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John_Galt
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re: Time to play hard ball on tech manufacturing
John_Galt   1/29/2012 4:00:33 PM
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Germany and Japan both are seeing shrinking populations - I think Japan is actually worse off in this regard. But at least solving this problem can be fun - so in the parlance of current day slang you guys should "be gettin' biz-aay!"

KB3001
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CEO
re: Time to play hard ball on tech manufacturing
KB3001   1/29/2012 10:53:13 AM
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Germany has its own Demographics problem, James. Its population is due to decline considerably in the next 20-30 years if they do not do anything about it (encouraging immigration is a quick way of doing it but difficult to sell politically). I think the US is in a better place, albeit not ideal, on that front ;-)

Made in USA
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re: Time to play hard ball on tech manufacturing
Made in USA   1/29/2012 1:46:07 AM
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Product for product, value for value trade is the norm. However, normal trade on the surface was transformed in the early 70s when the US went to a purely fiat based currency. This change allowed the US to globally trade manufactured Dollars and Dollar-based credit for the real manufactured products of other nations; instead of actual manufactured product for actual manufactured product as would normally be the case. On the surface the US had a new trade advantage. In reality, a destructive process was set in motion. Our trading partners began trading real manufactured product for our real manufacturing capability and jobs. Now, the trade is about complete. 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 actual product in order to trade for actual product. 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 this change about. Our ability to provide jobs for trade will eventually run out.

John_Galt
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re: Time to play hard ball on tech manufacturing
John_Galt   1/29/2012 12:46:23 AM
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This thread has seemed to have veered a little off course from high tech manufacturing offshore to unemployment in the US - a natural progression I supposed. But I posit that the US' biggest hurdle will soon be a historic labor shortage. I use as my exhibit current day Germany that enjoys an unemployment rate 2% less than the US even though its GDP lags. How can this be? One word - demographics. Unlike the allied powers, the axis powers did not experience a post war fertility surge but instead grew more or less linearly after WWII. The US has 23% (so called "baby boomers") of it's labor force speeding towards their "golden years" with the mean age of the 'boomers being 59.5 years. So even if 3/4 of the boomers cannot or choose not to retire at 65, that still leaves an employment deficit about 6% which theoretically means - barring a financial calamity - an unemployment rate below 3% (economists generally agree "full employment" is 4%). By the time we'd build-up facilities in the US, we couldn't find enough people to work in them!

KB3001
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CEO
re: Time to play hard ball on tech manufacturing
KB3001   1/28/2012 4:13:41 PM
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Good point. Germany's corporate law and taxation system are completely different from Anglo-Saxon countries. To start with, most German businesses are owned largely by German entities (German banks, German Government, and/or German private citizens). Second, labour law in Germany is based on co-determination which gives employees a greater say in the management of companies. Third, the tax system in Germany is more egalitarian. If you add all of the above, you can see how hard it is for German businesses to take decisions which will see the loss of thousands of German jobs to foreign labour. Instead, they look for ways to keep jobs locally, taking some short term financial losses at times, in return for longer term welfare and stability. Compare and contrast with Anglo-Saxon countries where a tiny minority of shareholders (institutional or otherwise) control the whole economy. Why should these folk care about the average American or British worker if they can double their profits by moving jobs abroad??

KB3001
User Rank
CEO
re: Time to play hard ball on tech manufacturing
KB3001   1/28/2012 3:57:46 PM
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I am afraid it's the whole shareholder-driven corporate system and the skewed taxation system that is to blame here. No one can do anything about the loss of jobs and decline of Western living standards (not even the mighty US president!) unless radical changes to corporate law and taxation are made. The problem here is the vested interests! Are these global oligarchs going to accept such change that will see their influence and wealth wane? I doubt it.

rick merritt
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re: Time to play hard ball on tech manufacturing
rick merritt   1/28/2012 1:52:00 PM
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It's worth noting that the electronics industry has been offshoring relatively low skill level assembly work since at least the 1970's when Intel pioneered sending chip assembly and test to places such as Manila and Penang. More recently, Intel was one of the first to build a big A&T plant in Vietnam Early in his career, Jobs tried to pioneer the concept of highly automated factories--Macs making Macs, with plants in the US and Singapore. With its move to China dn Foxconn, Apple basically decided not to follow that path and go the way the rest of the electronics industry--led by Intel--had been moving for many years.

Made in USA
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re: Time to play hard ball on tech manufacturing
Made in USA   1/28/2012 10:47:37 AM
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Dishonest fiat monetary/banking system is root cause of 30-plus year manufacturing loss. Vote Ron Paul.

me3
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re: Time to play hard ball on tech manufacturing
me3   1/28/2012 8:18:46 AM
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Instead of this mass ranting against our colleagues in China, maybe we can take a good look at Germany. They seem to be doing something right.

chipmonk0
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Manager
re: Time to play hard ball on tech manufacturing
chipmonk0   1/28/2012 2:25:09 AM
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Here is some scary math to get you thinking. At the end of WW II Japan had a population 80 % of the US and a std. of living only 30 %. It took them 40 years to catch up by exporting cars and consumer electronics to the US. But in the process half the jobs in the US Auto industry were lost. In 1990 China had a population 4x that of the US and by Purchase Power Parity a std. of living only 1/8 th of the US. Now can you figure even if outsourcing to China is allowed to continue at current level ( annual deficit $ 350 billion ) how long will it take for the Chinese to catch up with the US so they would lose the labor cost advantage ? Next estimate how many US industries will get destroyed before such a race to the bottom ends.

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