Fareed Zakaria weekly take - Trump betting on US manufacturing.
- Thread starter Eppy99
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I think the key, with any president or politician, is to separate the policy from the politician.
I think a lot of Trump’s policies are bad - but not because he’s the one promoting them. And his trade policies are high up on that list. They’d be just as bad if a politician I liked was doing them.
But I don’t have any issue supporting those instances when he’s pushing something I do support - such as getting the border under control.
I think a lot of Trump’s policies are bad - but not because he’s the one promoting them. And his trade policies are high up on that list. They’d be just as bad if a politician I liked was doing them.
But I don’t have any issue supporting those instances when he’s pushing something I do support - such as getting the border under control.
Or changing the Gulf of Mexico to America. In his speech where he was just going scorched earth on the prior admin and Dems and all of them had a stoic face he made that announcement and Hilary Clinton bust out laughing. And you could tell it wasn’t a sardonic f you laugh but a spontaneous genuine laugh out loud funny at how absurd. I didn’t know she had a sense of humor. It made me laugh watching her. I must have watched it a dozen times
That was very dumb and I was amazed at how many comments on social media were some version of, “he did that so that the United States now owns the gulf and can drill anywhere we want.” People are really ignorant about so many things but confidently make baseless assertions.
I suggest listening to this expert on international trade.
The point of this thread is to listen to Fareed’s take. I think he makes excellent points regarding our economy is more of a services economy than our past manufacturing economy. Employees get paid more for services than manufacturing. Services is the fastest growing segment in the world economy. He suggests tariffs will lead to lack of competition which breeds stagnation similar to that of Japan. I’d really like you all to give this a listen and have an open discussion. We’ve already pointed out it’s less important which politician is making the policies so long as the policy is good for America.
I’m in light manufacturing. It could be done here with the right conditions. Factories in rural areas with tax abatements. No benefits. No crazy minimum wage. You could bring back a lot of what you see in China and Mexico in this space. But you can’t have crazy calif dems calling for super high min wage and benes and the rest. It doesn’t work. And actually it’s counterproductive. It just kills small towns.
Dad’s a trucker. Pulling in $75k. Mom’s at a cut and sew factory making $12 an hour. Rural Midwest. 3/2 house for $225k. They’re good! But AOC and the rest go from the bar to the gov and just don’t know anything. Trump same. So many industries the cap expenditure and infrastructure is already overseas. There’s just not a viable way to start over here. OSHA flsa min wage work comp employment tax property tax biz tax biz license it’s endless here
I guess one of the questions though is SHOULD America aspire to be a leader in manufacturing like the old days versus being a services economy which Fareed suggests is more profitable for employees and companies?
I think it’s a generalization. It really is industry by industry. What do lawyers really produce for a grand an hour. They spend that money in the economy so that’s good. But service is also a shitty waitress job. I’m not much of a historian but I suspect we were a better country when we were manufacturing before turning to service. A car plant provided a nice life vs $200k in student loans to do whatever service shit
I don’t think he’s referring to that type of service work as leaders of the economy. He’s talking about design, marketing, software as a support system to the global economy. His monologue explains it much better. To your point though I would like to ask him a follow up question as to how this economy has a trickle down effect, especially for the non college educated.
Federal minimum wage is still $7.25 and there are plenty of states that don't have any state requirement for higher. I don't think that's really much of an issue in rural Midwest, as far as manufacturing.
The reality is that any manufacturing brought to the US is going to worked by robots, not people.
I used to commute 45 minutes through methville every day, and there were always commercials on the radio for local factories holding job fairs. "Start at $12/hour!" To fabricate steel for a company that's so large they have their own police force. F*ck that. I'd rather flip burgers. At least the McD's exactly one town over starts people at $15.Federal minimum wage is still $7.25 and there are plenty of states that don't have any state requirement for higher. I don't think that's really much of an issue in rural Midwest, as far as manufacturing.
The reality is that any manufacturing brought to the US is going to worked by robots, not people.
Missouri is $13.75 going to 15. We manufactured for a time in two cities not far from rolla. Both factories had abatements, which helped immensely. Add in all the other costs and regs it makes a difference with tight margins. Both factories are gone now. One went under the other moved to Tenn. one made sec football unisFederal minimum wage is still $7.25 and there are plenty of states that don't have any state requirement for higher. I don't think that's really much of an issue in rural Midwest, as far as manufacturing.
The reality is that any manufacturing brought to the US is going to worked by robots, not people.
The factory that made sec fball unis didn’t have ac. Just opened the doors on each end
I just think it's pretty irrelevant. Indiana has federal minimum wage, but you can work at a gas station for $15.
The federal minimum wage was something like $13 or so in the 1960s (inflation adjusted)
The factory that had sec fball unis didn’t have ac. Just opened the doors on each end
It all adds up. Especially when you have 300 employees. That’s double from $7.50. These are companies that aren’t making a ton of $. I’m actually taking the kids down to table Rock tomorrow and visiting one outside of rolla. I’ll be curious to hear what they think. They’ve been around forever
I did listen. And I linked an alternative view. Is that not allowed? I linked an hour conversation with someone who has been a US Trade rep and whose career has been involved in trade and business. I would hope you would encourage everyone to listen to both to make an educated decision on the proper approach to our economy.
