The American Spectator : Manufacturing Noises

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Manufacturing Noises

By Peter Hannaford on 2.16.12 @ 6:07AM

Is that a job-making machine we hear?

American manufacturing is coming back. By how much and for how long is uncertain, but the signs are clear and they are growing. For example:

General Electric, a huge conglomerate, may be in the forefront of the movement. Overall the company cut U.S. jobs when the recession hit, but has added 9,000 since 2009 and plans to add 4,500 or more this year.

Among its products are jet engines (it’s the world’s largest manufacturer of them). It has announced it will open three new engine factories this year, in Ohio, Mississippi and Alabama. When, last December, GE announced the opening of a new X-ray machine plant in China, many worried that the 120 workers in its Wisconsin plant would lose their jobs. GE says, no, tit wasn’t a zero-sum matter. The China plant is expansion in that market — not an outsourcing of U.S. jobs.

Last week GE opened a new appliance plant in Louisville, Kentucky to meet increased demand for energy-efficient water heaters and refrigerators. The company says it will create 1,300 new jobs there by 2014.

A smaller conglomerate, Carlisle Companies, makes restaurant supplies, insulation and tires.

It has announced it will open two new U.S. plants and bring its tire manufacturing back from China.

Union Pacific plans to double its purchase of locomotives this year, spending $400 million or so to buy them. Boeing says it added 10,000 jobs last year in U.S. plants to fill airline customer orders for new 737s and the much-delayed 787.

Caterpillar is closing a locomotive plant in Canada and bringing the work into a U.S. plant where wages are lower and productivity higher.

Where is the Obama Administration in all this? President Obama has touted exports and U.S.-based manufacturing. He has called for a tax credit for companies that bring jobs back home. Generally, tax credits are not good policy because they add new complications to an already overcomplicated Tax Code and have very little effect on the economy. Mostly, Obama is paying lip service, but will of course try to take credit for any manufacturing job increases as well as increased exports.

The reasons are elsewhere and there are several. The low level of the dollar against several other currencies makes our exports very competitive. Several companies, seeing India and Brazil as promising growth markets, are building plants and distribution systems there.

China’s domestic market is still a growth opportunity for many American companies. On the other hand, China’s exports to here and elsewhere are becoming less competitive. For years, as it set out to build a major manufacturing infrastructure, China lured ever-increasing numbers of farm workers to its cities. Result: For years China became the favored source for inexpensive household goods, clothing and electronics. Now, however, its urban work force is beginning to decline. Women make up the work force in most garment and electronics factories. The United Nations estimates that China’s women aged 15-24 will drop from 106 million in 2010 to 92 million by 2015. Add to that increased affluence in the population and wages that are growing faster than productivity, plus continued international pressure on China’s currency and you have a recipe that means manufacturing benefits for the U.S.

A recent New York Times poll showed 52 percent of the public said it was important that the products they buy be made in the U.S. Two-thirds of those polled said that U.S. companies should take much of the responsibility for keeping manufacturing jobs on our shores.

They are, by reading the signals of the market. Will “insourcing” and domestic demand grow sufficiently to speed up the weak economic recovery and create enough jobs to replace the 8.7 million lost in 2008 and 2009? It was take more than manufacturing to do it. Its work force shrunk for 14 million in 2006 to a little under 12 million last year. Kurt Rankin, an economist at PNC Financial Services in Pittsburgh, predicts that job growth in 2012 will average 135,000 a month. At that rate it would take the economy — manufacturing and service sectors — five-and-a-quarter years, until 2016, to get there.

Presidential pep talks and speculating taxpayer money on risky “green” solar plants, wind farms and expensive automobiles won’t do it Getting the government out of the way would give savvy businesses a chance to make it happen.

About the Author

Peter Hannaford was closely associated for a number of years with the late President Reagan, beginning in the California Governor’s office. His latest book is Presidential Retreats.

Letter to the Editor View all comments (66) | Leave a comment Leave a comment

Bill Hussein O'Stalin| 2.16.12 @ 6:28AM

Without cheap energy I wonder how successful the manufacturing process will be in the overall scheme of things.

For instance, gas is already making a move towards $4 a gallon. It's cheaper to mail an overnight letter at the post office for $12 than to drive somewhere in the same time period.

