19 ms·
Good. Once the total cost of remote manufacturing starts licking the cost of local/domestical, it'll finally start to make sense to manufacture domestically - p
by pmlnr 5y ago
Good. Once the total cost of remote manufacturing starts licking the cost of local/domestical, it'll finally start to make sense to manufacture domestically - plus then stick a label on it that it's a domestic product, and benefit from it.
- stavros 5y agoAnd you'll have half the purchasing power for your salary.
- n0mad01 5y agowouldn’t it have the effect that producing more goods -> higher worker demand -> higher salaries?
- enriquto 5y agoThis argument of yours is only part of an equilibrium. If it was the only force in play, that would be a strong argument against international trade. I guess there are some missing pieces here.
- Chris2048 5y agoYes. Globalists can't pit foreign labour against local if that happened, then how'd they become billionaires?
- knownjorbist 5y agoThe more realistic argument is that you simply don't have the human capital necessary to build certain things in certain places. This can be addressed in large part by making immigration easier.
- Chris2048 5y agoNot sure that's more realistic. There is often enough human capital necessary to build certain things in certain places, just not at the lowest price. > This can be addressed in large part by making immigration easier Not if local laws don't provide the same competitive edge.
- concordDance 5y agoDoubling the cost of imported physical goods will have a negligible effect on the QoL of the average westerner. We spend the vast majority of our income on local things (housing, healthcare, education, events...). I think my average yearly spending on imported goods over the last few years was around £1000.
- fvdessen 5y agoThe 'local' things also depend on imported physical goods.
- concordDance 5y agoAnd what proportion of, say, housing or healthcare cost is overseas transport? Around 1% would be my guess.
- Sayrus 5y agoElectronics, Fruits or even raw materials, I do think there are a lot of products where import plays a role in the supply chain. A product manufactured in the UK (I assumed as you used £) might have a price increase if the required materials has now a 2x shipping cost. I think that 70-80% of the food in the UK is imported so I don't think the impact is that negligible. While most of the money is spent on local things as you said, if after housing / healthcare / education / ... you are left with a fixed amount of money to buy groceries, a 50% price increase is huge on your QoL and purchasing power.
- fpoling 5y agoThere was a study in Denmark that showed that only about 20% of a price one pays in the supermarket went to producers of the food and like 10% was spent on transport. 25% were taxes, 25% was spent on advertisements, the rest was the shop take to pay workers, location rent and the profit. I doubt in UK it is much different. So if the transportation will be twice expensive, it will translate into price increase only of 10%.
- 5y ago
- pmlnr 5y agoYes. That sounds bad, but consuming less would actually be a benefit. Remember: reduce, reuse, recycle, and reduce is probably the most important part.
- 88840-8855 5y agoThis is very noble. But many people grew up in (relative) poverty - like me. I was studying hard, working hard, making compromise in order to move up. Now I am doing alright. Now it is my time to consume: drive a nice car, buy things I always wanted, travel a lot. I am honest to you, my opinion is not noble as yours: I want to consume, I want my things cheap, because I would not be able to afford otherwise. There are billions like me on this planet who did not grow up in a nice middle class family in a 1st world. Those people want to move up and consume such as the Western middle class did until recently. The new generation that grew up in a very stable, rich world and had everything suddenly realises that they do not need consumption and hence talks noble things. But you cannot and must not force it to all those people who did not grow up in fanciness.
- xbmcuser 5y agoThis is why I feel the world is fucked and global warming can't be stopped. I am not blaming you or accusing you just saying the current resource use is when 80% of the worlds population is not consuming much. The world is already over populated as we simply don't have the resources to give a decent life to current worlds population let alone a rising population.
- iso1631 5y agoI've got mine. It's a common sentiment.
- 88840-8855 5y agoThanks for commenting. HN loves to downvote this opinion: the world IS overpopulated. Imagine there were 8 billion tigers or bears living on this planet - how sustainable would this be? And bears and tigers dont fly, dont drive cars and dont wear clothes. I remember learning in school that there were 6 billion people in the world. Recently I realised that we are over 8 billion already. And all of us want to have a good life and those who grew up poor want to consume. 100% understanable.
- CalRobert 5y agoIf I said to you right now "you can get amazing quality clothes for $10, a new, fast car for $5,000, and nearly-free seafood of any type you might desire", would you want me to tell you that I was doing it by beating and killing enslaved people, dumping toxic waste in to rivers, giving kids in poor countries asthma, and destroying the life support networks people will rely on for the next century? Modern life is pretty damn great but let's not kid ourselves that it's basically theft from the poor and the young.
- nsonha 5y agoI dont think this is the only perspective. Without those outsourced industries, the economies of those countries might be worse off and people might have better air and water but face poverty, umemployment and other crises. It'll be better for the West to bring back jobs no doubt.
- sean_the_geek 5y agoI don’t understand the downvotes to your comment. It is a valid alternative perspective.
- rocknor 5y agoThe downvotes show how little the HN audience knows about economics and geopolitics, making dumbass statements like > Modern life is pretty damn great but let's not kid ourselves that it's basically theft from the poor and the young.
