The Return of MADE IN AMERICA

The Newtinies continue.  Not sure who coined the term “Newtiny”, but it is a good one and Newt stepped in it again.  Recently ABC News discovered and reported that Newt’s Campaign gear is,  get this, NOT Made in America.

I know I was completely floored that when I heard this too.  I mean who buys their stuff from the likes of China, Germany, Japan, S Korea, or Mexico anymore?  Okay sarcasm off.  This is an extremely important topic and the reason I got off to a sarcastic start is two fold;  EVERYBODY knows it is too expensive to manufacture most goods in America to compete with foreigners, and the fix is actually quite easy.

Yes you heard correct.  The fix to return manufacturing (and JOBS) to the United States of America is easy.  Then why you might ask is whatever that must be done, not being done?  That I cannot answer, but the solution is to follow some solid old advice on tariffs, 235 years old to be exact.

Adam Smith in the Wealth of  Nations wrote that there are only 2 reasons to impose a tariff.  One is on National Defense products and services so high that items related to National Defense would ALWAYS be, in the case of the US, Made in America.  The other is a tariff on foreign goods & services to match taxes and fees imposed upon competing products and services made domestically.

This is quite an important economic rule to adhere to.  One, National Defense should never be compromised because another nation can’t keep up with our demand.  This makes perfect sense so I’ll leave it at that.  The other case may or may not make as much sense so here goes.

When the US Federal, State, or Local Governments impose a Tax, Fee, Regulation, License, etc upon US Products (including Services), then that raises the cost to produce that Product here, raising it price.  A quick and very incomplete list of these additional costs US manufacturers deal with, including but not limited to; Corporate Taxes, Income Taxes, Social Security Taxes, FICA, various Agency costs such as (EPA, OSHA, DOT, FDA, etc), UNIONS, and the list goes on.

Some may argue that “Hey, we need all those taxes, fees, licenses, and regulatory costs in order to maintain safety and order” and I have a very good argument against, but that can wait.  Suppose no argument against these additional government imposed costs can be found, what are the ramifications?

First as we discussed already the cost and therefore price of US products go up.  This gives our foreign competition a leg up on our guys and gals here at home.  Most of our foreign competition does not have all the government mandated costs that our manufacturers have so they now have a US Government mandated competitive edge.  Sound crazy?  It is.

So in response OUR Manufacturers spent billions increasing efficiency and quality to compete, but alas to no avail.  So what do they start doing?  They move what once used to be OUR operations overseas to THEIR operations.  Now THEY get extremely efficient processes and better quality at no effort or costs to themselves.  They have cheaper labor and less taxes so now our loyal manufacturers have to compete with similar efficiency and quality + less government overhead.  That is not competition, that’s a massacre.

So all Adam Smith is advising to do is level the playing field.  Even out the competition.  Why get in the ring if your legs and arms are tied and your trainer left you for the other team?  It is just an invitation to get beat up.  We gave them the jobs, we gave them the manufacturing know how, we gave them the quality know how, and all we should ask for in return is the SAME government imposed costs applied to their products as is ours.  Even Steven competition and our Guys and Gals are a match for ANYONE.

This system is actually ingenious.  What it will do is raise the price of foreign goods equal to what it would be to produce them here.  So now the US Federal Government will be getting hundreds of billions of dollars in Tariffs each year, except those Tariffs will start earning less with each year because US Manufacturing, US Ingenuity, US Pride, and most important today US Workers will be back in the game and our store shelves once again filled with “MADE IN AMERICA” stamped all over the the high quality products that Americans were once renown for.

I worked for Wal-Mart back in ’87 when Made in America was a Wal-Mart requirement.  Sure they had Made in Taiwan, China, etc, but that was the exception, not the rule.

Folks this is OUR Nation we’re talking about.  This is our lives, our home, and standard of living.  We cannot continue to let the same two failed ideologies (D’s & R’s) that got us into this mess continue to lead us down the path to misery.

‘They’ do not suffer from their poor decisions.  They like the Bankers (wonder why?) win whether we win or lose.  They claim, and they actually might, to feel bad when their poor decisions make us suffer, but they will never actually FEEL as bad we do.  I’m not suggesting we make them FEEL bad.

I am suggesting we do like we should have long ago and start replacing and ignoring them because the End is Far.

Steve A Morris

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Posted in economics

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