It’s hard to see the supply chain crisis getting meaningfully better any time soon. Covid is not as under control as the authorities have convinced themselves. China is in the midst of an energy crisis that isn’t going to resolve soon, and that’s leading to factory shutdowns and new supply shortages. The latest word from the tech sector is that the chip crisis will extend into 2022. Oh, but magnesium is about to become scarce, which will very rapidly put a dent into car production.
We’ve taken to reading the Substack Doomberg, styled “Chicken Little got a Bloomberg terminal, and the sky has been falling ever since.” He’s amusing and looking for fundamental developments that haven’t been sufficiently well noticed or interpreted. Doomberg ranks #8 on Substack among financial sites, so it’s not shabby. Even though we don’t necessarily agree with what he says, his information nuggets are good.
A recent piece was useful for a different reason, in that it contends the supply chain mess is going to be so severe and protracted that it will force a great uncoupling. From his post Opposite George:
So, here’s our best guess at what is going to transpire after the coming dark storm clouds finish drenching us with their rain of doom:
- The breaking of the European energy markets is just a symptom of a greater disease. It reflects the demise of the just-in-time logistics philosophy at the heart of modern capitalism.
- Companies can no longer delegate their survival to the tight performance of their supplier base in the name of efficiency. This works until it dramatically and disasterously doesn’t.
- There will be a massive build out of raw material and work-in-progress inventory, which will likely further exacerbate ongoing inflationary pressures in the near term.
- There will be a staggering wave of onshoring. Businesses simply can’t rely on unreliable ports, a shortage of longshoremen and truck drivers, or a backup in rail car availability. So, they won’t.
If we’re right, the scale of the upcoming wave of onshoring will likely surpass the flight from the cities we observed after Covid, at least as measured by economic impact.
I don’t mean to sound dismissive, but well off people decamping to the exurbs or another state requires enough cash and a good enough credit rating to make a down payment, plus movers, and a little more cash to buy new curtains and odds and ends like lights and end tables. This was a wave of single transactions all heading in pretty much the same general direction.
By contrast, it has taken 40 years to create tightly coupled supply chains that include substantial foreign sourcing, both of raw materials, intermediate product, and often a great deal of sub-assembly.
It doesn’t do any good to get more raw materials or inventory, even if you had someplace to put them, if you don’t also have the equipment and direct labor and systems (mechanical and IT) and skilled supervisors and plant managers to keep everything moving and prevent equipment and safety disasters. How long would it take to design and build a new factory, or an expansion of an existing factory? You have to get approvals, contract to have the structure built, buy equipment and have it delivered (oh, again probably from overseas, putting you back in the crosshairs of the ports/shipping mess), hire and train workers, shake down the operation…even assuming you could find seasoned operations managers who were good enough to manage a startup (way harder than overseeing an established operation).
For instance, at Deere, management is merely attempting to fill in for union workers. They’ve already had one accident and they are now clamping down on reports of other safety incidents. Startups or major expansions are at least an order of magnitude more difficult to execute.
Let’s look at other practical issues. Will we have rare earths mining in the US any time soon? We let China have that not because rare earths are actually all that scarce, but mining and processing are really nasty. But there is also specialist know-how, and we’ve ceded that too. Think the US will have enough fabs any time soon to meaningfully reduce our dependence on China, Taiwan, and South Korea?
How about more mundane products, like textiles? The US ceded that a long time ago (US spinning mills were on their death bed in the 1980s). Europe has largely given up on fabric manufacture for clothing, even on the high end (my former tailor is in despair that he is limited to supply from Asia, and the fabrics are inferior to what he was able to get from France and Italy, although even that have been getting thinner, for want of a longer-form, more technical discussion, for some time too). And what about the cutters (who are high skilled)? Who exactly will sew?
And what about pharmaceuticals? We already get nearly all our Vitamin C from China, both as a medication/dietary supplement and a preservative. On the order of 80% of our drugs come from China, not just active materials but the entire compound. India provides much of the rest. Pray tell how do we repatriate that in any reasonable time frame?
But let’s get back to the biggest reason there is no way, no how we will see a massive wave of onshoring, no matter how bad supply chain breakdowns get: management incentives and financialization.
