Buchanan's thoughts on the death of manufacturing

[Hamel]

The rise of free trade has eroded America’s industrial base and with it our sovereignty.


By Patrick J. Buchanan

After Mass at St. Mary’s, a retired FBI agent who had worked as a boy in the great steel plant in Weirton, W.Va., whose father had died in an accident at the mill, handed me the Weirton Daily Times. “Where Do We Go From Here?” read the May 20 banner. The front page was devoted to the bankruptcy filing of Weirton Steel, which had once employed 14,000 workers in a town of 23,000. Mark Glyptis, president of the Independent Steelworkers Union, said it didn’t have to happen. It was a poignant story. When I began my campaign of 2000 at the Weirton mill, Mark and his ISU endorsed me.

That same week, a friend e-mailed me. Timco, a lumber mill where we spent the last day of the New Hampshire campaign of 1996, had shut down. As Weirton Steel had been hammered by subsidized steel dumped in the U.S. market, Timco had to compete with subsidized lumber from Canada.

Across America the story is the same: steel and lumber mills going into bankruptcy; textile plants moving to the Caribbean, Mexico, Central America, and the Far East; auto plants closing and opening overseas; American mines being sealed and farms vanishing. Seven hundred thousand textile workers—many of them minorities and single women—have lost their jobs since NAFTA passed in 1993.

Thirty years have elapsed since our free-trade era began and 30 months since George W. Bush became president. It’s time to measure the promise of global free trade against the performance.

Undeniably, free trade has delivered for consumers. A trip to the mall, where the variety of suits, shoes, shirts, toys, gadgets, games, TVs, and appliances abounds, makes the case. But what has it cost our country?

Every month George Bush has been in office, America has lost manufacturing jobs. One in seven has vanished since his inauguration. In 1950, a third of our labor force was in manufacturing. Now, it is 12.5 percent. U.S. manufacturing is in a death spiral, and it is not a natural death. This is a homicide. Open-borders free trade is killing American manufacturing.

In 2002, we ran a trade deficit in goods of $484 billion. This May, it reached the level of $562 billion, nearly 6 percent of GDP. Evangelists of free trade tell us trade deficits do not matter. Michael Boskin, Chairman of the Council of Economic Advisers under Bush I, declared, “It does not make any difference whether a country makes computer chips or potato chips.”

History teaches otherwise. In 1860, Britain abandoned its Britain First trade policy for the free-trade faith of David Ricardo, John Stuart Mill, and Richard Cobden. By World War I, Britain, which produced twice what America did in 1860, produced less than half and had been surpassed by a Germany that did not even exist in 1860.

Free trade does to a nation what alcohol does to a man: saps him first of his vitality, then his energy, then his independence, then his life.

America today exhibits the symptoms of a nation passing into late middle age. We spend more than we earn. We consume more than we produce.

Why does it matter where our goods are produced? Because, as I wrote in The Great Betrayal:

Manufacturing is the key to national power. Not only does it pay more than service industries, the rates of productivity growth are higher and the potential of new industries arising is far greater. From radio came television, VCRs, and flat-panel screens. From adding machines came calculators and computers. From the electric typewriter came the word processors. Research and development follow manufacturing.

Alexander Hamilton, the architect of the U.S. economy, knew this. He had served in the Revolution as aide to Washington and lived through the British blockades. He had led the bayonet charge at Yorktown. And he had resolved that never again would his country’s survival depend upon French muskets or French ships.

As first Treasury Secretary, he delivered in 1791 the “Report on Manufactures,” one of America’s great state papers. Reflecting on how close his country had come to losing its liberty, Hamilton wrote,

Not only the wealth, but the independence and security of a country, appear to be materially connected with the prosperity of manufactures. Every nation … ought to endeavor to possess within itself all the essentials of a national supply. These comprise the means of subsistence, habitation, clothing and defense.

Under the Constitution he helped write, a national free-trade zone was created. Hamilton’s idea was to use tariffs to end our dependence on Europe and force British merchants to finance our government and the roads, harbors, and canals that would tie America together with commerce.

Tariffs would give our national government the revenue to operate, while providing our people both privileged access to the fastest growing market on earth and incentives to go into manufacturing. With American manufacturing thus encouraged, we would soon produce ourselves the guns and ships to defend the republic and the necessities of our national life so we could stand alone against the world.

For 12 decades, America followed Hamilton’s vision. On the eve of World War I, the 13 agricultural colonies on the eastern seaboard had become the richest nation on earth with the highest standard of living, a republic that produced 96 percent of all it consumed while exporting 8 percent of its GNP, an industrial colossus that manufactured more than Britain, France, and Germany combined.

