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America underestimates the difficulty of bringing manufacturing back

molsonhart.com

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Re: America underestimates the difficulty of bringing manufacturing back

#271
post #165
post #147

Earlier quoted context omitted.

This isn't just ego. This is an impending existential issue. America needs to increase manufacturing capacity if it wants to maintain hegemony and possibly world peace. China will soon have the ability to take Taiwan and Korea and Japan. If that happens it's game over for any American interests and perhaps democracy as a whole. Wargames[0] paint a grim picture of an upcoming conflict between China and America over Ta…

That is not an existential issue; many former hegemons, such as the United Kingdom, continue to exist. Coalitions exist to ward off hegemons.

The UK continues to exist because it was replaced by a democratic American hegemony.

If an authoritarian country like China achieves hegemony the continued existence of democracy is at risk.

I want to live in a democratic world, not an authoritarian one.

America's democracy is a flawed one but of the two choices -- American hegemony or Chinese hegemony it is the best path to a flourishing global liberal democracy.

Can you foresee Chinese hegemony leading to increased democracy, individual property rights, due process, and rule of law?

Re: America underestimates the difficulty of bringing manufacturing back

#272
post #135

Earlier quoted context omitted.

> There are plenty of people saying these tariffs will not work. Work to do what? > But a person used to be able to graduate high school and get a job that could support a house with a yard, a car, a non-working spouse and children. Why do you think this has anything to do with tariffs or manufacturing? > How do we get that level of prosperity back? Better pay for the jobs people actually work. Reducing inequality by…

> Work to do what? Bring back manufacturing, and make the US economy work better for workers. > Why do you think this has anything to do with tariffs or manufacturing? Because usually the best-paying jobs were in factories, especially if you didn't have a college degree. A lot of towns in the Rust Belt were economically dependent on a local factory -- think cars or steelmaking. Often, part of the reason these factori…

>Bring back manufacturing, and make the US economy work better for workers.

Seemingly, this is going to magically happen? Where are the programs to make sure this does happen? Erecting tariffs is one thing, but having an actual plan and executing on said plan is another. So far, all I see is rising prices and looming threats of job cuts due to slow downs which stem from increased costs, and there is nothing coming to buffer that.

Let alone, the investment capital isn't moving in this direction. As of this writing, the general posture of the Republican donor class is 'wait and see how long the tariffs last' not 'lets invest in American industry again'

>Because usually the best-paying jobs were in factories, especially if you didn't have a college degree. A lot of towns in the Rust Belt were economically dependent on a local factory -- think cars or steelmaking. Often, part of the reason these factories were so high paying is because the jobs were unionized.

Emphasis mine. Do you believe that the modern Republican party is pro union? Do you really think they won't undermine organized labor even if jobs come back in some form? Even though the modern Democratic party have a spotty history on labor issues, the Republicans have shown for 40 years to be the anti labor party. They rarely - if ever - pass legislation that is pro labor. This administration isn't proving to be different in that regard either, and it wasn't different the first time around.

>I grew up in the Rust Belt and I'm old enough to properly remember when some of those factories were still operating. I saw with my own eyes what used to be a respectable blue-collar community decay into an economic wasteland.

So did I. Hallowed home town and all. One of the poorest in the state I grew up. You know what else never happened? Sustained public policy to help these areas. There were largely no programs to help transition workers from one industry to another. We don't have comprehensive safety nets and retraining / re-education programs for workers. We lack all of that. Why aren't we starting by implementing those programs? Its rather wishful thinking that bringing manufacturing back to the US, that it will end up in these same areas to begin with, because manufacturing is very different than it used to be. I doubt most of these areas would be good places to re-build manufacturing capacity in the US. What manufacturing is done here is already concentrated in the South which precludes huge chunks of the traditional rust belt.

Re: America underestimates the difficulty of bringing manufacturing back

#273
post #176

Earlier quoted context omitted.

Can someone explain to me why EU VAT is considered a tariff, while US sales taxes are not? They both seem a sale tax to me.

Because VAT is collected at the border on imports, some people (wrongly) consider VATs a tariff. Considering that VAT is rebated on exports, VATs are trade neutral. Sales tax as implemented in the US is not as tax efficient as VAT due to the impact of sales taxation on intermediate transactions during manufacturing. VAT only taxes the incrementally the value added at each transaction) whereas sales tax applies to the…

Hmm how is it different in the US do you not get back in the sales tax that you paid for your input. Here the middle man pay tax on the buying price and then collects on the sell price. Then has to pay the government minus what they paid as input sale tax. So all increments on the price gets taxed till the end user. But the tax itself is not taxed again.

Re: America underestimates the difficulty of bringing manufacturing back

#274

Earlier quoted context omitted.

Well, money talks and it's hard to choose the other option. On one hand bring manufacturing back to US and pay them higher, because otherwise the pay in McDonald's is better with a less demanding physical (cmiiw, don't live in US). On the other hand, keep manufacturing outside of US for cheaper labor to keep price low and having bigger margin. It's an easy choice to make. And again this is not a US specific problem,…

The thing is also that absolutely nothing about the overall situation changed meaningfully over the last 50 years or so. People had the exact same concerns and fears when electronics manufacturing started shifting to Japan like 50 years ago-- they went in the same way up the value chain that China did, and they started losing a lot of the industry with rising wages, too, exactly like what we see with China => Vietnam…

Seeing it as a "rip off" is indeed delusion, but turning a blind eye to the dangers of becoming (ever more) dependent on a foreign country is an even worse folly.

