As the presidential election campaign begins, the candidates should be talking about their plans for reviving U.S. manufacturing and putting America's productive capacity back to work.
WASHINGTON – With the pox that is the U.S. presidential election campaign upon us, it’s a good time to begin looking at concrete proposals for reviving the U.S. economy and identifying a new engine for economic growth. I submit that the incumbent and all of his challengers begin by focusing on what could be called a U.S. manufacturing renaissance.
Simply put, the United States must significantly increase the amount of stuff it makes, be it mobile devices, commercial jets or construction equipment. It’s one obvious way we can extract ourselves from the decade-old pattern of economic stagnation and declining wages that threatens the continued existence of the American middle class.
Electronics technology fueled several generations of U.S. innovation and economic prosperity, but electronics manufacturing and the jobs it created are long gone. U.S. companies like Apple remain global leaders in consumer product design, but an economic revival requires domestic manufacturing jobs.
Some technology entrepreneurs are trying.
During a recent visit to XCOR Aerospace, an entrepreneurial company looking to send tourists to the edge of space and satellites into orbit, company co-founder Jeff Greason told us he had a stack of engineering resumes on his desk and all the aeronautical engineers he could use. What the company needs, and what it is still unable to find, are machinists and electricians who can manufacture the guts of XCOR’s rockets.
Like software engineers in Taiwan, machinists in the States are worth their weight in gold and can take their pick of high-paying jobs. A high school graduate with a lot more on the ball than this correspondent would ensure a bright future by taking up a vocation like welding or structural engineering. A recent report about the growing need for workers with basic technical skills found that highly skilled airplane mechanics were being snapped up left and right by energy companies expanding their natural gas distribution networks.
When those trained workers leave, it’s difficult, if not impossible, to find replacements.
So why isn’t the U.S. education system responding to this shortfall? One reason is that a growing number of strictly for-profit colleges are siphoning off as much as $26 billion a year, according to Bloomberg, from U.S. student loan programs. In many cases, unsuspecting students are left with meager job prospects and crushing student loan debt.
One political reform would be closing loopholes in federal student loan programs that allow companies like Goldman Sachs (yes, Goldman Sachs!) to enter the tech school diploma racket. The Wall Street giant owns about 38 percent of Education Management Corp., parent company of the Art Institutes. The sole requirement for admission to AI and a growing list of for-profit colleges appears to be a pulse.
Fixing the student loan program would allow those funds to be more effectively used for vocational training programs that could create the next generation of skilled U.S. manufacturing workers.
The Obama administration paid lip service to manufacturing over the last three years as more manufacturing jobs were shipped overseas. In December, the White House finally acted by creating a cabinet-level Office of Manufacturing Policy. Why did it wait this long? Is it mere coincidence that the initiative has arrived just as the administration is ramping its reelection campaign?
Policy-makers within the administration “increasingly realize that a robust national recovery in the long term is impossible without a manufacturing sector," Rob Atkinson, president of the Information Technology and Innovation Foundation, told the Milwaukee Journal Sentinel. "It's taken a while for them to come to that conclusion, but I give them credit for getting this far."
If nothing else, creation of a White House manufacturing office will compel presidential candidates and policy-makers alike to get cracking on a viable national manufacturing policy. Whatever the election’s outcome, America needs a coherent manufacturing plan that gets our engineers and technicians back to work.
Post-Reagan Trade groups including professional engineering societies here ( unlike those in Germany ) are too timid and divided ( the Design Engr. vs Process Engr. divide ) to take collective action and tell the truth.
Those interested in bringing manufacturng back to the US ( at least the high value components like chips & displays ) must organize a grass roots movement along the lines of " Occupy Wall St. ".
First US consumers need to be educated that they have been committing slow suicide by being addicted to cheap consumer electronics.
Assembly needs to be robotized to make it cost competitive with the cheapest worker in China. This will create high value jobs here to build and program the robots. But more serious is the decline in the infrastructure for semiconductor materials & process R&D ( SemaTech only managed to train future recruits for TSMC ! ). Even a couple of hundred billion dollar invested smartly in this area ( hopefully with a major contribution from Apple ) would pay back within year or two.
