Skip to comments.Why America Needs Factories
Posted on 09/27/2012 3:28:10 PM PDT by goodnesswins
If youve only been living in America for a few years, or if, like me, you only really became aware of your surroundings after the economy went to crap in a pleather briefcase, you might not have noticed the sharp decline in the number of factories on US soil. You might not even know what a factory looks like. How do you find a factory? Is there a password? Does it require a certain state of mind? What is a factory?
Sure, there were the days of Henry Ford and his cars of many colors (as long as its black), and there were a lot of factories then; there must be a lot of factories now, right?
No. Not really. There are still factories, but there are a LOT less than there used to be.
Lets check out this statistic from Prospect.org that talks about our disappearing factories:
Since 2001, the country has lost 42,400 factories, including 36 percent of factories that employ more than 1,000 workers (which declined from 1,479 to 947), and 38 percent of factories that employ between 500 and 999 employees (from 3,198 to 1,972).
Wow, thats pretty bad. This basically means that American industry has taken a huge hit, which most of us already knew. Ive personally watched two factories being demolished; the main reason was that they were abandoned, outsourced and, frankly, really damn ugly. Is that really what we want our industry reduced to? Factories are where we produce the items that rake in the big bucks things like cars, food products, natural resources, and high-technology products like semiconductors and Apple devices. Its a crucial part of the economic system that has been a weak link in the American chain for some time now. However, an article from Bloomberg.com claims that, under President Obama, factory jobs have made a record recovery.
The BGOV Barometer shows U.S. factory positions have grown since early 2010, arresting a slide that began toward the end of the 1990s. Its the best showing since the era of Bill Clinton , the only president in the last 30 years to leave office with more factory jobs than when he began.
Thats pretty good, right? Well, maybe. If you check out the full article, one thing you might notice is that the writer does not provide any statistics, any links, nor any evidence whatsoever to back up her claim. Thats journalism 101, back yourself up with facts. So, Im reluctant to take her word for it. Regardless, Ive seen American industry slipping for some time, and I feel like if it were really recovering, wed be hearing a lot more about it. True, the article was only posted today, and perhaps the writer is still looking for statistics. But the fact that she is reporting on this without linking to the source makes me think that its too good to be true. Perhaps factory jobs are improving, and perhaps theyve been improving for a while, but I suspect the actual numbers turnout is low.
An improvement, but eh.
However, Slate.com seems to think, judging by the title of their article from April of this year, that we really shouldnt care so much about factories.
Normally I try to be composed about other peoples articles, but OH MY WHOLE-WHEAT FLAKES, Mr. Ynglesias, blood is shooting out of my eyes. How can you possibly possess the opinions that you possess?
Basically the author, Matthew Ynglesias, claims that high-technology companies like Twitter, Apple, Google, and Facebook produce a high standard of living, while factories are usually found in lower-class areas and therefore produce a low standard of living. Logically, the conclusion is that we should encourage more growth in these high-technology companies while getting rid of the factories.
He even goes so far as to deliver this gem:
The scary thing about the factory-driven view of the American future is that its not totally implausible. The insourcing trend where firms move production back to North America is real enough. The drivers are rising Chinese wages and falling unit labor costs in the United States. But thats just a way of saying that America can regain factory parity with China by eliminating the prosperity gap between our two countriesa very strange policy aspiration. Most likely theres nothing we can do to prevent some narrowing of the gap, which will have the consequence of bringing some jobs back. But we should measure our success by the extent to which this doesnt happen, and we instead build and expand new industries that push living standards up and keep factory owners searching abroad for cheap labor.
Did he seriously just advocate for outsourcing manufacturing labor to foreign countries like CHINA!? Isnt that what everyone in the entire country hates? Dont we always rail against the made in China tag on those little lead-filled toys? AHHHHH.
Okay, returning a modicum of sanity to the discussion here, I really think Mr. Ynglesias misunderstands well, everything.
