A Little Ignorance And Malevolence, Comin’ Right Up

Earlier today, I wrote about a difficult conversation I had with a friend regarding American bicycle manufacturing. One of the commenters offered up this link to counter my “bullshit”.

Here at Riverside Green, we take our readers seriously, at least until they are unmasked as shibari addicts or serial fantasists. So I promptly went over and read the suggested article, which contains the following paragraph:

Given the abundance of facts about manufacturing’s strong position the US economy, why would anyone argue that it is even struggling, much less in decline? Other than ignorance or malevolence, I don’t have a good answer to that question.

Ah, but the writer does have a good answer to that question, and I’m happy to show you why.


We can start with his core point, quoted by totitan:

We are, right now, at the peak of industrial production in the US. The industrial production index peaked in December 2007, then dropped by 15% by the summer of 2009. It took five years to recover to a second peak in 2015. As the world economy dipped in 2015 and 2016, so too did US industrial production. We are back at a record level of industrial output. It’s worth noting that total US industrial production is more than twice what it was in 1979, when employment peaked. And yes, of course, that is adjusted for inflation.

Okay. that sounds like very good news. It’s even adjusted for inflation. It is not, however, adjusted for population. We now have 327 million people in this country, compared to the 225 million of 1979. Still, even when we adjust for population that is clearly more total industrial production per person than we had in 1979. This is great! Let’s return to the text.

Manufacturing employment, which all too many folks think is a good sign of the industry’s health, is about 1.5 million less than it was at the start of the Great Recession and about a third lower than at its peak month in 1979.

Oh.

Since about 2000, manufacturing jobs held by non-college graduates have declined by almost 45%, while manufacturing jobs held by those with a college degree are up nearly 17%. In net, all the new jobs and almost all the replacement jobs in manufacturing are going to college graduates. That trend accelerated during the recessionn

Does this mean that modern manufacturing jobs require more education, or does it mean that factories are picking Gender Studies majors over high-school graduates to work on the line? Either way it’s bad news.

Geographically, there was very little relocation of manufacturing between rural and urban places since the start of the recession. But the longer trend is far more disruptive, with nearly seven times the manufacturing GDP growth in urban American than rural America since 2000. That trend has returned since 2009. This is unsurprising, since that is where the new workers manufacturing firms need are located.
.
Economists call this agglomeration, but it looks like urbanization to demographers. Since 2001, 60% of all manufacturing GDP growth has occurred in just 10 cities, the smallest of which is about 2.2 million people. More than one in four metropolitan areas actually lost manufacturing GDP during this period.
.
The simple truth is that US manufacturing is doing extremely well and is enjoying record levels of production. At the same time, the places factories are located and the people who work in them have gone through epic change. The big winners in this transformation are college graduates with technical degrees located in large urban places. This trend will continue for the remainder of the 21st Century.

The author of this piece, Michael Hicks, claims that only “ignorance and malevolence” would permit someone to claim that American manufacturing is in decline. Well, sir, allow me to display both of those qualities.

I am ignorant enough to think that manufacturing is primarily valuable as a means to employ the citizenry and offer them a chance at a better life. I don’t give a shit if Scrooge McDuck’s Fully Automated Widget Factories are producing more widgets than ever before, enabling Mr. McDuck to upgrade from a Gulfstream G450 to a G650. In fact, the only people who could possibly care about that are McDuck’s fellow members of the investor class.

I am also malevolent enough to have no interest in supporting or promoting a “manufacturing renaissance” that doesn’t employ anybody but urban techies. Nothing against urban techies — the automotive hobby, and the magazines that cover it, depend on urban techies to some extent — but you can’t build a country on the backs of a privileged group of robot tenders.

Allow me to suggest a “simple truth” that Mr. Hicks willfully overlooks: Millions of jobs have been sent overseas since President Clinton signed NAFTA into law and renewed China’s most-favored-nation status. These were not all great jobs. Some of them were really crummy and depressing. My first wife took a summer job at the Dirt Devil factory in Cleveland once, assembling vacuum cleaners on a line. She didn’t last very long. But if we’d had children at that point who needed to eat, both of us would have high-tailed it back there.

The American middle class as we know it today was built on factory labor. This is doubly true for black families, which have been devastated by the disappearance of high-paying factory work. We often hear a bunch of duckspeak from wanna-be Paul Krugmans about how much regular Americans benefit from being able to buy cheap Chinese goods. How often does anybody have the courage to draw the line between the disappearance of factory work and the catastrophic collapse of the black family in America? What has that cost us? Is it more than we saved by being able to buy cheaper toasters?

We are also told that the manufacturing jobs have been replaced by other work in the service, retail, and hospitality sectors. Anybody with two eyes can see that this is a complete lie. Even if there were enough McJobs to replace the factory labor that made the American Dream possible for so many people, the fact of the matter is that not everybody is suited to work in those professions. If we really cared about human dignity and quality of life, we would have automated McDonald’s well before we automated the assembly plants, because this country is chock fuckin’ full of 90-IQ types who can put Tab A into Slot B like nobody’s business but who are utterly helpless when confronted with something as difficult to operate as a McDonald’s fry station.

