In 2006 China had 112.63 million manufacturing jobs, nearly eight times the level of manufacturing employment in the United States (14.16 million). THIS IS NOT A MISPRINT, THIS IS A FACT. Does this statistic register with you? It better! It is foretelling the future demise of the United States economic system. Without a manufacturing base our life style will continue to deteriorate into oblivion. Sure, we can have doctors, lawyers, engineers, physicists, biologists, researchers of all types, but without a manufacturing base the average American worker will not be able to find a job. Why, because the average worker is either not trained to be a professional nor do they strive to be one. They then are the mercy of the manufacturing sector performing a generic task of some type. FOR EXAMPLE,  an assembler, a bank teller, a technician, a quality control person, a purchasing agent, a clerk, a bookkeeper, a foremen, drivers, shippers, retailer, etc. These jobs do not pay enough for the average American worker to support his or her family. This is the reason for the two income household. If these secondary type jobs disappear, then what?

Total compensation for a rural manufacturing employee in China is only 53 cents per hour. In urban areas, the average is $1.47 per hour. Total compensation costs include wages, employer payments for social benefits such as workers' compensation, unemployment insurance, health insurance and pension funds. It includes sick leave, income guarantee insurance, life and accident insurance, illness compensation and family allowances. And the majority of Americans are making a whole lot more than the Chinese. So where do we go from here? Basically, nowhere. The reason is simply stated above. We are not competitive when it comes to labor costs.

On a global scale, productivity is allowing output to grow by about 4 percent a year with no increase in jobs. Poorer countries have increased their production capacity by  increasing in manufacturing employment. The United States, Britain, Germany and Japan have been the loser of jobs gained by the poorer countries.  Between 1990 and 2005, Britain lost 43.5 percent of its manufacturing jobs (2.6 million); Germany lost 31 percent of its manufacturing jobs (3.6 million); the United States lost 24 percent (5.09 million); and Japan lost 22 percent of its manufacturing jobs (3.36 million). That is it in a nutshell.

What are the alternatives? Tariffs, quotas, import taxes have been tried before. Those that scream, "unfair competition" are called protectionists. But there has to be some type of balance. We cannot keep exporting jobs without a negative effect at home. Policy makers need to seek new ways for us to be competitive with those of low wage manufacturing/outsource countries. Do we let the dollar go into a tailspin? This will briefly solve one problem, that of being price competitive and therefore a net exporter of goods as our manufacturing sector revives. But in this scenario, a major inflation risk will result. Our imports will be more expensive and by a large measure. One of the previous entries presented the Icelandic Scenario and it was not pretty. http://thenewbostonteaparty.com/2009/10/30/the-united-states-is-headed-for-the-economic-ice-age.aspx.

Do not believe the pretty picture on how good things are and how they are getting better. This is not true. Unemployment is 10% officially and unofficially it is most likely 20%. Jobs are being lost at the same pace of those lost in the 1930's. A shorter work week is commonplace. Reduction in pay or pay freezes are not what one finds in a growing economy. BUT, YOU THE TAXPAYER IS BEING ASKED TO PAY MORE FOR GOVERNMENT SERVICE YOU DON'T NEED, DON'T WANT AND CAN'T AFFORD. THE PUBLIC UNIONS ARE TO BLAME. THEY HAVE NO SYMPATHY FOR YOU, THE HARD WORKER, THE RETIREE OR THE SMALL BUSINESSMAN. THE SIGN SAYS IT ALL.



THERE IS A CURE, CUT TAXES BY 25% TO 50% ACROSS THE BOARD WITH A CORRESPONDING REDUCTION IN THE SIZE OF GOVERNMENT. THIS WILL REVIVE THE ECONOMY, INCREASE TAX COLLECTIONS, CAUSE A BUDGET SURPLUS. HOWEVER, DON'T HOLD YOUR BREATH WHILE THE SOCIALISTS ARE DRIVING THE BUS.