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America's basic socioeconomic structual model is highly flawed and any company wanting to do manufacturing here will see obvious disadvantages compared to Europ
by photochemsyn 3y ago
America's basic socioeconomic structual model is highly flawed and any company wanting to do manufacturing here will see obvious disadvantages compared to Europe or Asia.
1) Employers are responsible for employee health coverage, inflating employee costs by a significant degree. The rationale for this model among the investor class is that it makes employees dependent on their employer and limits the power of unions, but for example in Germany, there's free state-supplied health care (paid for by higher taxes on individual and corporate profits).
2) Four decades of neoliberal trade policy and corporate profit maximization have created a situation of fragile global supply chain dependence and a lack of skilled experienced labor in many manufacturing sectors. High-skill manufacturing jobs have been replaced with low-skill service jobs and the brain drain into the financial sector has left the industrial sector in second place.
3) Construction and operation of new manufacturing facilities relies on a robust domestic infrastructure system, but American infrastructure (railroads, electricity grids, ports, etc.) is woefully decrepit in many areas and lags behind China and Europe. Again the reason is nobody wants to pay for it, and the issue is not 'overregulation' it's that it would require higher taxes and corrupt government contractors divert government funds into their own pockets instead of into the projects, resulting in constant cost overruns and low-quality outputs (reminscent with what went on with Iraq and Afghanistan reconstruction contracts).
It turns out worshipping at the feet of Milton Friedman & Co. wasn't such a good idea after all.
- addfgionio 3y ago>Construction and operation of new manufacturing facilities relies on a robust domestic infrastructure system, but American infrastructure (railroads, electricity grids, ports, etc.) is woefully decrepit in many areas and lags behind China and Europe. Again the reason is nobody wants to pay for it, A whole lot of people want to pay for it. The problem is that a minority doesn't, and they've been able to ruin things for the rest of us.
- AnimalMuppet 3y agoI don't think much associated with fabs ships by rail, even in Europe.
- adolph 3y ago> obvious disadvantages compared to Europe or Asia > Employers are responsible for employee health coverage, inflating employee costs by a significant degree > for example in Germany, there's free state-supplied health care (paid for by higher taxes on individual and corporate profits). TANSTAAFL, just choose your favorite accounting structure. A company with a younger contract workforce (and likely lower spending/risk profile) might find the funding model advantageous.
- sleepybrett 3y agoOn point 1, it would be interesting to see the per employee costs both in taxes and payrolls/benefits between mostly identical companies in the US and somewhere like Sweden. I imagine it might be higher in Sweden.
- strictnein 3y agoBMW would seem to be in a good position to judge the manufacturing capabilities of both Europe and the US, with their large presence in both. $1.7 billion expansion in the US towards the end of 2022: https://www.bmwgroup-werke.com/spartanburg/en/news/2022/BMW-Group-Electrification-Plans-Press-Release.html https://www.bmwgroup-werke.com/spartanburg/en/news/2022/BMW-... Expanding on their already expansive presence in Spartanburg. The X3-X7 and their newest high end vehicle the XM are all built in the US: https://www.bmwgroup-werke.com/spartanburg/en.html https://www.bmwgroup-werke.com/spartanburg/en.html Mercedes, another company that knows about manufacturing in Europe and the US, is producing some of their newest vehicles in the US, including new electronic vehicles that debuted in 2022, the EQE and EQS. The 2024 Maybach EQS680, with an estimated price of $200k, is also built in the US. Toyota is spending $2.5 billion to expand their US facilities: https://pressroom.toyota.com/toyota-announces-2-5-billion-expansion-of-north-carolina-plant-with-350-additional-jobs-and-bev-battery-capacity/ https://pressroom.toyota.com/toyota-announces-2-5-billion-ex...
- BirAdam 3y agoKIA and Hyundai have built and are building more in Georgia as well.