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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

#331

I don't think anyone underestimates that, as much as some people with the author's viewpoints would like it to be true. To paraphrase Kennedy: "We choose to [bring back manufacturing]. We choose to [bring back manufacturing] in this [or the next] decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skill…

How many additional hours are Americans going to work? What pay cuts will they take? How many years later du they want to retire?

These are the questions people need to ask themselves. We both know what the answer is.

Re: America underestimates the difficulty of bringing manufacturing back

#332

Earlier quoted context omitted.

Question: if the jobs were off shored, but the resulting profits were shared more equally, would Americans still complain?

Yes, definitely yes. America suffers from a flattened income curve. There are many many more people earning $100k+ today than in 1960 (inflation adjusted). America has an envy problem first, equality problem second, spoiled child problem third.

I would not necessarily say that the envy is unjustified. If you live in a rich country you ideally want all citizens to become wealthy. Else, irrespective of income, you will be lorded over by those who are magnitudes richer than you.

Re: America underestimates the difficulty of bringing manufacturing back

#333

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…

This is explicitly referenced in “A User’s Guide to Restructuring the Global Trading System”, written November 2024 by Stephen Miran—current Chair of the Council of Economic Advisers of United States—which outlines the general ideology and strategies behind the current tariff situation. https://www.hudsonbaycapital.com/documents/FG/hudsonbay/rese...

I'd believe that article more if Trump hadn't called on congress to eliminate the CHIPS act, or if tariffs+Musk hadn't undermined it, or if republicans were for the Green New Deal, etc. If you're interested in onshoring, the smart thing would be to work on a targeted approach in high-value areas.

It's a really complicated manoeuvre even if you're not actively trying to shoot yourself in the foot. Eg Domestic factors (automation, corporate offshoring decisions, etc) also contributed to manufacturing job loss. A weaker dollar would probably help, but isn't a silver bullet.

The main article for this post goes into this in a lot of detail.

Re: America underestimates the difficulty of bringing manufacturing back

#334

Earlier quoted context omitted.

I think the mistake here is the model of low-skill/high-skill labor is not a useful distinction. Manufacturing is high skill period, however there are low-infrastructure and high-infrastructure products and factories. The labor wages themselves are a factor, but an increasingly minor factor in product costs. By bypassing investment in US manufacturing skills and infra, the US sat itself on the sidelines for the abili…

Not disagreeing with you, but isn't the issue that the US stopped investing in the skills and infra which made mass-production low-skill in the first place? Instead, the offshore-destinations kept offering more and more services in the value-chain, until the entire skillset to actually create the low-skill labor processes to offshore was replaced with "let the offshore company manage".

Yes climbing the value chain was a necessity for nations like China. But in the US popularized in the 90's, was a business strategy trend that strongly discounted the value of long term capital investments - particularly for this discussion, investment in factories. They do require extra management attention and they do tie companies to strategies in longer time frames at lower margins - but they deliver long term value and long term synergistic growth benefits (in the vein of go slow to go fast). Many US business elected to chase short term growth, and short term and higher margins and minimize long term investments.

See a list of leading US companies that are off of being king of the hill - Boeing, GE, Intel, ... leading industrial US companies continually divested from manufacturing, or shorted long term investment, not because it wasn't profitable, but because it wasn't profitable enough in the moment. It took decades, and many dividends and stock growth was taken in the middle, but the shortfall manifests in time.

Re: America underestimates the difficulty of bringing manufacturing back

#335
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…

Do you think that global hegemony by force is long-term (centuries) sustainable at all? What makes you confident that this could ever work on a longer term? The US is only ~5% of people globally, and I would expect any industrial/technological lead to melt over the years unless there is a monumental, continuous difference in spending (like what the US military did since WW2). But I see no indication that you can keep…

I think "centuries", plural, is too long for anything much to last since the industrial era. I'm not comfortable guessing past 2032 even without any questions about AI.

The United Kingdom of England and Scotland didn't exist until 1707, and even that was sans-Ireland until 1800.

And yet, even with the biggest empire the world had ever known, WW1 could only be won with the support of another huge empire (France) and the subsequent arrival of the USA; shortly after this, most of Ireland became semi-independent.

WW2 was "won", again with huge support, but a pyrrhic victory from the UK's point of view, and India soon after became independent. The Suez Crisis was 1956, and showed that the old empires of the UK (and France, Union française) were no longer economically hegemonic — even when working together — and the US had replaced them in this role.

