My nomination for oxymoron of the week: Radical Conservative. I have this vision of the weathermen wearing three-piece suits and trying to blow up union halls, the SEC, the EPA, and the IRS.
Globalization isn’t a choice, it’s a fact (sort of like gravity). If a company wants to help the “american public” (which I guess means those folks who happen to live in america at the moment) the first thing they have to do is survive. They are not going to do anything for themselves, their stockholders, their customers, or even their employees if they go out of business because they are too slow to act. My real concern is that “american companies” (still a meaningless term) are “globalizing” too slowly to remain competitive. I can picture the chapter in the history books, right next to the chapter about the british empire.
Look at the domestic auto makers who are still trying to hold onto their U.S. manufacturing facilities for some reason. Does it make any sense that they didn’t move all those operations off-shore decades ago (or at least move them to “right to work” states and dump the unions)? At least one of them will not survive, and the other two are likely to be bought up buy bigger fish eventually (if they don’t completely self-destruct in the meantime). I know that labor costs/unions are not their only problem, but that’s big part of it. My concern is that they are “globalizing” too slowly.
It would be more arrogant of us to assume we are the only ones in the world capable of providing current technology.
But these countries are NOT developing the technology on their own. We’re GIVING it too them. BIG DIFFERENCE. I’m NOT saying they don’t develop new technologies…They do. I’m just talking about the technologies that the US corporations are GIVING them for the sake of higher profits. The technologies these countries develop make for great competition …GREAT…
You’re making the assumption that the ONLY way to compete is to off-shore!! For some industries I won’t disagree. Take a look at GE…Jack Welch…the Father of Off-shoring. Closed down several plants in the US and moved them to Mexico and other countries…not because the plants couldn’t compete (they did very nicely)…but because he could only make 21% profit at these plants and by moving the Mexico was able to get 25% profit. Has NOTHING TO DO WITH SURVIVAL…HAS EVERYTHING to do with HIGHER PROFITS.
You also seem to think there’s going to be this GREAT new wave of “something” that’s going to come along to save us. Great…let me know when it happens. When the US manufacturing industry was in the Toilet back in the 70’s and 80’s the technology revolution was already in full swing to take over. Now that our US companies are moving technology overseas…the NEXT GREAT WAVE isn’t in place yet to take it’s place. I hope you’re right…But I haven’t seen one bit of evidence that you are.
The Japanese probably have it right; a national industrial strategy (what is good for the country), high quality standards, an extremely skilled and educated workforce,world class industrial processes, and a constant analyis as where to make things. I own 4 Japanese cameras. The oldest one was made in Japan the other three were made in Indonesia!! and in China. They were made in Japanese plants in those countries, but the design was all done in Japan.
Sweden went through a gut-wrenching industrial realignment as wages and development costs rose. Swedish electrical giant ASEA joined with Brown Boveri of Switserland to form ABB. They have plants all over the world. Sweden (population less than New York City)could not support 2 car manufacturers and had to join larger ones to gain development and design economies of scale. In spite of the very high wages, much manufacturing is still done in Sweden for most Saab and Volvo models.
The Swiss moved their watch manufacturing into the premium market (except for Swatch)and left the low end to the Asians.
Electrolux expanded overseas and bought up smaller appliance manufacturers, while Ericsson joined forces with other cell phone companies to be more competitive. Finland’s, Nokia the world’s largest cell phone manufacturer now makes their phones in Asia as well.
Philips, the Dutch electrical giant, reinvented itself; sold off their home appliance and other low tech divisions, built plants in developing countries, and moved up the technology ladder, like GE.
But these countries are NOT developing the technology on their own. We’re GIVING it too them. BIG DIFFERENCE. I’m NOT saying they don’t develop new technologies…They do. I’m just talking about the technologies that the US corporations are GIVING them for the sake of higher profits. The technologies these countries develop make for great competition …GREAT…
That wasn’t the point. I was saying that “U.S. corporations” (whatever that means today) are not the only ones that have state of the art technology in most areas. If the U.S. choose not to share a specific technology with a developing country, several other developed countries are likely to have equivalent technologies that they are more than happy to share. The only result would be loss of market share and loss of development opportunities. The U.S. government can not even effectively control legitimate classified information, do you really think that anyone can keep 5 year old industrial technologies out of the hands of anyone in the world that wants to copy it? That ship has sailed.
I still don’t know who “we” is, these technologies belong to a specific company, not the U.S. government, not the U.S. public, and certainly not to their employees. The U.S. trade balance, U.S. wage rates, and the lack of U.S. technical talent are not their problems. That company can do whatever it wants with it’s property, including relocating it’s entire operation to another part of the world (which may be a very good idea for some technical businesses). These companies are responsible to their shareholders, not to any national interests (as long as they follow the laws of the countries they are doing business in).
I still don’t know who “we” is, these technologies belong to a specific company, not the U.S. government, not the U.S. public, and certainly not to their employees. The U.S. trade balance, U.S. wage rates, and the lack of U.S. technical talent are not their problems.
