In
last Wednesday’s paper was an article about how the White House wanted to focus on
the economy at large and more specifically at improving manufacturing. In this same article the wanted to raise the
minimum wage from $7.25 to $9.00 per hour, as though this would help.
Here is where are could write something sarcastic, but I won’t. Instead, I will put down a few bullet points
that would help increase manufacturing from the prospective of someone who is
actually in that field.
· Lower the minimum wage – at the very least
in underdeveloped areas with higher unemployment
· Increase the work week from 40 to 44
hours, many countries have a 48 hour work week, making them more
productive/competitive the minute they show for work
· Give manufactures a lower corporate
tax rate, say 25% instead of the current 40%
· Increase oil exploration, even in Alaska – this could
not only lower energy costs, but increase manufacturing jobs in its own right
· Limit access of international
students to our engineering and science graduate degrees, where they can take
our own research and knowledge home and compete against us
These are
just a few ideas; there are many more that could improve our manufacturing
competitiveness. They are probably too controversial for politicians, not that these are not. Below is a Hubpage on Creating Wealth we
wrote sometime back that might be apropos.
Creating Wealth Instead of Transferring It
This is a subject that
is near and dear to my heart, as I am associated with the electronic component manufacturing and the agriculture industries. These both happen to be industries that create
wealth.
How does one create
wealth as opposed to merely transferring it? When I explain this to my
children, I tell them that in order to create wealth it was come from the
ground. It must be grown, mined, or manufactured. This may be an over
simplification, but for the most part wealth is extracted from the ground.
This is not to say
that the accounting or legal professions are not important, in fact they are
imperative. They do not, however, create wealth but transfer it. The act of
manufacturing a transformer that is made with steel and copper, both of
which come from the ground, is creating wealth. The liability insurance that is
sold to that same manufacturing company is transferring it and before that
money can be transferred it must first be created.
I contend that the
only way to truly bring back our economy, without the use of smoke and mirrors,
is to bring back manufacturing. There is a reason that China has been able to
finance the United States’ enormous debt. China is where everything is now
being manufactured and hence where the wealth is being created. On the
agricultural front, Brazil is coming into its own and while agricultural made
not be glamorous it will be an industry that we will regret having not defended
more vigorously.
The old English Empire
once thought that they could “sub out” their manufacturing and agriculture to
their colonies while they would be the banking and finance center. In other
words, they would hold our money for us. It didn’t take long for the colonies
to decide that they could hold their own money. The money will always be
located where it’s being created and unfortunately that is less and less in the
United States.
Ireland has realized
this some time back and for more than twenty years has lured manufacturing
companies to locate there by offering attractive packages in order to not only create
these type jobs, but create wealth. In the meantime, the U.S. saddles
manufacturing companies with higher taxes and more regulations.
