Final Numbers are in.....

Not bad for early days. What was the percentage penetration Toyota had of the US market back in the late 60s early 70s? They were no threat at all eh? Jap Crap, recycled coke cans, no threat to good olde American iron. Hardly a V8 among them even now, Americans want nothing but V8s. Nothing will ever replace film cameras, Polaroid instant cameras are the best, vinyl is the only way to listen to music, CDs will never be replaced, they are indestructible after all.

These are things that should be written in the hallways at GM, Ford and Chrysler. The time for dreaming is over, it's catch up time boys.

 

malorn... i understand your concern about our deficit...but that problem was not really caused by the japanese or anyone else.

WE ARE SOLELY to blame...

there is an excellent docu... called "Maxed Out"... it talks about sub prime mortgages, credit card debt, etc...

watch this and you will see, our problems come from within...

 

Malorn,

You've identified a problem. What's your solution?

 

Education is a major problem... people don't understand money/saving at all. They're told to buy, buy, buy and they feel that part of their self-worth is tied to their material possessions. I would gladly pay more for quality American products and do when I have a choice. However, most people want the cheapest thing when they don't care. They'll gladly buy an escalade that they can't afford and then shop at walmart for the rest of their lives. No savings, massive CC debt. If we want to keep our wages up then we need to be willing to pay more for things. Otherwise those things will be made in China or whoever becomes the next China when Chinese workers won't work for pennies.

Could you elaborate on the reciprocal trade agreement bit? I agree with you and see you concern as quite valid, but we can't just go into a protectionist shell. That won't help us.

 

That seems reasonable to me. As long as it doesn't stunt companies by making them complacent (because of protectionism) then I don't have a problem with it.

We have to be careful though, slapping tariffs willy nilly played a major role in the depression (in the US at least), or so I'm told. To prevent shocks and trade wars we'd need to phase this sort of thing in somewhat slowly so that consumers have time to adjust. I'd love to get some of our mfg base back, but people have to understand that things will be more expensive (unless we automated a lot of stuff, but then there are fewer, though perhaps higher quality, jobs). I'd love to see the RE industries take advantage of a resurgence in American manufacturing, and these industries could actually lead the charge. There's evidence of that already. Even foreign companies are located mfg facilities here for wind and solar.

 

Farmers want to be guaranteed prices equal to those of 1910-1914 (so-called 100% of parity), adjusted for inflation. Detroit wants freedom to build yesterday's cars with high price labor and for Uncle Sam to make sure Japan buys one of them for every Japanese-built car sold here.

Fact is, the Japanese cannot do anything with their trade windfall but spend it. They buy Levi's, Coke, movies from where? They travel to the US on US-built planes and spend their vacations admiring the Grand Canyon, etc. Tourism $ for the US. When was the last time you bought a soft drink from a Japanese company?

I come from the farm sector, but have become a city guy. 100 years ago 95% of Americans worked on farms. Now under 5% do, give or take. I saw the pain of that reality which is deeply heartfelt, like that of the auto workers. Many industries have endured such change.

But we cannot afford to protect everyone. Equitably, we must allow the markets to work. We are better off producing goods and services in which we have a comparative advantage. There is transitional pain, yes. We need to fight for free markets abroad. We need to protect intellectual property from infringement. But protectionism hurts us as much as them.

See, for example, Adam Smith's The Wealth of Nations from the 1800's for the classic proof of the cost of protectionism.

Until every American has equal access to the guaranteed jobs, let's have no guaranteed jobs. And if you want to see big trade deficits, try guaranteeing everyone a job. When was the last time you bought a Cuban car? Give me a guaranteed living on the farm, and I'll think about supporting $30/hr Suburban workers. But make it work for everyone, not just you and me.

 

Response to malarn's #72, I think:

Not all of it. I believe, without proof, that they copied stuff that we and others owned. Let those with evidence pursue that as best they can with the support of the State Department, DoJ, etc. We do have the best lawyers, for good and bad.

But yes, I believe they are vastly better managed and produce better products today that hold value better. I was a GM guy throughout the 70's and 80's. I really liked our 76 Impala, and even the maligned 80 Chevette. But the 82 Celebrity and 84 Cavalier, well...

But the products I want today are mostly from Japan. I'm not happy about it, but I will buy the product I see as best for the money, whether it is a Japanese car or TV, or a Hollywood movie. [I loved the old US-made console COLOR TV from 1970; trouble is, GM et al expects me to buy that same product today at the inflation-adjusted high price it commanded then.] The market will take care of the rest. I have to be clever enough to adjust to the fact that our auto industry and farm industry cannot guarantee me the livelihood I dream of. Sometimes, that means my next best thing is a step down. But its best to keep growing the pie, rather than protecting the pie.

To an unsettling degree, the world is flat (to copy a phrase), and we must provide value to maintain our standard of living. The Chinese are and will be formidable. [Apparently, we have to tell them we do not want lead in our children's toys or in our fish.] And I believe, without proof, that they copy our technology illegally. We have to fight things like that and always work for equitable trade. But we must, imho, trade or perish.

 

balancing trade in an open market simply cannot be done. there are too many players all with diverse resources and needs.

we are the bread basket of the world but several years ago when we tried to jack up the price of grain, countries simply went elsewhere.

same with apples... it didnt matter that our apples were better, if it wasnt the right price, then it sat in the orchards. so we have to be competitive on the world market.

when paying american workers more than double anyone else to build a car, it was inevitable that you either had to have quality 2nd to none, efficiency near 100% and product flying off the lots or you could not afford to maintain profits.

now to say that american car quality is not as good as japanese, german or whoever is simply not true. the real difference in quality is not that great... but american car companies simply dont offer a product that americans want. they then lost thier toehold in the market place, their reputations dropped and now they are in hole that is impossible to dig out of with their current labor agreement.

couple that with completely asinine leadership and what we have is company that has now become a burden and liability to the country...

 

Ford is showing some promise with their Fusion/Milan line. High quality that is on par with Toyota and Honda, with features offered that are 1:1 with those brands. The main problem is now that the big three have sown so much crap out in the past few decades, people are afraid to go domestic and continue to go foreign.

What most people fail to realize about the trade deficit is that the US no longer has the manufacturing base that is once had and is more of a service based industry. Example is my line of work, we sell voice over IP and internet, all service based. In order to trade, you need something to trade. Steel industry is pretty much gone here, overseas is where most steel comes from. Injection molding has pretty much gone overseas, along with stamping and die work. Foreign markets have pretty much outbid american manufacturing to the point it no longer is feasible to keep the doors open. Once they are gone though, they are gone for good.