Does the U.S. need factories to be an economic power?

[Engineer]

The amount of support jobs pales in comparison to the good old days of the assembly line. Yes, there are support jobs, and they pay well, they just do not account enough people.

I agree. Wasn't saying that the extra automation jobs created were enough to take the place of jobs lost...just saying that if you offshore the entire factory system, those jobs will be gone too.

 

[werepossum]

Don't forget that the manufacturing in the US, while automating, creates millions of support jobs such as tool builders, automation integrators, etc. Without said manufacturing, many high skilled jobs (and to some extent manufacturing themselves as they make machines, etc) would cease to exist.

Agreed. Automation is a net wealth builder. Unfortunately for us, due to free trade laws and the near-total abolitionism of technology embargoes it's just as easy if not easier to automate production in countries with cheaper labor. And of course we still have to strike a balance between rewarding those innovators who invent and implement the automation (engineers and factory owners) while still finding more good jobs for the displaced workers.

 

[Engineer]

Agreed. Automation is a net wealth builder. Unfortunately for us, due to free trade laws and the near-total abolitionism of technology embargoes it's just as easy if not easier to automate production in countries with cheaper labor. And of course we still have to strike a balance between rewarding those innovators who invent and implement the automation (engineers and factory owners) while still finding more good jobs for the displaced workers.

I've seen automation from those countries and in general, it's shit (from experience).

How the Chinese automate a press

 

[piasabird]

In reference to your Apple reference where are you purchasing American Computer Products??? They dont hardly exist except for maybe the Case or a sticker on the front indicating maybe it was assembled in America.

Almost all computer products are made overseas.

 

[WhipperSnapper]

Factories produce the wealth that we enjoy consuming. Where are those physical goods supposed to come from if we don't produce them ourselves or at least produce enough of a certain good to trade for other goods?

You might answer that we can trade intellectual services for manufactured goods, but what nation in its right mind would be content to produce the manufactured goods and not want to produce its own intellectual services?

Basically, we are paying for manufactured goods by exchanging our assets--ownership of businesses and land, which will impoverish us long term.

The free market dogmatist advocates who claim that we don't need manufacturing (that we don't need to produce tangible, physical wealth) are living in some sort of a fantasy world where Americans possess superior intellects and intellectual capacity and thus other nations in the world will happily send us manufactured goods for the privilege of trading for our superior intellectual products. They are also living under the illusion that it's possible to employ over 100 million people (who all need solid middle class jobs and not poverty wage retail service jobs) in knowledge-based jobs when we already have huge oversupplies of college-educated people and millions of college degree holders who are underemployed-out-of-field. (Heck, according to a recent study we have 5000 janitors who have PhDs.)

 

[ShawnD1]

I've seen automation from those countries and in general, it's shit (from experience).

How the Chinese automate a press

LOL china. Is that really cheaper than building a real automated system? Like I know chinese labor basically costs zero dollars and automated systems are crazy expensive, but true automated systems are so much faster. Wouldn't that make up for it?


Here's how north america does automation. No humans, extremely fast, very efficient.
http://www.youtube.com/watch?v=00cKkJGOjNU (how potato chips are made)

 

[Engineer]

LOL china. Is that really cheaper than building a real automated system? Like I know chinese labor basically costs zero dollars and automated systems are crazy expensive, but true automated systems are so much faster. Wouldn't that make up for it?


Here's how north america does automation. No humans, extremely fast, very efficient.
http://www.youtube.com/watch?v=00cKkJGOjNU (how potato chips are made)

What I find amazing is that my previous company tried to offshore some of the tool building and the Chinese actually wanted more money to build it than the US companies. After seeing some of the "cheaper" Chinese machinery, I would stay away at all costs (do not want).

 

[Siddhartha]

I vote for having a broader manufacturing and tax base with lower unemployment and trade deficits.

 

[Pulsar]

I'm not even going to read pages 2, 3, and 4. After page one, there's no where to go but up. This is a very simple answer, and anyone half-way educated economist can tell you what it is.

The ONLY way to bring money into a country is to add value to something. That can be adding value through engineering, or adding value through manufacturing.

