This post by Tony Wikrent on globalization, free trade, US manufacturing and the hollowing out of the US economy. Lots of very concrete examples. Tony’s one of the folks who’s gotten things right for years.
This post by Tony Wikrent on globalization, free trade, US manufacturing and the hollowing out of the US economy. Lots of very concrete examples. Tony’s one of the folks who’s gotten things right for years.
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lambert strether
Thanks for the link. It’s an awesome post.
Ed
Thanks for the link and merry Christmas.
A number of comments in the Corrente piece tried to look at “free trade” from a non-economic perspective. That is how I look at it too. Workers in the US managed to get a labor environment and laws that gave them a certain level of wages and workplace conditions. The US has laws setting environmental regulations for companies. “Free trade” as it is currently understood, is how companies evade these laws by manufacturing overseas in more lax countries, then selling the products here. Like most that is wrong with the US economy, it is law evasion pure and simple.
Ricardo would simply not recognize the “free trade” agreements as such because they are not, they are investor protection agreements. Ricardo and Smith were on the left of the political spectrum of their time, their positions were essentially anti-cartel.
Celsius 233
Tony Wikrent is factually correct on every point. I worked as a machinist for 20 years and I machined titanium, aluminum, stainless steel and alloy and about everything else you can name. I know first hand how “free trade” is killing us. The largest company I worked for made pumps; huge pumps for everything from drilling mud to nuclear reactor cooling pumps.
This company used to get their castings from a company in Tacoma, Washington. They switched to a company in Korea named Hyundai. It seems the castings were cheaper and were even pre-machined. The Tacoma foundry is no longer in business.
I saw the writing on the wall and retrained as a cad designer which was the equivalent of trying to stay one step ahead of death. I witnessed the unions getting busted back, wages dropping, and management changing from people who had hands on knowledge from the floor to MBA’s who’s knowledge of manufacturing was non-existent. I was bullshited with all of the theories of JIT and the other euphemisms used to gut companies of well paid employees with “native” knowledge.
The destruction of America’s manufacturing base has been intentional, deliberate, and nothing short of grand theft rivaling that which we just witnessed in the financial sector.
If I were still in the U.S. I would seek out Tony Wikrent just to shake his hand.
S Brennan
Ian, I read it over there, it’s a great post, too bad it’ll get buried. When liberals turned their back on the working class & the working poor…the working folks started voting Republican.
As I pointed out before, “progressive” bloggers [present company exempted] are some of the biggest idiots on the subject of trade & industrial policy. thanks for the re-post.
Celsius 233
^^ Addendum;
With the huge loss of knowledge about how to make things, we’re also losing many other things; not the least of which is the ability to think critically. That is possibly the reason Americans are fed shit, told it’s good nutrition, and believe it.
Hillsfar
Let’s see… Lead in children’s toys, melamine in milk, mercury and pesticides and heavy metals in garlic and shrimp, sub-standard, shoddy construction in machine parts and machine tools and medical equipment.
I had an after-market camshaft synchronizer (Duracraft, but made in China) sheer off in my truck’s engine block 2 weeks after installation. Found out there were tons of reports of problems like this being talked about on-line. Duracraft had to pay for the replacement of my engine, and I got a car rental for two weeks while that happened.
Is it really the same product if it isn’t really the same product?
tatere
$14/hour to rebuild airplane wings. Holy crap. I think about what the people I know get paid, and for what, and sure it costs more to live here (SF) but still. Holy crap.
Lex
Excellent piece. I think the underlying problem is exemplified in the welder story: how to show people that they’re supporting the very thing that’s killing them.
I currently have a little experiment running over at Scholars & Rogues on our resident, right-wing troll (who happens to be a successful trader). Most every time he opens his mouth i point out that he’s not actually conservative; that he is, in fact, a neo-liberal. I’m wondering if one weapon in the fight might be to turn the now pejorative “liberal” against those who weaponized the word in the first place.
It isn’t just jobs that this silly perversion of free trade is hurting. In the horticultural/nursery field free trade is creating significant environmental concerns. It used to be that Central and South America were used to produce nursery stock that was economically inefficient to grow in the US. That’s been shifting to China where costs are even lower. The problem is that plant pests from S. America cannot over-winter in most of N. America. Chinese plant pests, on the other hand, over-winter just fine.
Scott R.
Let’s not lament the passing of our past American manufacturing prowess and wax poetic praise on it without first looking back to 1969 and visualizing the Cuyahoga River fully ablaze. Or remember the Acid Rain of the 1970’s. None other than Tricky Dick had to sign the Occupational Safety and Health Administration act in ’71 to force industry to provide adequate (OK, more than adequate) protection for workers. And still…, people were dying from Byssinosis (Brown Lung Disease) through the ’90’s. A little prettier picture is painted by listening to Jimmy Buffet croon about going to Montana after spending, “…four lonely days in a brown LA haze.”
I think we can safely say that manufacturing wouldn’t have made some necessary changes without government intervention. Did it cost jobs? That’s a rhetorical question if ever there was one. Here’s another. Can American manufacturing compete with third world countries who pay workers pennies a day…, or an hour for that matter?