Electricity has skyrocketed over the last three years and the utilities are already back in many states looking for more.

The consumer will have less money to spend and when gas goes over $4 the effects in many ways are immediate and began to cycle through the economy very quickly.

If Obama can't figure out a way to get more refineries back on line he's most likely doomed.

c. j. acworth| 2.16.12 @ 6:43AM

I agree with all but your last sentance, Bill. It's US who will be doomed if Obama's EPA continues to strangle energy production.

THKrupp| 2.16.12 @ 9:28AM

Bill,

While gas and diesel are relatively expensive right now. Natural gas is dirt cheap. $3-$4 per therm. Electricity depends on where you are located. Some places its cheaper and others its more expensive. In order for capacity to be built it will have to get more expensive.

Bob K.| 2.16.12 @ 10:56AM

Chesapeake Energy, the largest presence in the Marcellus Shale region of PA, has stopped new exploration and production of natural gas there because the current price of natural gas is too low for them to make a profit on it.

Mike Hawk| 2.16.12 @ 8:12PM

Obama doesn't want more refineries on line. THree in the Philluffya area are shutting down and being dismantled to go guess where. Sunoco and Conoco/Phillips can't refine at a profit so it's Bon Soir y'all. They are gettingout of the refining business just like Exxon did. THey will be keeping the tank farms open to receive the refined product that will be coming in from new Indian refineries. Foreign refining companies are profitable.

Doctor_X| 2.16.12 @ 7:16AM

I work for GE and I can tell you for a fact that GE has more job openings OUTSIDE of the US than inside. When it comes to IT for example they have 10x's the number of jobs open in india and China than they do in the US.
Jeff Immelt is in Obama's back pocket, he's doing what needs to be done in a election year to get his boy back in the White house then it will be Outsources as normal.
Our IT departmant will be gone by the time of the election. I guess I could just take a 50% pay cut and move down south and learn to build aircraft engines.
Maybe this will push GE stock about $20 for the first time in 5 years.

Timothy L. Pennell| 2.16.12 @ 9:58AM

This is nothing more than a PAYBACK to Obama, for GE's payment of ZERO, on a $5 Billion Profit, last year.

Doctor_X is exactly right.

This is Smoke and Mirrors.

vtwin| 2.16.12 @ 12:15PM

Concerned about politicians in the pocket of Corporate America? Welcome to the 99%.

Timothy L. Pennell| 2.16.12 @ 8:41PM

Just THIS Politician.

Dai Alanye | 2.16.12 @ 11:08AM

Sounds like the GE I know and love, and for whom I once worked. Always an eye on the main chance, always looking for gummint aid of one type or another.

PolishKnight| 2.16.12 @ 4:13PM

Freddie Mac wanted to get their applications off the aging IBM mainframe. These were text based menu mortgage buying applications written in Cobol and JCL that would require a user to enter a number to drill down into state, zip code, number of loans, etc. and about 5000 types of products such as 1K SFH bundled 5 year securities, 500 MFH securities, etc.

The project was called "Advantage" and the main purpose was to make the applications portable so they could be moved (in other words, merged with Fannie Mae but nobody said that outright) but as a bonus, they could get rid of the dozen 50 year old white males working in the basement. The total cost of the mainframe was about 10 million dollars and do the math for the salaries of the guys.

The initial proposal was to have the project written by highly skilled Indian programmers in Ohio at TATA who, for the low initial price of a few million, would easily replace those guys with super efficient java code on a linux platform.

After a year, the project had sucked up $100 million of consulting fees (which strangely involved workers that weren't available directly in Ohio...) and they wanted another $200 million before the plug was pulled and management quietly killed the project.

They stayed on the mainframe. The executives who sold the project were commended for their excellent work and given promotions.

Maybe we would be better off if the commies took over...

Stuart Koehl| 2.16.12 @ 11:28PM

Nobody I know outsources anything other than the most rudimentary coding work to offshore companies. For reasons such as this. As always, the highest value added work remains onshore, because American workers are at a competitive advantage both in competence and in productivity.

PolishKnight| 2.17.12 @ 11:31AM

There were sold the project as being run by a bunch of "skilled" H1B's in Ohio at a total cost of $100 an hour per consultant. Yeah, it's onshore all right! Trust them!