First of all, the reason we need manufacturing jobs domestically is because producing products and then selling them is a really great way to boost the economy. Thats first grade reasoning and Im not sure how thats not getting across. Especially if we can create something and sell it to another country, we can be making money and maybe alleviate some of the debt we have to everybody. The reason companies like Facebook, Yahoo, and Twitter cant do that is because, contrary to Mr. Ynglesias belief, these companies dont actually produce anything. Theyre service websites, and without membership fees they make a majority of their money through advertising. So basically, the money goes between two parties, the companies doing the advertising, and the website hosting. The transaction does not include consumers at all.
In the case of Apple, the industry portion of the company isnt even domestic. The industry is in China.
So BOOM GOES THE DYNAMITE. Owned.
But I believe factories are even more important because of the mindset they produce.
I currently work in a factory that produces food products, and I can honestly say my first week was one of the hardest things Ive ever done. Ive worked in landscaping, construction, high-technology manufacturing, and nothing has been harder than working at a conveyor belt at a food manufacturer.
Theres really something to be said for that type of work. If you slack off, the line will not slow down for you. Those boxes just keep coming and coming until youre buried underneath them. It builds character, thats for sure, and it also teaches you really fast that the world does not revolve around you, but if you screw up, everything comes to a screeching halt. It teaches humility and work ethic, and those are two things we really need in this country right now. So when Slate.com publishes an article that says we dont need factories anymore, Id hasten to say that they are part of the problem. We take away the opportunities for hard work in this country, pay more and more for minimal effort, and then wonder why our population lazy and lacking work ethic. Well you know who isnt lazy and lacking work ethic? People who work in factories. Its almost impossible.
So lets start bringing factories back to America. Lets utilize our own natural resources, manufacture things out of them, and sell them to other countries. And lets embrace hard work.
Seriously, once your fingers stop bleeding its really kind of fun.
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Free Traitors will HATE this article.
You should hear the names I was called a few days ago for suggesting that manufacturing taxes should be completely eliminated to spur job creation.
How dare I suggest cutting taxes for anyone other than the wealthiest Americans.
Not on Free Republic, or if so please repost that flame.
Its been a week or so but I’ll dig it up.
America's problems have little to do with free trade. Higher tariffs or limits on imports may work in the margin or on specific products, but it won't effect manufacturing employment greatly overall. The USA needs to look at itself.
The US Government encourages companies to move offshore. We pay Americans to be unemployed. 99 weeks of unemployment insurance is just the start. Look at record numbers of Foodstamp and Soc. Sec. disability as well.
then look at EPA, OSHA, FCC, USDA, DOC and all Government regulations on business and job-creation. Look at tort law and the incredible financial liability one has by operating manufacturing plants in the USA. We can't drill offshore or on Federal lands. We can't build pipelines and we can't build coal plants. The rest of the world tries to provide cheap energy to their industry - do we?
Then look at taxes, both Federal and State. Who wants to build a factory when you have redistributionist Marxist in the white house? Business are fleeing California for this reason.
Then look at the state of US Education and society - a great portion of the workforce, particularly younger workers, are difficult to employ in anything but basic service industries because of drug use, reading/math ability, and work ethic.
Lets fix some of those things first - and the industry will come back regardless of what China does.
“Free Traitors will HATE this article.”
I’m a free TRADER, but I agree. I simply think that this country can KICK BUTT if we can deal with our own, internal, problems, rather than blaming China and other countries for our problems.
So, as a start, we GET RID OF UNIONS, and then go after EPA and labor rules that simply won’t allow us to build anything.
So call me a ‘Traitor’ if that makes you and the UAW happy, but it won’t affect me, ONE BIT.
thanks for posting ..tried to get a conversation going about this last week
There is nothing wrong with protecting our market to keep full employment. Our founding fathers did it from the beginning of the country.
If it all about "Free Traitors" then why did Bill "NAFTA" Clinton see a net increase in US Manufacturing jobs?
Clinton signed the largest US trade deal in history yet this article claims Billy created more manufacturing jobs then anyone else.
