8 ms·

This is the cruel and predictable result of a society that has meticulously and senselessly offshored/outsourced most its industrial capacity. If your country c

by zkms 7y ago

This is the cruel and predictable result of a society that has meticulously and senselessly offshored/outsourced most its industrial capacity. If your country can't manufacture, from raw materials, all the electrical/electronic/mechanical components, the tooling, the equipment, and the chemicals (industrial and pharmaceutical alike) it needs to keep everything running, you're dependent on these hyper-fragile and convoluted supply chains that are optimized for cost above everything. This isn't a "China vs US" thing; i bear zero ill will towards China and their massive gain of industrial capacity, my ire is solely focused towards those in power (government and industry alike) who presided over the suicidal deindustrialization of the United States and Europe. The net result is that it's China who's able to send medical aid (ventilators, masks, respirators, test kits, etc) to Italy, and not the US, if only because the US is incapable of meeting its own needs: https://twitter.com/VKJudit/status/1237448125800988675 https://twitter.com/VKJudit/status/1237448125800988675

SketchySeaBeast 7y ago
Assuming that this travels into the country wouldn't the same impact be observed as areas of the country with particular specializations were affected? I don't know how one could prevent supply chain disruptions, they'd just come a little later than sooner.
- mc32 7y ago
  But if most industrialized countries had retained their mfg expertise some factories would be active while some idle and there could be some kind of staggered affect as the interruption courses it’s way in and out.
  - SketchySeaBeast 7y ago
    So wouldn't the answer to this also be to just move the industrial base to various other developing countries? If we split our manufacturing between more of South East Asia, South America, and Africa, wouldn't that have the same effect?
    - mc32 7y ago
      I don’t see why they should not attain that capability as well and I also don’t see why we should shed our capability to mfg either.
jcims 7y ago
It doesn't have to be (and likely wasn't) intentional. Economic pressure will twist gravity towards specialization and supply chain consolidation. You need meticulous surveillance and testing combined with authoritative regulatory control to counteract these pressures and maintain a resilient supply chain (which doesn't necessarily need to be in-country).
powowowow 7y ago
The supply chains that you rail against have successfully delivered the greatest levels of prosperity to the largest number of humans in all of history. They were created not by some mysterious force, but by individuals making rational choices about how they want to allocate their time, their energy and their resources. The "suicidal deindustrialization" you refer to is the result of people making informed choices that you happen to disagree with. They didn't want a $400 locally knitted sweater, made from neighborhood sheep. They wanted a $40 sweater that was made as efficiently as possible, and $360 of change. Please don't mistake your belief that you could design a better society for an actual analysis of reality.
- hintymad 7y ago
  And I honestly do want a $400 sweater if we have a prospering manufacturing business. How many people stuff their house with clothes that they wear only once? How many people buy toys that their kids play only a few times? How many people hav a whole closet of shoes? Why do we have twice as large of closet room compared with people living in the 50s? Why do people just have to buy clothes every quarter, every month, every week? People around the world seem have been consumed by modern consumerism. If people around me can get decent jobs because of local manufacturing, if US can keep developing talents in mechanical engineering, chemical engineering, and material engineering, hell yeah, bring me the $400 sweater.
  - twblalock 7y ago
    A lot of people can't afford a $400 sweater. What are they supposed to do? Local manufacturing is for rich people who can afford it.
    - hintymad 7y ago
      See the second paragraph "If people around me can get decent jobs because of local manufacturing", and I'm not making that up. People used to buy $300 snickers (or loafer? I forgot) back in the late 80s.
    - triceratops 7y ago
dugditches 7y ago
What happens when you can manufacture from raw materials, but your raws themselves come from offshore? There is still lots of manufacturing of high quality here. However they're costly and smaller in scale versus overseas.
kentosi 7y ago
I was thinking of this the other day. Perhaps this pandemic will help reshape our global economy away from its current monolithic structure into self-sustainable micro-service economies where all regions can self-sustain to a large level. (Apologies for the nerdy analogy but this is Hacker News...)
- cycrutchfield 7y ago
  Sounds incredibly inefficient
  - AnthonyMouse 7y ago
    Diversification always sounds more inefficient than monoculture, until the monoculture encounters a systemic vulnerability and all fails at once.
  - Seenso 7y ago
    > Sounds incredibly inefficient Just like having redundant servers for your applications and backups for your data.
Aunche 7y ago
> you're dependent on these hyper-fragile and convoluted supply chains that are optimized for cost above everything. I'd argue that this is a feature. Economic codependence is a much safer and effective deterrent to war than mutually assured destruction.
- dv_dt 7y ago
  I'd argue it is currently assuring interlinked global mutual assured destruction in the form of climate change (while yes maybe it reduces the chance of mutual destruction in the form of nuclear war, at least at the moment while the exponential effects of climate change are still in the lower order distruptiveness)
twblalock 7y ago
If we were manufacturing everything in the United States, supply chains would still be disrupted because companies would be sending workers home, which is what they are doing already. No supply chain is safe in the event of a global pandemic. One day there might be a pandemic which affects the West but not China, which would make outsourcing supply chains look pretty smart. You are drawing a general conclusion based on the circumstances of a single, rare event. Besides, where is the suicide of the west here? The west has benefitted from this arrangement for decades. The west is better off with this arrangement than it would have been without it, and this pandemic would have happened anyway, and it would have disrupted supply chains anyway. I have not yet seen any evidence that lack of western manufacturing capability has made this pandemic worse. However, there is a massive body of economic knowledge that tells us that exploiting comparative advantage increases wealth.
- jandrese 7y ago
  If your supply chain encompasses two countries then a disruption in either country will take you offline. If you keep everything in-house you only have to worry about one country. You can also harden your supply chain by having multiple suppliers in different countries, so a loss of any one isn't an issue. For something like Covid-19 it's near impossible to avoid disruption, but for less-global outbreaks it can be a winning strategy.
  - hef19898 7y ago
    Only in the case epidemics or natural disasters. And even then I would argue that's nit the case. E.g. there was a major accident in a Chinese chemical park last year, it closed down for the majority of the year. This park manufactured the raw materials for stuff like car lights, the glasses of them. It also was the only source. Did anybody outside the industry suffer any results? No, because supply chains actually adopt pretty well to stuff like that. What would happen so, if everything is in one place is higher costs off-crisis, you wouldn't survive economically to see a crisis that way. Recovery is key, so. And that is where we will see which companies did their jobs supply chain wise and which didn't.
  - twblalock 7y ago
hef19898 7y ago
Supply Chains have been global ever since the bronze age. So the principal isn't new. Supply Chain resilience is a crucial topic so. One that is, to a certain degree, under rated. Because it is more than buffers you have for general inefficiency.
s_dev 7y ago
China, the US and the EU are fundamentally different to most other countries/economies. They are political and economic super powers -- effectively. Ireland simply cannot make everything the way China can from scratch. It's not even an option on the table let alone some abstract trade off. Complex supply chains are the only way to achieve any meaningful economic growth. This also affects how our economy works. We don't get the same "multiplier effect" that the US will get from a stimulus package.
- remarkEon 7y ago
  >Complex supply chains are the only way to achieve any meaningful economic growth. I call BS. Complex supply chains are one of the ways to achieve questionably meaningful _GDP_ growth. Hopefully one of the outcomes of this crisis is that we start to question the "number go up" ethos of most conventional economists. It's true that Ireland can't make "everything" from scratch. But do they need to? Though, this becomes an almost circular philosophical discussion very quickly.
bluntfang 7y ago
this sounds like a dog whistle

