America can't compete in the global manufacturing space because of government regulation and government spending. Our shit costs so much more to make because we let forces other than the free market dictate how much we have to pay to make it. Look at the difference between California and Texas. California is rife with entitlement programs. Taxes are outrageously high, government spending is out of control, the state is bankrupt, and businesses are fleeing the state to places like Texas in droves.
The U.S. can't compete because there is a huge surplus of desperate, impoverished labor in other countries and the costs of educating and training that labor to work in the factories is not prohibitive. Also, the U.S. tries to reign in environmental costs and externalities by making businesses be responsible for them. It also attempts to increase the quality of life of its citizens with labor laws.
Are you proposing that we eliminate our environmental laws and labor laws and try to be more like the third world? Are you proposing that we decrease our standard of living in the name of competing with fifty-cents-an-hour Chinese?
You can't fix a price problem by spending more money. I'm all for keeping manufacturing in the US, but I'm not going to do so for the sake of a 300% or more price increase.
If we closed our borders to all but natural resources that we cannot obtain in the U.S., it's doubtful the prices would jump 300%. However, you need to also look at the invisible stuff on the back-end: Would wages and hours worked increase to make up for the increased prices? Would negative social costs of unemployment and underemployment decrease?
If the prices of goods and services produced abroad doesn't fall by as great of a percentage as people's wages and also make up for increased resultant negative back-end costs then what good is it?
Bring government spending back to the realm of fiscal responsibility, get rid of needless taxes, and America will again compete in manufacturing.
Even if we did this, even if we ended all environmental and labor regulations, we couldn't compete with the Chinese, Indians, and Mexicans--not unless we wanted to decrease wages and standard of living to those nations' third world levels.
Basically, because those nations have huge surpluses of impoverished labor they'll be able to produce goods and services for lower prices. The only way that America could "compete" would be for it to average out its wages and standard of living with those nations which means that Americans would need to be prepared to join the third world and to take on a third world quality of life. Really--we can have all of our jobs back--just as soon as we're willing to work for third world wages and without environmental and labor regulations.
Entitlement programs like minimum wage and public health care do nothing but drive ALL costs up, because, inevitably, the costs for those products are passed on to consumers.
The costs of the products are passed on to consumers--and some of the consumers receive higher wages than they otherwise might receive and health care, which is a benefit to them and to society. You make it sound as though the money generated by the higher costs just magically disappears.
Is it possible that those higher front-end costs could actually result in a greater decrease in invisible back-end costs? What if providing higher wages and health care for the poor decreased negative social costs such as the costs of the need for welfare and the costs of violent crime? (Why should the lower classes not slaughter the upper classes that are enslaving them? See South America where members of wealthy families are often kidnapped and held for ransom and where the upper classes have to live behind barbed wire and guards.)
Sadly, in the real world where people are interdependent, where land and resources exist in finite limited quantities, and where inherent conflicts of interest come up between rational productive people, the solution to our economic problems is not as simple as just establishing real laissez-faire capitalism (regardless of the fantasy Atlantis you might have read about in
Atlas Shrugged or
Capitalism: the Unknown Ideal.)
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