Meanwhile, China has risen to a sort of frightening prominence on the back of a labor-and-manufacturing-related economic boom. They build everything and anything. Some of it is even built well. We find ourselves surrounded by Chinese goods, because having something made in China is so shit-simple even Instagram hookers can do it. We didn’t just give away the manufacturing — we gave away the infrastructure that supports manufacturing, which makes everything infinitely harder. In order to make something from scratch in the United States now, you basically have to be Cameron Weiss and devote every waking moment of your life to building the machines that build the machines.

So yeah, maybe manufacturing in the United States is doing just great if you’re in the business of selling F-35s to Israel or if you’re the mega-wealthy owner of a fully-automated factory. But all of that is just as irrelevant to the everyday American as the price of an Audemars Piguet Royal Oak Offshore would be. The fact is that we can’t operate a functioning national economy on the idea of everybody selling each other real estate, double-mocha lattes, and online advertising. Somebody has to make something. The “somebody” part is just as important as the “something”. Maybe more so. Call me ignorant, call me malevolent, but trust me: the real ignorance and malevolence won’t appear until all the jobs are gone. And then it will be, as the old man once said: solitary, poor, brutish, nasty, and short.

72 Replies to “A Little Ignorance And Malevolence, Comin’ Right Up”

    • Doug

      Yes, it will be turned around once we become a third world nation. Once our labor costs are down below the global standard then manufacturing will move here again. Unfortunately the way to this result will be no good for anyone.

      Reply
  1. Ronnie Schreiber

    Playing devil’s advocate, those F-35s require an extensive supply chain that’s still located in the U.S. I’d like to see some legislation that would require military equipment to use U.S. made electronic components (to make sure we can still make that stuff here) while still allowing for implementing improvements from technology firms in allied countries, for example some of the avionics developed by Israel Aerospace Industries (I recently found out that my big brother services IAI’s equipment).

    What concerns me is when you can’t get something made here because that particularly industry has been completely off-shored.

    It’s depressing how many people tell me that I should have the Harmonicaster made in China, even after I explain that the economics and logistics don’t work. I’m using harmonica components that are only made by one company in the world, in Germany. The pickups are custom made for me by Lace, in California. Those make up about 70% of my material costs and would have to be shipped to China if assembly was done there. No, there aren’t Chinese companies making the same things. I 3D print the plastic parts in-house (using Chinese filament from eSun – I’ve found their ABS+ to print very well, better than American filaments I’ve tested), and there’s about 2 hours of semi-skilled labor involved in assembling everything. Semi-skilled labor in China is about $6/hr. The finished product would them have to be shipped from China to the U.S. for further distribution. I just can’t see the cost of manufacturing reduced enough to make a significant difference in the retail price.

    I have a silly romantic idea that if it takes off I can lease space in Detroit proper and hire a small crew.

    For what it’s worth, because of regulations in California and the EU I did get a very nice Pace soldering station (made in USA) capable of doing a good job with lead-free solder.

    Reply
    • Athos

      You would be surprised to find out that you can build some injection moulds out of 3D printed bits. A local business did a demonstration @ the office a couple of years ago.

      Someone in Detroit may be able to shot them for you.

      Reply
  2. Justin Styer

    While we’re on the topic… I just bought a Speed Queen washer dryer set to replace my absolute garbage fancy pants LG units.

    Solid construction, great materials, and made and assembled here in the USA.

    Reply
    • Felis Concolor

      As a Dexter operator who also greatly admires the product coming out of Alliance, I commend your purchase.

      Reply
    • JMcG

      Thanks for this, I’ll be getting a set of these soon. I had no idea anyone still made washers/dryers in the US. Cheers!

      Reply
    • Wyllyam

      You ain’t kiddin. I replaced my 20 year old Maytags that my ex wouldn’t even take in the divorce with LG’s that beep, whistle, think, talk to your phone app, etc. They just crap out constantly with weird behavior. My 4 year old reached in and spun the drum backwards and it removed the belt of the dryer. There was no way for its brain to let us know what was wrong…call dial-a-wait for service, etc. I am done. Glad for the rec!

      Reply
      • -Nate

        The rental house we’re in after the fire has a front loader Whirlpool with stainless steel drum, it has more buttons than a 1940’s double breasted suit but works O.K. and actually cleans the grease, oil and dog hairs off my clothes pretty well .

        I dream of the day I can afford a Speed Queen stacker W & D combo.

        -Nate

        Reply
  3. -Nate

    Another priceless and FREE bit of education for those who’ll actually pay attention .

    Jeezo-Peezo am I glad I have water tastes to go with my (cheapo, low grade) Beer budget….

    -Nate

    Reply
  4. totitan

    I am neither a Serial fantasist or a Shibari addict. For you to refer to me as such seriously pisses me off. I normally refrain from name-calling, however since you started it I will return the favor. You are a simple minded trumpbot who disguises yourself as a hipster with your long gray dyed hair, your hundred pairs of expensive shoes, and your collection of silly watches. You are so wrapped up in your Dogma that you apparently haven’t noticed that the US unemployment rate is only 4%. You are skilled writer and have the ability to fool a lot of people however you will never fool anyone who knows the facts.

    Reply
    • Ronnie Schreiber

      Karl Popper laughs, ruefully. You misunderstood what Jack wrote.

      “Here at Riverside Green, we take our readers seriously, at least until they are unmasked as shibari addicts or serial fantasists. So I promptly went over and read the suggested article, which contains the following paragraph:”

      He took you seriously, so he checked out the article you cited.

