Financial topics

[John]

> Auto repair services would be a good example of that. The next
> layer is whether the US economy has the means to produce the parts
> that are used in the auto repair industry. From what I know, the
> answer is yes, despite these kinds of statistics:

> Cars.com surveyed domestic parts content for the top 113 models on
> the market, which make up 89 percent of all the cars sold through
> May. More than 80 percent of those cars — the vast majority of
> what shoppers are buying — have domestic parts content below 75
> percent or are assembled in Canada, Mexico or abroad.

> http://www.cars.com/go/advice/Story.jsp ... amMade0712

> The next layer after that is whether the typical US consumer has
> the means to buy and repair an automobile over the long
> term. That's where things get a little questionable.

An interesting contrast is the Cubans, who have turned repairing 1950s
American autos into an art form.

[Higgenbotham]

Here's an interesting editorial from 2009, back when people were really worried.

The response to the problem was to counterfeit trillions of dollars and create a junk economy out of that.

Now people are not so worried anymore.

How can a superpower remain a superpower if it can't make its own clothing, shoes, appliances and even cars?

"We don't think it can," says Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition.

America consumed $673 billion more than it produced last year - meaning that $673 billion was sucked out the window. And that's been the trend for years and years.

How can that possibly be sustainable?

Answer: It isn't.

"The only loan my parents ever took out was on a house," Tantillo says. A generation later, he adds, we've been programmed that we can consume whatever we want whenever we want.

The core question in all of this is how wealth is created. Some say it's created by trading and financing. Others say by production. They're both right, but only to a point. Trading and financing only get you so far so long. What does pressing each other's pants produce?

Ultimately, a country must produce in order to create wealth.

As Tantillo notes, Americans aren't losing trade advantages due to any lack of abilities to produce. Instead, it's been a combination government trade policies that play us for suckers and give every advantage to foreign competitors; the global self-interests of multinational corporations; and a Wall Street that got fat on foreign capital.

The result of all this is that the United States lost 651,000 jobs in February alone; manufacturing employment is at its lowest level since July 1941; 4.91 million manufacturing jobs have been lost in the past decade; and U.S. output in appliances, carpeting and furniture is lower than it was in March 1978 - despite population growth and exploding consumer demand.

For years, we've been told that America can be just fine without old-school manufacturing. We're seeing that's not the case at all. And the living standards that we've had the past 30 years or so, as we've piled up $15 trillion in private-sector debt, have rested on a house of credit cards.

Our living standards have been based on paper, not production.

Every empire, Tantillo says, has done the same thing: tell itself that it no longer has to do dirty, menial jobs, that other countries can do that for us while we bask in our greatness.

But America's greatness didn't come from shopping and slurping up soft drinks. It came from hard work and good-paying jobs and creating wealth through the sweat of our brows.

The difference between America and history's other juggernauts may be the breathless pace of our decline.

What we're doing is unsustainable over the long term, and unbefitting a supposed superpower.

As catastrophic as GM's and Chrysler's crises have been, they are but a symptom of the larger problem: We need to make things, and increasingly we don't.

It's a problem of our own making.

http://juneauempire.com/stories/060109/ ... 3119.shtml

[Higgenbotham]

> Auto repair services would be a good example of that. The next
> layer is whether the US economy has the means to produce the parts
> that are used in the auto repair industry. From what I know, the
> answer is yes, despite these kinds of statistics:

> Cars.com surveyed domestic parts content for the top 113 models on
> the market, which make up 89 percent of all the cars sold through
> May. More than 80 percent of those cars — the vast majority of
> what shoppers are buying — have domestic parts content below 75
> percent or are assembled in Canada, Mexico or abroad.

> http://www.cars.com/go/advice/Story.jsp ... amMade0712

> The next layer after that is whether the typical US consumer has
> the means to buy and repair an automobile over the long
> term. That's where things get a little questionable.

An interesting contrast is the Cubans, who have turned repairing 1950s
American autos into an art form.

I knew a retired man in his 70's who used to go to junkyards and buy vehicles that the insurance companies had totalled. He had installed Buske equipment in his garage at home. One day he invited me over to watch him start a project on a car he had just purchased, a late model car for something like $1000. He would negotiate with the junkyard for the car plus all the parts required to fix it. The day I watched him, the frame on the car was bent and he was applying a torch to the frame and straightening it. He was doing all this in his garage at home by himself. What he did with those cars was truly amazing - they looked brand new when he was done.

There were two aspects to this. One, he told me he always drove practically for free. Two, he would sell a few cars a year at good prices to people until the government ruined that by saying a salvage car couldn't be resold. He claimed that was something the auto manufacturers pushed through on the pretense of safety so they could sell more cars. He said there was nothing inherently unsafe about what he was doing, if done properly and inspected properly. He said the government inspectors were a bunch of retards who had no idea how to inspect a car. He called them "goldbricks".

Definition of GOLDBRICK
1b : something that appears to be valuable but is actually worthless
2: a person who shirks assigned work

Interesting, that old guy who didn't complete high school knew a word I didn't know. Plus a few other things.

[Higgenbotham]

As Tantillo note[d in 2009], Americans aren't losing trade advantages due to any lack of abilities to produce.