To put this more simply, take picture of the US, and put a box around it. Now draw an arrow in. Write the products that come in. These are products that have had value added outside the country - essentially turned from worthless into worthwhile.

Now Draw an arrow coming out and do the same.

This is, essentially, a mass balance. A Thermodynamic balance. Any type of balance you like. If you are adding less value and sending it out that you are bringing, then net dollars, net value, is leaving.

It is THAT simple. Believing that you can throw that value-adding base away and simply add value to paper is ludicrous. Engineering follows the product itself. It may take a while, but there are dozens of reasons why it makes far more sense to engineer in the location you build at. If you move your manufacturing away, or your value adding, then your engineering, your design, and in the end your new intellectual property will move away as well.

There is no such thing as a successful economy based on service, unless you are in the unique situation of having a valuable PLACE (Aruba, Jamaica.... etc) that brings people in. That is another type of value.

We are on the slow downward slide of worldwide wage equalization. As long as our manufacturing continues to leave, so will our tech and white collar jobs.

If we create no value in this country, no dollars will flow in, only out, and the net worth of our country will decline. There is simply no arguing this. No amount of wall street tricks or paper shuffling will stop it. Period.

PS - to the ignorant individual who believes that factory jobs are basically run by illiterates and drop outs.... you're an idiot. I'm a white-collar multiple degreed engineer, and some of the hourly people who work for me have more creativity, common sense, and flat out intelligence than many of the engineers I work with. If you think that silly little paper with a degree on it creates YOUR value, you're greatly mistaken.

 

[Pulsar]

LOL china. Is that really cheaper than building a real automated system? Like I know chinese labor basically costs zero dollars and automated systems are crazy expensive, but true automated systems are so much faster. Wouldn't that make up for it?


Here's how north america does automation. No humans, extremely fast, very efficient.
http://www.youtube.com/watch?v=00cKkJGOjNU (how potato chips are made)

Yes. It's cheaper. By orders of magnitude. I know because I deal with their products that come in. It is STILL cheaper for them to make those parts, send them over, then employ a dozen people lineside checking the quality 100%. That's how cheap it is to manufacture over there. Billions of people paid pennies an hour.

 

[Pulsar]

Factories produce the wealth that we enjoy consuming. Where are those physical goods supposed to come from if we don't produce them ourselves or at least produce enough of a certain good to trade for other goods?

You might answer that we can trade intellectual services for manufactured goods, but what nation in its right mind would be content to produce the manufactured goods and not want to produce its own intellectual services?

Basically, we are paying for manufactured goods by exchanging our assets--ownership of businesses and land, which will impoverish us long term.

The free market dogmatist advocates who claim that we don't need manufacturing (that we don't need to produce tangible, physical wealth) are living in some sort of a fantasy world where Americans possess superior intellects and intellectual capacity and thus other nations in the world will happily send us manufactured goods for the privilege of trading for our superior intellectual products. They are also living under the illusion that it's possible to employ over 100 million people (who all need solid middle class jobs and not poverty wage retail service jobs) in knowledge-based jobs when we already have huge oversupplies of college-educated people and millions of college degree holders who are underemployed-out-of-field. (Heck, according to a recent study we have 5000 janitors who have PhDs.)

Exactly correct.

 

[Brigandier]

I'm not even going to read pages 2, 3, and 4. After page one, there's no where to go but up. This is a very simple answer, and anyone half-way educated economist can tell you what it is.

The ONLY way to bring money into a country is to add value to something. That can be adding value through engineering, or adding value through manufacturing.

To put this more simply, take picture of the US, and put a box around it. Now draw an arrow in. Write the products that come in. These are products that have had value added outside the country - essentially turned from worthless into worthwhile.

Now Draw an arrow coming out and do the same.

This is, essentially, a mass balance. A Thermodynamic balance. Any type of balance you like. If you are adding less value and sending it out that you are bringing, then net dollars, net value, is leaving.

It is THAT simple. Believing that you can throw that value-adding base away and simply add value to paper is ludicrous. Engineering follows the product itself. It may take a while, but there are dozens of reasons why it makes far more sense to engineer in the location you build at. If you move your manufacturing away, or your value adding, then your engineering, your design, and in the end your new intellectual property will move away as well.