      One factor in the unemployment rate being low is the large number of men that are no longer even bothering to look for work. Unemployment in Wayne County, Michigan, home to Detroit, is just 4.5%, close to what is considered full employment. Do you really think 90%+ of the men age 18-65 in Detroit are gainfully employed?

      Reply
    • safe as milk

      the u.s. unemployment rate is a manipulated political talking point of very little statistical value. the statistic that really means something is the labor force participation rate. it measures the percentage of americans 16 years old and over who are employed full-time.

      here’s the chart:
      https://data.bls.gov/generated_files/graphics/latest_numbers_LNS11300000_1948_2018_all_period_M02_data.gif

      i got it from the bureau of labor statistics. they have a very nice calculator for such things here:
      https://data.bls.gov/pdq/SurveyOutputServlet

      as you can see, labor force participation peaked in about 2000. it’s been downhill ever since. for the last couple of years, we have been at 1970s levels. it’s important to remember that in the seventies, women were not fully in the workforce and a higher percentage of families were supported by one wage earner.

      Reply
    • roamer

      For you to actually repeat that official 4% unemployment rate with a straight face makes you….a serial fantasist, really. That media reported rate is known as the ‘U-3’ rate. It was debunked many years ago. The real rate is the U-6, and correlates to 175-200% of the U-3 rate. Of course, as you’re a troll, I assume you know this. But for anyone interested in reading more, google ‘real unemployment rate’. The Quartz and thebalance articles are both good; don’t waste your time with the fivethirtyeight article.

      Reply
  5. Nick D

    As a young, fresh-from-a-top-10-business school grad in finance at an automaker, I inwardly – and naively – chortled at the UAW posters bemoaning the loss of skilled trades and the associated impact on US manufacturing and warfighting ability.

    The UAW was right. I have an accutron watch in my meager three-digit total value watch collection. It uses a hair-thin wire to turn gear teeth so fine they cannot be touched, yet robust enough to survive outside an SR-71 pilots space suit and was made in the slide rule and cigarette era in the US.

    Those wheels can’t be reproduced because no one knows how.

    The UAW was right – I’m scared to think of what this loss of skilled and unskilled (but still skilled) labor means for our long term security. I’m lucky enough to race with a real tradesman and few things are more meaningful to me than bringing him tools, watching, and learning.

    Reply
    • Eric H

      There’s no such thing as “they can’t be reproduced because no one knows how.” I bet I could make them in my garage, it’s done with lithographic masking and etching and is trivial with modern methods. I suppose you’ve never heard of MEMS devices?
      I agree that the loss of skilled trades would be something to mourn, but no such thing is happening. There may be fewer practitioners and they’ve migrated away from “simple” tasks such as automotive manufacturing and migrated to other more demanding industries. The knowledge and skill it takes to make a modern EUV lithographic stepper and the semiconductors that it produces dwarfs just about everything else the human race has done so far.
      The ability to manufacture precision items at any scale has never been greater and at the same time has never required fewer people to do so.

      Look at a company like HAAS Automation. They make heavy CNC machinery in California and export it to the whole planet. The factory jobs that have gone away are not the highly skilled ones. Anything that can be improved by automation will be, it’s how these things have worked since the dawn of domestication of farm animals.

      Reply
    • MrFixit1599

      Unions ruined our manufacturing industry. I’ve been to the Celina OH plant that Huffy used to be made in, another that used to make Zenith TV’s, another that used to make Maytag washers and dryers. Hell, the office I work out of used to be a manufacturer of mining equipment. All of them closed down, moved out of country, or forced into bankruptcy because they could not afford the demands of the unions.

      There was a point and time for unions, but you can’t tell me anyone thinks that finding out the union is “protecting” a worker that is drunk and or stoned has a valid point. DO YOUR JOB.

      When I walk into a UAW plant, and it takes me 3 times as long to do my job as it should, at 150 an hour, that’s an issue. It’s basic maintenance.

      I get it if you are in some union that protects you from everything, but all that protection comes at a cost. I believe eventually unions will eventually go away, or collapse in some way.

      Then again, maybe it wont. All the damn snowflakes that can’t keep a job on their own accord, and need a union to help them keep their jobs after they get a paper cut on their finger and need 3 days off to recover. Once that happens they will gladly pay more dues to the union to save their job for them.

      Then again, you could just DO YOUR JOB. Seems a rather rare thing to actually happen in #THECURRENTTIMES.

      Reply
      • WheeTwelve

        On one hand, I agree 100%. On the other hand, I look left, I look right, and I see companies dumping employees just to outsource the work overseas.
        I read a very good article yesterday, which talked about IBM laying off their senior (50-something) employees, and replacing them with younger (20-something) employees, usually overseas. Main reason? Cost-cutting.
        So, I agree 100% with the DO YOUR JOB mantra. Yet, at the same time I have to wonder who can and will speak for these people who are getting laid off for no reason other than their experience and seniority. In a way, they are getting laid off BECAUSE they have been doing their job.
        I wish I had a solution to this problem, at least in part because similar fate probably awaits me in the future. But I have no solution. Giving unions too much leeway leads to abuses you write about. And not having unions gives corporations freedom to abuse the employees. Does anyone have a solution? Is there a solution?

        Reply
        • Eric H

          IBM isn’t really a good example, they’re swirling the drain and trying to get the executives their bonuses before it all goes down.