POST American| 2.16.12 @ 7:26AM

---Speaking of capstone Globalist GE
(Globalism & EUGENICS)

----ANYONE following the yet covered up
unfold of the FUKISHIMA world depop
op kick off?

Seems parts of Tokyo now are 4X more
contaminated than Chernobyl.

---And NOT a word of query, much less
indignation over those flawed GE reactors----
even as Jeff 'I-Melt-down' is opening dirty
plants across China and the world ---TAX FREE
and at your expense.

--------------------------NOT EVEN AN ISSUE.

Keep a goin' kiddies!

------O'Reilly's watchin' out for ya'!

------------Oprah CARES!

------------------EUGENISTS have big hearts!

-----------------------Keep a goin!

----------------------------------------------GIT!

JP| 2.16.12 @ 8:45AM

With 0% interest rates, a weak dollar, and a huge expansion of our money supply I would be surprised if things didn't improve. I always believed that the President's actions were totally geared towards elections. Smother the electorate with gifts early (jobs, cheap credit, and entitlements), and transform the economy over time. It took 3 years, but both housing and manufacturing are recovering.

The unimaginable debt load, suffocating regulations, and higher taxes will kick-in after 2012. The voters are following the Piper down to the river.

JoshInHB| 2.16.12 @ 8:50AM

Yooo-Hoooo

Obama's plan of making us poorer than China is finally starting to work.

Von Mises Jr.| 2.16.12 @ 9:22AM

The examples utilized by Mr. Hannaford are dubious.
- Crony capitialist Immelt's GE earned $14.2B in profits last year and paid zero in federal business tax. Were all manufacturers to pay no tax, they would surely hire more bodies.
- There has been a tariff war with China over tires. If you make Chinese tires uncompetitive to import, you force domestic production. http://news.yahoo.com/china-ti.....25555.html
- Catapiller and other farming related stocks have done relatively well with food shortages worldwide, exacerbated by Obama's insistance on burning corn as ethenol fuel
- Union Pacific and other railways are affected by high fuel prices. A train can transport goods using something like one gallon for some hundred miles. As gasoline prices have doubled, smart investors made money buying profitable rail stocks. Isn't that one of Buffet's favorites?

It is easy to reach the conclusion you want when you pick the examples to justify your point.

THKrupp| 2.16.12 @ 9:53AM

Catapiller no longer has an ag production line. They sold that to Agco a few years ago. Catapiller is doing well because of demand from Asia and they are a well managed company.

Von Mises Jr.| 2.16.12 @ 10:16AM

Good point. I was not aware of that. I have not owned CAT often or recently, but the massive building of cities in China makes it attractive and probably a strong investment.
I own DE and a few fertilizer companies such as MOS, POT and SQM (that doubled due to their mining of lithium for electric car batteries).
Thanks for the clarification. I also agree with your point below. Obama can destroy America allot faster than its international companies.

JP| 2.16.12 @ 12:56PM

Real estate inflation as well as commodity inflation are slowing China's growth. Instead of 12% annual GDP growth, China is down to 6-7% (if only we could produce such numbers). We should also remember that much of China's growth in recent years is being subsidized by our federal budget and trade defecits. China is borrowing against the value of thier cash and bond holdings in order to build bridges to nowhere and cities for noone. The bulding gravy train there is now coming to an end. Rising wages (something the CHICOMs had to allow) are making China less competitive in many markets. China is not a good bet.

Von Mises Jr.| 2.16.12 @ 1:40PM

It is also a risk to believe Chinese government statistics any more than Obama regimes. The bulk of the Chinese still live in rural areas living on hundreds or perhaps a couple thousand dollars per year. And growth is overstated in percentages when you start from almost zero industrial base. I stay away from Chinese stocks. I believe Hu Jintao as much as I believe DC that we have 8.3% unemployment and 2% inflation. Real U3 is probably closer to 11 and Gallop just admitted U6 is 19.1%. The CPI excludes food and energy, but includes the depressed housing numbers. But food is up 10% year over year recently, and energy up 85% in three years.
These lies, damn lies and statistics. If Obama fundamentally transforms America, he will assign everyone a low paying, grunt job (except his cronies) and we will have full employment. "If you don't OBEY, you don't eat."

Pat| 2.16.12 @ 4:30PM

Von Mises Jr.