by zkms 7y ago

SketchySeaBeast 7y ago

Assuming that this travels into the country wouldn't the same impact be observed as areas of the country with particular specializations were affected? I don't know how one could prevent supply chain disruptions, they'd just come a little later than sooner.

mc32 7y ago
But if most industrialized countries had retained their mfg expertise some factories would be active while some idle and there could be some kind of staggered affect as the interruption courses it’s way in and out.
- SketchySeaBeast 7y ago
  So wouldn't the answer to this also be to just move the industrial base to various other developing countries? If we split our manufacturing between more of South East Asia, South America, and Africa, wouldn't that have the same effect?
  - mc32 7y ago
    I don’t see why they should not attain that capability as well and I also don’t see why we should shed our capability to mfg either.

jcims 7y ago

It doesn't have to be (and likely wasn't) intentional. Economic pressure will twist gravity towards specialization and supply chain consolidation. You need meticulous surveillance and testing combined with authoritative regulatory control to counteract these pressures and maintain a resilient supply chain (which doesn't necessarily need to be in-country).

powowowow 7y ago

The supply chains that you rail against have successfully delivered the greatest levels of prosperity to the largest number of humans in all of history. They were created not by some mysterious force, but by individuals making rational choices about how they want to allocate their time, their energy and their resources. The "suicidal deindustrialization" you refer to is the result of people making informed choices that you happen to disagree with. They didn't want a $400 locally knitted sweater, made from neighborhood sheep. They wanted a $40 sweater that was made as efficiently as possible, and $360 of change. Please don't mistake your belief that you could design a better society for an actual analysis of reality.