          Reply
      • mopar4wd

        Income gap looked a hell of a lot better with unions then without. I think they need tweaking for a proper balance but they do seem to be one of the fixes to what troubles America.

        Reply
    • roamer

      Questions of cost and complexity aside, I can’t see Israel buying a fighter that has not yet been able to fire it’s cannon successfully while in flight.

      Reply
  6. silentsod

    What’s recently come onto my radar is how damn hard it is to figure out where food products are made these days. How strange it is a can of chickpeas isn’t labelled with country of origin and trying to find out where they come from gets you a nice tale of a company’s “guaranteed quality level, we’ll never have this long list of chemicals in our foods.” Uh huh, sure.

    Reply
    • Felis Concolor

      I’m still wondering if the current political situation is preventing me from easily obtaining a supply of blue salt which is exclusively mined in northern Iran. A decade ago I could find it on any Safeway or Kroger affiliate shelf; now I’m down to my last few grams and may well be forced to make an international mail order.

      Reply
      • silentsod

        There’s “Persian Blue Salt” on Amazon and you might also try local spice shops. I live nearish a couple hoity toity towns which have plural dedicated spice shops and upscale cookware businesses which carry salt varieties though I usually don’t pay too much mind to them.

        Reply
    • Disinterested-Observer

      I think the same thing whenever some so-called organic produce is produced in a third world country. If a country is bright red on Transparency’s CPI map for important stuff like not being disappeared by the government how can you trust them to make sure your tomatoes aren’t covered in mostly harmless poison?

      Reply
      • stingray65

        Organic is the biggest scam in the food business. There is zero evidence that it offers any health benefits or tastes better, it requires at least 25% more land to grow the same amount of food (goodbye wild-life habitat, hello higher food prices). Then you have the people that think organic is better for the environment, but that is very debatable, particularly considering the carbon footprint when “organic” corn is grown in Turkey and shipped to the US to feed “organic” pigs and cattle. And then consider the extremely low likelihood that the “organic” corn from Turkey or “organic” anything from China is actually grown organically and you end up paying a big price premium for absolutely nothing.

        Reply
        • sabotenfighter

          Not to mention that a lot of organic pesticides are known for being horrible to bee populations. That’s one I like to throw into the face of “NO GMO! I only feed my dog a fully organic, vegetarian diet” types. I think the assumption is that organic=natural and therefore good for nature. Hardly the truth at all.

          Reply
        • DirtRoads

          I work in the aviation business and one thing the agricultural spray operators all tell me is they loooove the organic farms. Why? Because they have to spray them almost twice as often as they spray the “chemical” farms to produce the organic food.

          I dunno — I don’t think a plant can tell the different between nitrogen found in the soil or nitrogen from a pellet dropped nearby.

          Reply
  7. MIke M

    Bravo!
    This is a solid piece, it felt like Paul Harvey telling “the rest of the story”

    The thing is that anyone can cherry pick stats to prove their point and/or find a narrative that has been published that backs up their point.

    I have a couple of “back of the envelope” observed escalations since NAFTA, the astronomical opioid problem throughout the country and the rising mortality rate of middle aged white men. The opioid issue effects all facets of the population and the suicide rate is in a non protected segment of the population. Any employment lawyer can go into detail about the protected class of employees. This is a small chunk of the people who are not calculated in the unemployment number, there are others too. If the unemployed number included all able bodied people in the monitored demographics I am certain the figure would be much higher. NAFTA is only a small part the opioid epidemic, there are so many other facets contributing to that crisis.

    My point is that the stats say the economy is booming and unemployment is low but there are many people out there that do not have the mental or physical capability to hold down a corporate job or one of the new economy gig jobs. These folks are looking for a rote unskilled stable job that will enable them to live a modest life.
    I am sure i can find a stat or article to back this up, but all i have to do is look at the labels of the things I use every day. 85% of those labels say Made in China and the bulk of those products once had a Made in USA label on it years ago. Those products were once made in a factory here employing someone here and now those jobs are gone. Hopefully this will start to change to benefit us, but there is big money in play to keep things status quo.

    Reply
  8. Will

    Totally off topic, but Farago just sold TTAG. A large minority are already comparing it to TTAC. I’m surprised that many people were readers of both.

    Reply
  9. safe as milk

    china did pull it self out of poverty largely with the help of cheap factory labor. no doubt, our jobs were exported there and nothing has replaced them. however, i believe the real question going forward is how much of manufacturing will be automated.

    i think the future is going to be “privileged robot tenders” whether here or in china. there really isn’t going to be much use for unskilled labor anywhere.as robbie shreiber pointed out, labor costs are a relatively small part of manufacturing costs, in an automated factory. i think the logistical advantage of having the manufacturing in the u.s. vs. overseas could offset a lot of the higher wage rates here.

    what the neo-liberal economist refuse to acknowledge is that globalism only works when the pie is growing and the pie stopped growing at least 10 years ago. in this environment, we need to work harder at holding on to our share of the pie.

    Reply
  10. JustPassinThru

    While I share your annoyance at mindless cheerleading, led by skewing of statistics and obfuscation of raw data…I take exception to the assertion that one primary value of manufacturing is to “create jobs.” That is a side effect of manufacturing; it’s also a distraction, and in our litigious world, it’s a danger.

