Lost your job to Globalization?

By Jules Lombard

In my last post (“We can change the world”) I quoted Steve Jobs as saying: Those who are crazy enough to think they can change the world are the only ones who do.

The logical next argument is: When the world changes, most people are swept up by the change. They become either victors or victims.

Judging from the established fact that 2% of the people become unbelievably rich as a result of the world’s changes and 98% are struggling to make ends meet, we can safely conclude that most people are victims of the changes.

Consider the iphone.
1. It replaces the home telephone. Telephone-making companies such as Bell Labs have become obsolete. The workers at Bell Labs and other makers of telephones have lost their jobs. They are victims.
2. It replaces mapmakers, through the maps app. Map publishers have lost their jobs.
3. It replaces the phonograph and the cd player. Employees in those industries are the victims.
4. It replaces the desk calculator, the newspapers and magazines. More people lose their jobs. More victims.
5. Every app you see in the iphone represents an industry that is either obsolete or on its way to obsolescence.

What does this all mean? Change is dislocating. One minute you have a job and a career. The next minute you are pounding the pavement.

If you see history as a river, and all events feed into that river – most modern historians subscribe to this new reading of history – then that river now goes one way. From Shanghai to Rotterdam.

The big shipping firm, Maersk Line, according to Bloomberg Business Weekly, is betting its future on a giant ship that, when made to stand on its stern, is almost as tall as the Empire State Building. “It can carry 182 million ipads or 111 million pairs of shoes from Shanghai to Rotterdam,” is how the Bloomberg article describes it.

It’s a sign of the times. In the coming years, 20 of these ships will be built.
The world has indeed changed. China produces, the world buys and consumes.

Meanwhile, in America, employees of Walmart, McDonalds and foodservice workers at Las Vegas casinos are on strike. They are demanding a living wage. If you have a family, how can you survive if you are making $8 an hour, they ask.

You can’t. So the employees are demanding an increase in their wages to $12 to $15 an hour.

Guess what? Even if they get their higher wages, they won’t be able to make it either.

What does this all mean? It means that down the road, the Americans who work today will have very little to show for their lifetime of struggle and trying to build a nest egg. Most Americans will retire with practically nothing, or not retire at all because they can’t afford to retire.

The statistics are troublesome. 90% of working Americans are now working in service industries. Manufacturing accounts for 8% of working Americans, and agriculture represents the balance. In 1950, 30% of Americans worked in manufacturing and manufacturing-related jobs.

What this means is that only 8% of working Americans are assured of a middle-class lifestyle. The rest, the service workers, must choose which service sectors they enter, and must study long and hard to make themselves eligible to work in decent-paying service jobs.

Increasingly, today’s college graduates must go back to school to make themselves qualified for high-paying service sector jobs.

If they fall into the McDonald’s and Walmart type occupations, it will be a tough slog for the rest of their lives.

There are many reasons, many causes of the American worker’s decline. To us here at the American Consumer, the biggest symbol of this decline is the World’s Biggest Boat, the Maersk boat that carries goods from Shanghai to Rotterdam on that one-way river called globalization.

If you ask anyone, they will tell you there is no turning back. And we agree. We cannot bring back America of the 50’s, or the 60’s, or the 70’s. Or even America of the 80’s.

But we can build a new and vibrant America. Instead of only 8% of Americans working in manufacturing, we can bring the number to perhaps 20%. We will never be able to duplicate the 1950’s, when 30% of Americans worked in manufacturing. But certainly we can go up to as high as 20%.

It all goes back to the point that we have been trying to make over the past year in this blog. If we insist, as a country, that 51% of all manufactured products sold by the major multinationals and foreign corporations in the U.S. are manufactured within our borders, half of the manufacturing jobs that we have lost will start coming back.

Manufacturing jobs have always paid more than service jobs, so many more Americans will once again have the middle-class lifestyle within sight.

Over the past year, I have laid down a blueprint for achieving this goal of strengthening American manufacturing. A lot of you, dear readers, have encouraged me to write more on the subject. There is definitely a lot of interest in crafting America’s new world.

Are we “crazy” enough to get it done? We’ve always been a “crazy” people, a people who defy conventional wisdom, who challenge the elements, who blaze trails, who have tamed the West, who believe in a manifest destiny.

We are the American Consumer, the most powerful economic engine in the world.  Let us never forget that.  We decide if we are victors or victims. And hell, no, we will not be victims any longer.

We have always believed in ourselves. Let’s get this thing done.

(You may post comments in this blog or email me at JLombard88@gmail.com.)

We can change the manufacturing world

By Jules Lombard

I was watching the movie “Jobs” a couple of weeks ago when I was struck by what the late Steve Jobs said in one of his speeches. His character, played by Ashton Kutcher, said in the movie: “Those who are crazy enough to think they can change the world are the ones who do.”

One has to be crazy, or act crazy in order to change our world. Sane people cannot be depended on to attempt to change their world because sane people think safety first.  Many think only of safety and security.

What was Steve Jobs referring to when he implicitly admitted that he was crazy enough to change the world?

He obviously was referring to the Imac computer, which was the rave in the computer business at one time. Did his prescience provide him with a front seat view of the world of the ipod, which would eventually lead to the iphone and the ipad?  Probably not.  Not even Jobs could have predicted that we would use the telephone as the portal to our Internet-crazy world.

Surely at the time that he was extolling the virtues of the imac multi-colored computers he did not actually see in his imagination the ipod.

What we do know for certain, however, is that Steve Jobs was one of the early proponents of globalization, which in my vocabulary is a dirty word. Globalization has meant the step-by-step destruction of the massive American manufacturing world and by the shipment of that manufacturing to faraway countries, mainly China.

Fast forward to Steve Jobs, the biography by Walter Isaacson. Jobs in that book justified his decision to manufacture the iphone and ipad in China by saying that it was so much easier to manufacture in China because there are so many engineers there, compared to the engineers in the U.S.

Was that so? Then why did we not import engineers from China? We import doctors and nurses from many countries. Leading up to the turn of the 21st century, we imported hundreds of thousands of computer specialists into the U.S.

The truth is, Jobs wanted to manufacture in China, not because of the engineers there but because of the cheap labor. The people who are building the iphone and the ipad and 2/3 of the electronics products sold all over the world are ordinary folks. Many are kids as young as fourteen. There are tens of millions of them scattered all over China, and they are not engineers.  Many were starving in farms until they were plucked from their overcrowded neighborhoods and installed in overcrowded tenements run by the FoxConn manufacturing behemoth.

They are virtual slaves living in cramped apartments in high-rise buildings and made to work sixteen hours a day, seven days and week, 365 days a year.

Many have tried to commit suicide, a good number of them having been successful.  The high-rise buildings have nets all around them to catch the would-be suicides, but not all the jumpers are caught by the nets.

Steve Jobs was crazy enough and successful enough in changing the world, and today’s world is the result of that change.

The world, dear readers, is not the way it is because of some rule about the rise and fall of civilizations, which the academicians and the China apologists are trying to sell to us.  Those blokes tell us that the decline and fall of the American economic empire is inevitable because of some “law” about the rise and fall of civilizations.  No siree, the world is the way it is because of some “crazy” people who have changed it.

One could argue that other CEOs, such as the CEO of Nike and of Intel actually started changing the world by manufacturing in low-wage countries. That argument definitely has merit.

What we’re talking about here, however, is the mass migration of U.S. manufacturing to China and other low-wage countries. That did not happen until the turn of this century and Steve Jobs was one of the most vocal trendsetters.

We’ve got news for them, dear readers. We’re going to bring the world back to where it should have always been.

