Emphasis on Quality abroad, protection at home

From China comes the surprising news that the increasingly affluent Chinese youth actually have a penchant for American products. Chinese consumers under the age of 40 are attracted to American manufactures such as toiletries, consumer electronics, apparel and fashion accessories and books, music and videos. Not to mention GM’s Buick, which is a hot-selling automobile in China across the age groups.

The Chinese have a positive view of American-made products, which have a reputation for their quality, as opposed to Chinese-made products which the educated and affluent Chinese consider as of lower quality.

The research was conducted by Research International and commissioned by UPS. The cynics might consider the study biased since UPS is a huge beneficiary of the feverish pace of China-America trade, which is currently lopsidedly in China’s favor. Still, since we are talking here of an awakened giant and its more than 1 billion people, this very encouraging news is a big deal.

We’ve all heard of China slapping tariffs on foreign-produced goods to protect Chinese industry. We’ve all read about foreign companies setting up manufacturing facilities in China because the Chinese government encourages foreign multinationals to manufacture in China products intended for the Chinese market.

The Chinese people apparently have other ideas, with the affluent and middle class young – affectionately called “Chuppies,” a Sino version of the American “yuppies” – wanting to see more American products in their local stores.

But let’s not be fooled by this surprising breaking news. American products have a long way to go before they become entrenched in people’s minds over there. We must forge ahead with our drive to bring the bulk of American manufacturing back to America.

We consumers can help accomplish this only by insisting that 51% of all manufactured products sold in the U.S., with rational exceptions of course, shall be manufactured in the U.S. within five, seven or ten years, depending on the complexity of the products.

The Japanese and Koreans have a built-in bias against American products. The Japanese love American sweets and fast-food franchises, such as Kentucky Fried Chicken. And of course American culture. The Koreans love American toiletries and movies. But these two major export economies are self-sufficient and don’t need any of our manufactures. Japanese and Korean consumers feel their products are superior to American counterparts and there is really no great demand in those countries for American-made products. They do import Toyota Camrys and Honda Accords, which are made in the U.S., but these are products that use Japanese and Korean-made parts.

It’s striking that those two giant export economies love American foods, which are low-technology products. High-tech, they go with their own products. There are exceptions, of course, such as airplanes, which were the biggest single American export until recently, when gasoline and fuel became America’s single most important export.

Yes, we do export gas and oil despite the fact that we are the world’s largest importer of crude oil. The reason is pure microeconomics. Oil companies make more money selling their products abroad than selling the same products in the U.S. This creates artificial shortages and the resultant high cost of fuel in the U.S. makes it economically feasible to import crude oil and process the imported crude and sell the gas in the U.S. So the oil companies import crude for the American market. Complicated? You bet.

Some would tell us that it is not necessary to encourage more American manufacturing because the trend to manufacture in America has already started. The cost of labor in coastal China is now in the $3 to $6 an hour range and it has become more economically feasible to manufacture in America again. Don’t be fooled by this. All the Chinese have to do, which they are doing now, is to relocate manufacturing in the inner cities and rural and exurban China. Besides, If it’s not China, it will be some other country in the future.

As long as China and other countries protect their manufacturers from American competition and as long as foreign consumers prefer their own manufactures to American products, the transfer of wealth from Americans to foreigners will continue unabated. When America was rich, we encouraged some of this. We encouraged imports from Japan, Germany and the rest of Europe because America stood alone as the biggest market for manufactures during the decades that followed the Second World War. We watched as those foreign economies rose literally from the ashes as they overtook us in some industries.

We could afford all that because we were the richest country in the world. We are no longer the richest. Our sixteen trillion dollar sovereign debt took care of that. Every month we go deeper and deeper in debt.

We must put a stop to this nonsense. We must rebuild our manufacturing here at home and the only way we can accomplish this is by protecting our industries the way other countries protect theirs.

Our politicians have promised us a new and more hopeful America, an America with a bright future. We cannot have any of that if we do not insist that our manufacturing recovers and we are a manufacturing power once again.

Many of us denizens on the Internet are retirees or semi-retired, and so this is not really for us.  It is for our younger siblings, our children and the children of our friends and neighbors.  It is for all Americans under the age of 55.  We must make sure that we leave America in the same robust shape we found it.

The Chinese keep telling us we are in decline.  Don’t believe any of that.  We are not in decline.  We only have to make one easy-to-accomplish change.  We only need to Buy American.

 

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