    Someone running a small business who can handle all work, whatever it is…cleaning pipes and drains, or building computers on a bench, or catering weddings…can control all aspects of his product or business. Once it expands to where outside help is needed, now there’s the dynamic of bureaucracy, and control of work-quality.

    Paying someone to work, is not beneficial to the business. It’s overhead.

    Hiring a body when a machine would eliminate the need, is a complication and eventually a cost. Should a project manager hire a hundred men with shovels, to dig a trench for a sewer line?…or just one man and a helper, with a Deere shovel?

    The auto business is rife with failures that came from treating manufacturing as a jobs program. One of the better-known, more-obvious, was that of the Yugo. Malcolm Bricklin and his subordinates were astounded at the number of men on the factory floor, used to (slowly) make the Zastava/Fiat. Of the inefficiencies. Of course, the Yugoslavian government wanted as MANY, not as few, bodies as possible on the job – political success. But it had one person whose job was to take the mis-designed wiring harness for the rear liftgate, CUT that piece of wiring, install it to power the rear wiper, and then splice it back together again. With a 20-percent error rate.

    Replacing that job with a properly-designed piece would have abolished a job – and that, repeated dozens of times, cut the man-hours to make a Yugo by about 30 percent. And would have had Party commissars damning whichever official mandated it, the better to demonize him.

    It happens in private business, too. Studebaker, in its last years, was unable to make a car profitable – in boom years for car sales. The antiquated factory, complete with outdated procedures, cost the company what could have been profits.

    In my own industry, railroading…from the time of steam power, trains had five-man crews. Engineer, fireman (to stoke the firebox) conductor in the caboose, and two brakemen. Trains were stopped by brakemen climbing to the tops of freight cars, on a moving train, and winding down brake wheels. Fun times, hey?

    George Westinghouse’s air brake put an end to that, but the brakemen remained on the job. They’d assist the conductor and fireman in their jobs.

    Diesel power put an end to the need for a fireman, but the fireman’s job stayed. Unions threatened strikes and violence if any move was made to cut ANY of those jobs. So, there’d be three men sleeping on a train at any given time.

    THEN, radio-controlled rear-end air-pipe reporting devices that transmitted motion, and air pressure to the engineer, and could activate the brakes in an emergency…ended the need for a caboose. At that time, the railroads were frantic to get rid of the highly-paid, useless extra men on trains.

    They did go. In the space of two years. The unions gave up trying to rationalize the extra men – and a lot of those men let go were in their middle years, with no other career options. Their lives were ruined

    …and it need not have happened. Had the crews been hired and kept according to NEED, not UNION POLITICS, their lives would never have been thrown into chaos. Many of them would not even have been hired – they’d have trained for other work when young.

    No, make-work is not the purpose, nor a valid function or reason, for industry.

    Reply
    • Disinterested-Observer

      Yes but a healthy and happy citizenry is the point of a representative government. There is no reason to incentivize the destruction of your own country through tax and trade policy.

      Reply
      • Eric H

        Our “Representatives” haven’t cared about the citizenry in a generation or two.
        Their only incentive is self-enrichment.
        When you have unlimited campaign spending this is what you get.
        I’m also surprised the current administration hasn’t repealed the STOCK act.

        Reply
      • JustPassinThru

        Free trade is not incentivizing destruction. On the contrary, punitive tariffs have ALWAYS cost consumers money – directly or indirectly. Tariffs are barriers; demands for punitive monies which in the end are paid by those who ordered the goods. And ultimately, consumers – businesses pay no taxes. Businesses are just organizations.

        Customers and shareholders pay taxes.

        The last time the United States used punitive tariffs was in 1930, with Smoot-Hawley. That took the situation of the time, a stock-market correction, which is a normal part of the business cycle…and turned it into a depression, deep and lasting. It also launched retaliatory tariffs, and the hostility and breastbeating gave political credibility to three dictators overseas.

        Let’s get one thing out: Not all trade is equal. Free trade with free people, rich or poor, is a win-win for all partners. Trade with slave camps, such as the Chinese FOXCONN plants, where shop-floor suicides are frequent…that is not free trade. And that door should never have been opened; and closing it will take more political capital than even a determined President may be able to muster.

        Free trade with other free or relatively-free people, is something that benefits all. If the trade flows more in one direction, the thing that’s needed is to figure out why. And to remember, these trends reverse. Remember when Nissan and Toyota and Mitsubishi were all building AMERICAN plants? Because Japanese labor, once as cheap as China’s is now, became, with their advances, more expensive than even UAW labor. So, with Rule of Law and stable money and property protection, foreigners invested here.

        That could all disappear in a trade war. In part it already is, with the War on Industry using the EPA as shock-troops.

        Rationalizing environmental laws, reducing corporate taxation at least partly (because customers, not corporations, pay taxes) and generally making it easy and welcoming to open American plants…these could have launched a nationwide economic boom.

        Maybe that chance is missed, but we can at least avoid repeating the smoking ruin of Smoot-Hawley and the Depression.

        Reply
  11. Tyler

    A guess, Jack, regarding the hiring of college graduates for what is probably semi-skilled labor at heart: education level probably tracks pretty well with the ability to pass a drug test. (“Pass a drug test” – not “be sober”.)

    I’ll add that even front-line labor work anymore involves a fair amount of computer-based documentation in what is almost always a clunky-and-getting-clunkier database UI. Otherwise-qualified individuals who can’t handle 15-step counter-intuitive “input and retrieve information from a computer” functions get bounced quickly.

