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America's advanced manufacturing problem and how to fix it

americanaffairsjournal.org

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Re: America's advanced manufacturing problem and how to fix it

#221

Post by yterdy »

chii wrote: post #111
yterdy wrote: post #76

Earlier quoted context omitted.

> On the second point, the elephant in the room is that smart people in the US can make 2-3X as much in software or finance as they can in manufacturing, so what do you think they're going to pick? Which company is private investment going to fund - the SaaS co. with 40% margins and rapid growth or the manufacturing co. scraping 10% margins and 5% CAGR? Ooh, this one's easy. Make software companies give back some of…

> users being scammed out of the true value of their contributions is it a scam? Or are the users willingly trade their data for features? > The SpaceX that built heavily on gifted NASA research and expertise i think you're discounting their own hardwork. NASA research is available to any other company - it isn't an exclusive transfer.

>is it a scam?

Is it a scam if I buy a $1 million painting off you for $50, knowing that I'm aware of its value and that you aren't? It's at best unfair and disingenuous. But what's more important to consider is how the scale of this imbalance has warped our economy: as mentioned above, a large portion of our most educated workers are getting paid to build addictive social media platforms instead of things that are useful and sellable, because tech companies are capitalizing on an arbitrage opportunity that is so massive as to probably be unfair, if not criminal, somehow.

>NASA research is available to any other company

But not NASA grants and personnel contacts.

Re: America's advanced manufacturing problem and how to fix it

#222

Post by JumpCrisscross »

Animats wrote: post #12

Note the absence of tax policy changes that favor manufacturing. Here are a few: * A tax on financial transactions. This is sometimes called a "Tobin tax". The US financial services sector has doubled in size as a fraction of the economy. It's currently around 12%. That's an overhead cost, and a big one. Could be half that. * A tax on advertising. The tax deductiblity of advertising as a business expense should be li…

> tax on financial transactions

This is a tax on the middle class. Plenty of countries have stamp taxes on trades, for example. The wealthy structure to avoid a books-and-records trade. The average person can’t do that and so pays.

If you’re upset about the size of finance, just tax that directly.

Re: America's advanced manufacturing problem and how to fix it

#223

Post by JumpCrisscross »

mschuster91 wrote: post #7
mdorazio wrote: post #6

Here are the key points the article suggests (it spends quite a long time explaining how we got here): 1) Improve the [government sponsored] Manufacturing Institutes 2) [federally] Back R&D for manufacturing technologies 3) Provide scale-up financing [by the government] 4) Use government procurement power to promote new manufacturing technologies 5) Direct production support [to sectors deemed critical] 6) Provide bo…

> On the second point, the elephant in the room is that smart people in the US can make 2-3X as much in software or finance as they can in manufacturing, so what do you think they're going to pick? Make unions stronger and kill off all of Wall Street finance shenanigans that's purely devoted to creating money out of thin air or skimming (especially HFT). That house of cards is going to crash hard anyway, so best tear…

> especially HFT

People deciding to kill things in domains they haven’t the vaguest conception about is how we wound up in this situation. (Killing HFTs would be a major boon to Wall Street. You’re mandating an increase in transaction costs.)

Re: America's advanced manufacturing problem and how to fix it

#224

Post by michaelt »

cced wrote: post #216
sudosysgen wrote: post #148

Earlier quoted context omitted.

CEOs are employed by the board, the board is made of major stockholders, those are pensions funds and other investors mainly interested in stock prices. No need for conspiracy theories or pitchfork waving, it's just all working exactly how it's openly designed to.

You guys keep saying pension funds. Where are the sources that financialisation sucking us dry is because pension funds need to get seeded? We’re living in a time of record profits and ceo to worker pay ratio through the roof and you guys are implying pension funds, the little to last thing workers have, as the issue? Gee I’m wondering what we should all be thinking and doing about those pension funds and who that wo…

CEO pay is certainly way too high, I agree.

But look at any big corporation, take the CEO's total compensation and divide it by the number of employees. The CEO of IBM earns an obscene $16.5 million per year - but divide that by IBM's 288,300 employees and it's $60 per employee per year. Wal-mart's CEO makes $25.31 million, but it's only $12 per employee per year.

Even if we redistributed the CEO's entire salary to workers, $60/year isn't going to do much to close the gap between rich and poor.

