As we are getting closer to the 2012 elections, I am hearing more and more of the political rhetoric about manufacturing jobs. We must bring the manufacturing jobs back to America. I am doing this for it. I will do that for it. Blah Blah Blah.
My friends, the higher standards of living that we enjoy and the wages and benefits required to support these standards, raise the cost of production and hence the prices of our products and services. What I do not understand is, how we are ever going to be able to compete, with this high cost of production, on cheap manufacturing jobs?
Other and really important fact is that we have gained and maintained number one position in the world not because of cheap manufacturing jobs. We always have been and still are number one, because of very high level of creativity, innovation, research, inventions and high tech patents. Hence, if we want to stay at number one position, these are the things we must be focused on, not the cheap manufacturing. In 1980s, it was broadly speculated that Japan would overtake United States. It had same advantages over United States, as China, India, Brazil, Russia and Australia have over us right now. Lower cost of production and cheaper products and services. Yet, Japan was never been able to catch United States. Why? Because Japan’s cheap, second degree and borrowed manufacturing was never able to compete with high end, and highly creative and innovative U.S. products and services. Same seems to be the story with currently rising economic powers.
We are losing our edge not because we are losing manufacturing jobs. We are losing this edge because our business financing system is, now, totally outdated and broken. United States used to be the haven for highly ambitious, talented, gifted, intelligent and smart entrepreneurs and high risk start-ups from around the world. Business financing was mostly in the hands of highly ambitious and risk taking angel investors and venture capitalists. The availability of capital was so swift and easy, if you had a really good and novel idea and you wanted to venture on it, United States was the place for it. Society was very less structured and field was wide open for all adventurers.
Unfortunately, over time, these highly ambitious, risk taking, business minded angel investors and venture capitalists are replaced by MBA executives in venture capital companies, investment firms and banks. For them business is not a dream, a passion and a venture, anymore. It is purely a game of numbers and graphs that even it’s creators and authors do not understand. Everything goes by book and the value of ideas and people is gradually diminished, almost, to zero. Start-ups are dying due to lake of capital and America is not the heaven for creative, innovative, ambitious, intelligent and smart minds, anymore. This is when the start-ups and early stage companies in China, India, Brazil and Russia are growing like wild fire. The availability for capital is unbelievable. Specially in China, if you have a good idea and you can show that you can do it, capital is not an issue at all. Their government backed financing is not like our SBA, which uses private banks to invest tax payer money in small business. The banks SBA uses and the policies it devises, provide money mostly to people and businesses who already have money.
Airplanes, cars, railroad, shipping and courier services, printing press, telephone, cell phones, television, movies and theater, audio and video tapes, CDs, DVDs, electricity and light bulbs, and Internet are just a few examples of inventions we made or perfected. All this happened because our major focus was not on where the jobs are right now. But we were focused on how and where we can generate high end and high value markets and how we can extend existing markets. This is ‘the way’ to create high value jobs and to stay at the top of the world.
There were times when our universities and other educational and research institute were not focused existing job markets. They were the centers of research and innovation.
Political and big media gimmicks have brought us down to a level where we have never been before. Unfortunately, they are being controlled by big corporations, their lobbies and advertising revenues. These multinational corporations have no interest in America or American people or human beings in general, or competitive markets or making people’s lives better. They are just interested in cheap, monopolistic markets, here and abroad, and cheap labor.
This is the reason these companies and their lobbies do not want comprehensive immigration reforms and they certainly do not want more competition due to easy access to capital, education and R&D resources. They just want cheap employees, workers, contractors and slaves.
This is another reason why they hate unions. Unions give power to the people. We are ‘United States of America’. Our system is run by political parties, which are the unions of voters. At every level, from federal to state, to county and city, we have Chambers of Commerce, which are the unions of businesses. Many businesses that are the members of Chambers of Commerce, seriously oppose the workers unions. You can become a Republican party member by signing a card. But, Republican party does not want you become a union member that way. Becoming a member of union by signing a card is violation of democratic principles. But, becoming Republican party member by signing a card is not. What a freaky notion? Still, lots of people fall for it.
The amazing jobs that were created in automotive industry, in the past, and the ones that exist in high tech industry, today, are largely due to unions.
Old Southern notion that sucking the last drop of blood from the worker makes businesses profitable and successful is proven wrong by several scientifically done, controlled, case studies. These studies have repeatedly shown that most successful companies are the ones that have happiest employees.
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