We are going to bring manufacturing back to the U.S. and having done that we will encourage other countries to start manufacturing the products that they consume within their borders.

We will rebuild our world so that factories are sprouting up all over the world instead of in places like China, Mexico and Brazil.

Initially, manufactured goods will be more expensive, but that’s OK because people will have good-paying jobs and can afford the higher prices.

Eventually, factories will be able to find the optimal mix of man and machines and improve productivity.  Then prices will come down again.

We will make the CEOs who are making huge fortunes at the expense of the workers obsolete. CEOs will no longer make 700 times what the average worker in their companies make. Why? Because corporations will no longer be shamelessly making products exclusively at Chinese prices and selling them in the U.S. and Europe at U.S. and Euro prices.

The stock markets will initially slow down in its ascent to never-before-reached heights, but with manufacturers doing very well in all the economies of the world because they are creating jobs everywhere and not being perceived as exploiters of local economies, the boom in manufacturing will be celebrated around the world.

We here in The American Consumer community can see that future. But that future, we suspect, is down the road a long ways.

What will jump-start that march into the future is bringing manufacturing back to America and making America the model for the whole world.

We will work tirelessly because we have the passion. We in our community want to make things again. We want to make those Nikes here. We want to make the iphones, ipads, Intel chips, Caterpillar tractors, Hollister shirts, GE television sets, Vizio electronics products right here in good ole U.S. of A.

We will make only enough of those products so that a little more than half of those products that we buy in the U.S. are made right here.

Initially, China can still make the bulk of the other items sold around the world. But, with the American experiment being successful, we expect the Spains, the Italys, the Greeces, the Australias, the other countries to follow in America’s lead.

We expect other countries to insist that the bulk of manufacturing of products sold in their markets are also made within their own borders.

The result will be a boom in factory construction and in manufacturing. Everybody will benefit because the continuing industrial revolution will go on forever – everywhere.  In Asia. In Old Europe and in New Europe. In Central and South America.  In the African continent and the Middle East .

Let me repeat: prices will rise intially, but that’s OK because people will have good jobs and will be able to afford the higher prices. But, eventually, the world will discover the optimal mix of man and machines which will cause prices to start heading south.

This is the world we envision. We can create that world. We only have to be “crazy” enough to attempt it.

Apple, Inc. is a Chinese company

By Jules Lumbard

What’s good for Apple… is not good for America.

There was a saying that everyone in America accepted prima facie when America was a strong, vibrant and uncomplicated country. What’s good for General Motors, the saying went, was good for America.

People did not just mean General Motors, they meant Big Business. If Big Business was successful, people believed, the country would be successful.

A successful Big Business meant increasing profits. Increasing profits meant more investments. Investments in plants. Investments in new employees. Communities were progressive. New hotels. New roads and bridges. New amusement parks.

Because Big Business created American jobs, the road to the middle class for most Americans was an easy road to navigate. People had cars, houses, pensions, savings. Savings were used by banks to invest in businesses.

Small businesses became big businesses. And the cycle went on and on.

That is the mind’s video of the 50s, 60s, 70s and 80s.

Starting in the 90s, that video broke. Big Business was no longer investing in America. They were not creating jobs in America.

The world was globalizing. Big Business started creating jobs in Mexico. In Canada. In Ireland. In Brazil. In India. In Southeast Asia. In China.

Apple, the most valuable company in the world and in all of man’s history, does not invest in America. It does not create jobs in America. It, rather, invests in China. And it creates jobs in China. It makes the Chinese rich. It cares little what happens to Americans.

Apple makes huge profits on its sales of Iphones, Ipads and other electronic devices to eager consumers in America. But it does very little for Americans.

The reality is that Apple is a Chinese company. And why do I say this? Apple’s operations are conducted almost exclusively in China. The Chinese are reaping the huge rewards of Apple’s success. Apple may legally be considered an American multinational company, but the reality is Apple operates plants in China and other countries, but not in America.

And Apple is not the only one. A whole host of manufacturing companies that people think are American companies are actually Chinese companies.

Big Business, since the 1990s, is no longer good for America. Since Big Business is no longer interested in helping Americans achieve their middle-class dreams, we Americans must do it all alone. Without any help from Big Business.

And how do we do this?

We must pressure our government to bat for us. Government for the longest time was caught up in the What’s good for Big Business theory. As long as Big Business was successful, everything was humming along for Americans. So the government adopted policies that strengthened Big Business.

But Big Business, having abandoned Americans, is no longer on the same page as the government. It’s not only on a different page, it’s in an entirely different book. Big Business is on the Profit Motive book, known widely as Capitalism. The government is now using a different book. It’s called Employnomics, which is of course different from traditional Economics.

Employnomics assumes that the most important goal of the government is the creation of jobs for the American people. It differs from Economics in that Economics creates wealth for corporations and individuals. Wealth creation for corporations and individuals in the 21st century is not being used to create jobs in America. It is used, instead, to create jobs in China and to a much more limited extent, in other developing countries.

The role of government is to advocate for the people. It’s a government for the people, of the people and by the people. Now that it is clear that Big Business has abandoned Americans, the government must side with the American people and treat Big Business as a foreign entity. Because that is what it is. With a number of outstanding exceptions, of course.

American Big Business, European, Canadian and Australian Big Business have put China on track to become the biggest economy in the world. Perhaps sooner rather than later.

What can the government do? Well, for starters government must recognize that the American market is far and away the most important market in the world. For the privilege of selling in the American market, all manufacturers must abide by the new rules.

I call it the Proposed New American Doctrine. Within five, seven or ten years, depending on the industry, all major manufacturers who sell their products in America must manufacture 51% of their American sales within the United States. The major manufacturers who fail to do so within the allotted time will face huge tariffs that will make their products uncompetitive in the American market.

Where manufacturers actually make the products intended for other parts of the world is not our concern. It is only those products that are intended for the American market that we are interested in. 51% of such products must be manufactured in the U.S.

The people who run our government, elected and unelected, must work for the interests of the American people. Not for the Chinese. Not for the Indians. Not for the Taiwanese, the Mexicans and Brazilians.

We Americans demand nothing less from our government, from the elected politicians, and from our bureaucrats.

We must give them notice that their power derives from our power. We can always take back that power. Through the ballot box. Through the media. Through blogs such as this.

(Readers who wish to contact the author may send an email to: JulesLombard88@gmail.com. He will be glad to answer any questions or comment on readers’ concerns.}

The Giant Sucking Sound and the Rise of Employnomics

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The upside of this change is that much fewer comments will be received and we will have time to respond to most of the comments. This blog will start looking more like a community from then on.
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By C. Fernando Lumba

In 1992, during the campaign for the presidency of the United States, Independent party candidate Ross Perot warned the country about the “giant sucking sound” that Americans would soon hear if the North American Free Trade agreement became law. That agreement would promote the creation of millions of jobs in Mexico and Canada in return for American companies’ free access to the Canadian and Mexican markets.

Perot argued that the net result would be the loss of millions of American manufacturing jobs while the U.S. would benefit little from NAFTA (North American Free Trade Agreement).

Ross Perot, as most of us know, has been vindicated. Millions of American jobs have been lost to Mexico and Canada, while the gains made by the U.S. to compensate have been minimal.

Since the 1990s, we Americans have been hearing that Giant Sucking Sound.

Turns out NAFTA would prove to be a relatively minor headache. The major headache for America would prove to be our relationship with China.

Why do we have a lopsided, nearly one-way trade with China? And for that matter with a few other developing countries?

(Our trade deficit was at 540 billion dollars in 2012, much of that deficit attributable to our trade with China.)

