Friday, December 10, 2010

Has anyone seen "19 Facts About Deindustrialization...?"

Have you received an email or noticed this very blogged post? I have inserted it below and have added my comments to it. To my knowledge, no one has bothered to respond; probably because it is riddled with hyperbole and does not suggest what to do about this doomsday situation. Hope you enjoy my rebuttal which is italics and bolded after each number...

So what happens when the debt bubble pops?

The deindustrialization of the United States should be a top concern for every man, woman and child in the country. But sadly, most Americans do not have any idea what is going on around them.

For people like that, take this article and print it out and hand it to them. Perhaps what they will read below will shock them badly enough to awaken them from their slumber.

The following are 19 facts about the deindustrialization of America that will blow your mind....

#1 The United States has lost approximately 42,400 factories since 2001. About 75 percent of those factories employed over 500 people when they were still in operation.

The 3 million manufacturing jobs lost since 2000 have been reabsorbed into our economy. They are a very small part of the unemployment today, which is primarily marginal service workers.

#2 Dell Inc., one of America ’s largest manufacturers of computers, has announced plans to dramatically expand its operations in China with an investment of over $100 billion over the next decade.

They did this to sell more computers in China. Wouldn’t you? They are competing with Lenovo (formerly IBM PCs) in their home market. Seems like a good idea.

#3 Dell has announced that it will be closing its last large U.S. manufacturing facility in Winston-Salem, North Carolina in November. Approximately 900 jobs will be lost.

And this is because it is competitive? Of course it is not competitive. Here’s one for you…why have Mercedes, Toyota, Honda, BMW and Nissan all set up manufacturing in the USA? Because they are not unionized.

#4 In 2008, 1.2 billion cell phones were sold worldwide. So how many of them were manufactured inside the United States? Zero.

Question, how much of the software running he 1.2 billion dollars was produced inside the United States? Almost 100%

#5 According to a new study conducted by the Economic Policy Institute, if the U.S. trade deficit with China continues to increase at its current rate, the U.S. economy will lose over half a million jobs this year alone.

The United States has been more than 25% of the world’s GDP since 1950. As a fully industrialized nation, our economy cannot grow if the world economy does not grow. The only way it grows is to produce and sell more. The first phase of industrialization is to export. The second phase is to consume. China has not even begun to consume. The answer for US job growth is to innovate and to produce efficiently.

#6 As of the end of July, the U.S. trade deficit with China had risen 18 percent compared to the same time period a year ago.

Just ponder the following table for a moment. It shows the development of the world’s largest population. They are earning more and spending less on food and closing and housing, and increasing their expenditures on health, transport, telecommunications, services and goods. Hmmm…

#7 The United States has lost a total of about 5.5 million manufacturing jobs since October 2000.
The number is actually 3 million. The real question is, what do you want them to build? More washing machines? More cars? More iPods? Part of our manufacturing decline has to do with SATIATION. How much more stuff do we need?

#8 According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies increased an astounding 30 percent to 10.1 million. During that exact same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million.

Are we supposed to interpret this to mean that the foreign affiliates are producing goods and shipping them back here? That is offensive to the reader’s intelligence. Let’s take General Motors. They have increased manufacturing employment in China to around 250,000 to BUILD BUICKS FOR THE CHINESE. See the Dell comments above.

#9 In 1959, manufacturing represented 28 percent of U.S. economic output. In 2008, it represented 11.5 percent.

According to all sources, including Wikipedia, this number is 21.9%, not 11.5%.

#10 Ford Motor Company recently announced the closure of a factory that produces the Ford Ranger in St. Paul, Minnesota. Approximately 750 good paying middle class jobs are going to be lost because making Ford Rangers in Minnesota does not fit in with Ford's new "global" manufacturing strategy.

Ford just announced this week that they are hiring 1,800 people to work in their Louisville plant.

#11 As of the end of 2009, less than 12 million Americans worked in manufacturing. The last time less than 12 million Americans were employed in manufacturing was in 1941.

I dispute this figure. I simply think it is inaccurate. The US Bureau of Labor Statistics says in 2010 we have over 16m in this category.

Still I don’t know what the point is here. Do we want our college educated children working in manufacturing just to get this number over 12 million? Even with unemployment at 10%, we have more adults working now than ever.

#12 In the United States today, consumption accounts for 70 percent of GDP. Of this 70 percent, over half is spent on services.

If this was not happening, we would be Cuban. It literally shows an absolute lack of understanding about society’s economic development. We are fully industrialized. Every home has a washer and dryer, refrigerator, television, furniture, etc.

#13 The United States has lost a whopping 32 percent of its manufacturing jobs since the year 2000.

This seems to be the Department of Redundancy Department.

#14 In 2001, the United States ranked fourth in the world in per capita broadband Internet use. Today it ranks 15th.

This has to do with 1) Excessive Government Regulation and 2) countries with small populations putting broadband into place.

#15 Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975.

Not in absolute terms, but perhaps in % (see point 11 above).

#16 Printed circuit boards are used in tens of thousands of different products. Asia now produces 84 percent of them worldwide.

Why would stamping silicon be an ambition. 90%+ of the world’s software running the circuit boards is created in the USA.

#17 The United States spends approximately $3.90 on Chinese goods for every $1 that the Chinese spend on goods from the United States.

See the table above about Chinese consumption and you tell me if you think they will be buying more or less of our goods in the future.

#18 One prominent economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

That would happen if Al Gore is correct and the USA will be 20 feet below sea level and we are all dead.

#19 The U.S. Census Bureau says that 43.6 million Americans are now living in poverty and according to them that is the highest number of poor Americans in the 51 years that records have been kept.

Poverty should always be a serious issue, but only a U.S. citizen who has never left this country could possibly think that our definition of poverty is the same as the rest of the world. We define the Poverty Line (2008) for a family of 4 as earning less than $22,200 per year. The international poverty line is defined by $1 per day. Do I need to go on?..

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