The BGOV Barometer shows U.S. factory positions have grown since early 2010, arresting a slide that began toward the end of the 1990s. Its the best showing since the era of Bill Clinton , the only president in the last 30 years to leave office with more factory jobs than when he began
Bob offshoring a non union factory to a communist country helps fight unionism how? 6% of the workforce is in a union. 6%.
I committed the mortal sin of suggesting cutting taxes not only on the top earners but at the source of revenue as well. I’m as bad as Obama for suggesting that taxing a manufacturer for manufacturing is idiotic. LOL
You can be in favor off protecting non union manufacturing jobs being off shored or you can be a traitor. That simple. 6% of the US labor force is in a union, 6%.
And I don't even support taxes.
I lay this problem at the left hoof of Sean Hannity!
Its like an oncologist treating a stage iv cancer patient. He can give drugs radiation BUT HE CAN'T KILL the patient although technically that "cures" the patient and the cancer. Same with manufacturing, we can fight for reduced taxes etc. but off shoring a bridge to far.
“Bob offshoring a non union factory to a communist country helps fight unionism how? 6% of the workforce is in a union. 6%.”
You make a GREAT POINT regarding how successful the unions have been in sticking it to THE MAN and making him shut down his operations (as many here, including me, have seen first-hand). You’re ALMOST done, just 6% of our private labor force left.
But I’m wondering - considering the undisputed DAMAGE done to this country by unions (and the threat of unionization), why do you continue to be such an APOLOGIST for them? You STILL have not answered. I suspect it has to do with with George Soros or some other org pulling your strings, although I’m not sure. Perhaps you have some better answer, that won’t make people ROFL here?
In your pea brain it is not possible to want to protect or non union manufacturing base and be anti union.
I’ve been gaining a new perspective lately on why companies outsource. I’ve tried for the past several weeks to find a clothing manufacturer in the US to produce my designs. Of the dozen-or-so I’ve contacted, only one has bothered to reply, and that was to say that they couldn’t work with the fabrics I used. I’m giving the last batch I contacted until Friday to respond, and then I’m going to have to start looking overseas. It’s hard to run a business when the manufacturers keep giving you the silent treatment.
I remember that when I was young we were primed to feel sorry for people who had to work in factories. So when these awful places relocated abroad people didn’t feel like they were losing anything.
Except, they were losing everything.
People who make things are people who understand how to make things, which means they have a tactile understanding of how the world works. You have people who are actively involved in creating and using technology, and passing that accumulated knowledge generation to generation. You have multiple paths for advancement that allowed people with smarts and hard work to make something of themselves.
Also, people who make things are people who are able to buy homes and raise families and look the world in the eye.
Ship your factories abroad and you have a country that has lost its innate understanding of how the world works, your citizens are no longer in the loop when technology is transferred, “good old American know-how” becomes “Chinese know-how”. And you’ve got wave upon wave of people who can’t find work and can’t support their families.
When an economy has been reduced to service industries, I’ll shine your shoes if you wash my car, the paths for advancement are pretty few. Even people with degrees find themselves living in their parents’ basement because without blue collar people cranking out widgets there isn’t much need for white-collar people to count them. And people who can’t even make their own widgets find themselves left behind as the world rolls on without them.
“In your pea brain it is not possible to want to protect or non union manufacturing base and be anti union.”
So you’re down to that. I appreciate you making your point (even if you don’t proof read, LOL).
Anyway, yes, if Americans don’t mind living like crap, begging the unions to allow their subjects to make something, we can follow your path, and take whatever our union masters will allow us to have. That IS your definition of protecting jobs.
Some of us here (like 90%+ on this site, sorry) prefer to tell the unions to GET LOST and allow this country to compete again, at a level where Americans will not have to live like Hondurans. But you prefer to have AMERICANS live like crap - so I ask AGAIN, where is your problem with this country (if you’re even from here)?
We have lost almost all of our manufacturing.
Now we fight over crumbs.
It is time to take back our manufacturing. Now.