Look at some of the steps I set forth above. Even if a very brave company got religion and decided to embark on that path, what would it entail? Massive up front expenses, not all of which could be capitalized. That means trashed earnings until the new reshored company is humming, which is years down the road. And would retained earnings be enough to pay for all the investment? If not, that means borrowing or issuing stock. Gee, do you think investors would be keen about that?
On top of that, the current leadership would almost certainly be unable to execute a change program of this scale. Think they are prepared to sign job death warrants?
More generally, giving up on supply chain dependence is a huge negative for executive and manager pay. In many if not most cases, its real purpose was to transfer income from lower level workers to the executive and mid manager ranks by reducing hourly-type labor content and increasing risk. Both the (often illusory when properly risk adjusted) savings and the increased enterprise complexity justified higher pay.
And it is not as if one can expect political support for this type of shift. Moving production on shore will increase costs, if nothing else the need to recoup the considerable business restructuring and investment costs. Making voters pay more for stuff, or worse, asking them to sacrifice for any reason other than war, is not a popular proposition.
ECONNED provided the obligatory discussion of what might happen after that financial system near death event. The book set forth four scenarios. I regarded the last one, paradigm breakdown, as the most likely, and the response to a continued supply chain is likely to be the same. From ECONNED:
Paradigm breakdown, meaning key elements of the current system are no longer viable, but that is a possibility that no one is prepared to face, since the old system seemed to work well for a protracted period.Thus the authorities reflexively put duct tape on the machinery rather than hazard a teardown….
Let’s use a different metaphor to illustrate the problem. Say a biotech firm creates a wonder crop, the most amazing creation in the history of agriculture. It yields far more calories per acre than anything else, is nutritionally extremely complete, and can be planted and harvested with far less machinery and equipment than any other plant. It is tasty and can be prepared in a wide variety of ways. It is sweet too, so it can be used in place of sugar and high fructose corn syrup at lower cost. We’ll call this XCrop.
XCrop is added as a new element in the food pyramid and endorsed by nutritionists and public health officials all over the globe. It turns out that XCrop also is an aphrodisiac and a stimulant (hmm, wonder how they engineered that in) and between enhanced libido and more abundant food supplies, the world population rises at a faster rate.
Sales of XCrop boom, displacing traditional agriculture. A large amount of farmland is turned over from growing other types of produce to XCrop. XCrop is so efficient that agricultural land is taken out of production and turned to other uses, such as housing, malls, and parks. While some old-fashioned farms still exist, they are on a much smaller scale and a lot of the providers of equipment to traditional farms have gone out of business.
Twenty years into the widespread use of XCrop, doctors discover that diabetes and some peculiar new hormonal ailments are growing at an explosive rate. It turns out they are highly correlated with the level of XCrop consumption in an individual’s diet. Long-term consumption of high levels of XCrop interferes with the pituitary gland, which controls almost all the other endocrine glands in the body and the pancreas.
The public faces a health crisis and no way back. It would be very difficult and costly to put the repurposed farmland back into production. Some of the types of equipment needed for old-fashioned farming are no longer made. And with the population so much larger than before, you’d need even more farmland than before. The world population has become dependent on the calories produced by XCrop, so going off it quickly means starvation for some. But staying on it is toxic too. And expecting users simply to restrain themselves will likely prove difficult.
Mind you, that does not mean there won’t be some increase in domestic content. It may not be enough to impact any macro measurements, but plenty of citizens are becoming more survivalist in orientation, looking to produce more of their energy and food and building up more emergency stores, as in carrying more inventory on a household level.
Another way the US can see more de facto onshoring is by purely domestic players stepping into production and service gaps created by supply chain interruption opening up opportunities for them to take ground. But again, it’s hard to see how significant this will become on a US economy basis.
The one thing that could make Doomberg right is war with China. And that’s not implausible given the bizarre US love of eyepoking, particularly over issues that China regards as non-negotiable, number one being the status of Taiwan.
What ended the last great period of globalization was the Great War, which also created huge financial stresses due to the inability to ship gold to settle balance of payment differences. But let’s worry about that some other day.
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good morning, it seems like this article was cut-off mid-stream-of-thought. “From ECONNED:…..”
needs a reupload? thank
Sorry, launched early so as to be included in our 7 AM e-mail blast.
Thanks for being an early bird. All done now!