I've been questioning lately not whether but to what extent Americans have lost their ability to produce between 2009 and today. For example, I watched the demise of part of the US tooling industry from a local standpoint as it got sold off and offshored. That gives one specific information about who the local players were, what their ages were, etc. Whereas that aspect of the tooling industry probably could have been resurrected in 2009, it cannot be done so today, in my opinion.

[Higgenbotham]

If machine tools are the basic building blocks of manufacturing‐based societies, then the rate at which a country installs new ones ought to say something about its pace of industrialization. For the past decade China has led the world in acquisition of cutting and forming equipment. For 2012 the pattern has continued, and as the pie chart below shows, more than two‐fifths of the output by value of the world’s machine‐tool producers has been put in place on Chinese factory floors.

By contrast, in 1995 the top five—namely the U.S., Germany, Japan, China, and Italy, in that order...

The above discusses where the output of worldwide machine tool production is installed. As late as 1995, the US was still leading the world in installation of output for production. Today, China puts 4-5 times as much output into place as the US does.

Production of machine tools would be the second issue - whether a country is capable of producing its own tooling needs and to what extent it is capable of producing machine tools in general. China produces a huge amount of machine tools but installs an even huger amount. Japan and Germany produce a huge amount of machine tools and I would presume sell a lot of that excess to China. While the US installs less than 25% of the machine tools that China installs, it is not producing all of the relatively small amount of tooling that it does install.

Producers of Machine Tools
Country $-Millions 2012 (est.)
1. China, Peoples Rep. 27,540.0
2. Japan 18,252.9
3. Germany 13,622.9
4. Korea, Rep. of 5,705.0
5. Italy 5,667.7
6. Taiwan 5,430.0
7. United States 4,983.2

https://www.gardnerweb.com/cdn/cms/uplo ... SURVEY.pdf

[Higgenbotham]

This report from 2009 discusses, in part, the lack of ability of US machine tool manufacturers to provide high end machine tools to "produce and support critical defense systems".

I. Executive Summary

The Bureau of Industry and Security (BIS) conducts critical technology assessments to examine the impact of export controls on key existing or emerging technologies subject to the Export Administration Regulations (EAR). These technologies are dual-use, meaning they have both civilian and military applications. For a given technology, BIS evaluates the scope and impact of current U.S. export controls, foreign export control practices, the sector’s economic status, and the foreign availability of product substitutes.

This assessment focuses on machine tools for milling and for grinding having five or more axes that can be coordinated simultaneously for “contouring control” (i.e., mills, grinders, mill/turns, and machining centers). It also examines the health and competitiveness of U.S. machine tool manufacturers and distributors, and identifies issues relevant to domestic and foreign machine tool procurements by the Department of Defense and its contractors necessary to produce and support critical defense systems.

The issue of secure foreign sourcing is one that has been raised recently as a result of two reported cases where Japanese companies and/or the Japanese Government have denied the sale of five axis simultaneous control machine tools to a USG end-user and a commercial end-user that performs USG defense contract work because of intended nuclear end-uses. This raises some concern over whether USG end-users and defense contractors can reliably procure five axis machine tools from their non-U.S. suppliers, especially given their preference for foreign-made machine tools. As one USG end-user confirms, “Usually our customers consider machines from foreign sources to be of higher quality and possess the capability to machine to closer tolerances.”

If foreign governments impede the five axis machine tool acquisition process for U.S. end-users, there would be increased reliance on domestic producers to meet USG needs for defense operations. Some USG customers question whether current five axis domestic production capability can meet this need. Another USG end-user expressed the concern that, “We could not find the configuration, quality, and overall accuracy that was required for our parts. We have numerous older U.S. machines that were state of the art in their day. The U.S. producers have not kept up with the technology gains in the rest of the industry.”

http://www.bis.doc.gov/index.php/forms- ... hine-tools

[Higgenbotham]

I don't know if any of this matters.

It may be that the government dropped the topic because it's known that molecular manufacturing or 3-D printing can or will soon be able to produce acceptable parts.

I've searched some of the key phrases I pulled out of the report and don't find any discussion.

[aedens]

http://www.nature.com/ngeo/journal/vaop ... o2109.html

http://science.nasa.gov/science-news/sc ... thirdbelt/

http://www.eia.gov/forecasts/steo/data.cfm

[aedens]

I don't know if any of this matters.

It may be that the government dropped the topic because it's known that molecular manufacturing or 3-D printing can or will soon be able to produce acceptable parts.

I've searched some of the key phrases I pulled out of the report and don't find any discussion.

http://failedevolution.blogspot.gr/2014 ... -west.html

taxpayers deserve all and more - you are not allowed to produce unless sanctioned

http://defendressofsanity81.wordpress.com/

[gerald]

I don't know if any of this matters.

It may be that the government dropped the topic because it's known that molecular manufacturing or 3-D printing can or will soon be able to produce acceptable parts.

I've searched some of the key phrases I pulled out of the report and don't find any discussion.

for what it is worth --
My dentist is using a form of 3-d printing for fillings and crowns. --- How many skills and industries are no longer needed?"