Re: America underestimates the difficulty of bringing manufacturing back

#275

> Let’s focus on America’s strengths in high end manufacturing, agriculture, and innovation instead of applying tariffs to all countries and products blindly. We should be taxing automated drones for agriculture at 300% to encourage their manufacture here, instead of applying the same blanket tariff of 54% to that that we apply to t-shirts. Everything wrong and right with the author's thesis. Our present day high-end…

Robot drones probably are something the US should do. Access to US farms is useful for anyone making agriculture products. Remembers these drones are part of the supply chain for food, and so doing them in the US makes the supply chain closer. You want the ag drones made in small city, not Silicone valley. However your might write the software in Silicone valley - that is where you will find a supply of people who can do that - some of those people will then be making regular trips to the factory though to learn how it works.

Re: America underestimates the difficulty of bringing manufacturing back

#276
post #176
post #35

> China generates over twice as much electricity per person today as the United States. Why? This appears to be completely wrong? All the stats I can find say that the US has about 4x the per capita electricity generation of China. Other than that it seems to be mostly good points, especially the overall one: you cannot do this overnight. > If you’re building a new factory in the United States, your investment will a…

Can someone explain to me why EU VAT is considered a tariff, while US sales taxes are not? They both seem a sale tax to me.

The answer is: rhetoric. It's a fake argument to justify US tariffs. It won't work for people like you and me, but Trump fans will love it.

Re: America underestimates the difficulty of bringing manufacturing back

#278
post #149
post #91

Earlier quoted context omitted.

A genuine question, presuming no correct answer: what is to be done about it? China is reportedly on track to run more than 50% of global manufacturing by 2030, if the World Bank is correct. What would you do to act against this? Is doing nothing acceptable?

A great analyst once taught me the response question: "yes, and so what?" What's so magic about manufacturing as opposed to all the higher value work of the US economy? Have people not noticed that the average American is still richer than the average Chinese person by a long way, and (yes, painfully) more so than the average European? If you're going to talk wars, then .. US military manufacturing is still the world…

A lot of the war stuff gets framed in very odd terms. If you want a local defence industry then pay for it. Enforce component sovereignty requirements... Which everyone already does. Then actually react to reports which call out the gaps and pay to close them.

This bizzare "we'll bring back manufacturing and be ready all the time" thing seems to imagine you'll just turn the local widget maker over to knocking out high temperature stealth composites for hypersonic missiles real quick.

Which is of course the story of a lot of American manufacturing: it's hard to get a hobby run of PCBs because all the PCB makers are optimized for large orders for defence procurement (and the clearance, supply line and stuff requirements that brings).

Re: America underestimates the difficulty of bringing manufacturing back

#279
post #123

Earlier quoted context omitted.

I've seen this brought up with board games that are now primarily made in China, because injection molding is cheaper there especially for small quantities. The US could make the board game minis, but everyone who is capable of it in the US is producing high value high quality aerospace, industrial, medical parts. It's a waste of their time to produce small runs of toy parts.

This seems like the kind of thing where 3d printing is probably good enough quality wise. Of course, the 3d printers themselves are probably being made in China.

3D printing absolutely sucks for production runs of more than a few dozen, and it produces finishes nowhere near as good as injection moulding.

Re: America underestimates the difficulty of bringing manufacturing back

#280

I think the collapse of the American Empire is no more preventible than the collapse of the British, Spanish, or Roman empires. The issues with the US being the reserve currency has been known for a while now (and was even predicted by Keynes before the Bretton-Woods summit): https://en.wikipedia.org/wiki/Triffin_dilemma Any discussion of "bringing back manufacturing" that doesn't mention government spending or socia…

The American Empire never existed, because it never could. The US made the explicit decision not to occupy the defeated forces after WWII, save for strategic forces in place to protect the interests of the host countries. The US opened its market (the only market of size left and still the largest consumer bases in the world, by far) with no tariffs.

What the US got in return was cheap goods and a whole lot of debt. What the world got was stability. The US is no longer interested in subsidizing the global order.

The current discussion re: “bringing back manufacturing” is making the mistake that everyone always makes when Trump is involved: taking him at his word. The point isn’t to bring back all manufacturing. The point is to profit off of imports. Some manufacturing will return — whatever is high value added and benefits primary from cheap shipping internally - but nobody thinks that Americans are going to sew t-shirts.

Also, those who are looking for an American decline as comeuppance for being unkind to allies are going to be sorely disappointed. The US has everything it needs to be self sufficient, and no matter how batshit crazy the leadership is, it’s still — still — the safest place to park capital, still the largest consumer market by far (more than twice China), has a stable demographic and a middle class country to its south that brings in lower cost workers as needed. Not to mention being totally energy independent, bordered on two sides by oceans and with more potential port coastline than the rest of the world combined… and also holding the virtually all of the world's supply of high-purity quartz, which is a requirement for semiconductor production.

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