Made in USA, Part One
When we bought this house in 2005, we also began procuring the tools and paraphernalia associated with home ownership and gardening. Among these were loppers, shears, and pruners. I remember being very particular about what I bought. I wanted tools that were manufactured in the United States. I sometimes had to go out of my way to find them: Home Depot for the shears, Target for the pruners, Wal-Mart for the rake, George’s Hardware for the machete. But, in the end, I got all American-made tools.
I was in Lowe’s last weekend, and on my way through the garden department I came across a display of Fiskars tools. They made my loppers, pruners, and shears. If I had considered adding more Fiskars equipment to my collection, I won’t anymore: all their products are now made in China. Just to check and make sure I wasn’t mis-remembering what I bought, I went home to check. Sure enough, each piece is stamped “Made in USA”.
This situation troubles me deeply. It means that there was once a factory somewhere in the United States, where people like you or me were employed, where people had healthcare and retirement benefits, where people enjoyed company picnics and softball games. One morning, a mid-level manager probably received a memo from the factory owner–who probably received a memo from Fiskars–stating that the plant was being shut-down so production could be moved off-shore, where labor costs a small fraction of what it does in America. The mid-level manager probably went out on the floor that afternoon and told everyone that they’d better start looking for work somewhere else. Some of the lucky ones may have found jobs quickly. But I suspect many others didn’t, and shortly thereafter lost their health insurance, and maybe their cars and homes. Their town, if it is small enough, sees some people move away, while the ones who stay have a lower standard of living. Property values drop, and so does tax revenue. Schools get worse, and the next generation has fewer opportunities to make something of themselves. Crime goes up. So does the divorce rate.
What is it worth to prevent this? About $2.00, apparently. That’s the difference between what I paid for my made in USA pruners and the ones now made in China.
The United States’ trade deficit is astonishing (something like $800 billion). If you believe the Milton Friedman-types, all this is good, since it means the dollar is strong, and that consumers are able to buy more things at lower prices. To the first point I respond: that’s nice when I travel overseas, but I’m not in the business of trading currency, and, even if I were, I wouldn’t be betting on the dollar, since we owe China trillions, and by any standard our CAB looks pretty bad. As to the second point: low prices are nice, but what you don’t see printed on the price tag is what I wrote above – the death of manufacturing in America.
We can deceive ourselves into thinking that we have it good, when we go to Wal-Mart and find aisle after aisle of cheap, made in China merchandise. But if things go on like this, there will come a day when retail, hospitality, and other service jobs are the only thing left for people without a college degree. The middle class will disappear.
Filed under: Current Events, Rantings on June 9th, 2009
Don’t want to be a bummer, but cheap trade and the internet will probably lead only towards lower wealth for the Western world as more labor and “knowledge” work is moved overseas. On the plus side, China and India will enjoy a middle class they never had before.
Nicholas Kristof came out in favor of sweatshops, or more accurately the injection of manufacturing industry where there otherwise is absolute poverty. Is it better that 1 American be promised a stable labor job with good pay, or that several 3rd-world families no longer live in abject filth?
Kristof is a human rights-minded journalist, and I respect that. And, of course, I don’t like that anyone suffers in this world. But, aside from my belief that it’s important to preserve American manufacturing while we can, I also worry about the unseen aspects of industrialization in the developing world.
Western countries, where we’ve had hundreds of years to deal with the negative effects of industrialization, are finally getting a handle on it. In the developing world, however, where this is all relatively new, there are serious issues, from child/forced labor, to the environment, to political oppression being sustained by the profits of that industrialization.
Though I don’t agree with some of the tone she takes, Annie Leonard’s “Story of Stuff” (www.storyofstuff.com) does a good job of illustrating the way the developed world exploits the resources of the developing world with little concern for the negative effects the citizens of those developing nations experience. We now have laws in the US to prevent wholesale environmental devastation. But in the third world, these laws don’t exist. The governments are so focused on the profits (often used to maintain oppressive control), they’re willing to allow their natural resources to be trashed.
Leonard also does a great job illustrating the “externalized costs” that come with globalization. We pay way, way less for the made in China products we buy than they actually cost to produce.
A lot of these problems go away when the manufacturing occurs in the USA. First, a lot of the BS junk that nobody needs–the stuff that fills $.99 stores and Pier 1 Imports–would go away, and there’d be much less waste, because it wouldn’t be worth paying the real cost of the singing animatronic fish we give as a gag gift. Second, industry would be cleaner. And, finally, we’d have a thriving middle class.