Fareed does make some good points. And he and his staff certainly found data to support his view. But there was nobody to question him or challenge him on his information.
And I will say that Tucker doesn't challenge Bob Lighthizer in the interview but at least it's and hour with some questions. I'd like to see a conversation between Fareed and Bob. But sadly, that will never happen.
Lighthizer was Trump's chief trade Rep, so he's just defending the Trump policy with softballs. He's also got a deeply flawed view of the issue.
@Eppy99 I watched the video, and he’s exactly right.
However, there’s also something to be said for the efficiencies gained by increased automation, their impact on unit labor costs, and what that could mean for domestic manufacturing.
At the end of the day, production of any kind is going to find its way to wherever it makes the most sense. And, as with most things, government ought not get in the way of that.
Freer economies are wealthier economies.
Great point on automation. Doesn’t help the worker or maga but bye bye osha flsa unemployment employment taxes health insurance workers comp etc. quick way to become competitive
Right. I guess I don’t see the road to prosperity by bringing $12 an hour manufacturing jobs with no benefits to rural areas. That’s poverty regardless of where you live in the US. These jobs are a far cry from the automaker union jobs from decades ago.
Depends on the community. And if hubby works. Owensville mo. Licking mo. Lots of towns that’s how people survive. So Ill. All over
The single best thing we could do IMO is figure out ways to get more people invested in capital assets. I hate to sound like a broken record on this, but this is why Bush's 2005 Social Security reform was such a missed opportunity. Last I looked, around 60% of American households have (directly or indirectly) money invested in equities. And that number has certainly grown over the decades.
Introducing a component of individual investment to Social Security would've grown that number even more -- while simultaneously helping to narrow the funding gap. To me, it was the closest thing to a no brainer entitlement reform that we've had put before us in my adult life. And not a single one of the objections to it made any sense.
When we go to the pickers store I’m going to teach you a little about these backroads communities. How they live. How they repurpose goods. What they survive on
It's the great equalizer on labor cost disparity. That said, we shouldn't lull ourselves into thinking that we'll have great advantages when it comes to the design, implementation, and maintenance of automation systems.
We desperately need more people with these kinds of skills -- and I'd even say that we're lagging some of our foreign competitors in that area....which is maybe the primary reason why we have to get it right on immigration policy.
Yup. And in fairness I don’t know the first thing about heavy manufacturing. Only light. Type nike etc does
I can get on board with the wage talk, but no benefits combined with low wages? How do you expect people to sustain themselves under those conditions? Not try to be argumentative at all. I get the spirit of what you are saying. People I these jobs will need government support then.
Wife makes ten an hour hubby is a trucker. They survive all over America. Lose factory that $10 gig is gone. So is that cushion
I have an issue with for profit companies paying poverty level wages and no benefits throwing their employees over to taxpayers to take care of.
Medicaid costs are a huge threat to Indiana right now. The state has focused on warehouse and logistics jobs at the expense of higher wage sectors. The result has been more and more Hoosiers on Medicaid. The working poor do have a job, but they are still poor and soak up public resources.
Cushion being the operative word. My 15K driver job provides a cushion, but you can't live on that.
And make everyone else in the country collectively poorer via protectionism and subsides....
Sounds like a shit plan.
While I have the same problem, we should probably get used to this. I'm not quite as bearish as many people are on the future of our labor market, but the fears aren't unfounded. There is going to be some higher level of turbulence -- just how high it is, and how lasting, is anybody's guess.
Accelerating technology is going to have a lot of effects. Most of them will be broadly beneficial. But there's no such thing as a shift which is all good and no bad.
That’s fine. Then the business goes under or overseas. Not all are making bank. Our first manufacturer spun off from Rawlings. Stayed seven years then went under. No one filled that void in the commubity. 100 cut and sew 50/60 year old women out of work. They liked being there with their friends more than standing at subway or unemployed
Yeah, it should also be said that it's not incumbent on employers that people:
- acquire marketable skills
- are reliable and productive
- don't let alcohol and drugs ruin them
Etc.
Part of the subtext of a lot of this discussion is that the country is failing people, employers are failing people, the education system is failing people, etc.
I don't see a whole lot of talk about people failing themselves. We all have an end of the bargain to hold up too.
Even for those that are making bank, a particular company's profitability doesn't have a whole lot to do with prevailing wages.
I've lost count of the number of retailers that have gone under in recent decades. Off the top of my head...
Bed, Bath & Beyond
Toys R Us
Joann Fabrics (just recently)
The Limited
Sears
K-Mart
It's a very, very long list. I'm willing to bet that wages at these stores -- and wages at small retailers, too -- didn't differ much from wages at WalMart...which has a net income of $20B per year (though not much earnings growth).
Labor markets are competitive. And, like other markets, sometimes conditions favor those who buy labor, sometimes conditions favor those who sell it.
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