- nsonha 5y agoThe funny thing is most people having this view have not lived in a developing country. Yet they feel that they know what's best for us.
- beardedetim 5y agoCould we say the same about Africans in the slave trade? I’m not sure because I don’t know history but I would hazard a guess that one could.
- lucioperca 5y agoHalf of purchasing power is way to high. Depending on the product you have only have single digit percentage of increase (you save shipping and you will have more automation).
- a_imho 5y agoSalary++;
- imtringued 5y agoTrade imbalances are bad full stop. The only exception are developing nations that are so tiny they don't destabilize global trade. Trade deficits are bad because the deficit nation has to take on debt. Trade surpluses are bad because the surplus nation forces debt onto deficit nations. I said trade imbalances, trade itself is good and there is nothing wrong with being a trade champion. That debt hat to be taken on by someone. The private sector doesn't want it. We have run out of good borrowers as indicated by the 2008 financial crisis. Interest rates drop to 0% as money is not finding any takers. So the government must take the debt and forcibly invest it as the borrower/investor of last resort. Just address the problems at their root. Stop saving too much money and stop foreign nations from dumping their savings into your country. When people invest too much into land tax it appropriately. These are century old problems. They aren't new.
- hef19898 5y agoThe container shortage has nothing to do with trade imbalances. Those existed already before, yet we only had container shortages around Chinese New Year. Now is different, Chinas Covid lockdown resulted in almost no shipments to Europe and the US (I am not that familiar with the Asia US business). That meant a container shortage for exports from the EU, which resulted in less containers at these destinations. Then China opened up again, while the rest of the world went into lockdown. Add to that Chinese new year, crazy demand changes (e.g. wood from everywhere to China and the US), disruptions caused by Covid and you have containers all over the place. Just not where they usually are supposed to be. And containers where already less available before Covid compared to 5 years ago. That'll take a while to sort out. More, much more, than I guessed a year ago.
- tim333 5y agoTrade imbalances are not always bad. Say your house goes up and you borrow to buy a car. That's a local trade imbalance but there are no losers there really. Similar stuff happens on the international level but in more complicated ways.
- RyEgswuCsn 5y ago> Trade deficits are bad because the deficit nation has to take on debt. Not if the deficit nation can pay off the debt using its own currency whose supply is also controlled by the same nation, no?
- danielrpa 5y agoPerhaps balanced by the additional money in the pockets of the workers employed in these new production lines.
- tejohnso 5y ago> And you'll have half the purchasing power for your salary. Great, so then there's an added advantage of less consumption / waste / pollution.
- RyEgswuCsn 5y agoWell one can immediately achieve that by donating half of their income to help those who can barely survive --- no need to wait.
- prestigious 5y agoYou way over estimate the cost of manufacturing something. This is the same argument against minimum wage… you want a hamburger to cost $50?!?! Actually labour is like $0.15 cents of it
- opo 5y ago>...Actually labour is like $0.15 cents of it Where are you getting that number from? >...A fast-food restaurant could typically run labor costs around 25% while a full service restaurant could run about 30-40% of revenue depending on how up scale the bar or restaurant is and the demand needed. https://academy.getbackbar.com/average-restaurant-costs-liquor-food-and-labor https://academy.getbackbar.com/average-restaurant-costs-liqu... >... you want a hamburger to cost $50?!?! No one is claiming that proposed higher minimum wages would cause hamburgers to cost $50 - you don't need to use a hyperbolic straw man. But even before the pandemic, the minimum wage increases that went into affect in 2020 have had some effects on restaurants: >... A study by Harri revealed that a whopping 71% of restaurants have responded to the recent minimum wage increases by raising menu prices. In addition to price increases (71%), reduced employee hours (64%) and job eliminations (43%) were the most common reactions to wage inflation. https://pos.toasttab.com/blog/on-the-line/how-restaurants-deal-with-minimum-wage-increases https://pos.toasttab.com/blog/on-the-line/how-restaurants-de...
- mdorazio 5y agoThis is demonstrably false with 2 minutes of googling. For example, look at [1]. Most expenditures are not on things that are highly impacted by manufacturing costs, and even with imported manufactured goods or foods a big component of the cost is transportation, stocking, advertising, etc. [1] https://howmuch.net/articles/breakdown-average-american-spending https://howmuch.net/articles/breakdown-average-american-spen...
- rglover 5y agoIf it's made domestically, it costs less to move it around and get it to customers. Harder to deliver to customers = more expensive Easier to deliver to customers = less expensive So, short of price gouging or labor shortages, no, it would make things cheaper in the long run (and people would have more money to buy things because they have jobs). Edit: one addendum is raw material costs. If we don't have a ready domestic supply of some mineral or other raw material, then that could/would bump prices (because we're still stuck in the imports trap).
- jl6 5y ago… but it turns out shipping stuff across the globe is still cheaper than paying a 1st-world minimum wage.
