Live data from Hacker News

The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

rand.org

271–280 of 523 posts

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#271
post #263

Earlier quoted context omitted.

> military protection and a stable currency are some of the most complex exports And how come that always seems seem to come wrapped in ways that inexorably seems to concentrate wealth, so that the benefits of those exports seem to be less evenly distributed?

This was not true in the immediate postwar period. The turning point was roughly the 1980s. Wealth concentration has been a deliberate US domestic policy for decades. This is, to a large degree, separate from the stability of our currency or military protection. It's the stated intent and logical result of relaxing taxes on the rich while enacting policies designed to hurt the working classes (e.g. reducing union pow…

[deleted]

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#272

Earlier quoted context omitted.

It's an economic theory - https://en.wikipedia.org/wiki/Mercantilism The general idea is that when you buy stuff you're losing wealth so if you never buy anything then you never get poorer. Since we constantly dig gold up from the ground we still get richer over time even if nobody buys our stuff. This is also why its importantly to gain colonies (Greenland/ Canada) or mineral rights from other countries so that the…

Maybe if we're lucky, one of these sophomores will have an epiphany that military protection and a stable currency are some of the most complex exports , and that getting imports by trading away a self-created currency is a pretty great way to not give away any gold or silver... Just sayin'.

It's funny because the US right wing (and a huge part of it's so-called left, too) keeps trying to portray US global military power as the opposite. As charity for us ungrateful Canadians and Europeans

It's completely backwards from how people usually perceive empires. And from what it is. Which is a projection of power to ensure the supremacy of American capital interests.

Which is why US GDP per capita etc is incredibly high compared to the rest of the G7. It's not because they're smarter or better than the rest of us. It's because they've built the world order around themselves. By, as you say, exporting that military protection.

The US exports military dominance, and it gets paid in having its currency, regulatory needs / environment, etc. dominate almost everywhere.

(Whether this actually benefits the regular American worker vs its own wealthy business class is a whole other discussion, and may explain why this has become such a fertile ground for rage and frustration among Americans)

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#273
post #161

I keep seeing people advocating that the idea that we should build everything, and every piece or everything, here is a good one. Why? Is this just an isolationist dream? The reductive, absurd, extreme of this is why don't individual people go out and build all their own stuff like cars and houses. Let's all go out and learn how to mine and refine metal ore so we can get started on building the family sedan! There is…

the gist is: When you can manufacture ships, you can also manufacture warships. When you can manufacture warships, you can protect your economy. or: If all you sell are financial services, and a pandemic hits and you need to protect your people, where will you find masks? We don't need to build literally everything ourselves, that's a reductionist argument, we just need to become a lot more productive than we are now…

> we just need to become a lot more productive than we are now.

To nitpick about terminology:

  productivity = output / input
The US would (and maybe will) become less productive; the US is not as efficient at producing many things as non-U.S. competitors, including ship-building. The US is more productive at other things, such as software. (And in 2025, you certainly would trade ship-building productivity for software productivity. Including in warfare.)

If we insist on building ships in the US, we spend more money on the same ships, and - unavoidably - we must shift more productive resources to these less productive tasks. If your neighbor is a great carpenter and you are a great farmer, wouldn't it be smart to trade your vegetables for carpentry, instead of you trying to do carpentry and the carpenter trying to grow vegetables? If you are a Linux maintainer end and the business down the hall back end, do you try to do back end and they try to design OSes? Why?

(Of course, you probably trade your skills indirectly through the wonderful fungibility of money.)

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#274

Earlier quoted context omitted.

But it provides a tool to see how and why the “nuanced, appropriate version” is actually wrong. When one limits the choices for purchases or sales, one reduces efficiency, whether it’s limiting to products made at your home, in your city, in your state, or even in your country. It’s failed for so many centuries across hundreds of countries and attempts that it’s not even a question except among politicians stoking fe…

The question isn't whether maximum global free trade maximizes efficiency. The question is whether maximizing global economic efficiency creates optimal outcomes for a nation, for groups within a nation, or for individuals in the nation. It is clearly a mixed bag, so there is pushback. Ask these questions. Besides maximizing monetary efficiency: Does free trade maximize a nation's resiliency? Does free trade maximize…

With respect to the US:

- We’re the richest nation on the planet and have been until recently been adept in response to many types of disasters. - Unemployment has been The idiocy of conflict with China is just that. We’re better and richer together.

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#275

I keep seeing people advocating that the idea that we should build everything, and every piece or everything, here is a good one. Why? Is this just an isolationist dream? The reductive, absurd, extreme of this is why don't individual people go out and build all their own stuff like cars and houses. Let's all go out and learn how to mine and refine metal ore so we can get started on building the family sedan! There is…

> I keep seeing people advocating that the idea that we should build everything, and every piece or everything, here is a good one. Why? Is this just an isolationist dream?

No. There needs to be balance. We are way past the balance point, by far. When I say "we" I mean the US and Europe. We have the same problems, and I believe Europe is in far greater danger to be absolutely decimated in the next two to five decades.

Example: We are currently working on a robotics project. Just-about the only thing we can buy in the US (or Europe, for that matter) is the aluminum and steel, and only if we are ready to do the fabrication --machining-- ourselves (which we can do). If we have to rely on third parties to manufacture the parts we are sunk. Making anything in the US (and Europe) has become impossible. Wires, cables, circuit boards, motors, encoders, chips, displays, cast iron or aluminum parts, gears, belts, injection molded parts, filters, lubricants, etc. The list is massively long. Again, US and Europe, same problem.

