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the problem is that you can't have our current levels of unemployment without a welfare state or serious social unrest (and usually both.) We need the jobs. N

by lsc 14y ago

the problem is that you can't have our current levels of unemployment without a welfare state or serious social unrest (and usually both.) We need the jobs. Now, my understanding is that in terms of dollars, our manufacturing sector is growing, not quickly, but it is growing; but in terms of jobs, it's shrinking. Technology marches on. Chinese labor doesn't usually compete with American labor. Chinese labor competes with American machines. China isn't the problem; the fact that we've automated away manufacturing the way we've automated away agriculture is. 200 years ago, nearly everyone was involved in some sort of agriculture or agriculture-support position. Now? that's less than 2% of the economy. We found things for people to do when we automated away nearly all the agriculture work. We need to do the same thing now that we've automated away nearly all the manufacturing work. It's not the tax rate that stops people from hiring. You could argue that it's the tax complexity; I mean, the complexity does cause problems and increase risk. but I don't think that's the real problem. I think the real problem is that nobody has come up with a new business model to employ the masses and turn a good profit while paying a reasonable wage. China is doing it by having humans do work that Machines could do better. Essentially turning back the clock on automation of manufacturing. Personally, I think that's a bad idea. For the things that Machines can do, they are usually way better than humans. And I don't think it would work for us, either, because the humans involved create less value, and thus can't be paid what we'd consider a reasonable wage. It works for China because they have so many people that are so poor that what we'd call an unreasonably small wage is a step up. That's not where we should go with this. We should come up with a new class of jobs; start new businesses that do new things that turn the labor of the masses into more value than having them poorly mimic the work of machines. so yeah. what I'm saying is that living in a state with no debt but where only one person out of five can get a job? that's worse than living in a state with near full employment and a bunch of debt. Even if you don't care about human suffering, think of the crime rate and how much effort you'd need to put into keeping your stuff safe. The jobs problem needs to be solved first. I mean, I'm not saying that the government is the solution to the jobs problem (maybe they have a part to play and maybe they don't) - just that the jobs problem is a much bigger deal than the debt problem. And as the previous poster pointed out, it's easier to solve the debt problem once we have more people working and paying taxes.

robomartin 14y ago
This is very complicated because we (and the world) allowed it to get to this point. Yes, China is the problem and, at the same time, it isn't. China is automating (and can automate further) just as much as we can. I have manufactured in China. And the work I did was not done in sweat shops full of people doing mindless work. No, we are talking about reasonably skilled workers running very nice high-tech CNC machines to produced machined metal parts, injection molded plastics as well as electronic assemblies. In some cases the end product cost just as much as it could cost in the US if we could do the same job. Of course, in other cases it cost significantly less. In all cases quality was beyond good. They can do the same things we do and adopt the same manufacturing technologies we adopt. The world is pretty flat in that respect. What's the difference then? Well, labor cost is one piece of the puzzle. And, depending on discipline, not necessarily the largest element in the equation. The problem is multi-faceted: taxes, regulations, environmental restrictions, OSHA, unions, pensions, lawsuits, etc. And the other factor is that they have a government and business leaders who's sole focus in in winning. They want to win this in the world stage. And they are executing a strategy as flawlessly as they possibly can. In the mean time we are making and continue to make all the wrong decisions. It's like watching a bad chess game: One bad move after the other. Take industries such as the light aircraft industry. It has been all but killed-off by lawsuits, regulations and other issues. You'd be crazy trying to spin-up a light aircraft operation in the US, even if you have great ideas. When I was manufacturing there were components (lots of them) that you simply could not buy in the US (meaning, US-made) at any price. We just don't make the stuff any more. This spans from chips to even certain types of glass. We have managed to kill-off whole layers of the supply chain. And that's the other factor: The supply chain. China has been outstanding at developing manufacturing regions where the entire supply chain exists within a concentrated geographic area. This, from a product development and manufacturing standpoint is the equivalent of the software "killer app". We can't compete because our supply chain is horribly fragmented in so many places that it saps competitiveness out of the system. When statistics get thrown around about the manufacturing sector growing you have to dig deeper and be very, very critical of the data. Are manufacturers growing in terms of dollar amounts while, at the same time, being forced to outsource more of their supply chain and subassemblies to places like China? I don't know. I'm not in that game any more and I am glad. But I can tell you with absolute certainty that, at a certain point in the life of my manufacturing business it became exceedingly obvious that the ONLY way to compete was to start to insert more and more Chinese-made components and subassemblies into our products. No choice. We are far too far down the slippery slope. This is something that happened over many decades. As such it will take decades to fix --if that's even possible. Sorry to be too negative but I've been in the trenches and have had skin in the game for far too long. I am not a casual observer but rather someone who invested very sizable amounts of my own money to be in the game and have the scars to prove it. Let's not forget that Steve Jobs told Obama that a lot of high-tech jobs are never coming back. http://open.salon.com/blog/steve_klingaman/2012/01/25/lets_not_kid_ourselves_about_manufacturing_jobs http://open.salon.com/blog/steve_klingaman/2012/01/25/lets_n... And, he was absolutely on the money on that one. I suspect that if you could ask for clarification he would bring up such things are taxes, laws, lawsuits, unions, regulation, environmental laws, supply chain structure and other factors. It would require a very solid and decisive cultural, financial and political shift to bump us over into a different path that could lead to a serious and solid recovery at all levels. And that's the problem. While we are preoccupied with bullshit here in the US some around the world are making the right decisions on a daily basis. They are investing in a future that we will not be ready to face without massive challenges. That's the truth. We can choose to look the other way and pretend this can be fixed by raising taxes on a few people who make a little more money, gain votes and move on, or we can take this shit seriously and transform our country into a business powerhouse at all levels. I vote for option #2.