Something must obviously be done. We cannot let our country lose year after year millions of American jobs and expect in the end to remain a powerful, prosperous country.

But, unless we Americans act, and act now, we cannot prevent the fall of the American economy.

Why have we been unable to do something about the loss of jobs and industry? (23,000 American manufacturing facilities closed each day in 2010, a lot of them because the manufacturing was being transferred to China.)

The March of Knowledge

In the old days, doctors believed that the cure for many ailments was to bleed the patient. A lot of people bled to death in the process, so doctors eventually stopped that treatment method. Eventually scientists discovered antibiotics and the medical equipment we take for granted today, and the world has become a safer and healthier place.

Our increasing knowledge of the universe, of our environment, the discovery of DNA, the mapping of the human genome, the development of artificial intelligence have all made our lives better and more fulfilling.

In one area, however, we have made no progress at all since the Great Depression. Outside of Keynesian economics, we have not made any progress at all in the field of economics. What we believe today is essentially what people believed during the time of Adam Smith (Wealth of Nations).

For some people, the belief in free markets is a religion.  This despite the fact that if you look around, only a handful of markets, the U.S. market included, are essentially free.

We continue to believe in laissesz-fairish classical economics when the evidence is overwhelming that the old economic theories are no longer applicable.

Consider the principle of comparative advantage. Distinguished economists – all PhD’s, some Nobel laureates – and our politicians, including President Obama, believe that the principle of comparative advantage is applicable in the globalized world economy.

This principle holds that the world economy is most efficient when companies manufacture in industries where they have an advantage either in expertise, labor costs, transportation costs, etc. The products that would tend to be manufactured and marketed would be the best products and cost the least.

In the global economy, however, the principle of comparative advantage does not work.

Countries such as China, Bangladesh, Indonesia, Uganda, etc. have a huge insurmountable advantage in labor costs. The U.S. advantage in technology and innovation is supposed to be an effective offset against other countries’ labor costs advantage, but the American technology and innovation advantage is a mirage because technology can easily be stolen or transferred outright.

The result is that China and other countries have a near-absolute advantage over the U.S. and other industrialized countries.

Granted, within the borders of the United States, the principle of comparative advantage works. If manufacturing can be done more efficiently in Alabama than in California, the factory can be moved to Alabama, with no loss to the economy. California’s loss is Alabama’s gain, therefore there is near-zero effect on the American economy. Also, the Californians who lose their jobs can easily move to Alabama and follow their relocated jobs. California unemployment does not significantly rise as a result of the move from California to Alabama and whatever employment California loses is balanced by the employment Alabama gains.

But, when manufacturing is moved from California to China, there is a huge loss to the American economy. The employees who lose their jobs in California are not able to move to China because there is virtually no freedom of movement between the countries.

Unemployed Californians remain unemployed for years because all around them factories are closing shop and manufacturing is being off-shored to China. The ultimate result is that Californians are unable to buy the usual products that they buy, so aggregate demand suffers, world trade suffers, and the world economy goes into recession.

A lot of people think the 2008-2009 was only the result of the mortgage loans crisis.  That was indeed an important factor, but the long-term cause was the huge drop-off in aggregate demand as a result of people losing their jobs as factories closed or moved to China and other countries. To-date, the world has not fully recovered from that recession.

Employnomics, the new Economics

Just as doctors have found new ways to cure diseases, we Americans must find new ways to cure what ails our economy.

I am proposing the adoption of Employnomics. Employnomics is the field of economics that considers employment stability as one of the most important factors – if not the most important – that economists, world leaders and business planners must consider.

Traditionally, economists look at savings rates, interest rates, consumer confidence indexes, the stock market, labor costs, communication costs, transportation costs, investments, innovation, etc. as the important considerations when making business, economic and plant relocation decisions.

What I am proposing is that economists and business planners must also ask the question, “What will be the effect on employment stability of my decision to move my manufacturing facility from the U.S. to China, or the U.S. to Bangladesh, Brazil, India, Taiwan, Indonesia, Mexico, etc.?

Employment stability must be a very important consideration because we know that if the U.S.economy collapses, the world will be plunged into a great economic depression from which it will take a long, long time to recover. That’s because the European economy is already hanging by its fingernails. The double-whammy of an American collapse would assure that the world economy goes into a prolonged tailspin.

It is therefore in the interest of the whole world, including China’s, to make sure that the American economy does not lose any more jobs to the gods of globalization. It is in the interest of the whole world to see the U.S. gain back some of the jobs it has lost.

Those lost jobs are mainly manufacturing jobs and that is the reason we here at The American Consumer are fighting to bring manufacturing back to America.

We are not asking to bring back all manufacturing jobs lost to China and others. We are demanding that about half of the lost jobs be brought back to the U.S. The balance of all future U.S. progress will come from innovation and from the accelerated transformation of American society into state-of-the-technology.

Let’s have those flying cars, those buses that double as submarines, those robots that act as our valets, those bullet trains that travel in excess of 350 miles per hour. Let’s make those futuristic gadgets everywhere – in the U.S., in Indonesia, in the Philippines, in South Korea, Singapore, Mexico, Brazil and China.

Let’s spread manufacturing around. The beauty of Employnomics is that it mandates the preservation and creation of jobs everywhere. It rejects the notion that China, India, Brazil, Taiwan and others can do all the manufacturing while the rest of the world, including the U.S., is transformed into shopkeepers and mall operators.

Let’s stop the Wal-martization of America and go back to making things again. But this time, America must lead in the encouragement of economic nationalism everywhere, not just in the U.S. and Europe. Other countries must follow America’s lead in insisting that 51% of all manufactured products sold in their countries are made locally and not imported from China and other developing countries – or from Europe and the United States.

The result will be a worldwide boom like the world has never, ever seen. China will still probably emerge as the number one economy in the world, but it will not be at the expense of the U.S. and other countries.

It will be in partnership with the rest of the world.

(The author, C. Fernando Lumba, encourages everyone to make comments that tend to advance a discussion of the issues.  Readers with specific and perhaps personal questions may email the author at lumbacesar@gmail.com.  The author will attempt to reply to all emails received.)

 

Computer Manufacturing Must Return to America

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Because of the relentless pounding of this blog by spammers, most especially rogue computers, we are forced to limit comments to only humans who have pre-registered as users of this blog. We will make the change on August 1st, to give everyone a chance to register as a user. On August 1st, only registered users of the blog will able to post comments.

The upside of this change is that much fewer comments will be received and we will have time to respond to most of the comments. This blog will start looking more like a community from then on.
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By Jules Lombard

The babies being born these days, anywhere in the world, are the luckiest humans ever in our known history.

Babies born today will see cars that fly like airplanes, sink into the ocean like submarines. Cars that drive themselves.  They will see robots at sales counters, doing housework, teaching their children in school and over the Internet.

Powering the new robots and cars are very sophisticated computer systems made in… Where? China? South Korea? Vietnam? Cambodia?

We used to make personal computers and sophisticated cellular phones in the U.S., are we still making them here?  We’re not.  At least not in meaningful quantities.

It is crucial that we start making these small, portable computer-based products in America once again. Every aspect of our lives, in peace and war, will be run by computers. If America depends on other countries to manufacture the computers for us we will be at the mercy of those countries. China will be able to dictate to us, and so will other Asian countries that are increasingly becoming the most important manufacturers of smart machines that will dominate our lives in the near future and our children’s lives in the far distant future.

Drones are changing the way our country fights wars.  Other countries are following suit, manufacturing their own drones. Within perhaps thirty to fifty years, wars will be fought by not only drones but also by robots, with each robot being run by very sophisticated self-powered computers.

