“We don’t make anything anymore”
Is there a more tiresome economic whinge?
As an absolute statement it is, of course, nonsense. The United States produces much more ‘manufactured’ output than it ever has.
In any case, I despise broad judgments about economic activity. I am more philosophically inclined to trust the millions of decisions that go into forming patterns of specialization and trade and just accept the incumbent arrangement as being optimal.
And the element of xenophobia is particularly noxious. The gust sometimes comes out of the sails when you try to change the subject from Chinese to, say, Italian or Swedish manufacturing prowess. If people who argue such things didn’t have a villain to pin the blame on, I suspect they’d be less ferocious.
I remember once seeing a bumper sticker that said “Foreign Cars Destroy Our Jobs”. This was on a GM car with an Ontario license plate driving on a Canadian highway. What on earth should I take from that?
But let’s say that our goal is to increase our global share of manufacturing. To the degree that it increases out overall output faster than it otherwise would, I’m on board.
But if you are pissed off that the current lineup of manufacturers is not competitive enough with the Chinese, then what we need are policies that will create new manufacturers.
Never forget this: policies that promote real innovation are supposed to destroy existing businesses. That means dislocation, that means hardship and layoffs and pain.
Ultimately, though, I reject the manufacturing fetish because I think it’s such an arbitrarily small slice of the economy.
Think of the other areas that get a lot of public attention: farming and “green” industries.
Those markets are effed, which lead to serious distortions and a smaller pie for everyone.