Your mental prowess is demented, the factories that make stuff here are 94% NON-UNION. Try to comprehend that.
Its as if people don’t understand how a manufactured product is taxed.
The ore that’s mined is taxed, then the refined metal is taxed, then the screw milled from that metal is taxed, and on down the line. Then there is the energy used, the machines, the property the company owns.....
“Your mental prowess is demented, the factories that make stuff here are 94% NON-UNION. Try to comprehend that.”
Again, you seem TOTALLY UNABLE to explain your love affair with the union thugs that have virtually shut down manufacturing in HUGE sections of this country.
You seem only able to launch PERSONAL ATTACKS against people that disagree with you.
So please, stop with the PERSONAL ATTACKS and please tell us why you think we need to preserve unions. A lot of us are wondering.
We have lost almost all of our manufacturing.
Now we fight over crumbs.
It is time to take back our manufacturing. Now.”
Thanks, I COULD NOT agree more. Unions had a reason, but they’re simply not needed anymore, in this country. In my career, I’ve told workers that if they unionize, their plant would be shut down withing two years. They didn’t listen...now they collect welfare and vote for Obama.
I don’t see why it’s so hard for others to understand this.
Admin moderator? Come on Bob grow some skin. We are talking about our manufacturing base. Pretty important stuff.
I’m sorry, I didn’t realize there was any factory left in California. Their environmentalists must be slipping!
Not hard to understand, the plant could have moved to another right-to-work state. Is that what happened? Or was it sent "offshore".
“Admin moderator? Come on Bob grow some skin. We are talking about our manufacturing base. Pretty important stuff.”
My skin is pretty tough. I took your first, NASTY, attack - pointed it out, and you kept attacking. That is in violation of the rules here. You may not like what I say, be we are required to be civil.
Civil? You are calling me a supporter of UNIONS? That is both untrue and uncivil, A really low comment. I dont know of any unions or union members. One time I was on a construction site with union plumbers, that is the closest thing to a union I’ve come across. So chill Bob, I’m not the only one throwing flames.
“Not hard to understand, the plant could have moved to another right-to-work state. Is that what happened? Or was it sent “offshore”.”
Once it’s time to move, then all options open up. In this case, even the non-union plants have salary/benefit demands that are based on the union plants, rather than a free market (which would have been about half as high, since some of the work could be done by college students and others not trying to raise a family).
In the end, the numbers wouldn’t pencil out, and the offer from overseas was just too good. Had we stayed here, we still would have been non-competitive and would have shut down anyway. There’s just no reason for having an inflated wage scale for manufacturing, if we really want to bring the work back.
And just to make a point, there are some very highly skilled people that worked for us, the machinists, they demanded high wages and they were worth it. Unfortunately, they got thrown overboard with rest of the bunch...which is partly why I get emotional about it - some were friends of mine.
“Civil? You are calling me a supporter of UNIONS?”
Your posting history, with respect to me, at least, is more than clear. So let’s drop that angle.
I am an IT type in a food manufacturing facility as a contract guy and there are a lot of folks there in production and support (esp. trades) that have been there for decades.
At times I am not sure what to make of the place either but it has some pluses.
Selling out your country is hard work, were you paid well Bob? With countrymen like you who needs enemies?
I worked in the US textile and apparel business for decades. Fabrics can definitely be an issue depending on the product classification. Duties vary by country of origin and minimums are often significant. Also some sewing operations are specialized as to the types of products they make. Finally, the ability of a factory to take on work depends on the degree to which the product development is complete. If you don’t have a completely engineered package with the technical design and full range of patterns complete, the factory may not have the technical design resources to get the product into production. Start ups are time intensive and factories will allocate scarce technical design and PD resources to their best customers.
There are two US sewing industry associations you can contact to get assistance matching your project to the right US factory. They are SEAMS and SPESA. Do an Internet search on both to get the contact people.
“then look at EPA, OSHA, FCC, USDA, DOC and all Government regulations on business and job-creation.”