- rglover 5y agoYes, but at the cost of supply chain vulnerability. So it's either really cheap stuff, or long-term security of goods. Clearly the "really cheap stuff" angle has seriously embroiled American prosperity so it's arguable the benefits do not outweigh the costs in aggregate. Personally, I'm in the "I'm happy to pay a bit more if my environment is peaceful because the people around me can eat and have a future" camp.
- david422 5y agoBut that money is going into the salaries of your neighbors. Every time some corporation increases profits by going cheap overseas, that money is leaving the economy.
- JeremyNT 5y agoSounds like a fair trade, if it gets underemployed Americans good jobs with fair benefits. The costs of housing and medical care completely dwarf everything else in my life, so the cost of consumer goods hardly matter at all compared to those things. We pretend we don't have inflation just because consumer goods are still cheap, but we're not looking in the right places. I may as well buy fewer goods at higher prices and get Americans back to working higher paid manufacturing jobs in the process. My dollar's already worth less towards the things that really matter, anyway.
- jdminhbg 5y agoHousing and medical care are in fact included in the CPI: https://www.investopedia.com/terms/c/consumerpriceindex.asp https://www.investopedia.com/terms/c/consumerpriceindex.asp
- malka 5y agoThat is necessary for climate.
- jeffreyrogers 5y agoIt's not as simple as that (and I don't think your halving of purchasing power number comes from anywhere). And your argument ignores the negative effects of offshoring on entire communities in parts of the developed world.
- tomc1985 5y agoThere's a meme floating around about how McDonald's employees in Denmark get all these nice benefits Americans usually associate with white-collar work, all for just 27c more for a big mac vs America Your narrative is perpetuating a lot of negative, false things
- KozmoNau7 5y agoWhile buying purely local/domestic will reduce your selection somewhat, the majority of what you cut yourself off from buying are low-quality products anyway. I don't think it's possible to buy purely local/domestic for everything, but for some types of products, the switch is relatively simple and something more people should consider. One area that I have managed to go fully local in is clothing. Since I live in Denmark, I consider the EU+Norway+Switzerland to be "local", There is such a good selection of all types of clothes produced here, from work wear to casual wear to office wear and especially as you go into higher-end clothing, quality suits and of course anything tailor-made can be ordered made from locally-produced fabrics. Yes, each individual piece will cost more than an equivalent from a fast fashion brand, but the quality will be on a completely different level. And obviously some raw materials can only feasibly be produced outside your local area, which makes some transport necessary. But I prefer raw materials to be transported relatively directly and unprocessed, so the potentially harmful processing be done in countries with strict regulations on emissions and harmful chemicals, as well as reasonable labor protections. Unfortunately, as long as people look at price as the primary (or only) factor influencing their purchases, we're stuck with shipping clothing halfway around the globe for no good reason.
- knownjorbist 5y ago> One area that I have managed to go fully local in is clothing. Since I live in Denmark, I consider the EU+Norway+Switzerland to be "local" So this relies on an arbitrary definition of "local". None of what you listed is actually "local" to you, it just benefits from a free trade zone such that it may as well be. Now zoom out and apply the same thinking to the rest of the world. That's what we COULD have if economic populism arguments weren't so in vogue right now. We are in a globalized world, meet it and work with it.
- KozmoNau7 5y ago"Local" is "geographically close to me". Do you use a different definition? Having common goods like clothes shipped halfway around the globe is pointless and wasteful.
- knownjorbist 5y agoDomestic manufacturing is not some golden, pure idea that should be courted no matter what. It sucks that HN seems on average interested in economic populism.
- rocknor 5y agoHN is only good for tech stuff. For topics like economics and geopolitics it is only marginally better than Reddit and getting worse. Despite what programmers think, they aren't smart at everything.
- pmlnr 5y agoIt might not be, but I'm tired of trying to buy domestically made stuff and it doesn't exist.
- kwere 5y agothere arent reasons for an hegemon like usa to not have competitive industries in all acessible sectors; maybe is more valuable to have tangible power instead of playing financial shenanigans but who am i to criticize ?
- pier25 5y agoI doubt China is going to let that happen.
- ed25519FUUU 5y agoIf the USA was smart, they’d capitalize on this and start creating sticks and carrots for US manufacturing.
- hownottowrite 5y agoYou still won’t have the labor, the know-how, or the complimentary ecosystem. Also, there’s zero benefit to a domestic label. That’s just a fairy tale. The only label people care about is the price. This is a temporary thing for the next 18 months. Then it will be back to business (with some modification).
- merb 5y agowell made in germany, was a pretty strong label
- hownottowrite 5y agoI guess that’s why Samsung is the best selling television in Germany.
- merb 5y agowell it 'was', but at the moment I'm pretty sure most germans don't buy that much from these labels, because these days they are mostly "fake", i.e. fake in the sense of it's not really made in germany, just build together and designed. btw. in the past lot's of german television products were really really good. but they didn't get the memo about smaller form factors and smart tv's (Grundig, Loewe, Metz, Technisat, Lorenz, Telefunken/AEG most of them either died, lost their market share or were sold to the chinese)