This is why computer manufacturing is so vital to the future of the American experiment with democracy.

Imagine being at war with China. That country’s manufacturers are now manufacturing many of our personal computers, tablets and iphones.  Other countries, potentially allied with China, are producing the components, such as the motherboards, the transistors and capacitors, varistors, etc. that go into the manufacture of computers and other computer-based products. Increasingly, we are becoming more and more dependent on the Chinese and those other countries to make those products for us.

We still make the huge computers here in America, the ones that are being bought by the Department of Defense and by the healthcare industry, but the cost benefits of producing such items in foreign countries are pressuring manufacturers of such products to manufacture in China and elsewhere.

In a future war with China, which in some circles is considered inevitable because China is starting to impose its will in vital parts of the world such as the South China Sea and sub-Saharan Africa and increasingly in South America, America would be the bigger loser.

This author does not believe that war with China is inevitable, but if he is wrong and war does break out with that country, it is best to be ready for it.

If the Chinese and their allies are actually manufacturing our computers and computer systems, and they can cut off shipments of computers to us anytime they feel like, how can we win a war with them?  We can’t, unless we start bringing back the computer manufacturing that we have lost to China and other countries.

In the best-selling book, Death By China, the authors Peter Navarro and Greg Autry argue that in any future war, the country that has the superior manufacturing base will most likely win.

Recall that in the Second World War, the Germans had superior technology, but America had a huge manufacturing advantage. At the very outset of war, many American manufacturers refitted their factories and started manufacturing war materiel: tanks, armored vehicles, guns, bullets, cannons, airplanes, etc. at a feverish pace.  This quickly turned the European and Pacific wars around to our advantage.

A German general interviewed after the war was asked by a journalist how the Germans lost when they had superior tanks – the Panzer tanks were the best and most sophisticated in the world – and the Germans had V-1 and V-2 rockets.

The general replied (paraphrased): “We would shoot one tank, then shoot the next, then shoot the next. The next thing we knew, there were hundreds of American tanks coming at us. How could we win a war where the other side had many more tanks to throw at us?”

Again, we don’t want a war with China, but if there is ever a war with that country, America will be at a huge disadvantage, because while the Chinese can convert its manufacturing plants to produce war materiel, currently we in America have far fewer plants to convert.  Many of our factories have been closed, their manufacturing already shipped to China and other countries.

And at the rate we’re going, in the not-so-distant future we will have far fewer factories to convert to wartime manufacturing.

The authors of Death by China also point out that the Chinese are sending tons of satellites up into space, while the U.S. has stopped its space missions and no longer has the capacity and will to launch rockets to maintain and replace old and expiring satellites.  We actually depend on the Chinese and the Russians to carry U.S. payloads into space.

What this means, potentially, is that the Chinese will be able to attack and disable America’s protective satellites in orbit and will be able to attack the United States from space, according to the authors of Death By China..

Scary, isn’t it? Yet, that is the world that is trending right now. Because we have surrendered an important part of our computer manufacturing to China and other countries, it is likely that America will take some form of dictation from China by the time babies born today are grown up and in charge of our country. For good measure, China will probably slap us around and completely frustrate us in international forums such as the United Nations and APEC (Asian Pacific Economic Cooperation) and Pacific rim countries organizations.

Because our debt to China will be so huge if present trends in trade between the two countries are not reversed, China will also be able to threaten us with fiscal collapse should we decide not to do China’s bidding.

I have been saying for nearly a year now that it is important that we start manufacturing consumer items again in the U.S. Even more important is that we start manufacturing personal computers, tablets, iphones, etc. in the U.S. once again.  Our world, our wars, our lives will be run by computers.  If we don’t make computers here in the U.S. in sufficient quantities anymore, what do you think will be the future of our children, their children and the babies being born today?

Let me stress that our beef is not with the Chinese people. Before we Americans became victims of the mercantilist Chinese communists, the Chinese people had long been victimized by their own government.

The Chinese are committing suicide and attempting to commit suicide in larger and larger numbers. They are being worked like dogs and paid peanuts for their labor, under conditions that would appall every human rights activist.

The skies over China, the rivers and streams are so polluted that the Chinese are slowly dying from diseases caused by a poisoned environment. In some parts of China, experimental plastic bubbles over private schools have sprung up. Those plastic bubbles are necessary to protect the schoolchildren from the toxic environment.

In the urban and industrial centers, Chinese children are not allowed by their parents to play outside the house because the air outside is so toxic.

What about labor unions? There are no labor unions in China. The would-be labor leaders have all been shipped to the Chinese equivalent of the Gulag archipelago to either rot or die. None of them have been heard from since their arrest.

I know. A lot of American CEOs love to do business with China because there are no labor unions there. American CEOs hate the labor movement here in the U.S. and elsewhere. They are so relieved that they do not have to deal with labor unions because their manufacturing is being done in China. Disgusting, but true.  This must change.

The Chinese people would come to America, to Europe, to other Asian countries if they had a choice. They feel, however, that they have no choice. As bad as things are in China’s huge industrial hubs, their living conditions outside the industrial hubs were much worse. So they’ve actually seen improvement in their lives, even though the clock is ticking for them. They are slowly dying from cancer, emphysema and many diseases caused by a dirty atmosphere and by eating foods produced in a filthy environment.

The communist bosses don’t see or dont’ care to see what is actually happening to the Chinese people.  They can only see the finish line.  They can see China overtaking the U.S. and proving to the world that the Chinese system, which is based on the communist theory that the worldwide revolution against capitalism is a continuing struggle that must be won by the working class, is the superior system.

The Chinese leaders are very smart.  They know that the capitalist system is the only way they can win so they are using using capitalism in order to topple Capitalism and replace it with the communist system of the rule of the proletariat (working class).  But are they really working for the working class?  The leaders and well-connected are living like kings and princes, but the poor are still dirt poor, and many have become suicidal.

The Chinese people deserve our pity, not our condemnation. It is the ruling politburo, the apparatchiks who have enriched themselves beyond their wildest dreams and the corrupt Chinese military who deserve our disdain.

The Chinese trade war – which China is fighting through its Buy Chinese policy… through the emasculation of American, European, etc. manufacturing… through its refusal to sell rare-earth metals to the industrialized world in sufficient quantities… through its export subsidies which are illegal according to World Trade Organization rules… through its currency manipulation which undervalues the Chinese yuan by at least 40%… through its financial support of African dictators who control large quantities of metals – is ultimately for the purpose of winning the war for communism.

The ultimate goal of the Chinese military and China’s communist brain trust is the destruction of our capitalist system. We must not forget this, or we will end up in the belly of the Chinese tiger that we have been riding over the past couple of decades.

It is vitally important that we get back a good portion of the manufacturing industries that we lost to China and other countries.  We are not insisting that we get all of it back.  We just want 51% back.

Our goal of insisting that 51% of all manufactured products sold in the U.S. is manufactured in the U.S. will not only benefit the American people today, it will insure our children’s future, especially the future of babies being born today.

We don’t really care about the national origins of countries that manufacture in the U.S..  They could all be Chinese companies manufacturing in the U.S. for all we care.  We just want them to manufacture in the U.S. so our people will have good-paying jobs and so that we will have an adequate manufacturing base that we can convert to the manufacture of war materiel should the need arise.

(We are receiving far too many comments for us to reply to most of them.  We are not complaining.  We do encourage you to post your comments and queries here at the website, but if you feel a need to communicate privately with the authors on any matter, feel free to email us at lumbacesar@gmail.com and juleslombard88@gmail.com.)

