From Canada, a Fair Assessment of U.S. Manufacturing

By October 13, 2010Economy, Taxation, Trade

The Toronto Globe and Mail has a new look and a new journalistic project, “Time to Lead,” calling for a re-evaluation of the country’s institutions and self-conception. As journalism goes, it’s a worthwhile Canadian initiative.

Today’s contribution to the series is an outstanding column from a veteran Canadian editor and columnist, Neil Reynolds, on manufacturing in the United States. From “There are no ‘lost’ jobs, just lost opportunity“:

The real U.S. unemployment rate exceeds 15 per cent of the labour force – and U.S. manufacturers have eliminated another two million jobs since 2007. Yes, the economy as a whole dropped eight million jobs, but the decline in factory jobs has become a lament for a nation expressed by the nostalgic assertion that Americans “can’t make things any more.”

This is a defamatory lament. It incites further populism and further protectionism – and further delusion. It is, simply, wrong. The American factory worker leads the world in “making things.” The problem is not production. It is perception. U.S. manufacturers mostly make high-technology “things” that aren’t sold from store shelves – advanced computer electronics, for example, and sophisticated aerospace products. (The biggest losers in manufacturing: textile mills and clothing.) The fact is that the United States remains the No. 1 manufacturing economy in the world by a wide margin. The average American factory worker is more than twice as productive as the average worker in the next 10 leading manufacturing countries. The U.S. produces 22 per cent of the world’s manufactured goods – compared with Japan’s 13 per cent and China’s 12 per cent.

Reynolds cites the National Association of Manufacturers’ “2010 Labor Day Report” to identify government interference and protection as restraints on U.S. manufacturing resurgence. As the NAM report notes, more aggressive countries — including Canada and those of the European Union have negotiated and signed trade agreements that open up their markets to one another’s exports.

Meanwhile, the U.S. government pursues a disastrous strategy at home: treating manufacturers as people who can’t make things, compelling them to produce only the “right” politically correct products and imposing yet higher corporate tax rates.

Join the discussion One Comment

  • Chevy Truck says:

    Thank you Carter Wood for the kind words about American workers, and now if we can only get rid of the people that undermine us we will be in business again.

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