Von, you always seem to have a clear bead on economic issues, unlike some of our resident hysterics who espouse Big Business exercising total control over our elected rulers in Washington and the state legislatures. And businesses don’t compartmentalize decisions on plant openings as much as our pundits naively believe. Overall profitability vs. risk is the primary concern in corporate boardrooms and this issue pulls in the overhead costs of conducting operations within America vs. the reduction in costs by going off-shore.

Any American business, small to humungous, carries an 800 pound gorilla on its back relative to subsidizing government operations. Take government reporting as one minor example. Businesses collect every form of tax levy and pass it on to the government agencies – not out of choice but by mandate and without any form of compensation to the business for their effort. And the confusing regulations, the plethora of forms to fill out, the constant changes solely to benefit government agencies are all paid out of corporate profits – and these overhead expenditures increase every single year.

Information reporting to diverse government agencies alone has grown by leaps and bounds as our government bureaucracies have grown. The BE-10, BE-11, QFR-200, BE-577 reports and so on and so on are dutifully filled out and sent in by corporate worker bees without payment for their efforts. That these reports ask for the same information is irrelevant, each agency can demand whatever information they desire and without regard to the fact other agencies are asking for the very same information. Providing this information raw material so government workers can justify their above average salaries and fat pensions does absolutely nothing for corporate profitability or global competitiveness.

Rah-rah articles about how American manufacturing is resurging don’t reflect business reality. Periodically, some political hack announces the formation of yet another government committee to study how this increasing government burden on America’s businesses can be reduced. The committee to standardize sales tax reporting across the various states has been meeting and consuming jelly donuts for years but no uniform reporting rules are in sight. When voters can stop focusing on personalities and learn what it actually costs to do business in America, we can truly hold out hope for the great American comeback.

Von Mises Jr.| 2.16.12 @ 4:43PM

Well stated Pat. We are so overwhelmed with ObamaCare, EPA, NLRB, drilling moratorium and all the other assaults on our Constitution that we neglect to get to Dodd Frank, and even Sarbanes Oxley that have driven business into hybernation or offshore.
Dodd Frank is another abomination that must be repealed if we are to regain our capital markets and prosperity. Thank you for your astute and salient points.

Pat| 2.16.12 @ 5:40PM

Von, thanks but I think the best way to drive this point home would be to charge everyone to receive their W-2 and 1099 forms – say $300.00 for each W-2 and $150 for each 1099. The government would never allow it of course, our elected rulers believe it’s in their best interest to keep the general public ignorant of what costs American businesses absorb on the government’s behalf.

But getting a free W-2 benefits only our government, the issuing business gets no great thrill from handing out uncompensated services. The many voters who believe it’s downright stealing to walk into your local 7-11 and simply take a gallon of milk without paying see nothing wrong with forcing a business to provide them with free information to do their taxes. To the business, the overhead write-off due to shoplifting and the costs of doing the government’s bookkeeping tasks comes out of the same pocket - and neither the shoplifting or the government freebies provide any benefit to the owners.

Von Mises Jr.| 2.17.12 @ 7:54AM

Pat, business is the servant of government in tax collection and book keeping. The reason the Leviatan mandates the employer takes out all the taxes is that it is not apparent how much you really pay. If you had to write a check every month for the SS, FICA, federal and state taxes; there would be a revolt.
They set it up so that if you make $50K, you get paid $2,500/mo and tell people you earn $50K when you only get $30K in renumeration. This is why we got Greece in the shape it is in. People finally figure it out and they work in the underground econiomy for cash, which in Greece's case is probably one-third that pay no taxes but get all the free rider benefits.

Buck Ofama| 2.16.12 @ 12:21PM

>A train can transport goods using something like one gallon for some hundred miles.

Are these 100 mile per gallon trains HO scale?

THKrupp| 2.16.12 @ 1:28PM

Its one gallon per some unit of weight. Barge transport is much higher than this. The least efficient way to transport anything is by truck. Now cost is a different matter altogether.

joe| 2.17.12 @ 12:32AM

1Gallon of fuel moves 1 ton 400 miles.