    Reply
  12. galactagog

    agree….and that’s not the only big problem with cutting train crews down to the bare minimum

    from:
    https://en.wikipedia.org/wiki/Lac-Mégantic_rail_disaster

    “Freight trains operated by MMA were allowed (not “permitted”, see below) by regulators in Canada (Transport Canada) and the United States (Federal Railroad Administration) to have Single Person Train Operation (SPTO, alternately OPTO) status (1 operator). The “permit” process, which requires public input, was not followed. The Canadian regulator and the MMA entered into a negotiation process at the culmination of which, sometime before the second week of July 2012, the government allowed MMA to reduce their manpower to SPTO. An average of 80 tankcars per train was carried on this route[27] under the supervision of one person only. The Maine regulator had already allowed SPTO status before the first week of April 2012.[32][33][34] The use of SPTO for MMA freight trains was a cost-cutting move for which the railway company has received much criticism. In May 2010, former MMA engineer Jarod Briggs of Millinocket, Maine explained to the Bangor Daily News that “so much could happen in a 12-hour shift on one of these trains, such as a washed-out track, downed trees or mechanical failure. What if the engineer onboard were to encounter a medical problem? Who is going to know about it? If there is a fire engine or an ambulance needing to get by a train or a crossing when that happens, it could take hours.”[35] Briggs left MMA to work for another railway in 2007; while he described the lone crew member involved in the Lac-Mégantic derailment as “a very good engineer, one of the better on the property”,[36] he has long expressed safety concerns about the company’s overall train operations because “if you have two people watching you can catch a mistake. It was all about cutting, cutting, cutting.”[37]”

    Reply
  13. MrGreenMan

    Fred Reed used to describe bad public school teachers as “those unfit for anything but farm or factory work.” Old Fred reckoned 90% of Americans fell into this category.

    25 years ago, Mr. Clinton and Mr. Limbaugh both sold us on the vision that the entire population would be lifted up because “even if they [foreigners] are making the compact discs, we will be making the intellectual property that goes on those compact discs.”

    Today, we don’t do either, and we still have Fred’s 90%. America has pursued policies predicated on the idea that such people can be transformed, re-imagined, hammered into a different hole, pacified by welfare, or otherwise eliminated. Fact is – these are our people. Work with some of the H1B people and realize that, although they view technical work as a path to riches, they’re rigid in their thinking, brittle, and scared little rabbits most of the time – so the world only has so many people of particular types.

    As Mike Rowe has shown us over and over again, that “farm and factory” work is the thing that makes a society work. The Romans built aqueducts and bridges that still exist and deliver clean water and safe sanitation and worry-free travel; America’s got Flint water and Miami bridges.

    And, as we saw with YouTube yesterday, if you push people hard enough and do not permit them to make a living, they will bite you back.

    Reply
    • Daniel J

      Sure, stuff needs to be made. Should we hire folks just for the sake of hiring? Just look at construction. Basic mechanical and technological advances have been made over the years to which has reduced the overall workers to build a house. I can get software and hardware completed in half the time as it was 1O years ago because the hardware is faster, compilers are faster, and software languages have improved.

      Should private companies be inefficient just to put butts in seats?

      Reply
      • One Leg at a Time

        This is my wheelhouse – manufacturing and construction – both of those industries are desperate for workers, and eVerify means that the manufacturing jobs are not available for those workers without legal documentation.

        I framed my way through college (houses). It still takes a crew of 4-10 to build a house – the pace of building may be faster or slower, but the jobs are still there. Sadly you can not find people to do all of the open jobs. My brother is a small Roofing & General Contractor (two crews, about $1MM annually), he struggles to find enough people to fill those crews (skilled or willing to learn).

        As far as factory jobs, I can’t speak to everywhere in the country, but i work for a company with around 50 food manufacturing plants in about 20 different states. Every single one has open operator / laborer positions. Every single one has open maintenance positions. Most have one or two open supervisor and quality technician positions open (those tend to require a degree). We don’t just struggle to find qualified people – we struggle to find unqualified people who can pass a drug test and show up for more than four days in a row. I have plenty of peers/friends in other industries with similar problems.

        We tend to say that 4% unemployment means that everyone who wants a job has one. I think part of the problem is the bad rap that manual labor has gotten. Maybe people would rather be on public assistance, than work hard. I was at a job fair last week – we handed out 200 applications. If history is any indication, we will get less than 10% of those back, and may get one person who will show up. (A job fair counts toward the 20-hour work requirement for benefits…)

        The problem isn’t a lack of jobs – it is finding people who are willing to do the jobs that are available.

        Reply
        • dejal

          My cousin co-owned a machine shop. He would hit all the local Voc High Schools looking for graduates. He’s get recommendations from their teachers on who might be a good fit. He would give up to $60K a year to start.

          Most, said “Nah, sounds like too much work. I can get a easy job and if I lose it, I can collect”.

          Makes you wonder why they went to a Voc High School in the first place. I know years ago, they were considered dumping grounds for the “Not college material”. But 60K to start? No college? No college debt?

          Reply
          • -Nate

            ” But 60K to start? No college? No college debt?”

            Holy shit ~ I have lots and lots of training but never made anywhere near $60K / year in my entire misbegotten life .