You’re right…the technologies to belong to a specific company and NOT the US.
That company can do whatever it wants with it’s property, including relocating it’s entire operation to another part of the world (which may be a very good idea for some technical businesses).
And I’m NOT saying they can’t. What I’m saying is it’s good SHORT term business…And NOT good for this country. It’s great for the company…but NOT for the VAST majority of WORKING people here in the US. If all manufacturing jobs and technology jobs are moved overseas…WHAT’S LEFT…Service jobs???
And then there’s what’s call Brain Drain. My daughter is going to graduate next year with a degree in Chemical Engineer from MIT. She’s carrying a 4.4 average. Scored 1570 on her SAT’s (800 in math). And people in her field are having a difficult time finding jobs. Almost every single Chemical company in the US is moving jobs offshore. It use to be in the motto of this country…“Work hard…study hard and you can make something of yourself.” Now the motto is becoming…“Get your GED and get a job at McDonalds.” The incentive to move UP is being taken away. Nothing to strive for. There are less and less high-tech jobs here in the US. So what are people like my Daughter going to go into. Actually she’s talking about going to medical school (there goes my retirement money). What’s the incentive for students to do well in school??? So they can get a job at “The Gap”. Why even go to college??? Sure they are jobs NOW…But if the trend keeps going…what about 20 years from now???
Postscript:
Countries with an industrial strategy usually also have a respectable TRADE SURPLUS, whether they have natural resources or not. The US lacks an industrial and a sound trade strategy and has the most mind boggling trade deficit the world has ever seen.
Although unemployment is low, the Mcjobs do not really add to national wealth; in Japan vending machines have replaced many of these jobs.
Very high research & development and investment are also characteristic of countries with an industrial strategy.
Japan has no matural resources, so their strategy essentially forbids the wasteful use of oil, gas and coal! And mandates a high level of recycling.
“You sound like the ME ME thinking Radical Conservatives. I’ve got mine…forget about everyone else.”
No, I’m a globalist, if you need to hang a name on it. I’m far more generous than you seem to be. I’m willing to share with everyone and you want to restrict your generosity to US citizens. And it doesn’t always work agains the USA. The precipitous drop in the value of the dollar agains other currencies means that the USA is an attractive place to manufacture goods again. Auto and steel manufacturing are on the rise; those jobs pay an excellent wage.
m willing to share with everyone and you want to restrict your generosity to US citizens.
Nothing to do with SHARING. I have no problem that at all. I NEVER said companies can’t do what they want or stop them from doing so. All I pointed out is that by GIVING AWAY our technology it’s NOT good for our country.
Auto and steel manufacturing are on the rise; those jobs pay an excellent wage.
So you agree with my earlier post…Nothing to strive for. Just get your GED and forget about college because those jobs we want to go overseas. Yup…that’s what this country needs.
You’re making the assumption that the ONLY way to compete is to off-shore!! For some industries I won’t disagree. Take a look at GE…Jack Welch…the Father of Off-shoring. Closed down several plants in the US and moved them to Mexico and other countries…not because the plants couldn’t compete (they did very nicely)…but because he could only make 21% profit at these plants and by moving the Mexico was able to get 25% profit. Has NOTHING TO DO WITH SURVIVAL…HAS EVERYTHING to do with HIGHER PROFITS.
IMHO, neutron jack made the right call by increasing his profits from 21% to 25%. I would not want someone running my company who’s goal was “survival.” If he had not made that move he should have lost his job. If I was running a similar company, I would not keep one manufacturing job in the U.S. if I could do better elsewhere (in terms of totalproductivity, not just reduced labor cost). I also agree with his practice of dumping the lowest performing companies (and employees) and extravagantly rewarding the top performers; that is the only way of motivating the top performers, getting the average performers off their butts, and getting rid of the idiots. I would have no problem working for that company (until something better came along).
OTOH, if I worked for the U.S. dept. of commerce I would be looking for ways to preserve U.S. jobs and fix the trade deficit. In that capacity I would be looking for ways to provide incentives to companies (regardless of where they were based) maintain or establish U.S. operations. That would not include arguments about what was “good for the country” because they simply don’t care, it would have to be something they could bring to their board of directors without being laughed out of the room. There are ways of incentivize industries to maintain U.S. operations through taxes, contracts, etc. I would also start thinking about the education system, assuming that U.S. manufacturing is dead (a safe assumption now that it’s about 15% on the GNP) we better train some people to use their brains.
The Japanese probably have it right; a national industrial strategy (what is good for the country), high quality standards, an extremely skilled and educated workforce,world class industrial processes, and a constant analyis as where to make things.
I agree in principle, but it is not realistic to expect the U.S. government to take an active role in developing specific industries; although they occasionally try through the use of bogus defense initiatives (SDI comes to mind), and some direct R&D grants (usually much too small to be effective, like fusion energy). Usually, the best course of action for the government is to stay out of the way of the folks who are actually trying to get things done. The one exception is education, a legitimate (local) government function IMO, it would be nice if at least a few U.S. high school graduates could do basic math and find north america on a map of the world.