The self-sufficiency and industrial power Hamiltonian policies created enabled us to rearm in security, crush the Axis in four years, rebuild Europe and Japan, and outlast the Soviet empire in a Cold War, while meeting all the needs of our people.

But in the Clinton-Bush free-trade era, Alexander Hamilton is derided as a “protectionist.” Woodrow Wilson’s free-trade dogma is gospel. Result: our trade surpluses have vanished, our deficits have exploded, our self-sufficiency has been lost, our sovereignty has been diminished, and an industrial base that was the envy of mankind has been gutted.

And for what? All that junk down at the mall? What do we have now that we did not have before we submitted to this cult of free trade?

I'm not pasting the rest of this thing

[TrailerParkJawa]

The problem with keeping lots of manufacturing in the US is the cost of the labor. Does it really make sense to pay someone $25/hour plus great benefits to work on a car assembly line. If the jobs dont go overseas they will be replaced by automation.

Yes, its sad that a lot of places are losing their manufacturing base, but its been happening for a long time. Tariff wont change anything. I just wonder what will happen in the next 20 years. Now lots of white collar jobs are going overseas. We cant have a good economy when most Americans work for jobs that pay less than 12 bucks an hour.

[RedImperator]

Buchanan is just as big an idiot as leftist anti-free trade agitators. "An unlikely coalition of those who don't understand economics with those who don't understand economics at all" indeed.

[MKSheppard]

Yes, its sad that a lot of places are losing their manufacturing base, but its been happening for a long time.

It's sad that America is going the way of Early 20th Century Britain,
moving into a service economy like Britain...of course, we all know how
THAT ended up

[TrailerParkJawa]

Yes, its sad that a lot of places are losing their manufacturing base, but its been happening for a long time.

It's sad that America is going the way of Early 20th Century Britain,
moving into a service economy like Britain...of course, we all know how
THAT ended up

So you think the price of all manufactured goods should be higher so we can benefit people working in factories? Should other countries stay in poverty cause we cant stand to let the jobs go there? They are going there anyway, you cant stop the loss of manufacturing. You will always have trouble keeping the lowest skilled jobs sticking around.

[Joe]

Yes, its sad that a lot of places are losing their manufacturing base, but its been happening for a long time.

It's sad that America is going the way of Early 20th Century Britain,
moving into a service economy like Britain...of course, we all know how
THAT ended up

Tell me, did Britain at any point have over 80 percent of its non-agricultural work force in jobs not related to manufacturing like we do now?

Buchanan has never made his peace with the market, like many of those you'll find on the right (FR is loaded with them). There is little evidence of his much hated trade deficit having any negative impact on the United States economy.

[Stravo]

Buchanan thinks we still live in a WWII era economy where manufacturing might was the be all and end all of economic strength. Wait...Buchanan stuck in a time warp?? Noooo....it can't be.

[Xenophobe3691]

Well, nowadays, instead of Brawn making money, Brains make money! Ever wonder why smart, hard working people are the ones who're living it up, instead of the manufacturer? Why don't we just ramp up our education system?

Oh yeah, because Science, Reason, and Math are the tools of the devil! A dumb congregation is an obedient congregation! And last, but definitely not the least petty, is that people don't wanna pay taxes for education. Fucks.

[Stormbringer]

Buchanan thinks we still live in a WWII era economy where manufacturing might was the be all and end all of economic strength.

There is a danger in over dependence on other though. Should we ever need the capacity, and not have it, we'll be in deep, deep shit.

The real problem is that American manufacturing isn't economical anymore. We're spending more on worker benefits than materials in some cases and that's ridiculous. No manufacturer is going to pay that willingly and now with the global economy there's a viable way out of it. Unless the American worker can be competitive with those of other countrie we're stuck.

[Gil Hamilton]

The real problem is that American manufacturing isn't economical anymore. We're spending more on worker benefits than materials in some cases and that's ridiculous. No manufacturer is going to pay that willingly and now with the global economy there's a viable way out of it. Unless the American worker can be competitive with those of other countrie we're stuck.

Isn't this a fancy way of saying that American manufacturing is not economic because Asian workers are willing to work slave labor prices while American workers demand enough money to take care of their family and benefits like dental and such? And it seems that "competitive" means "working for well below the American poverty line".

Damn those American workers for refusing to be "competitive" and "economical"! Damn them to hell!

[Hamel]

Isn't this a fancy way of saying that American manufacturing is not economic because Asian workers are willing to work slave labor prices while American workers demand enough money to take care of their family and benefits like dental and such? And it seems that "competitive" means "working for well below the American poverty line".

Damn those American workers for refusing to be "competitive" and "economical"! Damn them to hell!