Re: America's advanced manufacturing problem and how to fix it

#225

Post by mschuster91 »

JumpCrisscross wrote: post #223
mschuster91 wrote: post #7

Earlier quoted context omitted.

> On the second point, the elephant in the room is that smart people in the US can make 2-3X as much in software or finance as they can in manufacturing, so what do you think they're going to pick? Make unions stronger and kill off all of Wall Street finance shenanigans that's purely devoted to creating money out of thin air or skimming (especially HFT). That house of cards is going to crash hard anyway, so best tear…

> especially HFT People deciding to kill things in domains they haven’t the vaguest conception about is how we wound up in this situation. (Killing HFTs would be a major boon to Wall Street. You’re mandating an increase in transaction costs.)

We wound up in the situation we are because we let the forces of the free market have free reign in creating all possible sorts of quackery and bullshit.

Re: America's advanced manufacturing problem and how to fix it

#226

Post by onthecanposting »

I really don't see Chinese-style whole government response with state-owned-enterprises and all happening in the US. That may not even work if it were possible. A viable domestic manufacturing sector is just not a goal of US decision makers (donors and kingmakers). At this point, career administration staff have been so fanatically selected for ideological loyalty that I don't think Washington can accomplish much of anything outside of accounting gimmicks.

Re: America's advanced manufacturing problem and how to fix it

#227

Post by eitally »

cced wrote: post #216
sudosysgen wrote: post #148

Earlier quoted context omitted.

CEOs are employed by the board, the board is made of major stockholders, those are pensions funds and other investors mainly interested in stock prices. No need for conspiracy theories or pitchfork waving, it's just all working exactly how it's openly designed to.

You guys keep saying pension funds. Where are the sources that financialisation sucking us dry is because pension funds need to get seeded? We’re living in a time of record profits and ceo to worker pay ratio through the roof and you guys are implying pension funds, the little to last thing workers have, as the issue? Gee I’m wondering what we should all be thinking and doing about those pension funds and who that wo…

You aren't wrong, but it's not reasonable to hold such a strong opinion without experience. I spent 15 years working in high-tech manufacturing, at Sanmina, which - like many peers - also offshored the majority of capacity. What remains in the US is mostly manufacturing for regulated industry (military, medical).

Take a look at this, re institutional ownership: https://money.cnn.com/quote/shareholders/shareholders.html?s.... 95% of outstanding stock is owned institutionally, which is pretty normal in manufacturing. For decades, this has been a core investment sector for pensions and other institutional funds, and remains so, even if it's just to balance investments in tech, biotech/pharma, retail/CPG, financial services, the military industrial complex and transportation. Moreover, if you attend quarterly results calls, you typically end up with a few analysts from banks and at least one from some pension fund, who ask questions. We young people may not care about pensions as almost none of us will have one, but they still exist and still influence large pieces of our economy.

Re: America's advanced manufacturing problem and how to fix it

#229

Post by BeFlatXIII »

twoodfin wrote: post #56
polygamous_bat wrote: post #54

Earlier quoted context omitted.

> Taxing this decision discourages making it—even if only marginally—and makes capital markets dumber and less efficient. Or it encourages making longer term investment decisions rather than trading like a jittery cocaine addict (which by no small amount of irony a nonnegligible number of traders are already.)

What you’re suggesting is that markets are more efficient when they’re less liquid. That’s both intuitively and empirically wrong.

What extra liquidity is there for executing trades every microsecond instead of batching them up for thrice a minute trades?

Re: America's advanced manufacturing problem and how to fix it

#230

Post by datavirtue »

i_am_proteus wrote: post #182
joe_the_user wrote: post #14

Earlier quoted context omitted.

Yeah, "financialization" is absolutely the answer and the articles' claim of lack institutional integration (or whatever) seems wrong. You can look at how Boeing gutted it's highly skilled Pacific North West operations to move lower skilled, lower paid areas elsewhere and generalize this to a multitude of similar industries.

>American financial markets favor a capital-light production model, or one of no production at all. Jack Welch was well aware of this in his transformation of GE from an engineering company—one cofounded by Thomas Edison—to a financial engineering company. In 1985, during his early years as CEO, he canceled the company’s “factory of the future” initiative consisting of automation systems, robotics, and ad­vanced mach…

You should see GE factory floors now. Totally left behind by the rest of the world. When I left they were getting into LEAN and the big suggestion was organizing tools on a cart for better efficiency. Jack Welch nuked GE.
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