“Another way the US can see more de facto onshoring is by purely domestic players stepping into production and service gaps created by supply chain interruption opening up opportunities for them to take ground.”
yeah…like mason jar lids.
how hard could it be?
since i can finally see the end of the tunnel with both my recent chaostime and my now almost 2 year infrastructure frenzy, i’ve been thinking a lot about this.
a surface google scan reveals little actionable information, regarding specs and equipment…but it’s a flat metal disk with a rubber-ish ring glued to it.
I think we’ll be pursuing it, this winter….ready local market, with infinite expansion potential, due to the monopoly shenanigans of that conglomerate that owns jar-making.
my grandad had a sheetmetal shop in houston for decades…and i think about the ancient equipment there…the big, 1940’s-50’s die cutters and stamping machines and whatnot…as well as the even older hand-tools for cutting and shaping…so i know the basics . were that shop still extant, they could retool for lids in a heartbeat.
but i expect such machinery to have been melted down long ago.
ergo, re-invent the wheel…which is the short version, i think, of why the optimism i detect in doomberg is premature, at best.
(finally got my little tiller back from the shop after 6 months of waiting on gaskets from abroad…yet another thing that is potentially doable on small scale, and imminently scalable….and other parts….keep an eye on the cost of refractory sand and crucibles and such for an indicator, there…and i’m thinking specifically about my neighbor waiting for parts for his round-baler, mower and rake…and having a local welder guy fab up a part that would do in a pinch)
That ancient equipment your granddad had might still be around somewhere. I’m getting the impression that at least the reasonably sized versions of this type of equipment are highly prized amongst advanced hobbyists. As long as they’re not worn out, those machines tend to be a on-off purchase that lasts a lifetime, even when they already lasted several lifetimes.
If you’re handy with computer hardware, earlier CNC machines might also be interesting – a lot of them seem to be sidelined not because of mechanical issues, but because the computer controlled part can only be repaired with eBay parts of dubious provenance and the control software is stored of floppies that may or may not be readable any longer.
I have a medium sizes metal turning lathe and heaps of accessories. Also have an arc welder. I’m now 78 and have thought of selling both and using the extra space in my shop for winter-time hydroponic gardening.
Yves’ very good essay now clouds the issue by making a good case for hanging onto the metal turning lathe and welder.
I probably need to get on with building that greenhouse I’ve long yearned for.
> I probably need to get on with building that greenhouse I’ve long yearned for.
are there any younger people in the vicinity who would be willing to “apprentice” with you — help with the greenhouse construction in exchange for instruction in use of the machine tools?
Mog-Yep, prolly.
these machines all had a particular shade of green, an a steampunk/art-deco appearance….made in places around the Great Lakes(don’t remember the brand names)
maybe even from the 30’s…although grandad could not have obtained them until after The War, circa 1946 or so.
massive, heavy-ass hunks of cast steel, and all with a loop at the top for attaching to a crane.
during my time as shop-hand, one of my jobs was to keep things running…i was forever changing out the little bushings in powr drills and sawzalls…but not these things. start capacitors and windings that just kept on going. only thing i ever fixed on them was the power cords.
brakes and shears and drill presses and …especially regarding lids…a giant hole punch/press contraption that would not be out of place in a Terry Gilliam film.
we used to get Lindsey’s Technical Books for some reason…and i bought far too few of that fanatic’s products(lol)…he retired in 2012(have the Last Catalog in my hand right now). he had all manner of weird how-to stuff…from all about thermite to how to maintain your brake press to ancient books about how to build all the equipment one would need in a machine shop in dayton, ohio in 1903.
sadly, such machinery…while available…is much like a 76 volkwagon camper van:high dollar and the exclusive purview of rich hobbyists.
there are small and medium shop tools available…often for reasonable amounts(had my eye on an english wheel and a hand-brake)…but i have no idea of their quality or provenance.
i’ve been collecting tools for a long time…whenever someone dies, it’s understood that i’m gonna pick through the garage/shop/storage, and extract the 1890 brace and bit or whatever…because everybody else will just junk that stuff.