Auto and steel manufacturing are on the rise; those jobs pay an excellent wage.
So you agree with my earlier post…Nothing to strive for. Just get your GED and forget about college because those jobs we want to go overseas. Yup…that’s what this country needs.
I wouldn’t count on that for the future, it may well just be a little blip in the overall trend to reduce manufacturing. As more of the world develops, there will be less reasons to deal with U.S. labor costs. It’s that “excellent wage” for performing menial work that caused many of these issues.
It’s that “excellent wage” for performing menial work that caused many of these issues.
That may have been the case 30-40 years ago…BUT NOT with the hi-tech industry. And I don’t think this is a blip…This is a trend that’s been accelerating for the past 10 years.
IMHO, neutron jack made the right call by increasing his profits from 21% to 25%
Neutron Jack believes that ALL manufacturing and ALL engineering jobs should be outsourced. His vision of the US is to just have design, management and service jobs here in the US. He even admitted in an interview that his vision is GREAT for GE…and if every company did it the US economy would plummet. Problem is…that’s exactly what many many companies want to do. It’s GREAT for the bottom line…but disastrous for the country.
Neutron Jack believes that ALL manufacturing and ALL engineering jobs should be outsourced. His vision of the US is to just have design, management and service jobs here in the US. He even admitted in an interview that his vision is GREAT for GE…and if every company did it the US economy would plummet. Problem is…that’s exactly what many many companies want to do. It’s GREAT for the bottom line…but disastrous for the country.
I have no problem with his vision, and you will find me working where-ever my next opportunity happens to be. It’s not GE’s responsibility to worry about the overall U.S. economy. There are plenty of elected officials who can take action to make the U.S. a more attractive environment for business if they choose to do so.
That may have been the case 30-40 years ago…BUT NOT with the hi-tech industry. And I don’t think this is a blip…This is a trend that’s been accelerating for the past 10 years.
I though we were talking about the auto and steel manufacturing industries??
Craig, the Japanese government and MITI do not get personally involved in this process other than selecting certain industries and providing strong incentives for R & D. The US government did this with developing fridges which used only half the power of earlier ones. The contract was actually given to Whirlpool, but the results were shared by all.
Th Partnership for a New Generation Vehicles (PNGV) was a good program sponsored by the US government; the various participants were given money to develop a family car that got 3 times the gas mileage of a standard Ford Taurus. They all did, but then the govenment and industry dropped the ball; at that time (1993) the CAFE standards should have been tightened up considerably, and tough gas guzzler taxes introduced. As a result, the “Big Three” shelved any further development, and only Honda and Toyota started developing hybrids. The rest is history.
We can now do the same with alternate energy sources, such as ethanol from waste (garbage), solar voltaic electricity, LED lighting, etc. In all cases, the government is the spark plug to get things going, and once in production various regulations are in place to help the product or process off the ground. Private industry does the work and reaps the profits.
Nuclear power in all countries would never have gotten off the ground without initial government subsidies.
I wasn’t disagreeing with the part of the Auto and Steel industry. I made the statement that we’re going backwards if that’s where we need to get our jobs from. It’s no longer necessary for our kids to go to college if the BEST jobs our there are the Auto industry and Steel industry.
Craig; those Japanese goods manufactured in developing Asian countries are sold all over the world; and Walmart is one of its biggest customers. Your next Panasonic camera (digital, of course) will likely come from China, Thailand or Malaysia. The Colt cars Chrysler sold for Mutisubishi were made in Thailand, which is the world’s second largest manufacturer of pickup trucks, most of them compact, of course.
Globalization within Asia is working extremely well; never in the past did the Japanese realize that there was no need to conquer Asia; just import raw materials and add value, export the product, and later farm out manufacturing. Most Asian counries have a love-hate attitude towards Japan, even those that were not invaded.
A similar attitude exists towards the US in Latin America, since local activists and corrupt leader all blame their misery and lack of success on the US, but love its products and clean factories where they make good wages.
We can now do the same with alternate energy sources, such as ethanol from waste (garbage), solar voltaic electricity, LED lighting, etc. In all cases, the government is the spark plug to get things going, and once in production various regulations are in place to help the product or process off the ground. Private industry does the work and reaps the profits.
Nuclear power in all countries would never have gotten off the ground without initial government subsidies.
I would like to see some significant grant money in those areas too, but (these days) it is usually too small to be very effective. My favorite example is still fusion (the technology that has been 40 years away for the last 40 years), where is the huge government effort to develop commercial fusion by some specific date? IMO, that would need an effort equivalent to the apollo program in the 60s if we were serious. The entire R&D effort could probably be funded for the cost of a year of the Iraqi war (maybe we will get around to it when that war ends in the year 2037).
Commercial nuclear power was really an off-shoot of navel reactors, I honestly doubt it would have happened without a military application. Look what (didn’t) happen with high temperature gas reactors; the south africans are still trying, but no-one else is very interested. General atomic tried to develop HTGRs in the U.S., and they lost their butts.