THKrupp| 2.16.12 @ 9:34AM

I would concur with this authors message. I know of at least 3 manufacturing facilities in Eastern Ohio that are expanding and one completely new facility that was brought from asia. things are slowly getting better. Although government has very little to do with it.

youfamissim | 2.16.12 @ 10:16AM

Stuff breaks... planned obsolescence, Stuff wears out. When enuff stuff wears out, production lines ramp up. Only when the production lines has a consistent demand does the economy begin to recover. We've seen this periodically, in different sectors since 2008. They have all subsided and this GE stuff will too. WHy is everyone so eager to call the recession over? Why are the unemployment reports - unexpected? Wat's with the shock? I think this may be a willingness to suspend reality and beliefs. Frankly, I don't want the economy recovering. I want it worse - way worse. The path to returning the Constitutional Republic requires a majority demand it. A force so great it dwarfs all other considerations is needed. Removing Obama from office and his Progressive ideologues requires it. Overturning the Progressive monstrosity in DC and Statehouse throughout America requires people suffer to a point they vote to dismantle it. What that tipping point? Dunno, but it ain't here yet.

Jim| 2.16.12 @ 10:35AM

You got that right, brother! I am amazed by the people who still don't want to get involved, they would rather watch the Kardashians and ignore reality. Frustrating... And don't get me started on the fools who still believe in Obama. I get the power hungry leaders, I do NOT get the pawns they are using...

JP| 2.16.12 @ 12:59PM

This is no longer 1932-33. Being unemployed today doesn't mean Hoovervilles and starvation. The social-insurance entitlement blanket today means a relatively comfortable period of semi-retirement. Naturally, many receipients of such lagress do not want the goodies to end.

vtwin| 2.16.12 @ 10:50AM

What's needed is a carrot and stick approach. Tax incentives for manufacturers that stay/come home paid for with hefty tax increases on job outsourcers.

stan redmond| 2.16.12 @ 10:53AM

Imagine if Obama and the czars were out of the picture. This country would be booming. And not to bad mouth it but GE is ramping up production in their engine plant for the new 787s. This was planned WAY before the Obama regime.

Blackwatch| 2.16.12 @ 11:28AM

I refuse to purchase goods made by my political enemies if I can help it.

So I no longer purchase any GE products if there is an alternate available. I don't care if the product is made by union thugs in Korea, China, Zimbabwe, Pluto--I won't support GE.

Stuart Koehl| 2.16.12 @ 11:40AM

The U.S. manufacturing sector is roughly ten times larger in absolute terms (using constant dollars) than it was in 1970. It is also still roughly the same percentage of U.S. GDP today as it was in 1970. However, it employs less than half as many people as it did in 1970. Manufacturing has become highly automated, and increasing output does not necessarily equate to a linear increase in manufacturing employment.

And this is, overall, a good thing. Most traditional manufacturing jobs are dull, repetitious and dangerous. Robots do them faster, better and safer. It is useful to note that the same people who today decry the loss of "high paying manufacturing jobs" a generation ago were the same people denouncing such jobs as "mind-numbing" and "soul-crushing". Back then, they had a point.

So, what to do for the vast majority of people who are not really suited, temperamentally or intellectually, for the "knowledge economy"? I would say two words: crafts and trades. The world does not need millions of BA-toting retail associates and cubical rats. It does need competent carpenters, electricians, plumbers, welders and mechanics. These are very high paying jobs (a master electrician makes a lot more than your typical white collar guy--as does a good automobile mechanic), and are in high demand.

Charles Murray was right in saying most people don't need a four-year college degree. What they need is vocational training and certification that will suit them not for non-existent and never-returning factory jobs, but for the skilled craftsman and tradesman jobs that will never go away as long as things break and need to be fixed, or as long as people desire beautiful and unique furnishings and accessories for their homes.

THKrupp| 2.16.12 @ 11:50AM

I agree completely about people needing to go into the trades. Its almost impossible to find qualified Instrument and Electrical Techs, thats even paying them $25-$30 per hour. The same goes for qualified maintenance people of every stripe. To get someone who is a good trouble shooter and can fix almost anything in an industrial environment is becoming almost impossible. I tell all the kids of people that I know to give trade school serious thought especially electronics and instrumentation. Many Many jobs are getting to the point where humans are obsolete. As technology improves this will be even more so. People to fix all these robots and machines will still be in demand for quite some time.

PolishKnight| 2.16.12 @ 3:21PM

There's a very simple free market answer to the problem of "Its almost impossible to find qualified Instrument and Electrical Techs, thats even paying them $25-$30 per hour". Try paying them more!

