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If you want to know the answer to 90% of questions, that answer is 'Follow the Money". US manufacturing stagnated because US companies offshored their producti
by simonblack 2y ago
If you want to know the answer to 90% of questions, that answer is 'Follow the Money".
US manufacturing stagnated because US companies offshored their production. Great for the company bosses and their huge bonuses, but .... that led to two main failures: the loss of skilled workers, and the loss of company manufacturing knowledge. NOTE: Company money that gets wasted on huge bonuses is money that is not available to improve the company's future profits.
Take the example of Boeing: The replacing of aviation engineers by accountants means that decisions are made on the basis of cashflows, not on the basis of how to make better planes.
Or take the example of the US space industries: the men who were the skilled workers who knew how to make large and powerful rockets have retired and/or died off. Nobody in the US has the day-to-day working knowledge of those men of the 1960s and 1970s who produced the Apollo systems that put a dozen or so men on the Moon. Today we have men stranded in space because their spacecraft is a piece of garbage, and it's not so long since Americans had to cadge lifts to the ISS from the Russians for more than ten years.
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- TapWaterBandit 2y agoI think "follow the money" is the correct call but not like this. I think having the reserve currency be the USD means there is more demand for the currency than is needed to trade with the USA (because USD is used for all sorts of other international trade as well including things like buying oil). This makes the USD relatively too strong which makes their exports relatively too expensive. This then has all sorts of flow on impacts throughout the manufacturing process and incentives inside the country.
- diogenescynic 2y agoExactly. Look at the investment in FoxConn (Hon Hai manufacturing) compared to the US. I bet as a % of their GDP the scale of their investments dwarf ours.
- panick21_ 2y ago> Nobody in the US has the day-to-day working knowledge of those men of the 1960s and 1970s who produced the Apollo systems that put a dozen or so men on the Moon. Funny then that the US has be far the largest space industry, produces the most rockets, launches the most rockets, produces and launches the most sats.