            Maybe I should have been a Machinist/toolmaker .

            IMO, not enough Americans are ever hungry .

            I was, cold and wet too so I dug ditches, pulled tits and shoveled shit ~ anything to eat and have a place to sleep .

            -Nate

          • dejal

            This is to Nate Below. There’s no reply click under him.

            His shop did a lot of contract work for GE and Pratt + Whitney (UTC). A lot of small fiddly space shuttle parts were sub-contracted out to him. Not a lot of 2nd chances if there is a “Oops”. Not a big run of any specific part either where you make 200 flanges all the same. More like, make 1 of these and 2 of those and 3 of them.

            So, you pay, but you have to have some talent. He would always complain about getting competent help.

            This is in Western Massachusetts. Everything costs, not Boston prices, but this is a higher wage area than a lot of places. That has to be taken into consideration. $60K is “nice” but won’t make you rich. Move 80 miles east and 60K isn’t “nice”. I know a lot of people would sell their 1st born for that kind of money but location comes into play.

            Mass. is also the place where the state police can make up to $150K with overtime and cheat on the overtime. Some of these staties make up to $300K. There’s a current scandal on that. The 300K is for the connected who “work” Logan airport. I think there are 30 cops that were/are in that range.

            When caught cheating, they can usually retire with a full pension. Most pensions are $100K for life.

          • mopar4wd

            Yeah central CT and western mass have a lot of precision machining and small component manufacturing still. And they do tend to pay reasonably well. It’s just hard to get kids interested in manufacturing. Now I don;t know anyone starting that high but most start in the 35-45k a year range and go up from there. I had a friend who worked for a spring company made like 40k a year out of high school but also got 4 weeks a year vacation, good benefits and quarterly bonuses when they made target of a round $1,500 that’s a damn good deal. He moved to Texas but I gather he still does tool and die work and makes a good living at it.

          • -Nate

            Thanx Dejal ;

            I’m a (damn) Yankee born & bred, I lived in and around Boston in the 1960’s, I’m aware of the higher pay and living co$t$ there .

            I also clearly understand the difference between the average parts changer ‘mechanic’ and a well trained Machinist , one who not only knows his work but consistently does it correctly .

            I was hyst making wishful comments, although I take the Mechanic’s job very seriously, I have no idea if I’d make a good Machinist or be like those guys in India…

            -Nate

        • Dirty Dingus McGee

          “The problem isn’t a lack of jobs – it is finding people who are willing to do the jobs that are available.”

          This, right here^^^.

          I have a world of trouble trying to get competent people. Or folks that will at least show up on time, and act like they give a flip. I can’t even begin to count the number of employees we have terminated, due to them seeing no problem with getting puking drunk on a Tuesday night and laying out Wednesday ( with no call to let you know). We run a tight crew on out of town projects. We bring enough skilled help to do a job in a certain time frame. That 8-10 hours we lost each time someone lays out, has to be recovered somewhere. So if over the course of a 21 day project we lose 40 hours due to no-shows, where do I make that time back? In the end, it’s myself, my partner, or often my foreman that has to pitch in (and sometimes work into the night) to make that time back. Then after a couple of these drunken no-shows happen, and the person is terminated, now I’m a miserable asshole that doesn’t give a shit about the working man. As I’ve told several over the years; “you apparently don’t give a shit about this job so why should I give a shit about you?” And if they keep pushing my buttons, they will find themselves at the Greyhound station, not the airport, as their transportation home.

          Reply
          • -Nate

            Amazing .

            I’ve worked more shit jobs (literally) than you can imagine and never been late once .

            I know poverty and hunger up close and personal, these snowflakes don’t apparently .

            In my last job I watched the lazy, dishonest and thieving asshats promote then make life miserable for those underneath them that they could .

            I was asked more than once to promote but I didn;t want to become a miserable sod like 99 % of my superiors .
            Told them so and didn’t make any friends although everyone came to me for problem solving right until I retired .

            Maybe I shoulda set my sights higher .

            I hated being a boss, my partner insisted on hiring the layabouts I knew from High School, they were to a man useless, why I said ‘DO NOT HIRE THESE LAZY BUMS ! ‘ .

            As soon as I left that shop they all ripped him off blind .
            Drinking buddies are never any good for anything else .

            -Nate

  14. Stingray65

    So you want to start/buy/run a business that makes stuff? Is it potentially “dirty” business or product? well then you need to spend 3-5 years doing an environmental impact study and going to court to fight the EPA and the Sierra Club and Greenpeace that don’t like your business plan. Going to need some labor? Well you are going to have to pay them $12 to $15 per hour minimum wage no matter how little experience they have or how trivial the job. Over 50 employees? Well then you are going to need to give them health insurance, which will cost you $7-10,000 per year per head. Is a union involved with the workers you need? Well then you can expect to pay extra in regular and overtime pay when times are good, you won’t be able to fire anyone for poor performance or economic downturns, and unplugging your welder will require calling a union “electrician” to unplug it for you – otherwise a grievance will be lodged. Can a worker or customer be hurt by your product? Well, then you better make sure everyone gets drug tested, and of course you will need to spend millions testing the product for quality defects in design and materials to reduce liability and comply with safety regulations. Wait – the drug testing will disqualify 50% of your workforce? Well you certainly can’t fire them because of those union rules, but you can put them in rehab programs. Wait – the insurance company just jacked up the health insurance because of all the rehab claims? Is your product in the tech or heavy industry fields? Well, the department of labor is making threats because your workforce doesn’t represent America, why is only 15% of your workforce female, and where are people of color (Asians don’t count), gays and transgenders? Looks like you will need to pay a fine for your poor hiring decisions, send all your management to a 2 week diversity sensitivity training course at $15,000 per person, and hire a full-time diversity director for your HR department at $150,000 per year.