It seems as though, to compete with the third world, you have to become the third world. Those evil regulations, unions, and wages were too much for corporate America to handle, so they hauled butt to Mexico. Those slave wages in Mexico were too much for corporate America to handle, so they skedadled to China. Expect to see an exodus of American business to Africa if the trend continues.

[MKSheppard]

Damn those American workers for refusing to be "competitive" and "economical"! Damn them to hell!

When it comes down to it, I'm perfectly willing to fuck over the cheep
Asian Slave Labor factories for American workers

[Stormbringer]

Isn't this a fancy way of saying that American manufacturing is not economic because Asian workers are willing to work slave labor prices while American workers demand enough money to take care of their family and benefits like dental and such?

There is that and I won't deny that. Place like Korea and other can undercut us. Not necessarily with slave labor wages but certainly without the enormously expensive benefits package every blue collar worker from the janitor up expects. That why for a long time there were jobs moving from the North to the Southern US. They weren't unionized and hence didn't demand all of that.

And it seems that "competitive" means "working for well below the American poverty line".

Not necessarily, just not producing enough to justify the expense. But that's the way it's worked out in practice for manufacturing jobs.

[RedImperator]

Isn't this a fancy way of saying that American manufacturing is not economic because Asian workers are willing to work slave labor prices while American workers demand enough money to take care of their family and benefits like dental and such? And it seems that "competitive" means "working for well below the American poverty line".

Damn those American workers for refusing to be "competitive" and "economical"! Damn them to hell!

That is exactly what he's saying. You don't have to like it, but you might as well accept it, because businesses don't stay in business by paying $25 an hour for unskilled labor that can be done overseas for $1.00 a day. The labor necessary to build most consumer goods simply isn't worth that kind of money anymore. Even if you erected a cast-iron wall of protective tariffs around the United States (wrecking the economy for everybody, by the way), you still couldn't prevent or reverse what's happened to blue collar jobs in this country. Either the manufacturers would respond by automating the production line and switching to non-union labor, or the inflated cost of labor would trigger a round of inflation that eroded everyone's buying power.

[Joe]

Damn those American workers for refusing to be "competitive" and "economical"! Damn them to hell!

When it comes down to it, I'm perfectly willing to fuck over the cheep
Asian Slave Labor factories for American workers

And you're willing to fuck over American consumers with higher priced goods so some union goon can earn 25 bucks an hour for to screw a bolt into a plate?

[Joe]

It seems as though, to compete with the third world, you have to become the third world. Those evil regulations, unions, and wages were too much for corporate America to handle, so they hauled butt to Mexico. Those slave wages in Mexico were too much for corporate America to handle, so they skedadled to China. Expect to see an exodus of American business to Africa if the trend continues.

They'd be leaving America even if those industries were completely hands off, because it's just cheaper to manufacture goods overseas these days due to basic economic realities. As for regulation driving business out, well, U.S. capital markets are still the best, most liquid in the world, regardless of regulation.

[Gil Hamilton]

There is that and I won't deny that. Place like Korea and other can undercut us. Not necessarily with slave labor wages but certainly without the enormously expensive benefits package every blue collar worker from the janitor up expects. That why for a long time there were jobs moving from the North to the Southern US. They weren't unionized and hence didn't demand all of that.

They are slave labor prices, by and large, with absolutely terrible working conditions. What would you call being paid 20 cents a week for 10 hours a day 6 days a week in an windowless concrete building stitching tennis shoes for export?

Besides those "enormously expensive benefits packages" aren't exactly what I'd call extravagant. My father has been getting those benefits for as long as I can remember and such packages often failed to cover what they are supposed to except under very specific conditions.

Not necessarily, just not producing enough to justify the expense. But that's the way it's worked out in practice for manufacturing jobs.

Not justifying the expensive? American workers rarely demand more than what it takes to take care of their families. A worker making 16 dollars and hour will have very large troubles supporting a family of four, with often the spouse having to work too. In the end, this translates to the family making just enough to stay lower middle class. Forgive me for not shedding a tear for big business when it sees a man trying to support his family as too costly. It's wrong that American jobs are being lost because American workers aren't willing to work for next to nothing just to stay "competitive". I mean, if American workers worked for the same amount as some sweatshop worker in Cambodia with no benefits, they'd quickly become homeless simply because living in America is expensive and they are incapable of living on what amounts to at most a few bucks a week.

[Gil Hamilton]

OK, it's clear that every active conservative on the board is going to turn out to agrue in favor of American workers being dicked over by businesses hiring overseas slave labor rather than pay what the workers what they need to live on, so I'm going to back off here. I'm willing to debate this with one of you, but I'm not willing to debate this with four or five.