I likely have enough stuff…and salvaged steel and iron…to make a bunch of the bigger tools…pretty sure i could fabricate a hand brake, for instance, with a couple of sections of I-Beam and some scrap steel pipe….but the more complicated machinery…like that hole press…are way beyond me.
a lost art.
my dad sold off all that stuff before i knew what he was up to…i was especially mad about the forming table…with the big, heavy “Dogs” –in various cone and other shapes—that was used to form sheetmetal when grandad first got started with it, pre-WW2. sold that to a winery not 60 miles from me…lol…i can go look at it in their tasting room.
and Frank- yeah…i’d hang onto it…or at least locate someone like me who might be able to put it to good local use.
in spite of my general pessimism about a full blown reshoring, DIY will be a growth sector…and will confuse and alarm hordes of economists.
and another consideration, when building one’s means of production palace: parts.
2 of my bench grinders, one of the 3 drill presses, and a couple of bench sanders…all require new start capacitors. Now that i’m finally getting to the point where i can catch my breath, and clean and organise my shop(which is a wreck since wife’s cancer, 3 years ago…and raccoons and chickens and geese all contributing to the chaos in there)…i’ll be attempting to source that sort of thing…and bandsaw blades and belts galore and sanding belts and on and on…(i never throw away a power cord,lol…cutting them off whatever appliance bites the dust.).
and another germane anecdote: the guys at the dump have been waylaying me at the beer store to get down there with a torch and a comealong and take all that scrap metal off their hands…seems whomever was buying all that has stopped in the last several years, and they’re running out of space.(i’m sort of a legend around there, for hauling out—pound for pound—more than i haul in…and this particular idiosyncrasy is spreading, I’m told)
lots of steel pipe and beam and roundstock…with a bunch of ancient scrap steel from sundry farm implements….all tangled up in barbed wire, hog wire and stock-panel(hence the torch)…abundant material, free for the taking.
idk if this situation is limited to way out here, or if it’s more general.
Everywhere I’ve lived it’s illegal to take from the dump; what’s dumped is crushed almost immediately.
Well I remember that shade of green from my high school shop class back in the 50’s. Also the thin milky white lubricant that would dribble down on the work as it was being fashioned.
I believe the chief reason for a lid shortage is the rubber-ish ring glued to it. I believe that material could be replaced with a silicone seal. It would be difficult to compete on lids and metal forming and I am not sure it is even necessary. I believe sheets of food-grade silicone are still manufactured in the u.s. and could be cut into a series of lid inserts using a stamp or on a smaller scale using the services of a waterjet. I imagine the services of a small waterjet manufacturing company might be available somewhere near where you live. It might not take long to build a market for silicone seals to make old lids seal as well or better than old. A food grade silicone should avoid many of the unpleasant and unhealthful chemical fellow-travelers infesting the standard rubber-plastic jar seal built-in to a standard jar’s lid.
I believe you could ‘prove’ your lid seals using a simple device, to ‘prove’ them equivalent to and much far superior to a brand new Ball Jar lid. Standardize on a set of readily available glass jars — like the spaghetti sauce jars for ‘Classico’ brand spaghetti sauce [“Can You Re-Use Classico Pasta Sauce Jars?” https://culinarylore.com/cooking-tips:can-you-re-use-classico-pasta-sauce-jars ]. “However, the jars Classico uses are not actual mason jars and were NOT intended for home canning. The jars being stamped Mason Atlas has more to do with marketing than anything else. They are lighter than actual mason canning jars, although the seals and rings for mason jars will fit on them.” The Classico brand — currently owned by Del Monte Corporation — sells its spaghetti sauce in ‘atlas’ jars. They are not ‘real’ Atlas jars. The ‘Atlas’ name was purchased and has been exploited for some time. The question though is how well, how long, and under what conditions of use, might any given jar perform. I believe much of current advice and ‘best’ practices has been greatly clouded by current legal practices and Corporate agnotology.
Drill a hole in the bottom of a jar-of-interest and install an inlet port. Attach that inlet port to a vacuum pump. Can the jar with your silicone seal hold vacuum adequate to seal and preserve the contents? I have not chased around to find what specifications apply to a properly sealed Ball Jar. But if I might climb off my lazy ass, I will. It would also be of interest to study and characterize the properties of various glass jars and silicone seals when used repeatedly under different conditions of use and maintenance. I suspect many currently produced jars may be much better at withstanding the thermal shocks of canning than Ball or other canning jar producers would have us know.