On the other hand, finding a CEO like Carly Fiorina who can trash HP while flying around in a private jet is probably comparatively easy...

THKrupp| 2.16.12 @ 3:25PM

I would gladly do so if these people existed. My point is that there is a large shortage of peopel with these types of skills. Just because you throw money at someone it doesnt make them qualified. The people exist or they dont and right now they dont.

PolishKnight| 2.16.12 @ 4:01PM

The way the free market is supposed to work is that higher wages gets you access to the few people who have such skills in the short term while generating demand for more in the long term.

$25 to $30 an hour is hardly "throw[ing] money" at them.

Are you saying that there's not a SINGLE person whose qualified for these positions?

Stuart Koehl| 2.16.12 @ 4:11PM

The market is, in this case, distorted by societal expectation and government subsidies. When everyone from the President down to your mom tells you to go to college and get a "good paying" white collar job, that's what you do. And when you have put in your four years, and racked up about $100K in debt, you go into the job market and realize that, because everyone else has done what you did, there is a glut on untrained and inexperienced holders of the coveted BA.

Meanwhile, vocational education is seen (by everyone from the President down to your mom) as being for losers, hence there is high demand and low supply, which commands high wages. Unfortunately, these really are SKILLED jobs, which require two or three years of training (apprenticeship, certification) and a couple of years of real experience (journeyman) before one can be considered a "master".

PolishKnight| 2.16.12 @ 4:31PM

Nobody has answered my question though: If this is really "valuable" work, then why is $25 to $30 an hour considered "throwing money" at them? In the meantime, overglorified secretaries are hired as project managers for $80K starting.

The degree has nothing to do with it. In the 1990's, construction jobs were going to illegals and Republicans looked the other way because the Realtor (tm) mafia told them to shut up. Then companies outsourced IT or brought in H1B's for white collar IT labor. The only jobs that can't really be replaced (yet) are high paying government jobs but, hey, give them time.

If a US passport means nothing when it comes to a right to work in the USA or not, it's rather hard for my heart to bleed when I read about corporations worrying, gasp, about PIRACY in China with copies of MS Office and the latest Disney film being sold on the streets. Quick! Get the government to lock down all our computers before money and "jobs" (of CEOs) are lost!

Hahahaha!

Nick| 2.16.12 @ 5:12PM

PolishKnight,

You can't keep paying them more, or else, you will price yourself out of the market. People, for the most part, are still cheap.

We have a family-run heating and air conditioning business. My dad is the best troubleshooter in the biz. Of all the techs (we don't call ourselves mechanics anymore) he ever had, and trained, he only had a hand-full that could even approach him. Most are just interested in a paycheck, not advancement. And some just never get it.

You can only pay the really good ones as much as the market can bear. And, eventually, the good ones go into business for themselves.

THKrupp| 2.16.12 @ 6:31PM

Polish Knight,

You are assuming that the market is 100% efficient. Its not, there will always be lag. Nick is 100% right. Its very hard to find someone like his dad...although I dont know him, I know a few people like him. There just arent that many people around with those kinds of skills. No matter how much money you offer these people dont exist in large numbers. They have to be trained and then become expirienced. What we are forced into doing is hiring someone who you hope is motivated to become a top notch person. Then hope that you can keep up with the offers they get on a regular basis. hence my advice to young people to study instrumentation, electronics and automation. The demand for these people is only going to sky rocket.

THKrupp| 2.16.12 @ 6:44PM

Also, part of my job as a Manager is to keep costs low. I actively try to get people to work for me for the least cost. This doesnt mean I dont pay up when I need to or when someone really deserves it. The hiring process is a negotiation, some people are better negotiators than others. We pay our operators $18.50 an hour. Our I+E guys make between $20-$28. In this area this is a very good wage. I realize $30 doesnt seem like a lot, but for many people it is. In my area someone with a $10/hour job is envied.

PolishKnight| 2.17.12 @ 11:37AM

Bottom line is this: If the free market is supposed to reward people for their valuable skills then how is paying someone more than $30 an hour pricing yourself out of the market while paying a CEO millions in bonuses to trash companies and the economy good business?

