foreign countries." To me, this is the money shot. I hadn't seen this expressed before and it makes perfect sense. I'm baffled that we (the US) caused this to happen to the US. I'm (unhappily) registered Republican but I argued vociferously to a Dem friend in 2000 that our…

My father was one of the last tool makers in the US working for Molex. They spent years teaching the Chinese, the Chinese would disassemble all molds sent over to China and often break them, so my fathers team would have to fix / rebuild them. They spent years training the Chinese side-by-side in the US. In the end they still haven’t exactly caught up to the quality we had in the US. However, they now have 5x the too…

I've got to add my two cents to this discussion...

You discuss tool and die makers, a very highly skilled profession; one that I would argue takes many years of training and labor to master. I would further argue that in the manufacturing world, when it comes to hands on work, tool and die guys are near the very top.

Yet at the same time, you talk about cutting the minimum wage. Tool and die makers (of any sort) aren't going to be working for minimum wage.

While I don't disagree with the importance of American manufacturing, I think your prescription is wrong. We don't need lower wages, we need better education, more apprenticeships, more buy in from industry to spend money on training their employees. Because sooner than people think, China will have labor cost parity with the US, and we'll find that labor cost isn't solely the reason they are a manufacturing power house.

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