I have not studied silicone adequately, nor have I studied the properties of glass under different conditions. I have not studied how flat the tops of glass jars might be, and have not studied how flat they need to be for different kinds of sealing. I also must find out more about ground glass seals. There are ground glass sealing techniques which might supplement or replace silicone seals when petroleum products, like the plastic-rubber seals in current use, become less common. I am still too ignorant about silicone. These are areas of interest for my future studies.
yeah.
don’t use pizza sauce jars.
i’ll hafta look into silicone, too.
after further thought, while gliding through my tasks, it hit me that a “holer”…of whatever size…could be build rather easily, with a handle that pulls down.
proper sheet metal stock…i’ll hafta look deeper.
the jars are definitely reusable…we’re still using some of my grandparents’ jars for jelly and such…but things like green beans(the scariest veg we can), we use new as we possible.
maintaining the condition of the jars is important…chips on the mouth are bad, etc.
so i’ve instilled habits with jar handling around here, and have several scrapwood boxes for jar storage.
the lids are the problem.
ball…or whatever conglomerate corpse owns it all…was the subject of a stoller article a while ago…monopoly, and them figuring they can make more money selling lids only with new jars, than replacement lids for yer saved jars.
that pissed me off, and i’ve been thinking about it ever since.
and i came across this site(again) while sitting down for lunch:
“It can be built by a good mechanic using scrap, steel bar and concrete using only common mechanic’s tools, a drill and a few small welds. It is easily converted to drilling and horizontal and end milling. Lathe cost is determined by the size of the machine you build and the kinds of good junk you have available.”
http://opensourcemachinetools.org/concrete-lathe/
lots of neat stuff, there…a welder made from a truck alternator,lol…mounted right under the hood.
and this:
http://opensourcemachinetools.org/multimachine/
not impossible…but we’re talking about the ability to fabricate the utter basics, here.
1910’s tech.
for when it really goes to pot.
Sorry — I did not intend to suggest not using “pizza sauce jars” or ‘atlas’ jars saved from Classico. I suspect they might both be more than adequate to the needs of home canning. I was trying to suggest the means for testing jars and seals is probably not rocket-science. Glass is very strong material. I think people like Ball have greatly exaggerated the ‘dangers’ of not using their jars and their non-reusable[their claim] lids. Are the toxins that can endanger canning really so difficult to detect? Are there truly, no color changing ‘litmus papers’ to give warning? — and none possible? Are jar lids so prone to failure, and so difficult to test?
Chipped jars definitely should not be used for canning. Jar openings can be made flat using a grinding wheel. It would be wise to examine and study the nature of a jar and of jar seal. I am no fan of deconstructions of literature, but I highly recommend deconstructing various inventions. Patent claims are/were helpful in such analysis. By one analysis, consider a lid as a top enclosure means coupled with seal, coupled with a compression means for compressing the lid and seal to the top of the jar. The means for sealing, compressing, even enclosing the jar’s contents can vary in different embodiments of the claimed means. The best patent claims distill the essence of the claimed improvement, and hence the essence of an invention.
Some further considerations of matters like canning or milling flour, or the making of tortillas and flat breads — strongly suggest to me the value of local community industry. I believe some of the first co-ops were mills for grinding grain for flour. Food preservation technologies are one area of our present and past Knowledge which must not be lost … to the great peril of our progeny. There are technologies which could be implemented in a household but would be much more efficiently and effectively implemented at a community level. I believe Humankind finds its greatest strengths from the Wisdom it remembers and shares from its past and present generations. We are social animals who have gained our ascendance through cooperation and sharing.
Jeremy.
I suspect that you’ve never canned before.
the Mason Jar is a remarkable achievement for mankind.
easy…so long as you have the knowledge…(I’m using New Deal recipes, put out by the government)
low tech, so long as you have the basic, simple equipment..
might near anything you can grow, you can seal in a Mason Jar.
It imparts agency.
there’s gonna be gardens sprouting up all over the place in the coming years…much more than before.
(get yer seed order in now, in anticipation:Heirloom)(and SAVE the frelling seed thereby)
then, belatedly, people will rediscover the need to Preserve the Harvest.
