9.22.2006

No Commodities

Earlier this week, I caught the tail end of a political ad on the
radio that I found very disturbing. In ominous tones, it talked of
the devastation of manufacturing jobs that have been lost to China.
Never mind that any such jobs we've lost to China are dwarfed by the
jobs we've "lost" to machines. In other words, manufacturing job
numbers are down mostly because we've mechanized what we used to have
to do by hand. In fact, while manufacturing job numbers are down
steeply in the US, manufacturing production is up, up, and up.

Which is not to say that we don't have an inter-country
competitiveness problem. Quite frankly, we are losing our edge
against other countries. But again, I disagree with the ominous
sounding political ads. They would say that the tremendous difference
in wages means the US can no longer compete.

They assume that production has become commoditized. In other words,
in the same way that a pound of coal is a pound of coal, no matter
where it was made, there is the notion that a computer is a computer,
no matter if it was manufactured in China or the US. And if that's
the case, and Chinese workers are willing to work for a tenth of what
US workers are willing to work for (when you factor in wages and
benefits and pensions, maybe it's a twentieth or a thirtieth), why
would anyone want to source production domestically?

Except that production doesn't have to be commoditized. If there's
anything we've learned in this country over the last generation, it's
that as consumers, we actually do care about things besides price. Oh
sure, Walmart will still garner some of our wallets because we can get
laundry detergent and bubble gum and blue jeans cheaper there than
elsewhere. But there's still something to be said about the premium
some products can command, whether from design, service, or
convenience. Products don't have to become commodities unless we're
too unimaginative to think otherwise. Who knew that you could trick
out a desktop, a visit to the grocery store, even a cup of coffee?

Maybe I'm particularly sensitive to the Asian-hating -- you know,
random Asians were beaten and even killed less than a generation ago
by angry Detroit auto workers who were tired of Japan eating them for
lunch. But we haven't lost our edge in manufacturing because of
"those darn Chinese." First, as mentioned, everyone's "losing" jobs
because technology allows us to produce more stuff with less people.

And second, we lost our edge not because Asian workers were willing to
work for less but because Japan made better products and US products
no longer had the monopoly in quality. Ask anyone in America who's
familiar with manufacturing from a generation or two ago, and they'll
tell you Japan was a laughingstock in terms of production quality --
and while they learned, retooled, and got better, we Americans got
lazy and sloppy.

If we want our edge back in manufacturing, we have to stop blaming the
Asians for the job losses that the machines created. We have to
recommit to quality control. And we have to put our unparalleled
America ingenuity to work, to dream up, design, make, and sell stuff
that people are willing to pay extra for.

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