    On second thought, maybe I’ll just outsource production to China, or stick to a business that doesn’t make anything tangible like a phone app.

    Reply
  15. Darren

    As a fan of being tied up in uncomfortable positions, I take offense to this article. Or at least the second paragraph.

    Reply
    • -Nate

      “As a fan of being tied up in uncomfortable positions” .

      ? You’re an Imported Automobile mechanic ? .

      -Nate

      Reply
  16. Daniel J

    So what’s wrong with technical degree requirements to hold a job in manufacturing? Nothing priveleged about my technical degree at all. Simply put, as a libertarian, if that’s what the market demands, so be it. I guess folks are only pro free market when it suits them. Just like every other big business. We want to reduce regulations (libertarian) but we don’t want the market dictate job requirements (anti-libertarian)?

    Reply
    • dejal

      Still doesn’t answer the question of what do you did with the “Surplus” workers, libertarian or not.

      I suppose if you are out of work long enough you volunteer to be Soylent Green.

      A true libertarian society would let the surplus die. They can’t fend for themselves as that would entail most likely breaking laws to survive. Welfare isn’t a libertarian point of view as far as I know.

      Pay me now, pay me later. We are in later.

      Reply
    • Jack BaruthJack Baruth Post author

      In a true libertarian society, though, you wouldn’t have systematic government incentives to send production overseas. The United States is only libertarian insofar as it relates to the privileged multinationals. Everybody else lives with laws that distort their market and their lives.

      Reply
      • dejal

        True.

        I need a mini PC in order to work from home. The current HP (about 6 years old) was made in China and is falling apart. I already have plans for an Office Space re-enactment. I’ve already bought a mini PC (BeeLink) from China and velcrod it to the back of the big screen for just screwing around.

        Just because HP + Dell are “American” doesn’t mean their products are “American”. If it is good enough for them to wave the flag but buy from China, I see no reason as to why I can’t also buy directly from China. Licensed Windows 10 in the $190 – $300 range. A Dell or HP logo and “Support” probably costs an extra $150. Which is probably off-shored to India.

        But, you say, Buy from a shop that custom assembles them. Where are the parts made? China.
        Considering these things are for the most part one circuit board with maybe a M2 SSD drive there’s not much to assemble.

        Do I feel great doing this? Not really.

        People have to do something. I don’t know what the something is. I’m pretty sure that the “Elites” don’t really know either. Just kick the can down the road until they get theirs.

        Reply
      • Daniel J

        I agree to some extent but I’d be curious as to what government incentives you are talking about? What about the state and local incentives to keep jobs here? Like the new Toyota/ Mazda plant they are getting ready to build just down the road from me? What about the incentives given to Remington just a few years ago just to watch them never meet their employment promises and now go bankrupt? Our governments (and tax payers) give plenty of incentives to build here.

        We either have to deregulate to meet China’s lax environmental and working conditions or we as Americans, as consumers, have to drive production here by not buying Chinese made products. Neither will happen.

        We want production, but “not in my backyard”. We refuse to pay what people want or need to be paid but we are more than satisfied with Chinese children or deplorable conditions just so we can buy the product on the cheap.

        Consumers ultimately drive the market in both purchases and in policy.

        Reply
  17. Danio

    No one actually wants to pay more for their stuff, though. Y’know, my grandmother didn’t leave the house to work. She stayed home and darned socks. My wife pays $5 for a big bag that we promptly toss when they get holes. There’s a niche for more expensive stuff for nationalists to wave around, but the average person enjoys their higher real wages that the $5 socks provide.

    Reply
  18. tyates

    Jack, you get a thumbs up from me. I spent some time in Singapore while getting my MBA and saw some manufacturing plants there. Singapore workers are actually fairly expensive in global terms, so its the pro-business low tax environment and access to infrastructure that makes it very attractive for multinationals. Also labor costs are generally low for most manufactured products so whether a worker costs $1/hr or $10/hr makes surprisingly little difference in many cases.

    America doesn’t have a manufacturing base – other than military contractors as you say – because the powers that be decided it didn’t want one and put a specific set of incentives in place that made that a reality. Multinational corporations are designed to find opportunities in different markets – financial, labor, product, regulatory, etc – and make the most of them. It is always better to be a multinational than a national because it gives you more options. However, nothing is stopping the US from incentivizing multinationals to set up shop in the US and sell out, rather than the reverse.

    Reply
  19. Tom Daley

    I’ve worked in Vehicle Assembly.
    An example: fitting AC and brake lines into the engine bay. Used to kill my back. Later cars went to a front end module so you could walk into the engine bay instead of leaning over the arches. My back no longer hurt, but my station lost one guy…make of that what you will.

    Reply
    • Athos

      Assembly methods have changed a lot. PD has now to meet plenty of ergo requirements and the PE/IE guys are a bit inflexible.

      The guy in your station may have landed where the FEM is put together… assuming that is still built in-house.

      Reply

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.