 

The Sirens’ Globalization Song

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Because of the relentless pounding of this blog by spammers, most especially rogue computers, we are forced to limit comments to only humans who have pre-registered as users of this blog. We will make the change on August 1st, to give everyone a chance to register as a user. On August 1st, only registered users of the blog will able to post comments.

The upside of this change is that much fewer comments will be received and we will have time to respond to most of the comments. This blog will start looking more like a community from then on.
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By C. Fernando Lumba

In The Odyssey, Ulysses was warned against hearing the song of the Sirens as his ship passed the island of the Sirens in the Aegean Sea. He instructed his men to tie him up so that he could not free himself and swim towards the island. If he somehow broke loose, he would get to the island and meet certain death.

His men all wore earplugs to make sure that they did not hear the Sirens’ song.

Ulysses and his men have taught us modern Americans a lesson. If we already know that hearing a song will eventually kill us, we should either wear earplugs or we must ask others to tie us tightly to a post, without any possibility of breaking loose.

The Sirens of Globalization are singing “cheap goods, cheap goods, cheap goods” and we as a country are going crazy. We have been, over the last few decades, abandoning our own manufacturing industries and surrendering those industries to China and a few developing countries that are selling products to us cheaper and cheaper.

Cheap goods will eventually kill the American economy. Millions of our fellow Americans, including our children and their children, cannot find jobs because the strongest engine of job creation – manufacturing – is severely damaged and almost certain to be in its death throes by mid-century.

Luckily, we American consumers still have our wits about us. And we are the only ones who can save our economy. Our political leaders, the CEOs of the major corporations, the professors of economics, business and marketing in our colleges have all heard the Sirens’ song. Some have swum to the Sirens’ island and have been imprisoned, ready to be devoured. Others are swimming toward the island. All of them are bound to be eaten up by the Sirens, with only their skeletons as future grim reminders that they once existed.

Nearly all of our leaders and academicians are doing China’s work.  They either have a direct hand in or allowing the dismantling of American manufacturing piece by piece. They are listening to the Sirens’ song and are losing their minds.

Here is the Sirens’ song, sung to the tune of the Hawaiian Wedding Song by Elvis Presley:

This is the moment, we’ve waited for/  You can hear us Sirens calling/

Soon you’ll be in the ocean swimming/.

This is the moment of year of the snake greetings/

We will make everything for you forever/

Promise me you’ll just relax forever/

Here and now, dear/  All our factories will make you rich, dear/

Promise me you will not make things in your country/

We will make everything cheaper here for-e-ever/

Now we make your clothes, your shoes, your jewelry/

Polluted skies of Beijing smile/

On this our wedding day/

We do love the taste/  of your muscles, your brains and your heart.

We will not only reject the Sirens’ song in case we hear it despite our ear plugs.  We will insist that 51% of all manufactured products we buy are Made in the U.S.A. If those products are more expensive, it would be OK, because we will have good jobs and can afford to pay higher prices.

A lot of people are terrified of higher prices. It is an unfounded fear. What we should be afraid of is lower prices. Lower prices discourage our manufacturers because they cannot make money when prices are too low. So they go out of business, or they close their factories in America and open factories in China and other countries where everything is cheap.

But, if prices are higher, that is, there’s some inflation, our manufacturers will be able to stay profitable and will feel less need to close their operations in the U.S. and open factories in China.

High prices can in fact be good for the general economy. Higher prices will drive up the values of our homes and other properties. Our savings rates will be higher, encouraging more savings. With greater savings, there will be more money for banks to lend to investors, leading to greater innovation.

If inflation is ever needed, it is needed now, so our economy can get off the ground and start humming once again.

Some say our economy is doing just great.  True, the major corporations are earning record profits, but that’s because these companies are making their products in China at Chinese prices and selling those products in the U.S. at U.S. prices.

Besides, only the major corporations are making money – lots of it.  We have a situation where the major corporations are making out like bandits, while the rest of America – the bottom 98% – are treading water, striving to stay afloat.

When you go to Wal-mart, or Target, or Sears and find that the products you are buying are getting cheaper, you should not rejoice. You must recoil from those products, because those cheap products are the ones responsible for killing millions of American jobs. Some of those jobs are your own, your children’s, your grandchildren’s, or the children of just about every American you know.

If we plug our ears, or if we tie ourselves to a mast or a post so that we are prevented from hearing the Sirens’ song and swimming towards the island of the Sirens, we will survive. And when our ship is at last past that island, we will be home free.

Then we can land our ship and start manufacturing in America again. If our products are more expensive than the products coming from China and other underdeveloped countries, so be it. For what that means is that we are making things again in America, and our children and many American children have good-paying jobs.

It could also mean higher tariffs on Chinese goods, which will encourage American manufacturers to make things in America again.

The pencil-necked economists will tell you, “Oh, but economic activity will be curtailed, because higher prices will mean people will be able to buy less goods.”  That is true only if our incomes remain at current levels.  But, if our incomes increase because we have better paying jobs, and not McDonalds type jobs, we will be able to afford the higher prices.

Remember, during the 50s, 60s and 70s, when most of the things we bought in America were made in the U.S., prices were a lot higher, but we were a happier and more confident people because we all had good-paying jobs.

When we come out of this funk we are currently in, we will be singing not the Song of the Sirens, but the Frank Sinatra song, The House I Live In.  Let me remind you of the last stanza in that song:

The house I live in,
The goodness everywhere,
A land of wealth and beauty,
With enough for all to share;
A house that we call Freedom,
A home of Liberty,
And it belongs to fighting people
That’s America to me.

(Comments are welcome at the Comments section.  Readers may also contact the writer by email at lumbacesar@gmail.com.)

Visions of America, the Manufacturing Giant

My dear readers,

You are in a position to bring manufacturing back to America. You hold a tremendous power in your hands. You are the American Consumer, and you hold the strongest hand in the struggle to determine which country or countries will dominate the world twenty, thirty, fifty years from now.

You can begin to exercise this power by signing the petition in change.org, asking the President of the United States and the U.S. Congress to mandate that 51% of all manufactured products sold in the U.S. must be made in the U.S.A.

Please click on the link below (in blue) to log on to the change.org petition to the President and Congress.

 

Change.org
Hey,I just signed the petition “The President of the United States, The U.S. Congress: Mandate that 51% of all products sold in the U.S. are made in the U.S.” and wanted to see if you could help by adding your name.Our goal is to reach 100 signatures and we need more support. You can read more and sign the petition here:https://www.change.org/petitions/the-president-of-the-united-states-the-u-s-congress-mandate-that-51-of-all-products-sold-in-the-u-s-are-made-in-the-u-s

Thanks!

It is vitally important for us and our children that we bring manufacturing back to the U.S. If we don’t our children and their children will wake up one day and find that America has no economic power and has been relegated to an also-ran status by the likes of emerging powers China, India, Brazil, Mexico.

We American consumers and only we are in a position to prevent the decline of the U.S. as an economic power.  Our elected officials cannot prevent our decline from happening because they are too invested in the status quo.  Our academia are on the same boat, because they have written books and have dedicated their lives to the making of our world.

America is on its way to a second-class status and no one but us American consumers are in a position to prevent it from happening.

Are you ready to join the movement to stop America’s slide to second-tier status?

To recap the arguments in favor of the petition:

1. What we are hoping to accomplish through this movement is to tweak our world. Not to completely change it, but to tweak it. We want international trade to be benign, not destructive of manufacturing in the industrialized world.

2. We want trade to be an instrument for spreading wealth around, instead of a tool that a predator such as China can use to subjugate other countries economically.