There is no such thing as a successful economy based on service, unless you are in the unique situation of having a valuable PLACE (Aruba, Jamaica.... etc) that brings people in. That is another type of value.

We are on the slow downward slide of worldwide wage equalization. As long as our manufacturing continues to leave, so will our tech and white collar jobs.

If we create no value in this country, no dollars will flow in, only out, and the net worth of our country will decline. There is simply no arguing this. No amount of wall street tricks or paper shuffling will stop it. Period.

PS - to the ignorant individual who believes that factory jobs are basically run by illiterates and drop outs.... you're an idiot. I'm a white-collar multiple degreed engineer, and some of the hourly people who work for me have more creativity, common sense, and flat out intelligence than many of the engineers I work with. If you think that silly little paper with a degree on it creates YOUR value, you're greatly mistaken.

STFU, you are an upper wage scale(>40k) shill. Workers on the assembly line have no creativity other than what society teaches them. That is why you get taxed for everyone else. Humans are dumb beasts that need educated people to direct them, if you're against that education, you are against the people. I'm sure you'd be quite happy with a never-ending constant manufacturing base.

 

[Pulsar]

I've seen automation from those countries and in general, it's shit (from experience).

How the Chinese automate a press

I suggest you drop your incorrect perceptions and learn a bit more. I know dozens of engineers I've worked with in the automotive industry who have been paid small fortunes to go teach the chinese how to automate correctly. They were more than happy to live in China for 2 years for what amounts to nearly millions of dollars, and in return many of China's facilities are approaching the US in levels of automation. And they still only have to pay their workers pennies a day.

 

[Pulsar]

STFU, you are an upper wage scale(>40k) shill. Workers on the assembly line have no creativity other than what society teaches them. That is why you get taxed for everyone else. Humans are dumb beasts that need educated people to direct them, if you're against that education, you are against the people. I'm sure you'd be quite happy with a never-ending constant manufacturing base.

God I hope that was sarcasm. If it wasn't, I feel very very sorry for you.

It's a pretty regular basis where we do business with no salaried employees here at all: the coordinators know how to run the plant far more effectively than most of the engineers. The only thing the engineers do better is troubleshoot, and that's only because we've had the formal education to read the prints, work with autocad, and understand the math and engineering behind the hydraulics and electronics and machine utilization. Otherwise, quite frankly, the engineers aren't really needed.

 

[Trianon]

LOL china. Is that really cheaper than building a real automated system? Like I know chinese labor basically costs zero dollars and automated systems are crazy expensive, but true automated systems are so much faster. Wouldn't that make up for it?


Here's how north america does automation. No humans, extremely fast, very efficient.
http://www.youtube.com/watch?v=00cKkJGOjNU (how potato chips are made)

hello, obesity and hypertension

 

[Engineer]

I suggest you drop your incorrect perceptions and learn a bit more. I know dozens of engineers I've worked with in the automotive industry who have been paid small fortunes to go teach the chinese how to automate correctly. They were more than happy to live in China for 2 years for what amounts to nearly millions of dollars, and in return many of China's facilities are approaching the US in levels of automation. And they still only have to pay their workers pennies a day.

My "perceptions" are based on what I have seen. You may well be 100% correct but that does not change what I've seen in person and the countless dollars spent on trying to get the cheap junk running and finally giving up and buying US made tools and presses.

 

[ShawnD1]

My "perceptions" are based on what I have seen. You may well be 100% correct but that does not change what I've seen in person and the countless dollars spent on trying to get the cheap junk running and finally giving up and buying US made tools and presses.

I finally found out why that is. Cheap shitty Chinese tools are often cast. Expensive American and German tools are machined. The strength of the material is completely different. Those $300 American made basic tools like wrench sets might weigh half as much but are still twice as strong.

It's interesting but there was a similar experience with skateboard parts. Cheap no name boards at the grocery store come with axles ("trucks") that break easily. The cheap ones were made from Chinese pot metal which is cheaply cast garbage that shatters when it hits something like concrete. High quality axles are made by American companies, they cost $50 just for the axles, and they're damn near indestructible. The ones on my board are made by Independent Truck Company in San Francisco. They made it through 5 years of abuse and they still work.