(get yer lid and jar orders in right fucking now)
I admit I have never canned before. I have watched my grandma make jams that she sealed with wax — as juno mas describes. [I believe both the acidity and high sugar content of jams makes them less susceptible to spoiling — especially spoiling like unsugared, unsalted, and unpickled beans might suffer.] I have read about the canning process and checked a little into the asceptic tetra pak technology. I believe knowledge about methods of food preservation will be vital to life in the future. I am not sure what differences there are between Mason jars and many of the jars used to can foods in the supermarkets, nor can I guess what your concern is. I am not knowledgeable of the processes food processing companies use for the mass canning of foods in jars. The ‘Atlas’ jars I save from spagetti sauce once contained canned spagetti sauce. From that, I inferred the jars could withstand some form of canning process. The kinds of glass used for jars can stand up to temperatures much higher than canning temperatures. I have not tested them but I suspect they can also endure the pressures of a Mason jar canning process. The thicker glass of the Mason jar would make a Mason jar less susceptible to fractures caused by rapid temperature changes. If a Mason jar canning process calls for moving from pressure cooker to an ice-bath, I doubt my spagetti sauce jar would survive. I have reused my spagetti sauce jars for freezing soups and black-bean chillis.
I do not have a canning pressure cooker or a large canning pot, and if I did, I have no place to keep them. For now, I will have maintain my inventory of dry goods. Growing anything larger than a houseplant suited to partial sun, is not an option for me. I think I might better learn what wild plants in my area are edible, and learn to grow mushrooms.
For the not too distant future, each community might be advised to establish a community grain mill, canning facility, and press for making flat bread, and stacks of uncooked tortillas and chapattis. If possible I believe it might be wise to power these devices by pedal power, or 12 or 24 volt direct current.
way late, here.
yes…the more acidic and/or sugary the thing, the easier to can.
wax seals are for acidic fruit tings…jams, jellies, preserves.(you can actually use plain cane sugar to treat festering wound…the sugar makes an inhospitable environment for bad bugs)
for things like green beans(which we do an awful lot of) they are not acidic at all, and must either spend a very long time in the boiling water, or be pressure canned…and the jars and lids must be exceptionally clean during the entire process. Botulism is the bad guy with things like that.
by the time you can smell the botulism, it’s way too late…you can have it without any outwards sign, at all.
so when you break into that jar of beans, you first push on the lid: firm=good, moves up and down=suspect/chickenfood.
then you listen for the whoosh when you open it…whoosh=good…no whoosh=bad.
again, we use the recipe book from the New Deal USDA…for time in the water bath/pressure cooker, as well as how much pressure, etc.
factory canned stuff is a whole other animal, with equipment and process that are worlds away from the home canner’s ability.
i can what i must(tomatoes, spaghetti sauce, green beans, and all the fruit stuff….and do other methods for other things…like squash/pumpkins…i dry cure them, and store them whole in a cool dark place…peppers go on ristras to dry…
etc.
we’ll hopefully be finally getting into the charcuterie this winter…if i can finally be done with the infrastructure frenzy, and get back to some kind of routine.
i got all the stuff, except the drains for the (potential) “commercial kitchen.
even built a smokehouse out of a 1950’s giant oven i got from the school for $200.(5’x6’x6’…and about 900#)
eventually, i’d like to get into fermented veggies…kraut, pickles, kimche, etc…collecting crocks and such for that.
and vinegar,lol…always wanted a Vinegar Mother lurking in the corner like some alien.
My grandma would seal the “canned” (glass jar) fruit she made from her fruit trees with hot wax. Is that no longer practiced?
I was going to ask the very same question — isn’t wax a sealant alternative?
Yep, I’m so old I remember when my grandma and aunts used parrafin wax to seal their canning jars, available at the general store back then in bars (not the drinkin’ kind, the rectangular kind). Of course it is a petroleum product and full of toxins and carcinogens. Hmm, me and the kids starve to death now or maybe develop cancer in 20-30 years, tough choice. Xcrop = high fructose corn syrup.
Have you ever seen the “Farm Show” magazine? The Farm Show features inventions built in farm shops from all over the country that focus on re-purposed implements, gardening and livestock tips, and a lot of simple inventions that come from the scrap pile. They are entirely subscriber supported so there is no corporate advertising, which allows for the “Best Buy-Worst Buy” segment where people can venerate a tool that has stood the test of time or vilify a company with crappy customer service. It is published in Minnesota in a newspaper type format kind of like “The Grit” or “The Mother Earth News” used to be. It costs $23 / year which also includes an annual edition of the Best Inventions and the latest Livestock Breeds which focuses on rare breeds, miniature breeds , and animals suitable for small land holders. Sorry I cannot link but the web address is http://www.FARMSHOW.com.