We have full sympathy for the hard working individual Chinese but simply put when the profit from the hard work of 100s of millions of them are aggregated by their still autocratic & totalitarian Govt. to pursue vain anti - US agenda then it becomes a huge concern.
Apologists for Wall St. ( primariily the charlatans with degrees in Economics and the MBAs ) who quote 19 th century British economist Ricardo's Law of Comparative Advantages to justify mega outsourcing to China today hide the fact that it was cast aside in the 19 th century itself. After England ran up a huge trade deficit with China by importing Tea and used up its gold reserve, it stopped buying Tea from China and started growing them in India.
Smartphones and Tablets for the masses is today's cup of Tea. But Washington would not do anything to reverse trade deficit with China. Both camps in DC are so in the pockets of the pro - outsourcing profiteers of Wall St. that they will never do anything sincere to reform the system. And MNCs who have been goaded by Wall St. to foolishly chase profit in China are giving the store away in the hope of getting a favorable deal from the Chinese Govt.
Obama appointed Jeff Immelt, the CEO of GE as his jobs "czar", knowing full well that GE is at the forefront of siphoning off to China high tech ( SiC power electronics, jet engines ) developed with US taxpayer / consumer expense !!!
And Romney has been an indirect outsourcer - no matter how much rhetoric he now dishes out about getting tough with China.
Normally, trade is only possible if one nation has real goods or services to trade in exchange for the real goods and services of a trading partner. Balanced trade is practically automatic. However, normal trade was disengaged in the early 70s when the US switched to a purely fiat based currency. This switch effectively allowed the US to substitute manufactured politician-faced paper in place of real manufactured goods and services when conducting global trade. On the surface the US created a new trade advantage. In reality, a destructive process was set in motion. In response, our trading partners began trading their real manufactured products for our real manufacturing capability and jobs.
Restoration of our manufacturing capability will only come about by restoration of an honest non-fiat based currency and non-fiat based credit system. This will restore honest trade and the honest trade requirement of having real goods or services to trade in exchange for the real goods and services of a trading nation. This is the manufacturing initiative we really need. If we as a nation do not pursue this path on our own, our trading partners will eventually bring it about for us instead. After all, our ability to provide jobs in exchange for real goods and services will eventually reach its limit.
I think if you look at the first job after graduation, the differences are apparent. After a number of years, they begin to equalize. For instance, from my experience (having worked with and hired both)it's a theoretical vs. practical experience difference. If you want someone with great theoretical knowledge, the university BSEE has the edge. If you want someone with more practical (i.e. hands-on) experience, from my experience the Devry BSEET or BSEE have the edge. Of course this is highly variable depending upon the individual.
Nic, one nit first: I'm not so sure that the DeVry guys really had "much more employable experience" than the BSEE folks. The target employers were somewhat different. That said, DeVry graduates always struck me as a good bunch. I know one who, after DeVry, went to Stevens Institute for 4 years, eventually joined Boeing, where he is now a Boeing Fellow. I think that they do a pretty good job... it's just not quite the same as a 4 year engineering degree.
From deVry's website: "All our professors have degrees in their field, if not advanced degrees like MBAs and PhDs as well as real, practical experience." RCA Institutes (now Technical Career Institutes) was like that back in the 70s of last century. They had people teach who worked in the industry and gave the students real-world experiences. It was one of the few two-year "trade" schools with a college-accredited program. All the credits were transferable to CUNY City College's BEE (Bachelor of Electrical Engineering) program in what is now known as Grove School of Engineering in honor of 1960 graduate Andy Grove, which then graduated engineers with much more employable experience than others with straight BSEE degrees. Engineering education needs to have more practical programs like these in order for at least EEs to thrive in the U.S. and help build a practical manufacturing base.
It should start with Apple, the richest company in the world but employee 100,000 of thousands of people in China and other low cost nations. We should put pressure on Apple to bring these quality jobs back to Americas soil or start boycotting their products. What if all our cars were only imported and none produced here. Same thing.
Shame on Apple you greedy souless bastards.
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