 

[rudder]

I suppose that's the case, however, the US does need a large well Paid Work force that produces some kind of high value product. That used to be Manufacturing and up until now there hasn't really been a replacement of those kinds of jobs in any number close to what has been lost due to the loss of the Manufacturing base.

In terms of dollar value, the United States manufacturers more than any other nation in the world. We just moved away from producing t-shirts, mops, etc and moved to airplanes, hight tech equipment, heavy industrial equipment, etc. These types of items simply require less manpower to produce. Same thing with automobiles. We still produce quite a bit in the U.S.... Chevrolet, GM, Ford, Toyota, Nissan, Honda, VW... it just takes less people to make a car now than 30 years ago.

The manufacturing base we have lost is for those items that are now being mass produced by people being paid slave wages. You can't pay someone $14/hour + benefits to make shirts and still hope to sell them on the world market.

 

[sandorski]

In terms of dollar value, the United States manufacturers more than any other nation in the world. We just moved away from producing t-shirts, mops, etc and moved to airplanes, hight tech equipment, heavy industrial equipment, etc. These types of items simply require less manpower to produce. Same thing with automobiles. We still produce quite a bit in the U.S.... Chevrolet, GM, Ford, Toyota, Nissan, Honda, VW... it just takes less people to make a car now than 30 years ago.

The manufacturing base we have lost is for those items that are now being mass produced by people being paid slave wages. You can't pay someone $14/hour + benefits to make shirts and still hope to sell them on the world market.

That's fine, except those Jobs are still lost and any potential for Export is definitely lost, nevermind what was likely mostly Domestic Production/Consumption is now simply Importation.

 

[hal2kilo]

**shakes head at thread**

Everyone can just be doctors, lawyers, computer IT guys and engineers. Problem solved.

I agree, the answer is so obvious. The medium IQ is 100.

 

[Zorkorist]

I watched Milton Friedman's 1980 PBS miniseries on the economics. In one episode he advocated bringing back sweat shops. No mininum wage, no OSHA, safety regulations, no unions, and probably no ecological regulations.

Where would you draw the line in regulating business? Get rid of all regulations? What about long term costs?

Today's people are much better educated than people even 20 years ago. They are much more connected and much more in tune.

Business will be regulated by the people. Just as Government today is regulated by the people.

If you had told the poeople 20 years ago, that we will no longer have factories, they would have said no.

-John

 

[werepossum]

I'm not even going to read pages 2, 3, and 4. After page one, there's no where to go but up. This is a very simple answer, and anyone half-way educated economist can tell you what it is.

The ONLY way to bring money into a country is to add value to something. That can be adding value through engineering, or adding value through manufacturing.

To put this more simply, take picture of the US, and put a box around it. Now draw an arrow in. Write the products that come in. These are products that have had value added outside the country - essentially turned from worthless into worthwhile.

Now Draw an arrow coming out and do the same.

This is, essentially, a mass balance. A Thermodynamic balance. Any type of balance you like. If you are adding less value and sending it out that you are bringing, then net dollars, net value, is leaving.

It is THAT simple. Believing that you can throw that value-adding base away and simply add value to paper is ludicrous. Engineering follows the product itself. It may take a while, but there are dozens of reasons why it makes far more sense to engineer in the location you build at. If you move your manufacturing away, or your value adding, then your engineering, your design, and in the end your new intellectual property will move away as well.

There is no such thing as a successful economy based on service, unless you are in the unique situation of having a valuable PLACE (Aruba, Jamaica.... etc) that brings people in. That is another type of value.

We are on the slow downward slide of worldwide wage equalization. As long as our manufacturing continues to leave, so will our tech and white collar jobs.

If we create no value in this country, no dollars will flow in, only out, and the net worth of our country will decline. There is simply no arguing this. No amount of wall street tricks or paper shuffling will stop it. Period.

PS - to the ignorant individual who believes that factory jobs are basically run by illiterates and drop outs.... you're an idiot. I'm a white-collar multiple degreed engineer, and some of the hourly people who work for me have more creativity, common sense, and flat out intelligence than many of the engineers I work with. If you think that silly little paper with a degree on it creates YOUR value, you're greatly mistaken.

Excellent post, well reasoned and well phrased. Thanks!