3. We want international trade to create jobs everywhere instead of killing jobs in the industrialized world.

International trade, which is now synonymous with globalization, has been bad for countries like the U.S. and the European countries and have only marginally benefited some Asian countries like the Philippines, Indonesia and Thailand.

If you follow the logic of the 51% movement, you will note that it is a response to what the Chinese are already doing.

The Chinese are insisting that the GM cars marketed in China are built in China.  Before long, the GM cars that we buy in the U.S. will be made in China.

The Chinese want to build almost everything they need in their own country. Boeing already has factories in China making airplane parts. Buy Chinese is official Chinese policy and not just an organic development in the China-style free trade system..

There is official sentiment in China that if their own people need something, they should build it themselves and not import the products from other countries. The Japanese, the Koreans, the Taiwanese, the Germans, etc. have similar though not formalized policies.

It is actually only the U.S. and some foolish European countries – and Australia – that practice truly free international trade.  Did I mention Australia?  Australia is content in being China’s supplier of raw materials, its manufacturing being shipped to China piece by piece as we speak.

We are the naive ones. We believe in completely free trade because of our foolish pride. We think we invented free trade, therefore we don’t want to abandon it. The truth? England invented free trade and look what happened to it. It has become a nation of shopkeepers.

International trade or globalization is the instrument used by countries like China and by corporations like GE, Apple, Nike, etc. to dismantle the industrial revolution in the U.S. and other advanced countries, piece by piece. And the pace is accelerating.

What should the U.S. do? We cannot just stand by and watch our doom unfold. It is time to act, not a time to doubt ourselves. We are the American Consumer, the most powerful force in the universe. We decide what the future looks like, other people will not decide it for us.

Do not believe those who tell you that we should concentrate on the super high-tech industries. We must make clothes, TVs, radios, plasterboard, computers – all kinds of products that we used to make in the U.S. – once again.

We must rebuild our industrial revolution by rebuilding our manufacturing.

Have you heard of singularity? Because of the heightened pace of progress in artificial intelligence research and development, by 2050 machines will be able to mimic humans. Machines will be able to think, feel, plan, play sports, perhaps even fall in love the way we humans can. Scientists call this singularity, the concept that machines become interchangeable with humans.

Scary, isn’t it? Without the U.S. having a strong manufacturing base, we cannot hope to become leaders in the  manufacture of those machines.

What kind of country will we be forty years from now? Will we be importers of the smart machines?  At the rate we’re going, we will be, since we don’t make computers anymore. If we do, not in any meaningful quantities.

Did you know that tires are no longer made in the U.S.? They’re all made in Malaysia now. There’s a whole city in Ohio, Dayton, which went from being “the tire capital of the world” to become the deserted capital of the world. Dayton is recovering and diversifying, thank God, but it will never be the same or anywhere close to what it was.

If you have children who are not doctors, nurses, physical therapists, etc., your children are victims of globalization. Their options are far more limited than our options when we were working. Chances are, they are living with you or are considering living with you because they don’t have the opportunities we had when we were first starting out.

We owe it to our children and their children that we fight back. Let this be the start of a movement.

Sign the petition on chage.org and feel much, much better about yourselves.

I signed the petition and I’m so passionate about our cause that I can’t resist asking everyone I know to sign the petition.

Finally, what we are advocating has been done many times by Americans who came before us. The latest American patriot who did something similar to what we are doing was the late President Reagan.

Reagan threatened sanctions on the Toyotas and the Nissans, etc. if those car companies would not voluntarily limit their car sales in the U.S. or set up plants in the U.S. Today, the cars that are actually most “American,” since they are made in the U.S. and have the highest U.S.-made parts contents in percentage terms, are the Camry and the Accord. Both cars are more “American” than the Fords, GMs and Chrysler cars that are assembled in the U.S.

The Apples, the Vizios, the Sonys, the Sharps, the GE’s, the HP’s, etc., will never make their products in the U.S. on their own volition because it is so profitable to make things in China and the other emerging countries at Chinese and third-world prices and sell those things in the U.S. at U.S. prices.

They therefore must be forced to make products here in the U.S. again.

You and I and the President and Congress must force them to make things in America again.

And if other countries like the Philippines, Indonesia, France, Greece, Spain and Ireland follow the U.S. lead, the ultimate result will be a redistribution of the huge rewards of international trade. Countries that have lost jobs to globalization will be able to rebuild their manufacturing base and hundreds of millions of the world’s citizens will be able to ascend to the middle class from the ranks of the poor, unemployed and underemployed.

We must encourage other industrialized countries to adopt a policy similar to our 51%.  It’s their only hope.

We, American consumers, will be the example for the whole world.  We will save America, and in the process save the industrialized world.

C. Fernando Lumba

(C. Fernando Lumba is an author, blogger, financial consultant and Internet raconteur.  He has written a book of essays and two novels.  The novels were written using a pen name.)

 

The New Awakening

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Because of the relentless pounding of this blog by spammers, most especially rogue computers, we are forced to limit comments to only humans who have pre-registered as users of this blog. We will make the change on August 1st, to give everyone a chance to register as a user. On August 1st, only registered users of the blog will able to post comments.

The upside of this change is that much fewer comments will be received and we will have time to respond to most of the comments. This blog will start looking more like a community from then on.
________________________________________________________________________________________________________________________________

By Jules Lombard

“The story of this blog is my story,” many of my readers have commented. I’ve gotten thousands of comments and most are thanking me profusely for voicing out their thoughts in a way that, they hope, will spur people in power to act on the main idea and small, corollary ideas advanced in this blog.  This blog has one simple idea, recycled over and over, the approaches coming in many different directions:

     People want their jobs back, jobs that have been lost to countries like China –            all in the name of globalization.

We are all expressing our deepest thoughts and sentiments here, we are not holding back.  And because we are now speaking as one, we can feel the power that we possess. We are the American Consumer. Our purchasing power is huge and we are waking up to that fact.  Manufacturers everywhere have known this all along and they want us to be their allies. True power resides in all of us.

We see ads on TV now claiming that the products advertised are Made in the U.S.A.  It is fashionable again to claim that manufactured items are American-made.  On the other hand, we see shirts emblazoned with:  Hollister – Southern California.  When you look at the tags, the Hollister shirts and hoodies are actually made in China, or Indonesia, or somewhere else. I am not accusing Hollister of deception.  I am gratified that they see fit to identify their products as from southern California even though those products are made in foreign countries.

Increasingly manufacturers want to claim that the products they are selling in the U.S. are American products, even though they are made elsewhere.  Times have really changed.

There is a collective urgency sweeping across our great country that demands that manufacturing – all kinds of manufacturing – must be done in the U.S. once again. We reject the theory, mainly espoused by pencil-necked ivory-tower economists, that jobs in low-technology manufacturing have been lost forever, never coming back.

These ivory-tower economists who work for the CEO’s who have outsourced millions of American jobs to other countries – mainly China – have been bamboozling us, telling us to concentrate instead on high-tech manufacturing where we supposedly have an advantage. President Obama bought what these pencil-necked economists sold to him and the result was a solar panels disaster (Solyndra) and other disasters waiting to happen.

Think of it, what have these CEO’s accomplished?  They have managed to increase their company’s profitability ten or more times because their production costs are at Chinese prices while they sell their products in America at American prices. So why are the CEOs making more than 700 times what average workers in their companies are making?  It doesn’t take any special talent to make tons of money by producing in China and selling in the U.S.