Looking into the future, there's no way to guess. The more tech advances, the easier it becomes for a single person to cause enormous, world-altering impacts: hackers are already relevant on the geopolitical stage; there's good reason to think that quality of life is directly related to how much energy a person can process, but once you have sufficient energy per-capita, it's not hard to use a cyclotron to brute-force the purification of weapons grade uranium, or to transmute depleted uranium into plutonium; simple genetic manipulation has been a standard technique for first year biology students for at least two decades, and can be done in a home lab, and at some point we will have risks from someone trying to use this for evil rather than decorative bioluminescence. All these things can topple a hegemon that spends its tomorrows looking at yesterday's battlefield.

Re: America underestimates the difficulty of bringing manufacturing back

#336
post #91

This pretty much mirrors what a friend of mine said (he is a recently-retired Co-CEO of a medium-sized manufacturing business). He's been telling me this, for years. It's not a secret. The information has been out there, for ages. I'm surprised that the administration didn't understand this.

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?

>What would you do to act against this?

Bloc building. Europe has countries which do lots of manufacturing. Use those to gradually reduce reliance on China by slowly restricting Chinese access to the Bloc market and build up supply chains inside the Bloc.

Making everything in the US can not be done without a very severe decline in living standards.

>Is doing nothing acceptable?

How high is your desire to learn Chinese?

Re: America underestimates the difficulty of bringing manufacturing back

#337

Earlier quoted context omitted.

Question: if the jobs were off shored, but the resulting profits were shared more equally, would Americans still complain?

I wouldn't expect "now that you've caught us we'll pay you to shut up" to go over well.

"Caught us" implies that the capitalists, the people who own the manufacturing plants, did something immoral, or illegal or under handed, but in the economic system that everyone championed in America, especially at that time, this was simply allowed. Seems like the fundamental anger is about the injustice of the economic system that leads to such consequences.

Re: America underestimates the difficulty of bringing manufacturing back

#338

Earlier quoted context omitted.

> Other than that it seems to be mostly good points, especially the overall one: you cannot do this overnight. It's annoying Americans were given only two choices - offshoring is great and let's keep doing it, and, as you say, the opposite, meth-fueled let's bring back manufacturing overnight. The kind of slow and steady protection and promotion of home-grown industry that China and most of Asia so successfully used…

This is the part that is so frustrating to me, and not just with regards to tariffs. It's that I see the extremes being so laughably bad (though not necessarily equally - I'm not "both sides"-ing this), and more ludicrously bad is that I've seen positions that don't follow these extremes as being derided now as "centrism". E.g. before the administration's attack on higher education, I do believe a lot of elite univer…

> making logical arguments in this environment feels almost pointless.

Unfortunately this is the culmination of social media as a controversy machine, that promotes the worst arguments.

> ideological purity tests like required DEI statements

Example?

There's a controversy industry that cherry picks the worst examples of student-politics excess in these regards and then carefully conflates it with university policy.

As well as the sad truth that as soon as you take away "DEI" requirements the segregationists come back and purge the library, delete all the black Medal of Honor recipients from the website, etc.

Re: America underestimates the difficulty of bringing manufacturing back

#339
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?

I would act against China - because China is making political moves that I do not like. (they are supporting Russia in Ukraine, they are building up to invade Taiwan, they are supporting terror in the middle east...) By acting against China that means I applaud moving manufacturing to Vietnam. I want to help Botswana grow - and I wish there were more countries in Africa I could name that seem to be on a good path (I…

What would prevent Vietnam or Botswana do make political moves 20 years down the line? Surely it is not their economic reliance on you, as China clearly demonstrates.

I see exactly zero point in repeating the example of China again. Why would the outcome be different? Vietnam is another Communist pseudo-dictatorship. Why is this one so different that it won't support Russia?

Re: America underestimates the difficulty of bringing manufacturing back

#340

I don't think anyone underestimates that, as much as some people with the author's viewpoints would like it to be true. To paraphrase Kennedy: "We choose to [bring back manufacturing]. We choose to [bring back manufacturing] in this [or the next] decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skill…

How many additional hours are Americans going to work? What pay cuts will they take? How many years later du they want to retire? These are the questions people need to ask themselves. We both know what the answer is.

Americans need to take pay cuts so we can bring back high-paying manufacturing jobs!

/sarcasm, or summary of other discourse in this thread?

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