[Stormbringer]

They are slave labor prices, by and large, with absolutely terrible working conditions. What would you call being paid 20 cents a week for 10 hours a day 6 days a week in an windowless concrete building stitching tennis shoes for export?

That is slave labor, no quest about it.

But there are plenty of other businesses that aren't that bad. Korea in particular is cleaning up these days, not with sweatshops but because they don't have the extrodinary cost of labor and benefits that American businesses do.

Besides those "enormously expensive benefits packages" aren't exactly what I'd call extravagant. My father has been getting those benefits for as long as I can remember and such packages often failed to cover what they are supposed to except under very specific conditions.

But do you have any idea how much even that costs the company? It costs them a fortune to offer any sort of plan because quite often the worker doesn't pay for it all. And even modest expenses add up.

I mean, if American workers worked for the same amount as some sweatshop worker in Cambodia with no benefits, they'd quickly become homeless simply because living in America is expensive and they are incapable of living on what amounts to at most a few bucks a week.

They would indeed. America has an staggering cost of living, even at the basic comfort level. And when there are countries where that wage amounts to much less no company is going to stay and take it up the ass.

Like it or not the American blue collar worker isn't very competitive anymore. They don't produce enough to justify the expense. A few skilled workers and a lot of robots have replaced the enormous work force of unskilled labor.

[Joe]

They are slave labor prices, by and large, with absolutely terrible working conditions. What would you call being paid 20 cents a week for 10 hours a day 6 days a week in an windowless concrete building stitching tennis shoes for export?

Compared to what? An even lower paying job? Homelessness? Starvation? Dying on the street? There aren't a lot of alternatives here. American overseas corporations tend to pay their laborers very well compared to what they would be making otherwise. If you want to complain about how badly third-world laborers are treated at the jobs they voluntarily chose to accept, fine, but produce a real, viable alternative.

Not justifying the expensive? American workers rarely demand more than what it takes to take care of their families. A worker making 16 dollars and hour will have very large troubles supporting a family of four, with often the spouse having to work too.

Perhaps the worker should have considered the ramifications of trying to raise a family of FOUR on a 16 dollar an hour wage?

t's wrong that American jobs are being lost because American workers aren't willing to work for next to nothing just to stay "competitive".

It's misleading to say that jobs are "lost," given that new jobs have been created to replace them (we're in the midst of a recession with unemployment only at 6.4 percent; that's outstanding from a historical perspective).

OK, it's clear that every active conservative on the board is going to turn out to agrue in favor of American workers being dicked over by businesses hiring overseas slave labor rather than pay what the workers what they need to live on, so I'm going to back off here. I'm willing to debate this with one of you, but I'm not willing to debate this with four or five.

Gil, what is your solution to the problem? Force companies to pay higher wages and go out of business? Make them swear oaths of allegiance to the United States?

[Stravo]

OK, it's clear that every active conservative on the board is going to turn out to agrue in favor of American workers being dicked over by businesses hiring overseas slave labor rather than pay what the workers what they need to live on, so I'm going to back off here. I'm willing to debate this with one of you, but I'm not willing to debate this with four or five.

Before you go, just what do you propose as a solution to this dilema? FORCE companies to pay the workers what they want? Create proetctionist tariffs that will cripple our economy and others around teh world. Screw over the consumer in price hikes that are unneccessary if teh product can be made cheaper overseas?

Face it, the US worker is a victim of this country's success. We don't pay Third World wages because we are not the third world. Remember when our parents urged us to become doctors, lawyers, business men? They knew which way the wind was blowing in manufacturing jobs.

[Glocksman]

It ain't just manufacturing jobs being lost.

I'm curious to see just how many 'free traders' stay free traders after it's their job that gets outsourced to India or the Ukraine.

After all, a Ukrainian or Indian software engineer makes perhaps 10% of what the salary is for one here in the US. Remember, it's the markets at work when you get laid off and can't find a job in your field.


Have fun pushing that broom.

[Stormbringer]

Remember when our parents urged us to become doctors, lawyers, business men? They knew which way the wind was blowing in manufacturing jobs.

Not to mention the manufacturing jobs are requiring more skills. The age of unskilled labor is rapidly coming to a close. Now days every job requires a good deal of training at the least.

[Pu-239]

Another problem is whitecollar IT jobs being outsourced to India.

[MKSheppard]

Another problem is whitecollar IT jobs being outsourced to India.

Oh yes, Hhahahahhaha we'll see how long these "republicans" last when
they graduate College with a degree in Electrical Engineering and find that
all the jobs are being outsourced to Electrical Engineering Degree holding
students from India