In the Upper Midwest if you find people familiar with The Farm Show you know your in good company.
Take a look at industrial O rings. Available in many grades of rubber, and many sizes. Using a lathe, turn an O ring groove into a round the size of the jar lid. As long as you have o rings (and you can probably sterilize them in a pressure cooker) you have resealable jars forever.
Turning an O-ring groove into the side of a jar is a good idea. I will have to give it more thought. I have been reluctant to examine ideas that involve machining a jar, including grinding its top more flat. I would appreciate hearing more about industrial O-rings which might meet or exceed the temperature cycling and costs of silicone washers — perhaps silicone O-rings or some new form of silicone O-rings — a perpendicular washer, alone, or to fit a channel which were ground into existing jars or cast into new jars? I wonder whether we may have come up with a new art which might have been patentable had we remained silent.
you can get a FDA food grade silicone sheeting at a competitive price from McMaster Carr and each lid will cost 10 bucks.
https://www.mcmaster.com/sheets/backing-type~plain/texture~smooth/food-industry-high-temperature-silicone-rubber-sheets-and-strips/
you will have trouble finding investors.
Check your reference — look further down the page. You can buy a 36″x36″ sheet of 1/16″ Food Industry High-Temperature Silicone Rubber for $154. [1/16″ is probably thicker than necessary — a 1/32″ sheet costs $93 => $0.65 per seal.] Each jar lid is roughly 3″x3″. Assuming little waste –jar lids are actually slightly smaller than 3″x3″ — that 36″x36″ sheet should yield around 144 jar seals [for simplicity, assume no effort is made to cut smaller seals from the interior of the 3″x3″ seals]. The cost for materials in this hypothetical is $1.07 per seal. I do not know the costs of contract waterjet cutting, nor the costs for building a stamping tool. For a small scale operation a simple cookie-cutter tool might be fashioned to cut seals by hand.
How did you arrive at $10 per seal?
I have nothing against McMaster-Carr — I picked up my P100 half-mask from will-call at the McMaster-Carr warehouse in my state. But I have difficulty believing McMaster-Carr could offer the most competitive price for silicone sheets. Investors? What kind of local manufacturing are you envisioning? I am thinking community level cooperative efforts.
Amfortas – love these two posts. Echoes my strategy.
I have been stockpiling structural steel (angle, tube, flat, round) for a while, as I alshinting (shouting)o selectively pick up fab equipment like sheet metal bender, heavy drill press, welders and the full assortment of hand-tools necessary for fabrication.
About 20 years ago, I decided that the most reliable, but also most costly path to resiliency was to bring technical arts onto the farm.
I put in mfg’g space, acquired tools, and started up the long learning curves. Took a long time.
Earlier this year I built a rolling mill (forms structural shapes into curves) using stockpiled mat’l and some bits of equipment, incl a big gear-motor. I had to buy sprockets and chain and keyed shafting and some big pillow-block bearings. Bought in about $400 worth of stuff, to make a piece of gear that would cost me about $8K. Point is I made a highly valuable manufacturing tool that works OK – not great; it was my first go at it – but what it doesn’t do right is fixable, and fixable by me. Just a point: this rolling mill correctly forms angle stock – that isn’t easy, and those who’ve attempted it know what I’m talking about.
There’s not much stuff here on my farm that I can’t design, build, repair, improve, or operate, and I have a lot of gear spanning many tech disciplines.
I could have spent all that time and money as an investor, or a contractor at great wage rates. I decided to invest in skills and wholly-owned productive capacity. Not a popular decision. Boy are you dumb, Tom. Really dumb. That was the consensus across all social and professional relations.
My macro-picture interest is to re-establish the household as a productive center, and to devise business processes which make a living as they fix the planet, and are “defensible” – e.g. can’t easily be hoovered up by the rentiers and predatory financiers.
There’s a scale sweet-spot that makes money, but doesn’t scale well, and therefore isn’t of interest to the predators.
==========
And to Yves:
There may be a third alternative to the “where does production go from here” question.
Instead of “stay in China” or “re-center at scale here in the U.S.”, a third possibility, as Amfortas is vigorously hinting at, is to distribute innovation and production to the “leaves” of the tree. We have been starving the leaves of the tree of nutrients (resources and encouragement) for decades, and the tree is rapidly dying.