You took the words out of my mouth. Don’t forget the onerous local, state, and county permits that have to be obtained as well.
All well and good, but manufacturing output in the United States has doubled [after inflation] since the seventies. Your young friend should dig deeper into the problems facing the American economy.
Yeah, the people who deal with intangible wealth really don’t like the people who create tangible wealth through actually manufacturing a real physical product. The intangible crowd loses control of the process, especially if the manufacturing is privately funded, and that really drives them nuts, like gambling withdrawl. It shouldn’t be any real surprise that the GDP downturn coinsides with the loss of manufacturing capacity.
During the Clinton years we warned of the same with the “service economy”. It seems that these days we have people living with the fantasy that we can be an investor economy.
We can’t, its only 1 leg of the stool. Necessary but not nearly enough to support the stool on its own.
“Selling out your country is hard work, were you paid well Bob? With countrymen like you who needs enemies? “
Unfortunately it was the unions that sold out my company. It was their choice, and they CHOSE welfare as opposed to work.
Bob's partly right. If his competitors moved overseas, the firm would have been non-competitive and would have shut down. That's why it doesn't make sense to blame an individual firm for choosing to go overseas. The solution has to come from government, probably in the form of import tariffs.
Had the government still had import tariffs in place, the offer from overseas wouldn't have been that lucrative. And it wouldn't have been lucrative to the firm's competition either. Therefor the firm might have been saved.
It would mean higher prices to U.S. consumers. But Americans would be employed, and that means fewer outlays for unemployment and other safety nets, and more tax revenues, and more salaried employees spending their earnings in the U.S. economy.
I’m sorry but the facts presented in this story contradict the conclusion being drawn about “Free Traitors”. So you have to either accept the story or the opinions. You cannot claim one validates the other.
what story? The original thread article or something I posted If something I posted, please reply to that post instead of the first post in the thread.
Doing only TWO things would bring manufacturing back to the United States.
1. END entitlements.
2. END the minimum wage.
Thank you, I’ll check those out!!
You’ve given me more info than all the factories I’ve contacted combined. Except for that one, I couldn’t coax so much as an “out of office” message from them. And they all advertised that they work with start-ups and small businesses, too. It’s frustrating.
I agree with tariffs. They have been laid dormant so long that if they are reinstated they will seem punitive. Still need to be done.
They may have been, but as long as the market place rules are such that anybody can go offshore and use $2/day labor to compete against you, you really have no choice but to offshore if you want to stay in business. It's only a matter of time until somebody undercuts you on price and takes your market share.
So you offshore, reap huge profits and huge bonuses until either competitors also move offshore and/or China copies your stuff. Then you take your bonus and pat yourself on the back that you successfully gamed the system, even if everyone else got screwed, because under the market place rules it was going to happen eventually anyway. It's why government is necessary and important in establishing those rules. And it's why free traitoring is bad for the country.
They will. And I don't know how hard it will be extracate ourselves from the WTO or if we can successfully raise tariffs within the WTO.
But we just need to position it as 25% unemployment. That's why we're doing it.
China no doubt will come back and say that we are causing them unemployment. And we will be. But we simply need to say, they need to lower their 90% tax rates and pay their people more so that they can consume the products they produce.
And we can always offer to buy our debt back at a discount so they can help pay for that.
While that would probably work, it would result in wages lower than the cost of living. Eventually we'd reach near parity with Chinese labor rates at which point the transportation costs would drive manufacturing back to the U.S.
However, that is a truly horrible solution. And one that is not necessary. We simply need to raise the import tariffs back up until we reach full employment. In fact, I think the tariffs should be tied to our unemployment rate.
Something along the lines of:
This would automatically raise the tariffs as U.S. unemployment went up. And it would automatically lower them as unemployment went down. And the make tariffs more expensive on high dollar items.
By the way, the political implications of what you suggest would doom any party that implemented it. Just the fear that Ryan would cut entitlements is probably why the GOP is about to lose to the most unpopular president ever.
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