So called ’free trade” regulations were an effort to “encourage” the industry to take action in the face of the inevitable. What did industry do? They spent most of the money…, they should have been using to diversify and change…, to lobby greedy congress critters for legislation favorable to them. Some were more successful than others…, on both counts.
Yeah…, free trade has cost us lots of jobs. That’s a fact. And we better face the fact that we are going to have to compete with third world countries and figure some way to live with it…, because we can’t turn back the clock. And I for one…, don’t want to…, I can live without a brown LA haze or rivers ablaze.
S Brennan
Scott R conflates pollution controls with offshoring here:
“Let’s not lament the passing of our past American manufacturing prowess visualizing the Cuyahoga River fully ablaze.”
And here:
“Or remember the Acid Rain of the 1970’s”
And here he conflates worker safety with offshoring:
“people were dying from Byssinosis (Brown Lung Disease) through the ’90’s.”
And here he conflates auto emissions with offshoring:
“…four lonely days in a brown LA haze.”
And here he conflates environmental laws with offshoring:
“I think we can safely say that manufacturing wouldn’t have made some necessary changes without government intervention. Did it cost jobs?”
And here he doesn’t seem to know that many nations do just what he says is impossible:
“Can American manufacturing compete with third world countries who pay workers pennies a day…, or an hour for that matter?”
John what are talking about here?
So called ’free trade” regulations were an effort to “encourage” the industry to take action in the face of the inevitable.
Here he suggests that lobbing efforts have ceased:
“What did industry do? They spent most of the money…, they should have been using to diversify and change…, to lobby greedy congress critters for legislation favorable to them. ”
Here he suggest we “have to” knuckle under:
“And we better face the fact that we are going to have to compete with third world countries and figure some way to live with it”
Here he suggests it’s inevitable:
“…because we can’t turn back the clock. ”
Here he suggests without trade favorable to the elites we have to live in filth:
“And I for one…, don’t want to…, I can live without a brown LA haze or rivers ablaze.”
Well…it’s hard to tell he read the article, but with John aboard Tony Wikrent has his work cut out for him.
Scott R.
S. Brennan…, a couple of questions. First…, who the heck is John? And did you read the Wikrent article? You better explain what you took away from it to me. This is what I thought his premise was,
“But free trade does affect you. To tell the truth, free trade is probably killing you.”
And he completely fails to back it up with a single documented death. I…, according to you…, utterly failed in my attempt to point out some things that were actually killing people and the fact it cost us a lot of jobs to fix that problem. But we did it because we had to.
Free trade isn’t killing anybody. Yes…, it’s costing us jobs…, but we did it because we had to. Like it or not, we live in a global world now and if you can’t find a way to successfully compete in it, you are not going to survive in business. Is Wikrent saying that Russ is being “killed” by free trade? I looked at it as Russ trying to cling to the old ways and saw a failure to adapt, change, innovate, or update his three decades old manufacturing plant.
“In between these increasingly painful meeting, the Russ had walked the floor of the factory he had built and run for nearly three decades. He looked at each machine, and considered. This line of cutters were losing their tolerances, and should have had their shaft bearings replaced a year or more ago. He had saved $3,500 by not doing that. This gluing machine had become very variable in the thickness of the bead of glue it applied; the entire hydraulic pressure system needed to be checked and parts of it probably replaced. It would cost $150 just to get a good technician to walk in the door, then $100 an hour in billable time, plus whatever the parts would cost. A thousand dollars, easily. Same with this gluing machine. And that folding machine. And that label applicating machine.”
And airplane wings? I guess if Wikrent is as astute an observer as you give him credit for…, the planes will be falling out of the sky daily any time now…, and we will see, “…free trade killing you.”
I liked the Wikrent article as a human intrest story…, but he misses his point by a far wider margin than you say I missed mine.
lambert strether
Scott R writes:
I don’t think the issue is Wikrent’s astuteness as an observer, unless you’re claiming that he makes stuff up; you have a quarrel with his analysis. Which is fine.
As far as the “falling out of the sky” argument: First, the specs are there for a reason. Are you saying that it’s OK not to build to them? Second, I think that aircraft are built with massive redundancy, so failure will happen over time. And all it takes is one or two for a big loss of life.
Interestingly, Corrente got a link to this story from the great Yves at Naked Capitalist, which everyone should read every day. But we can’t buy a link for a story like this from the access bloggers in the political world. I wonder why?
Scott R.
Lambert…, when Wikrent flatly states,
“To tell the truth, free trade is probably killing you.”
And then backs it up with a couple of…, I know this guy and he is credible…, and he told me this horrible story…, so you know it has to be true…, I am sorry…, call me cynical or just plain dumb…, but it smacks of urban legend to me.
And I take exception to this quote as well,
” … the dung heap that America has become.”
I am not buying it…, and speaking of buying it…, there is an example of the LACK of free trade really killing someone. I can’t go to Canada and buy reasonably priced perscription medication.