The CEOs and their economists tell us we must concentrate on high-tech manufacturing and leave the low-tech manufacturing to the Chinese and others.  But experience tells us that we cannot just concentrate on high-tech manufacturing because there are not enough jobs in those industries.  Besides, other countries, including China, are so far ahead of us in high-tech and we have a lot of catching up to do.

We must go back to basic, low-technology manufacturing.

Remember the Industrial Revolution? That Revolution, which started in Europe, was a manufacturing revolution. England and other European countries started mass producing consumer goods and the result was the greatest rise in standard of living the world had ever known.  As countries like the United States started manufacturing on a large scale, England started to fade as a manufacturing power. Now England is known as a nation of shopkeepers.

Does America want to become another England?

The comments I have been receiving from my readers say no, we don’t want to become another England. We want to bring manufacturing back to the U.S. All kinds of manufacuring: clothing, radios, TVs, cellphones, tires, furniture, shoes. You name it, we must manufacture it here.

Why is this important? Because manufacturing – specifically the manufacture of everyday products we find in our shopping malls – is the foundation of the American industrial revolution. If you remove the bulk of American manufacturing from our shores, you effectively pull the foundation out from under our industrial revolution.

What we have now is a country adrift, tossed around by monstrous storms such as China.  Chinese officials are going around telling the whole world that America is on the way down, sinking fast on its way to the bottom of the ocean.

Well, the Chinese are wrong.  We are going to take back the manufacturing that we lost to them.  And it’s going to happen soon.

When I read the comments of many of you, my readers, I sometimes get misty-eyed because a lot of you tell me that you have been thinking the same thoughts as I do but it is only now that you feel you have found a voice for your very own thoughts. I am humbled by all this. I promise you that I will continue to write about this subject until something is done.

We may not have to wait long. American consumers, now realizing that they are writing the obituary of their children’s future by patronizing products made in China and other countries, are beginning to demand that many of the products they buy must be made in the U.S.A.

If we as a country want a permanent solution to our horrendous long-term unemployment and underemployment problem, we must turn our desire to revive American manufacturing into a movement.

You my readers can start this movement by creating your own blogs, by writing your elected public officials, by badgering the U.S. Chamber of Commerce, by writing letters to the editors of newspapers across the country.

All with one message: We want our manufacturing jobs back. We want the jobs not only for ourselves but also for our children and for future generations of Americans. We don’t want jobs at Wal-Mart, Target and McDonald’s. We want to make things again. We want to make clothes, shoes, TVs, radios, small and large appliances. We want to make tires, bicycles, telephones, cell phones, plasterboard. We want to make the thousands of items that our parents used to make but are now made by the Chinese, the Indonesians, the Bangladeshis and people around the world who are willing to work for peanuts.

We reject the theory that cheap goods are good for everybody in the long run because people all over the world are able to buy more with their money. We reject this theory because we know that cheap goods are destroying American jobs. They are destroying European jobs. They are destroying jobs everywhere, while creating jobs in China and a few emerging economies. We are laying on the ground, playing possum, as the Chinese and others march toward economic dominance.

We Americans insist that if a foreign company or a multinational sells products in the U.S., 51% of those products must be made in the U.S. If those companies want to continue selling in the U.S., they must set up factories here. Or, they can do what they all do in China. They can use contract manufacturers.

Here’s an illustration of how contract manufacturing works. A Chinese company called Fox-Conn, which is a subsidiary of a Taiwanese company, makes more than half of all electronic products sold around the world.  It does this for nearly all the major brands found in shopping malls all over the world.

That company can easily set up an operation in the U.S. which will manufacture products for Apple, Vizio and other mass electronics manufacturers. We don’t care who own the factories, what we demand is that the factories are located in the U.S. and employing American labor once again.

The Apples, the Nikes, the GE’s, the Whirlpools, etc. can still sell their China-made products here in the U.S., but 51% of all the products they sell here must be made in the U.S. Either made by them, or made for them by contract manufacturers located in the U.S.

Other countries, especially the European countries, must insist on a setup similar to America’s.

If this happens, it will be the beginning of a new industrial revolution all over the world. This time we will get it right. There will no longer be Chinas in this world, countries that awaken economically by destroying manufacturing in other countries.

Under the new globalized economic order, every country’s manufacturing will be preserved. Every country will be making half of all the clothes, tires, TV’s etc. that are sold in their own markets.

The result will be a worldwide boom never before seen on this planet.

(Jules Lombard is a pen name.  He prefers to receive comments through the comments section of this blog.  But if the reader wishes to email him directly, his email address is Juleslombard88@gmail.com.  Because Jules Lombard receives so many comments and queries on his blog, he is able to respond to only a few of them.)

 

Was President Obama taken for a ride…

By his own advisers?

If you were paying attention to the campaign of 2008, you will remember that President Obama extolled the virtues of high-tech American manufacturing, claiming that America had no equal in the race to high-tech innovation and manufacturing.

President Obama ceded the low ground, the low technology manufacturing industries, to other countries such as China, Indonesia, Mexico and puppy countries wagging their tails in obvious delight. President Obama warned Americans that American jobs in the low-tech manufacturing world had been lost permanently and for us not to wish that those jobs would be coming back. Merely wishing and hoping would be counterproductive.  America instead, said the then Democratic presidential candidate, must concentrate on high tech manufacturing, specifically green-energy manufacturing, bullet trains and futuristic products.

Did the candidate Obama come to the conclusion that traditional manufacturing was gone forever on his own, or was he led to it?

The last four years have been cruel to Mr. Obama’s vision. The myth that America could make significant strides in high-tech, green energy, bullet-trains, robotics, etc. was exploded in midair.  Soon after his inauguration it became clear that other countries, such as China, Japan, South Korea, Germany, etc. were already leading us by a mile in high-tech, green energy, bullet trains, robotics, etc. manufacturing.

We knew we could no longer profitably manufacture low-tech products such as clothing, radios, TVs, mass electronic products.  Turned out we couldn’t compete in high-tech manufacturing either.

So what do young Americans do? Do they just work at Wal-Mart, Target, McDonalds? Or do they sell each other real estate and insurance? Or do they all study acting (we’re still undisputed leaders in movie and TV production), or become nurses and nurses’ aides?

If young Americans concentrate on service and entertainment industries and accept what is seemingly their destiny – the disappearance of our manufacturing industries – what kind of future will they have? Wages at $10 an hour.  Few benefits at the job.  Renting instead of owning their houses. Scrimping and saving for decades to afford the huge down payments on their major purchases. Living with mom and dad for extended periods until they are up on their own feet.

Our children face an uncertain future, and the President dropped the ball.

Thank God we all live in the present – not the past.  For, despite the four lost years when President Obama did not act dramatically to halt the flight of American jobs overseas – mainly to China – he still has an opportunity to resurrect his image as a defender of American manufacturing.

Talk about being lucky.  Whatever your political persuasion may be, I’m sure that you will agree that Mr. Obama is a man of destiny.  It seems that the stars have always aligned for him and he is now poised to enter our history books with an aura of greatness.

Yes, greatness comes a-knockin’ at the President’s door.  But will he open that door?

The most efficient use of the world’s capital resources is to manufacture everything in China, Japan, South Korea, Taiwan, Singapore, etc.  But is this what we Americans want?  Are we to become a nation of sales clerks?

Mr. Obama has an opportunity to answer that question.  He may want to answer that with a resounding “Hell, no!”  If he says that and acts on his visceral response decisively, he will be remembered as the President who brought manufacturing back to the U.S.  Will he do it?  I think so, since he already has proved his economic nationalism by saving the American car manufacturing industry.