Rush Limbaugh often tried to defend high CEO salaries to quarterbacks which I found amusing since it demonstrated the opposite of what he claimed: CEO's do work that is often simplistic such as changing org charts or laying off people to push up a stock price that anymore could do if their brother-in-law sits on the board but a quarterback possesses skills, and a fan base that pays for him, difficult to replace.

I thought of that in this context because highly skilled men who keep these production lines going are the quarterbacks and they should get $30 an hour while overglorified secretary project managers should get the same rate? Sorry, if the "free" market is failing in this regard, it's time to go communism which is on the way anyway since the Republican party is largely dead.

Stuart Koehl| 2.18.12 @ 11:01AM

Opportunity cost plays an important role. Consumers (and everyone else) make decisions about money based on alternative things they could do with it. If I have a broken television, and a repairing it is going to cost me $50, then I will probably get it repaired. If its going to cost me $150, then I am 2/3 of the way to a new television set, so I might as well trash the old one. Same with cars--as they age, how much you are willing to put into repairs goes down proportional to the age of the car: one would be foolish to put four hundred dollars into a car that you can only sell for two hundred. At some point, repairs aren't work doing, or are worth less than doing something else. Direct labor rates for repair technicians play an important role in that equation, which is why it matters.

albert constantine jr| 2.16.12 @ 6:26PM

Actually, I remember a point in the early 1990s, inspecting the paystub of a parolee who served 12 years of a 20 year sentence for a series of burglaries and robberies. He was a high school dropout, roughly the same age as I was, who learned the sheet metal trade in prison, and was working installing ductwork in the six months or so that he had been out. I was his parole officer with eight years of service, with a Bachelor’s degree, and several years of active duty (and additional reserve) service as a Marine Officer. His hourly rate was the equivalent of mine, and with overtime he stood to earn more on an annual basis than I did.

In terms of value, a trade education in a desirable technical skill does much more for earning power than a liberal arts bachelor’s degree.

Buck Ofama| 2.16.12 @ 12:18PM

>It does need competent carpenters, electricians, plumbers, welders and mechanics.

But most of the mexi-beaners have left! Boo hoo.

Oops, you said "competent".

THKrupp| 2.16.12 @ 1:01PM

Actually some of the finest electricians and tradesmen I have known were Hispanic. They were all Americans.

Buck Ofama| 2.16.12 @ 12:16PM

>A recent New York Times poll showed 52 percent of the public said it was important that the products they buy be made in the U.S. Two-thirds of those polled said that U.S. companies should take much of the responsibility for keeping manufacturing jobs on our shores.

Of course the NYT-reading liberals think it's the responsibility of USSA companies to keep jobs onshore- those assh0les can then tax the companies even more.

Chris| 2.16.12 @ 1:02PM

GE, A product line I'll NEVER, EVER, BUY AGAIN!
Thanks For The Wake-Up Call MSNBC
"They Bring All Things For Striff"!

Stuart Koehl| 2.16.12 @ 4:14PM

Then you're just an idiot. U.S. companies should invest in the U.S. in areas where the U.S. has a comparative advantage, and elsewhere in areas where it does not. The only thing the government can do to "keep jobs at home" (other than attempting to impose a kind of National Socialistic autarky--which worked so well for Hitler, Kim Il Sung and Enver Hoxa) is to minimize the tax and regulatory burden on businesses. Anything else just gets in the way, distorts the market, causes higher prices and backfires in the long run.

Bill| 2.16.12 @ 2:10PM

Santorum proposed a "zero tax policy" on manufacturing sector, and voted against the "Right-to-Work" law. He also is reluctant to do away with the most of the regulations imposed currently. Under his proposal, manufacturing sector will be unionized uniformly, and it will never recover. The problems with the manufacturing indutry:
1. taxation
2. regulations
3. labor unions
4. politicians like Santorum

PolishKnight| 2.16.12 @ 3:16PM

I disagreed with my father voting Democrat because of the party of FDR, but I also sympathized with him because of the stories he told of 10 year old boys picking coal out of shale, workers dying of black lung and casually replaced, and women getting half a day off to give birth and going back the same day. I thought many of them were exaggerated and unbelievable.

Then I read about Foxconn and worked with H1B's.

The tragedy for my father is that the Democrat party long threw loyal voters like him in front of the bus as they got into cushy deals with those same cronies while trash talking about them in public. So don't think this makes me a loyal leftist.