by lsc 14y ago

robomartin 14y ago

This is very complicated because we (and the world) allowed it to get to this point. Yes, China is the problem and, at the same time, it isn't. China is automating (and can automate further) just as much as we can. I have manufactured in China. And the work I did was not done in sweat shops full of people doing mindless work. No, we are talking about reasonably skilled workers running very nice high-tech CNC machines to produced machined metal parts, injection molded plastics as well as electronic assemblies. In some cases the end product cost just as much as it could cost in the US if we could do the same job. Of course, in other cases it cost significantly less. In all cases quality was beyond good. They can do the same things we do and adopt the same manufacturing technologies we adopt. The world is pretty flat in that respect. What's the difference then? Well, labor cost is one piece of the puzzle. And, depending on discipline, not necessarily the largest element in the equation. The problem is multi-faceted: taxes, regulations, environmental restrictions, OSHA, unions, pensions, lawsuits, etc. And the other factor is that they have a government and business leaders who's sole focus in in winning. They want to win this in the world stage. And they are executing a strategy as flawlessly as they possibly can. In the mean time we are making and continue to make all the wrong decisions. It's like watching a bad chess game: One bad move after the other. Take industries such as the light aircraft industry. It has been all but killed-off by lawsuits, regulations and other issues. You'd be crazy trying to spin-up a light aircraft operation in the US, even if you have great ideas. When I was manufacturing there were components (lots of them) that you simply could not buy in the US (meaning, US-made) at any price. We just don't make the stuff any more. This spans from chips to even certain types of glass. We have managed to kill-off whole layers of the supply chain. And that's the other factor: The supply chain. China has been outstanding at developing manufacturing regions where the entire supply chain exists within a concentrated geographic area. This, from a product development and manufacturing standpoint is the equivalent of the software "killer app". We can't compete because our supply chain is horribly fragmented in so many places that it saps competitiveness out of the system. When statistics get thrown around about the manufacturing sector growing you have to dig deeper and be very, very critical of the data. Are manufacturers growing in terms of dollar amounts while, at the same time, being forced to outsource more of their supply chain and subassemblies to places like China? I don't know. I'm not in that game any more and I am glad. But I can tell you with absolute certainty that, at a certain point in the life of my manufacturing business it became exceedingly obvious that the ONLY way to compete was to start to insert more and more Chinese-made components and subassemblies into our products. No choice. We are far too far down the slippery slope. This is something that happened over many decades. As such it will take decades to fix --if that's even possible. Sorry to be too negative but I've been in the trenches and have had skin in the game for far too long. I am not a casual observer but rather someone who invested very sizable amounts of my own money to be in the game and have the scars to prove it. Let's not forget that Steve Jobs told Obama that a lot of high-tech jobs are never coming back. http://open.salon.com/blog/steve_klingaman/2012/01/25/lets_not_kid_ourselves_about_manufacturing_jobs http://open.salon.com/blog/steve_klingaman/2012/01/25/lets_n... And, he was absolutely on the money on that one. I suspect that if you could ask for clarification he would bring up such things are taxes, laws, lawsuits, unions, regulation, environmental laws, supply chain structure and other factors. It would require a very solid and decisive cultural, financial and political shift to bump us over into a different path that could lead to a serious and solid recovery at all levels. And that's the problem. While we are preoccupied with bullshit here in the US some around the world are making the right decisions on a daily basis. They are investing in a future that we will not be ready to face without massive challenges. That's the truth. We can choose to look the other way and pretend this can be fixed by raising taxes on a few people who make a little more money, gain votes and move on, or we can take this shit seriously and transform our country into a business powerhouse at all levels. I vote for option #2.