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"The vast complexity of modern production" is not the driving factor behind globalization, as demonstrated by American manufacturing systems in the 1960s and 19
by photochemsyn 3y ago
"The vast complexity of modern production" is not the driving factor behind globalization, as demonstrated by American manufacturing systems in the 1960s and 1970s. If you have the necessary raw materials, energy supply and labor force then manufacturing can go on anywhere - all you need is the know-how.
The driving force behind globalization was the desire for cheap labor, the one component of the triangle that is most easily price-gamed. Of course, this doesn't affect trade between France and Germany, as moving a factory from one country to the other has no effect on production costs. In contrast, moving a factory from Detroit to Mexico, or to Indonesia, or to China? A 75% reduction in overall labor costs is all profit, minus shipping costs of course. Of course, it also drives down wages for those in the manufacturing sector while also shrinking that sector.
The other side of globalization with respect to labor is the import of cheap labor when it comes to non-outsourceable jobs like construction and agriculture, which again drives down the average wage in these industries (as migrants tend to work for less) - and this even extends to the tech sector, with the H1B Visa program being a point of contention. This also drives a political backlash with consequences (see migrant field workers fleeing Florida en masse at present, for example, as the state passes laws banning their employment).
Trying to write about globalization while ignoring the primary motivations and goals of the architects of globalization is kind of silly, and the main thesis - that modern manufacturing is just too complex to be done within the USA from start to finish - is just wrong.
- zokier 3y agoAlso more recently environmental regulations; afaik its not unusual to shift production to countries where environmental regulations, or their enforcement, is laxer to further cut costs. It helps that cheap labor tends to correlate with lax regulations.