There is an area of public concern that seems unable to ameliorate
a hurtful condition; that is the lure of US jobs to nations with cheap labor. This has caused a depletion of employment
among those who formerly counted on factory and mill work first in what used to
be the industrial belt – now known as the rust belt – and among southeastern
states.
Most of these
workers were noted for their lack of education especially beyond high school. This shift has been so extensive, the US
economy is presently referred to as a post-industrial economy. In the place of viable manufacturing towns,
the nation has a swath of hollowed out communities with empty factories and
mills. In some areas, as this blog has
reported, formerly vibrant communities have become centers of drug addiction,
particularly of unemployed workers hooked on opioids.
This is a two-edged
problem. There is the loss of jobs, as just
described, but there is also in importation of cheap goods. While significant numbers of workers lost
their jobs, everyone has the advantage of being able to go to such retailers as
Costco and Walmart and pick up products – clothing, furniture, house items,
etc. – for a fraction of what they would sell for if produced in America.
Overall, this dispersion of jobs and the
utilization of its accompanying formula of specialization mean, globally, more
efficiency – producing more goods and services at lower costs. But should this segment of the American
workforce pay such a price for the sake of that efficiency? Is there a strategy that allows more Americans
to enjoy the fruits of the global economy?
The CBS Sunday Morning Show[1] ran a
story of an American entrepreneur who started a garment business in North
Carolina and by so doing demonstrates that with a bit of creativity there might
be a formula to meet this challenge. The
piece traced the production process this manufacturer uses: from growing and harvesting the cotton used
in his plant to the work done at his plant that uses teams of workers – as
opposed to traditional assembly line approach – in producing his final
products.[2]
His process is significantly more
expensive than those that depend on imports, and his final hoodie – the item illustrated
in the story – sells for a whopping $105.
Yet, that hoodie lives up to the company’s name – American Giant – as a
high-quality product and has sold well in American stores. Yes, it benefitted from unplanned media
exposure, but success is success.
Here’s the synopsis the network
provides for the CBS story:
In 1980 almost 80% of clothing bought
in America was made in this country.
Today, it’s around 3%. But Bayard
Winthrop, founder and CEO of the sportswear company American Giant, is trying
to turn that around, helping to rebuild an infrastructure and workforce to
manufacture clothing that proudly bears the “Made in U.S.A.” He took correspondent John Blackstone on a
tour of the production cycle, from cotton farm to finished hoodie.[3]
It occurred to
this writer, what if a manufacturer took on this same challenge, perhaps at a
more modest level, – not producing the best hoodie on the market – call it
America Not So Big, and be able to sell it for a cheaper price, would that be
profitable? Just wondering. But what Mr. Winthrop has demonstrated – as part
of his challenge – is that there is a way for American manufacturing to return,
at least in the apparel business; and perhaps return in other industries as
well.
What remains,
and what this blog in future postings will address, is: what else can be done? A writer who has looked at this concern – and
has been cited before in this blog – is Edward Alden.[4] He provides an analysis that covers the
various aspects of this issue. And that
includes the role of government in not just refereeing the actions of the
pertinent players, but in issuing policies that encouraged – in some cases
mandated – the business activities that has resulted in the current state.
There are two
quotes in his account that set the stage for what Alden reports regarding
government’s role. The first is:
The federal government needs to go
further, however, by negotiating with other countries to create better rules
for international economic competition and enforcing those rules vigorously. The trade and investment agreements of the
past have made it easier for goods and capital to move around the world, which
has brought gains in productivity and efficiency.[5]
Here, Alden identifies a key factor, US trade policy since
World War II that this blog has previously reported. In summary, that policy was meant to lay the
foundation for a global economy that would give the nations of the world a
vested interest in avoiding global wars as were experienced in World Wars I and
II. Those wars caused, beyond untold
human misery, inestimable amounts of destruction to the world’s production
capabilities.
But that
writer goes on:
Companies have enormous leverage to
demand government subsidies, tax cuts, or a compliant, low-wage workforce as a
condition for investment. Even as it competes
fiercely for investment, the United States must lead a new international effort
to curb the destructive effects of unbridled competition. New rules should be put in place to set higher
standards for business around the world, to discourage corporations from racing
to the lowest tax jurisdictions, and to create the conditions for fairer global
economic competition. And those rules
must be enforced with vigor that has too often been lacking.[6]
This
blog has just issued a set of postings that looks at the responsibilities
corporations have as virtual citizens of the American federation.[7] With this issue, the loss of jobs due to seeking
cheap labor or the utilization of automation,[8] a
responsible corporate “citizen” should proactively seek out options that can
meet the needs of fellow citizens. In
this case, that would be of displaced workers.
As such, an American civics class
could legitimately investigate this issue by analyzing its related attributes
and asking its relevant federalist questions.
This blog will play its part and delve deeper into this issue at some
future date.
[1] “Made in America,” CBS Sunday Morning Show,
broadcast September 1, 2019, accessed September 2, 2019, https://www.youtube.com/watch?v=K05NEWHuHWg .
[2] In between there is the gin (where extraction of the
cotton from the plant occurs) and the mill (where the cotton goes through the
spinning looms and the other related processes to make the cloth occur).
[3] “Made in America,” CBS Sunday Morning Show.
[4] Edward Alden, Failure
to Adjust: How Americans Got Left Behind
in the Global Economy (Lanham, MD:
Rowman and Littlefield Publishers, 2016).
[5] Ibid., loc. 562 (Kindle edition).
[6] Ibid.
[7] The reader is invited to look at those postings
starting with “Corporations As Good Citizens,” August 20, 2019, https://gravitascivics.blogspot.com/2019/08/corporations-as-good-citizens.html .
[8] As demonstrated in the CBS report in how the
highlighted mill performs its role.
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