These are the steps that President Obama must take, and he’d better get started right away:

1. The President, acting in concert with the U.S. Congress, must invoke Chapter X of the World Trade Organization charter to advocate an amendment to the charter. This amendment will allow members of WTO to unilaterally make changes in the way they conduct international trade within their borders in cases where local manufacturing is being killed by globalization.

2. The President shall announce to the world a new American doctrine:  51% of all manufactured products sold within the borders of the United States will have to have the Made in U.S.A. label.  I have called this the “Proposed New American Doctrine.”  The President, if he wishes, could call it the Obama doctrine.

3. If the amendment to the WTO charter is rejected, the U.S. may consider the nuclear option, which is to opt out of the World Trade Organization. This is of course extreme and must be the very last resort.

4. President Obama must argue before the League of Seven or Eight – the leaders of the free world – that America will not stand by as its manufacturing industries are dismantled and shipped abroad, impoverishing our small towns – especially our one-company small towns.

5. President Obama should go on a world tour encouraging other countries to adopt a policy similar to our 51% because this would mean that the world’s major manufacturers will have to set up factories and hire local people and in the process strengthen the middle classes in those countries.

The world’s leaders who follow the U.S. lead will discover that a variant of the U.S. 51% doctrine would be the best thing they could do for their own countries.

The end result will be a redefinition of free trade. Free trade must protect the jobs in all countries that engage in it. It should not be used as an instrument that multinationals and awakening giants such as China or India or Mexico or Brazil can use to destroy wittingly or otherwise manufacturing jobs in the U.S. and other countries.

By Jules Lombard

(Jules Lombard is a pen name.  He has been the only writer – so far – of the posts in this blog.  He prefers comments to be posted in the blog, but if the reader wishes to communicate with him directly, his email address is:  JulesLombard88@gmail.com.  He receives a lot of mail and comments and cannot promise that all communication will receive a reply. He tweets as @JLombard88.)

 

We Americans Own the American Market

 We Americans own the American market.  Others – foreign companies and multinationals – sell in our market only with our permission.  It is not their right to sell in our market, it is a privilege that we have granted them.  Our Congress, acting upon our instruction, has every right to determine who can sell in our market and under what terms and conditions.

I want to assure you in this the most beloved of all holiday seasons that what we aspire to do, i.e., determine how we and others conduct international trade within the boundaries of the United States, is a right that exists in natural law and is embedded in our Constitution.

What we clearly seek to accomplish in this website and through discussions in this blog is to manage trade between the U.S. and other countries in such a way that it benefits Americans first and foremost, and citizens of most of the rest of the world as an intended consequence.

We will ask ourselves, at the end of the day, can we look down from the mountaintop and proclaim that we have created our brave new world, a world that we have imagined, a world that we have hoped for and a world that we will eventually will to our children and future generations of Americans?

The obvious answer to me is that we can.  Si se puede. The proposed new American doctrine of “51% of all manufactured products sold in the U.S. market, with rational exceptions, shall be manufactured in the U.S.” not only makes sense, it is the easiest and quickest way to a new and revitalized America.

The reasons are clear as a sunny day in the eternal sunshine of southern Nevada.

First, no foreign country or a company manufacturing its products in a foreign country has an inalienable right to sell such foreign-manufactured products in the American market. They have the privilege of doing this because we Americans have granted them that privilege. But we do so consistent with our Constitution. And our Constitution grants the U.S. Congress, acting on our behalf, the right to regulate all commerce between the U.S. and other countries, between the various states, between the United States and the Indian tribes.

Second, trade with foreign countries must be beneficial to us Americans and not lopsidedly beneficial to our trading “partners.” We do allow trade to be lopsidedly in favor of China, Japan in the recent past, South Korea, etc., but only on the assumption that such lopsided trade is temporary, that over the long haul, the movement of goods will become two-way and not virtually one-way, which it is now with China and some other countries.  We therefore have a right to force the issue of mutually beneficial trade.

Third, the goal of foreign trade must be zero, or close to zero. That is, ideally a country’s exports to another country must be roughly equal to its imports from that country. In the 1960s and prior decades, net U.S. foreign trade was only 4% of gross national income. Our exports to other countries were just slightly more than our imports from them.

Fourth, American consumers are the greatest economic engine in the universe. Any country or multinational that sells in the American market must be put on notice that Americans will no longer allow unfettered access to that market under rules prevailing in the 20th and earlier centuries. Trade rules must change, and foreigners’ access to the American market must be conditioned upon whether such trade creates jobs in America. No longer shall it be enough to say that cheap goods are made available to Americans, we must make sure that no country is able to export its unemployment to America and destroy American jobs.

Fifth and lastly, globalization must benefit most if not all countries on the planet. The U.S. must serve as an example for the rest of the world. We must encourage other countries to adopt policies similar to our 51%. Imagine what would happen if countries such as South Africa, Uganda, Argentina, Uruguay, the Philippines, Indonesia, Myanmar, Cambodia, Pakistan, etc. have their version of the 51% rule. Those countries will experience a boom in construction of industrial plants and in hiring to staff the new factories that shall be set up. Most countries will be both producers and consumers all at once. Gone will be the export economies that sell to the rest of the world but buy very little from the rest of the world.

The U.S. will maintain its preeminence because our standard of living will recover its lofty heights achieved in the 20th century, but close on our heels will be other countries.  That last point is important.  Other countries must realize their potential too, not just the U.S.

This is our brave new world. We can do this. We can do this by setting the example. We will require that 51% of all manufactured products sold in the U.S. are manufactured in the U.S., within reason. We will watch as other countries adopt similar policies. We will watch as China’s growth slows down and as other export economies realize that they can no longer take advantage of other countries whose markets are open to them.

The wealth of the world will be distributed equitably, and the resultant boom will benefit the greatest number as most countries experience a rapid growth in their middle classes.

Of course prices will tend to rise in the short term because production costs will increase temporarily. That is to be expected. But we here in the U.S. know that cheap prices at Wal-Mart and Target are NOT good for the country. What is good for Americans and people around the world is to have good jobs. People who have good jobs can afford to pay for the products that they buy even if those products are more expensive than they are now.

Remember, before the Japanese and the Chinese, most of the things that we bought at Sears and J.C. Penney were made in the U.S.  And they were expensive. But we did not mind, because we had jobs, we had good jobs, and we had good careers. We could afford to pay for those American goods because we had money.  We could buy houses and cars.  We could marry, have children and own our own homes.  We did not have to stay with mom and dad.

My friends, toss these principles in your heads during this holiday season. In January we will resume our journey and think of better ways to spread the news.  We will look at the devastated manufacturing industries that have been sacrificed to the gods of globalization and ask:  how and why did we let it happen?

We Americans are ready to take control of our markets again. We have this power to choose what we will buy and what we will reject. We have this power to influence our President and our Congress to change the rules of international trade in a way that assures us, our children, our loved ones a bright future. We reject the idea that America is in permanent decline.

We will lead the world in this new enlightenment.  We will open the eyes of the world to a truth that has been forgotten:  the truth that we own our economy and we have the right and the duty to set the rules of commerce in such a way that the commerce benefits us and not some villagers in a faraway country such as China.

The America we know is forever upbeat.  We are Americans, and we will never, ever feel that we are on the way down.

Happy holidays to all!

The horrible tragedy in Newtown, Connecticut should convince us all that something must be done about our unfettered love and adoration of guns.  We must also remember that our society is broken and must be reformed in many other areas, such as immigration, taxation and international trade.  We must make across-the-board adjustments in our body politic if our country is to emerge from our many national crises as the America we all know.  Finally, we grieve for the loss of the 20 angelic voices and their teachers who sacrificed their lives in defense of the children.