The Republican party and it's Holy Constitution (which is really now written by leftist S.C. members) are dying as conservatives fret about gay marriage and tilt at windmills.

Nick| 2.16.12 @ 5:16PM

"That nigger lover President Clinton had the pen and vetoed so many good bills passed by the Gingrich-led Congress."
- Written by Bill, yesterday, in the Time for Newt to Do the Honorable Thing thread:

http://spectator.org/archives/.....ent_749403

You're a moron and a racist, Bill.
GO AWAY!

Mike Hawk| 2.16.12 @ 8:25PM

Bill or whatever, you a plain full of BS.

cicero| 2.16.12 @ 4:46PM

If the government would stop subsidizing colleges by way of student loans, most young folks would go into occupations that interested them, and they had a knack for. Of course, that would result in about 2/3s of all post high school institutions having to shut down, and the people being presently overpaid to staff them go and find a job doing something useful. Goverenment money has scewed the entire economy. It is one thing to make sure no poor person falls into destitution and starvation. It is quite another to make sure than no college administrator, or professor falls below $250,000.00 per year.

Bill| 2.16.12 @ 5:22PM

Meet the other Santorum:
1. voted for raising debt ceiling 5 times, adding $3 trillion to the national debt
2. voted AGAINST the "Right-to-Work" law
3. voted for Medicare Part D and NCLB
4. voted for "bridge to nowhere"
5. voted against free trade
6. voted for Clinton appointed Sonia Sotomayer for federal judge
7. endorsed Arlene Specter over Pat Toomey

Mike Hawk| 2.16.12 @ 8:02PM

Do you live in PA?? I do and he was a damn good Senator. Far better than Bob (with one'o') Casey the empty suit we have now. BTW, Goerge BUsh and the entire RINO Establishment supported Specter. Rick resisted, but had to relent from political pressure. Specter stabbed him in the back and so did the RSCC. Specter did not win the primary because of a Santorum endorsement. It was close, so we put Pat Toomey in next time around.

POST American| 2.16.12 @ 9:31PM

--------------------FINAL WORD------------------------

KEY code-break:

GE = Globalism & EUGENICS

---------------REMEMBER FUKISHIMA--------------

---------------------------and SO much more!

Don| 2.16.12 @ 10:47PM

I don’t believe the manufacturing trade in the USA is growing. It sounds like election year BS. Run a manufacturing job in the local news paper and you will hundreds of applicants as there is no shortage for labor. When the labor pool tightens up, you cannot find workers, then let me know.

Don

Stuart Koehl| 2.16.12 @ 11:33PM

Manufacturing is recovering nicely--how long it can continue to do so hampered by onerous regulations, high taxes, high energy costs and a looming financial collapse in our biggest market is another question.

But whether manufacturing keeps expanding or not, do not expect it to result in large numbers of manufacturing jobs. The factory of the future will use just one person to do the work of ten today.

Nobody laments the mechanization that reduced our agricultural population from 50% at the beginning of the 20th century, to less than 3% today. I really have a hard time understanding why anyone would lament the passing of assembly line manufacturing jobs, which, truth be told, were hard, dirty, boring and dangerous.

PolishKnight| 2.17.12 @ 11:40AM

I'm curious Stuart (and I'm saying that honestly, not sarcastically). If agriculture has reduced it's labor down to 3%, then why are Republicans allowing an invasion of illegals presumably to pick grapes, lettuce, and apples?

Stuart Koehl| 2.18.12 @ 12:38AM

Most of the illegals in the United States don't work in the farm sector, and most foreign migrant workers are legal. By far the largest group of illegal aliens are those living in major metropolitan areas working in a variety of service, construction, day labor and trade jobs.

POST American| 2.18.12 @ 2:06AM

----AS FUKISHIMA continues to BURN----

'America better watch it
or in a couple of decades
we're going to be a minstrel show
---for RED China."
-Gore Vidal
1985
(the height of Reagan-Bush)

And we wouldn't want to be a Globalism
and EUGENICS collaborator --we wouldn't
even want to be Rockefeller front man
Maurice Strong ---once the GOOD people
of China reckon with the TRUTH of
what was done to them ---IS being done to
them.

--------------------UMMM---HMMMMMM

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