Who Makes the World's Stuff?

Who makes the world's stuff these days? Not the United States, certainly. We don't make much of anything here in the U.S. anymore. All of our manufacturing jobs have been off-shored and outsourced and shipped overseas to China and Taiwan and other points east, where wages are low, unions are scarce, environmental protection is an afterthought, and billions of people stand in line to do work once done in the U.S. for a fraction of what we used to charge.

The United States, having served as the global manufacturing leader for most of the last 100 years, has let that all slip away and has become a weak, reactive slave to consumerism. . . choosing to buy what we need instead of making it ourselves.

Isn't that right? I mean, that's what we've been led to believe, isn't it?

Wrong. As the the Financial Times pointed out in June of 2010, "The U.S. remained the world's biggest manufacturing nation by output last year."

Not China. Not Taiwan. The United States, thank you very much. We make the world's stuff. Still. For now.

But as that same article points out, the U.S. is poised to relinquish that crown to China in 2011 unless something dramatic happens.

Will that happen? Probably. Powers greater than me will decide that one way or the other. I'm just pleased that we're there, right at the top, vying for the lead. It's like finding out that you're almost as good at something today as you were back in high school. Maybe we're not as far gone as we've been led to believe we are.

And maybe there's hope. There are still things the U.S. does better than anyone else on the planet, I believe.

Canary in the Coal Mine

Have you lost your job in the last year? I really am sorry if you have, and I sincerely hope you have found work since then.

If you're like me and you've been blessed enough not to have lost your job, you probably still know a few people who have. But for many of us who have remained employed during this recession, I think it is all too easy to know emperically that a problem exists but to not really believe it deep down. No amount of hype on TV or in print can really bring home the fact that people are flat out LOOSING THEIR JOBS as a result of the sad state of the economy right now.

I'm not sure one more piece of scary information will help make this whole deal real for anyone else, but I heard a statistic recently that kind of jumped out at me. In my home state of Missouri, tax revenue (resulting from income taxes, corporate taxes and sales taxes) fell 9.1% during the last year.

That's real, and that's not small potatoes, folks. That's up in the low billions of dollars.

That's a real drop in taxes collected from what people earn (7.6%), because so many people aren't working, and many of those who are still employed have seen their incomes flatline or even decline in the last year. That's a real drop in taxes on companies (~5%) that aren't doing as much business as they did in previous years. And that's a real drop in taxes collected at the cash register (~5%) as people spend less of what they earn.

For some reason, knowing that my state's revenues have dropped by close to 10% in the past year somehow makes the recession more real to me. In a weird way, tax revenues are like the canary in the coal mine. . . a second-hand indicator of the health (or sickness) of its surroundings.

I think there's something bad in the air.

http://www.connectmidmissouri.com/news/story.aspx?id=478120

America the Beautiful

O beautiful for heroes proved
In liberating strife.
Who more than self their country loved
And mercy more than life!
America! America!
May God thy gold refine
Till all success be nobleness
And every gain divine!

New York and L.A.

What grinds my gears. . .

I read this morning that the last interview with Dennis Hopper, who died recently, is on news stands in New York and Los Angeles and "will be available nationally on July 6."

This, like the practice of opening movies in New York and Los Angeles days or weeks before opening them in the rest of the country, is part of the reason why 90% of the people in the U.S. hate New York and Los Angeles.

And yes, I know that more than 10% of the nation's population lives in New York and Los Angeles. Some of those folks hate themselves.

Elitist shenanigans.

First new post in a while

I haven't posted anything here since December '09, so this is really just a check to see if I can still log in to my blog, post, edit, etc. Seems to be working.

Fool Us Twice, Shame On Us

I mentioned back in December that the bailout for automakers felt like a bad idea. Specifically, I asked the obvious question: What if the bailout doesn't work? The obvious answer back then was that the car companies would STILL go bankrupt, and we (the tax payers) would be $14 billion dollars poorer.

Well, sure enough, here we are in late March 2009, and GM and Chrysler are turning their pockets inside out again, saying that the $14 billion we gave them didn't quite do the job. They want more money, and Obama is going to give it to them. Oh, he's doing his best to look all stern and grumpy while he's using the nation's overdrawn checkbook to write Detroit another check with nine or ten zeros on it. But he'll write the check, make no mistake about it.

And guess what. The automakers will still go bankrupt. But the question is, will that be the end of it? It'll go one of two ways, I think.

Option 1 has automakers filing for some kind of high-speed bankruptcy as a condition of their getting more bail out money. They'll file for bankruptcy, wiping out much of their debt (thereby screwing over their suppliers and vendors, not to mention the US tax payers). They'll take a crack at retooling their labor contracts and restructuring their pension and benefit positions. And they'll get billions more in guaranteed loans from the Obama administration. With all of this, the car companies will reemerge, ready to do business again. And guess what! They will still fail, and they will be back yet again to ask for even more money.

Option 2 has has automakers getting billions in additional money from the government before they take the step of filing for bankruptcy. They'll get the money, burn through it, and then still go belly up, wiping out the money owed from the first bailout ($14 billion) AND however much they get this second go-round. All creditors will get screwed, attempts will be made at restructuring, and they will reemerge just as screwed up as they were before. And guess what! They will still fail, and they will be back to ask for even more money.

There is, of course, a third option, but it is an option no one seems willing to take. This third option has GM and Chrysler being allowed to fail outright. We as tax payers resignedly write off the $14 billion in lost bailout money as a lesson well-learned, and we refuse to play the game any more. The automakers go belly up. And instead of allowing this privately-held company to screw over countless vendors and suppliers (and tax payers), we amke sure that their assets are used to pay all outstanding debts.

I used to think that having those big companies fail would be an unthinkable disaster for the country. I now see that there are far worse things.

Can GM and Chrysler emerge from such a liquidation and still competitively build cars? Probably not. So be it.

Lock the Door? Or Open It?

I’m conflicted these days about a lot of things. One that keeps smacking me in the face is the whole immigration issue.

Side A: California is showing a $40 billion budget deficit while they pay an estimated $13 billion annually to support illegal (not “undocumented”) aliens (not “immigrants”). States across the US are similarly burdened. Our federal immigration laws are being ignored, and crazy policies in states like CA are actually encouraging more illegal aliens to come on in. The US / Mexican border really does represent a national security weakness, too, although not nearly as much as some would like us to believe.

Side B: Mexico is a disaster; there is no hope there for the vast majority of Mexican citizens. The US immigration process is slow, unfair, and often wholly impassable for Mexicans wanting to emigrate to the US. If I was a Mexican citizen living there in poverty (as is the norm), I’d do everything in my power to get to the US. . . up to and including sneaking myself and my family across the border illegally. If I was poor in Mexico with a pregnant wife, I would do whatever it took to have my child born in the US. And in doing so, I would likely have to put myself and my family at great risk; too many people are suffering and dying as they try to get into the US.

There's a lot of fault to go around. I can find significant fault in the corrupt and broken Mexican government that has failed consistently for 200 years to foster any kind of prosperity for its people while actively encouraging its citizens to go to the US illegally and send money back home. I can find fault in US federal policy that has failed to reasonably and fairly regulate its southern border while also refusing to have any kind of reasonable enforcement and deportation processes in place. I can find great fault in the state policies in California, which have exacerbated the problem.

But if I am honest with myself, I cannot find fault in the motives of those who choose to come to the US illegally seeking a better life.

How’s that for wishy washy?