Ernie : With increasing use of robots / robotics , yes, American productivity in the manufacturing sector is up, in some areas this is major. Sometimes this happens because of reorganization, new styles of management etc.The point is that in other areas, despite this fact, like shoes, we simply, for all practical purposes, don't have an industry. Aggregate totals -rise in overall manufacturing productivity and sometimes products-- can mask serious problems in specific fields. In what way it is "good" that 100 % of all power-line transformers must be imported from abroad? In what way is it "good" that we don't have a consumer electronics industry any more ( actually there is some, but by-and-large ) ? Some people get rich by outsourcing, like Phil Knight, who is an Oregon business celebrity, who underwrites the U of O athletic program and has made the Ducks top tier in most college sports. Trouble is, most Nike products are manufactured in Bangla Desh or Malaysia, etc and not in the USA. Which is anything but some kind of fluke since what Knight does is no different than 1000 other businesses. Great. Terrific. But we no longer have an American shoe industry. And that is the opposite of great or terrific. We can restart a shoe industry if we need to. We can use the shoes we have for the next few years until that happens. But about power-line transformers that kind of time luxury may not exist in an emergency situation. Same for rare earths, even though this seems to be in process of correction. But for some years all of our rare earths were being imported from China. And that is not OK, it is utterly foolish. " America shouldn't chase where China was ten years ago. We need to figure out where manufacturing will be in 10 years, and make sure *those* kinds of factories -- or mixed manufacturing/service jobs -- are located here."
Yes, we should look to the future, exactly as this says. But the point is that national security may mean that we trade some efficiencies and profit margins for a higher good, survival.. Not sure why this concept is not registering. The world simply cannot adequately be thought of only in terms of ledger economics. We need some kind of calculus that allows us to value survival and balance survival needs against profit margins or cash flows, and something similar with respect to culture and values. Sure, Rap makes a lot of money, so too, do some Hollywood productions that promote violence and anti-Christian attitudes. But for me the issue of profitability is trivial in comparison to the overall damages done by Rap and bad kinds of movies. That is, the bottom line is not sufficient as a yardstick, it is woefully inadequate, and unless we find a better system of metrics than pure profitability we are heading off a cliff. About a few things, maybe we should be chasing after where China was 10 years ago. Billy ============================================ 4/20/2012 10:33:41 A.M. Pacific Daylight Time, [email protected] writes: Hi Billy, On Apr 20, 2012, at 10:19 AM, [email protected] wrote: > Ernie : > Ummm, as much as we all think that high tech is "the wave of the future," > there are such things as essential old school industries that are going > to remain essential for as long as anyone can imagine. Did you actually bother to read the report? The point is not that everything is high-tech. The point is that the "manufacturing process" is *itself* a technology, and thus is being disrupted just as surely as every other technology industry. It isn't going away, but the economies of scale and value creation are changing dramatically. > Shoes > Lumber > Power-line Transformers > Cement > Adhesives > Aluminum products > Plastics > Glass > Airframes > Paper products > Rubber and synthetics > Insecticides > Chemicals > Medicines and drugs > Fiber products > Tractors That's an odd list. Do you even realize that the U.S. is still the world's leading manufacturer? http://www.cbsnews.com/8301-505123_162-36742134/manufacturing-surprise58-the -us-still-leads-in-making-things/ The problem is that we lead in low-value bulk-items (like lumber and glass) and high-value low-volume items (like drugs), neither of which create the large numbers of well-paying jobs GM used to. All the angst is largely about the medium-value mass-produced objects which China is specializing in. But those are *precisely* the areas most likely to be disrupted by technological innovation. Additive manufacturing is scaring plastic toy makers ***less. And yes, even shoe manufacturers are worried: http://www.youtube.com/watch?v=tAVhnIUmyks America shouldn't chase where China was ten years ago. We need to figure out where manufacturing will be in 10 years, and make sure *those* kinds of factories -- or mixed manufacturing/service jobs -- are located here. -- Ernie P. > > > You get the idea. > > Yes, high tech has emerged as a really major factor in the economy. > Impossible to imagine many sectors without it. But there are such things > as industrial basics, the floor beneath our feet. Throw that away > and high tech becomes vulnerable to all kinds of forces that > no-one at MS or Apple has to worry much about at this time. > Trouble is, even now absence of worry would seem to be ill-advised > A "hollowed out" economy works against the national interest > including the national economic interest. > > Market forces are insufficient to protect a good number of essential industries. > > National interest = national security > Without it we all are cooked. > > It is essential for economists to cease and desist obsessive fixation > on bottom-line profitability. Some things, like national survival, > are much more important. > > Billy > > ================================ > > > > > > > > > > 4/20/2012 10:03:57 A.M. Pacific Daylight Time, [email protected] writes: > Hello again, > On Apr 19, 2012, at 9:11 AM, Dr. Ernie Prabhakar wrote: > >> I think they are 100% correct. That is why any focus on protecting our existing manufacturing industry would be vastly counterproductive. > > > More details from their executive summary: > > http://growth.newamerica.net/sites/newamerica.net/files/policydocs/Lind,%20Michael%20and%20Freedman,%20Joshua%20-%20NAF%20-%20Value%20Added%20America %27s%20Manufacturing%20Future.pdf > >> Public policy needs to focus on the imperative of revital- izing and upgrading America’s manufacturing base, by methods that include: >> >> R&D and Technology Diffusion. Public policy needs to encourage private sector R&D, including through a per- manent R&D tax credit. Public investment in R&D and support for manufacturing should be financed in part by new federal development banks and federally-favored municipal bonds. Breakthroughs in R&D must be fol- lowed by development at scale and the diffusion of new transformative technologies across sectors, with the help of government procurement, credit and technology exten- sion programs. >> >> Infrastructure and Energy Strategy. In addition to these forms of direct assistance, infrastructure and energy policies can indirectly retain or onshore manufacturing in the U.S. by lowering the costs of energy and chemical feedstocks and by reducing bottle-necks in the transportation and commu- nications infrastructures. In addition to lowering the costs of manufacturing, the energy sector, revitalized by natural gas, and the construction of new, more efficient transporta- tion and communications systems can provide sources of demand for domestic manufacturing firms. >> >> Tax and Regulatory Reform. Tax policy should encourage investment in American manufacturing by foreign and domestic firms alike. Legacy regulatory systems need to be updated as cutting-edge technology blurs or destroys the boundaries among kinds of manufacturing or between manufacturing and services. >> >> Training Workers for Advanced Manufacturing Jobs. Rapid technological change in manufacturing means that the U.S. needs a new social contract in education which ratio- nally allocates responsibility for learning and upgrading skills among government, employers and individuals. >> >> Promoting Mutually Beneficial Rather than Adversarial Trade. The U.S. needs to do a better job of defending its industries against predatory policies by mercantilist nations, without sacrificing the benefits of access to for- eign markets and foreign talent. >> > > These may not be the final answers, but they are very much on the right track. > > -- Ernie P. > > -- > Centroids: The Center of the Radical Centrist Community <[email protected]> >Radical Centrism website and blog: http://RadicalCentrism.org -- Centroids: The Center of the Radical Centrist Community <[email protected]> Google Group: http://groups.google.com/group/RadicalCentrism Radical Centrism website and blog: http://RadicalCentrism.org