The massive imbalance in tariffs and trade restrictions has collapsed entire industries. Try to print books or manuals in the US or Europe at scale. Good luck. Try to make packaging materials. Same problem.

I've been manufacturing for about four decades. It has never been worse. It's horrible. And we need to fix it or we'll be left with nothing. You cannot have an economy that is purely based on providing services and writing software.

A couple of decades ago, I used to buy a specially-treated antireflective type of glass from the last company making it in the US. The Chinese started to dump and created pricing pressure. Five years later they were out of business. I then bought the same type of glass from the sole remaining western factory in Germany. A couple of years later they discontinued the product. I then had to buy from China. A couple of years later they increased their prices --nearly doubled.

That's what we've been dealing with (US and Europe). A predatory and destructive "machine". This isn't about making everything. It's about making enough to have a viable economy in the long run. I find that people who are not in manufacturing cannot grasp this. It isn't about hating China either. They are doing exactly right by their people. I admire their dedication and focus. We (US and Europe) are the idiots.

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#276

These tariffs are a radical action that rhymes with the "Four pests" campaign of Mao Zedong's China which led to one of the worst famines in human history. Defenders of these tariffs say they might bring back manufacturing or say they are a response to some bad effect of the current state of America... They don't accept what the experts say, but what their authority says, and their authority says that these will brin…

> four pests

Mao's "backyard" steel furnaces might be an even better comparison:

https://en.m.wikipedia.org/wiki/Great_Leap_Forward

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#277
post #161

Earlier quoted context omitted.

the gist is: When you can manufacture ships, you can also manufacture warships. When you can manufacture warships, you can protect your economy. or: If all you sell are financial services, and a pandemic hits and you need to protect your people, where will you find masks? We don't need to build literally everything ourselves, that's a reductionist argument, we just need to become a lot more productive than we are now…

We had a little event a few years ago that answered your question. You give people money and they make crap. I helped procure like 30M masks. Nature finds a way. As a society, we’re more productive than we ever have been. We’re not breaking society to create a nation of workshops. This is a cynical power play.

> We’re not breaking society to create a nation of workshops.

That's what Mao tried in the Great Leap Forward: They tried to shift steel production to a cottage industry in back yards. You can imagine the results.

And also relevant: Everyone learned to say whatever Mao wanted to hear, so they all reported high and increasing production. It turns out that disinformation isn't economically productive, even if it feels that way - you can't make cars out of it.

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#278
post #273
post #161

Earlier quoted context omitted.

the gist is: When you can manufacture ships, you can also manufacture warships. When you can manufacture warships, you can protect your economy. or: If all you sell are financial services, and a pandemic hits and you need to protect your people, where will you find masks? We don't need to build literally everything ourselves, that's a reductionist argument, we just need to become a lot more productive than we are now…

> we just need to become a lot more productive than we are now. To nitpick about terminology: productivity = output / input The US would (and maybe will) become less productive; the US is not as efficient at producing many things as non-U.S. competitors, including ship-building. The US is more productive at other things, such as software. (And in 2025, you certainly would trade ship-building productivity for software…

If the carpenter owns weapons, a lot of my farmland, a lot of shares in my farming business, and my debt… I will learn to build my own crossbow

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#279

Earlier quoted context omitted.

The US manufactures more than ever, and the % of GDP in manufacturing has been flat for 70+ years now. The jobs didn’t leave, so they’re never coming back. They got automated. Just like we need vastly less farmers than in 1900 to farm more than ever, we need vastly manufacturing jobs to manufacture more than ever.

> The US manufactures more than ever More of what, exactly? I looked at steel production data (in metric tonnes, not dollar value), US production has been flat or slightly declining since 1970.

Computer components, medical equipment, vehicles, aircraft, chemicals, etc.

Steel is something where value matters. US steel is usually higher grade or recycled with more value. Korea churns out tons and tons of low value low margin rebar.

You bring back manufacturing by investing in clustered industries. New York has a bunch of semiconductors. There’s a ton of chemical industries around Philly and Houston.

The iPhone is made in China because they have the best manufacturing for precision products. If you want that here, you have to invest.

Re: The Decline of the U.S. Machine-Tool Industry and Prospects for Recovery (1994)

#280

Earlier quoted context omitted.

It's an economic theory - https://en.wikipedia.org/wiki/Mercantilism The general idea is that when you buy stuff you're losing wealth so if you never buy anything then you never get poorer. Since we constantly dig gold up from the ground we still get richer over time even if nobody buys our stuff. This is also why its importantly to gain colonies (Greenland/ Canada) or mineral rights from other countries so that the…

It is really effective at increasing the amount of gold in your vault, but The Wealth of Nations (Admin Smith) made a strong case against that primary goal. Crucially for the HackerNews crowd, Mercantilism increases the value of physical goods relative to services, and services becomes a smaller portion of the overall economy. Most of us sell server-time wrapped in software that performs a service…

Ironically, Adam Smith would be called a socialist in modern USA with his views on preventing monopolistic behaviours, the need for government oversight and controls, and the need for strong public goods where the private market fails.

So many people would benefit from reading his works.

Post reply on HN