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« Don't drink the water | Main | Piper paying and tune calling »

Jan 23, 2012

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Billy Jones

"“What U.S. plant can find 3,000 people overnight and convince them to live in dorms?”

That's Wall Street's vision of the "American Dream."

TL

"China has agreed to underwrite costs for numerous industries" would be more accurate if written:
"China has agreed to underwrite costs for virtually all industries." I say that based on reporting for trade magazines serving the decidedly not high-tech furniture-making business.
China's subsidies, rebates and other perks to employers help make it possible for us to enjoy shiny electronics as well as all those extra-low prices on crappy merchandise at big box stores.
We do get what we pay for.

Bill B.

As long as our artifical financial, energy and trade systems/policies continue, we will have this sort of occurrence. To the big boys, it is just temporary displacement as the market works. To the rest of us, it is a big ol' ...problem.

Billy Jones

It's possible the cost of fuel will rise enough to make imports too expensive to ship or fuel goes down and Americas' workers are forced to live in dormitories.

TL

Perhaps an even bigger factor that may send SOME jobs back to the US is China's across the board wage hikes. China wants a middle class able to buy the goods churned out by its factories. The CP is much less afraid of capitalism and affluence than free speech and the marketplace of ideas. So long as iPhones and Buicks keep the masses happy, they are less likely to question government policy.
As a result, a handful of US outdoor furniture makers are feeling optimistic about having retained some manufacturing capacity here rather than push it all off-shore.

justcorbly

When I read the piece I was struck by the way the American execs contrast the speed and agility of Chinese firms with their American counterparts. We work hard, long hours and are more productive than most, so perhaps it's something to do with the way American corporations make decisions.

Manufacturers have always sought cheaper places to make things. (That's why there are auto assembly plants in the southeast.) Cheap wages are the big incentive. But, delays caused by lack of agility in your supply chain also cost you money.

It's a waste of time to argue the Chinese government isn't playing fair, or that we should play tax and tariff games to make it too expensive to make stuff in China. Those are sideshows. Americans would just be stuck with inflated prices and the Chinese, with 7 billion other people on the planet to sell things to, wouldn't miss us all that much.

(Also, if Apple was forced to make iPhones and iPads in this country, that would increase the price of those products in the global market. Presumably, sales would fall, then profits, and on and on.)

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