I am steadily moving into the “protectionist” side of the aisle with regard to the American economy. As the Richmans write in the book “
Trading Away Our Future“:
The financial flows that sustained these deficits did not go to expand the U.S. capital stock – they mostly financed consumption of foreign goods,” they explain. “Japan and China and other Pacific Rim nations stole industry after industry from the United States. America’s manufacturing investment declined so much that by 2004 and 2005, net investment in American manufacturing actually went into negative territory, meaning that U.S. manufacturers were not even investing enough to replace wearing out machinery and plants.
The U.S. manufacturing workforce declined steadily, so that by 2007 over a fifth of the U.S. manufacturing jobs that would have existed given balanced trade had been lost. Those losing their manufacturing jobs often took less skilled jobs in the service sector, causing media wages to stagnate. In 2007, the United States was in a much weaker position to compete in world markets and the dollar had nowhere to go but down.”
Repeal NAFTA? CAFTA? I’m thinking this is a good idea. Moving towards protectionism? I’m starting to go there as well.
First, we go out of way in this country to punish success. And businesses, whose job it is not to be the government, still have to operate within budgets and cannot “print” money and simply stray into deficit territory for years on end.
On the other hand, how is it can American businesses and American industry can compete with what are, essentially, slave wages in other third, fourth and fifth world countries? How can America compete with its own school of sharks waiting, just waiting, to sue businesses large and small over the slightest grief or affront?
So what’s the answer? How can we bring industry and business back to America? How can we become more commercially independent? How can we regain that industrial powerhouse that was once the United States of America?
BZ
The fact is that the tendency to lower quality or industrial improvement to protect investment is not new, and precedes Nafta, Cafta and all the other “tas”. I remember when airlines first began to really impinge upon the Railroad control of passenger traffic. Did American Railroads do as did European and Japanese railroads and make the trips faster, more convenient and more enjoyable. No they did not. They did a fast count and saw that more profits were coming from freight than passengers and they deliberately sabotaged the passenger traffic; Putting passenger trains on the siding to wait for freights to pass, etc. I was working for the railroad in the fifties when carmen would come into the lunch room so disgusted because some boss would not allow them to service the airconditioning. Passengers who didn’t like the heat they would stop taking the train and the railroad could haul freight with more profit.
After a while passengers got so frustrated they went to congress and the abomination of mechanical misegenation called Amtrack was created, but to the railroads freight is still king.
American “industry” and economy has become heavily reliant on information and “service”. The problem with information and service is that it is worthless after it has been sold the first time, unlike a chair. Even a poor quality chair can be used a second time and a high quality chair can last for decades even centuries sometimes even INCREASING in value. Information or service after the first use and sometimes even before the first use is outdated. How much would you pay for Tuesdays newspaper or sales numbers for a product that is no longer sold? American industry focuses WAY TOO MUCH on units not chairs or tables. If you ask the head of Ford or GM they deal in units NOT automobiles. No wonder they are loosing market share and have to give people thousands to buy one of their units.
3S10: yup, freight will always be King. I’m a rail devotee also and have seen what happened in my area with SP and its digestion by Union Pacific which, in 1996 when it “ate” SP, completely locked up from the meal. The chemical coast shut down, the Roseville hub locked up, pretty much everything gridlocked. As some SP guys told me, UP stands for Utterly Pretentious.
WMD: Wow. You have hit upon a major, MAJOR component of industry. Way to go, you knocked that out of the ballpark and I hadn’t even thought of it in those terms — but you are absolutely correct.
BZ
Repeal NAFTA, CAFTA and IFTA…
International Fuel Tax Agreement, designed to equally split fuel taxes between Mexico, the U.S. and Canada, on an apportioned basis…
Screw Mexico and Canada, if American trucks are running there, then pay for the exact number of miles run… Not one cent more…
My position has been for quite some time: free trade for friends and allies.
If you stick by America, thick and thin; if you have just escaped tyranny and seek America as your model; if you have helped us, stuck with us and kept fighting for liberty and freedom then you damned well deserve free trade with us so that we may support liberty and freedom *togther*.
This leaves out such places as Mexico, unfortunately, unwilling to help or back the US in much of anything. Colombia, with a decade of fighting FARC with our help and trying to extinguish criminal narcotics enterprises does deserve something for that. Little Poland that struck the blows against Communism that made that edifice crumble and has stuck with us in Afghanistan and Iraq way past when the polls went south? Oh, my, yes. Ditto Hungary, Romania, Bulgaria, Israel, Japan, Australia, UK, and Canada… brave and stalwart friends and allies. Peru? Where canning factories are used to can and ship cocaine and heroin? hmmmm… get back to you on that.
Why we aren’t close to India that speaks english and has an Islamic problem to beat the band is because we want to be close to liberty loving China… it does love liberty and freedom, no? It doesn’t? Ohhh… it has… ‘a big market’. Well, I guess we don’t need to support liberty and freedom then, right? Worked out well since 1972 when we stiffed India and befriended China, hasn’t it?
I’ve got some serious problems with ‘free trade’ or, indeed, trade of any sort *creating* liberty as trade is *based* on liberty of those that have it. China’s trade is extorted from its poplation by companies empowered by the government to work individuals literally to death. Not the ‘geez, I’m tired’ but the ‘He’s dead, Jim’ sort of death.
But that makes me a ‘protectionist’ and ‘isolationist’ wanting to join with other peoples that support us and concepts of freedom and liberty and secure them for their people. Very strange sort of ‘protectionism’ that, to support the ideals of the nation and make sure othes PAY to get access to our markets. But then I don’t see much liberty in places where trade is used as an excuse to do nothing for decades… like the Middle East since 1917, China since 1972 and Yugoslavia since the late 1970’s… say, just how well *did* that last do, anyway?
Apparently those supporting this trade to create liberty and freedom conveniently forget these places. I haven’t. And I have problems with those who *have* willfully forgetten them.