hintymad 7y ago
And I honestly do want a $400 sweater if we have a prospering manufacturing business. How many people stuff their house with clothes that they wear only once? How many people buy toys that their kids play only a few times? How many people hav a whole closet of shoes? Why do we have twice as large of closet room compared with people living in the 50s? Why do people just have to buy clothes every quarter, every month, every week? People around the world seem have been consumed by modern consumerism. If people around me can get decent jobs because of local manufacturing, if US can keep developing talents in mechanical engineering, chemical engineering, and material engineering, hell yeah, bring me the $400 sweater.
- twblalock 7y ago
  A lot of people can't afford a $400 sweater. What are they supposed to do? Local manufacturing is for rich people who can afford it.
  - hintymad 7y ago
    See the second paragraph "If people around me can get decent jobs because of local manufacturing", and I'm not making that up. People used to buy $300 snickers (or loafer? I forgot) back in the late 80s.
  - triceratops 7y ago

dugditches 7y ago

What happens when you can manufacture from raw materials, but your raws themselves come from offshore? There is still lots of manufacturing of high quality here. However they're costly and smaller in scale versus overseas.

kentosi 7y ago

I was thinking of this the other day. Perhaps this pandemic will help reshape our global economy away from its current monolithic structure into self-sustainable micro-service economies where all regions can self-sustain to a large level. (Apologies for the nerdy analogy but this is Hacker News...)

cycrutchfield 7y ago
Sounds incredibly inefficient
- AnthonyMouse 7y ago
  Diversification always sounds more inefficient than monoculture, until the monoculture encounters a systemic vulnerability and all fails at once.
- Seenso 7y ago
  > Sounds incredibly inefficient Just like having redundant servers for your applications and backups for your data.

Aunche 7y ago

> you're dependent on these hyper-fragile and convoluted supply chains that are optimized for cost above everything. I'd argue that this is a feature. Economic codependence is a much safer and effective deterrent to war than mutually assured destruction.

dv_dt 7y ago
I'd argue it is currently assuring interlinked global mutual assured destruction in the form of climate change (while yes maybe it reduces the chance of mutual destruction in the form of nuclear war, at least at the moment while the exponential effects of climate change are still in the lower order distruptiveness)

twblalock 7y ago

If we were manufacturing everything in the United States, supply chains would still be disrupted because companies would be sending workers home, which is what they are doing already. No supply chain is safe in the event of a global pandemic. One day there might be a pandemic which affects the West but not China, which would make outsourcing supply chains look pretty smart. You are drawing a general conclusion based on the circumstances of a single, rare event. Besides, where is the suicide of the west here? The west has benefitted from this arrangement for decades. The west is better off with this arrangement than it would have been without it, and this pandemic would have happened anyway, and it would have disrupted supply chains anyway. I have not yet seen any evidence that lack of western manufacturing capability has made this pandemic worse. However, there is a massive body of economic knowledge that tells us that exploiting comparative advantage increases wealth.

jandrese 7y ago
If your supply chain encompasses two countries then a disruption in either country will take you offline. If you keep everything in-house you only have to worry about one country. You can also harden your supply chain by having multiple suppliers in different countries, so a loss of any one isn't an issue. For something like Covid-19 it's near impossible to avoid disruption, but for less-global outbreaks it can be a winning strategy.
- hef19898 7y ago
  Only in the case epidemics or natural disasters. And even then I would argue that's nit the case. E.g. there was a major accident in a Chinese chemical park last year, it closed down for the majority of the year. This park manufactured the raw materials for stuff like car lights, the glasses of them. It also was the only source. Did anybody outside the industry suffer any results? No, because supply chains actually adopt pretty well to stuff like that. What would happen so, if everything is in one place is higher costs off-crisis, you wouldn't survive economically to see a crisis that way. Recovery is key, so. And that is where we will see which companies did their jobs supply chain wise and which didn't.
- twblalock 7y ago

hef19898 7y ago

Supply Chains have been global ever since the bronze age. So the principal isn't new. Supply Chain resilience is a crucial topic so. One that is, to a certain degree, under rated. Because it is more than buffers you have for general inefficiency.

s_dev 7y ago

China, the US and the EU are fundamentally different to most other countries/economies. They are political and economic super powers -- effectively. Ireland simply cannot make everything the way China can from scratch. It's not even an option on the table let alone some abstract trade off. Complex supply chains are the only way to achieve any meaningful economic growth. This also affects how our economy works. We don't get the same "multiplier effect" that the US will get from a stimulus package.

remarkEon 7y ago
>Complex supply chains are the only way to achieve any meaningful economic growth. I call BS. Complex supply chains are one of the ways to achieve questionably meaningful _GDP_ growth. Hopefully one of the outcomes of this crisis is that we start to question the "number go up" ethos of most conventional economists. It's true that Ireland can't make "everything" from scratch. But do they need to? Though, this becomes an almost circular philosophical discussion very quickly.

bluntfang 7y ago

this sounds like a dog whistle