Letter to the editor: Does he even understand manufacturing?
Friday, December 30, 2016 8:01 AM
There Michael Hicks goes again with his cherry-picked globalist propaganda.
He clearly has an anti-manufacturing agenda to promote. Either that, or he clearly lacks any understanding of how manufacturing works. Some key points of his article I would like to refute. First is that real manufacturing production has not increased. Economists like Gomory and others have correctly pointed out that current productivity numbers are inflated because the reporting methods do not separate out the amount of foreign-made content in U.S.-assembled goods. The other is that high-cost items like airplanes skew the numbers toward the higher end. Aerospace also has an increasing amount of foreign-made content and employs a limited of number of workers compared to other large scale manufacturers like automotive.
The truth is that outsourcing continues to offset far more jobs than automation does. Hicks suggests that we shouldn’t believe our lying eyes when we see all the closed and severely downsized factories in our region. But again it wasn’t automation that drove these jobs to China, Mexico, India and elsewhere, it was the ever present quest to seek out the cheapest labor and laxest regulation to increase the bottom line, or companies driven out of business by the mercantilist practices of currency manipulators, I.P. thieves, product dumpers and illegal subsidizers.
U.S. manufacturing has never fully recovered from the 2001 recession, only to be hammered again in 2008. Look at the charts and you can easily see when manufacturing began its long decline in the U.S. The first was after NAFTA was passed, and the second when China was granted permanent normal trade relations. Contrary to Hicks’ “lying eyes” theory, these events have had a devastating effect on the closing and downsizing of U.S. industry: 70,000 closed factories, 3 million lost jobs. This is reality, not some academic exercise.
The trade deficit is the true deficit we should be very concerned about. Each billion dollars of trade deficit is 6,000 lost direct manufacturing jobs and a number three times that of indirectly negatively impacted jobs. The trade deficit is the gauge of wealth, jobs and technology leaving our country.