How long can the trunk and roots survive without viable leaves (householders with viable econ prospects)? If all the “rents” are collected at the trunk level, and the households founder, how long is that tree going to last?
To put that point on the affirmative: as the centralized production model continues to wring labor out of the production equation, one alternative to labor is to become its own market.
Sell your labor to yourself. Invest in yourself. Own your own production facility.
Of course there are many, many issues and obstructions to this gambit. It also has many, many powerful advantages, as well.
There may be many people, like Amfortas, that remember what it was like to build and operate a family business, and maybe even one that was based upon manufacturing.
Lastly, implicit in my and I believe, in Amfortas’ story is a values shift away from things-that-are-consumed toward things-that-produce, and things-that-last-a-long-time.
We don’t have to buy ocean-containers full of cheap stuff that hits the landfill a few years later. That is not necessary or desirable on several counts.
Any American wannabe revivalist of making mason jar lids in America will be immediately bankrupted by
Free Trade conspirators sourcing semi-slave labor mason jar lids in the handiest foreign country in order to mass-import them to abortionize any American mason jar lid wannabe-maker in the economic womb.
Until Free Trade is abolished and Protectionism is restored, no one will dare attempt to make mason jar lids in America. ” How hard can it be” has nothing to do with it.
Free Trade is the New Slavery.
Protectionism is the New Abolition.
When I first visited NZ 40 years ago they had sizable import tariffs on everything, and inflation is a tariff on availability in our case when it comes to imports, different ways of getting there.
The Kiwis had their own established industries, such as Fisher & Paykel appliances, Skellerup rubber co. et al, but still prices were dear on everything. The price of new books there took me aback, it was twice that of the same tome in the USA, yikes!
The most evident thing to me as a young adult was the cars on the road. Because of import duties on cars (none were produced in NZ) everything on the streets was rather old and fascinating to me, as the makes were largely of types i’d never seen before, there’d be early 1950’s French Renaults, lots of late 1950’s Morris Minors, 1960’s Holdens, et al.
To see a new car was a rarity, and it wasn’t just cars that were aged, everything you could imagine that was imported was while not quite an antique, certainly getting there.
There was a keep it going austerity to the place, and everything was fixable back then.
This is more the scenario I see happening to us in roundabout fashion for as you say Yves-the leadup time to get things going onshore is quite the undertaking and daunting under normal conditions let alone attempting it in the midst of a pandemic…
Everything about our consumer culture is a throw it out ethos though, as if anybody is going to get their $39.95 Bissell vacuum cleaner fixed after it stops working 7 months after purchase?
Well, I guess we can take rugs out to the back yard clothes line (after rigging it up) and beat ’em every spring.
We can use carpet sweepers, brooms and dust mops.
https://fuller.com/products/electrostatic-carpet-sweeper
Oops — made in China, though. Here’s another project for our enterprising Amfortas — onshore production of carpet sweepers!
P.S. Fuller Brush’s wooly dust mop is actually still made in the U.S.A. — hoo-hoo!
I don’t like using a vaccuum cleaner as inevitably the inevitable dust in these parts is stirred enough to hang about in the air ( virus particles anyone?) So, whilst that might seem silly, for a very long time all I do happily and safely, carpets and all, is use my old broom and a spritzer in hand – spritz first, then sweep. Admittedly it doesn’t go right down into the pores of things, but it keeps the dust out of the air, and does a nice job cleaning spaces that need to be cleaned. (Mightn’t be good for those having problems with too much humidity, but in arid climes it works.)
Same problem with central heating, so that’s been gone a long time -but I am happy my home has a thermostat in the livingroom. 60 degrees F is my daytime comfort zone for winter (which it now is, thank the Lord). Fireplace or heaters come into play below that, on a cloudy or frigid day, but spot heating only. Nights and early morning, on with the layers! ( One daughter studied in China a ways back where college dormitories had no heating. I asked her, how did you survive ? Answer: more layers!) And after all that heat summertime – it’s lovely to be cool again.
How this relates to the supply chain crisis? Well, as the above comments maybe just downsizing as needed. The only thing we have to fear…
This has been called the “number eight fencing wire” mentality (New Zealanders can supposedly fix anything with it). New things are scarce and expensive, so you need to be creative about making do with what you have.
I don’t hear it so often these days as globalization and deregulation have meant that we have all manner of products at our fingertips. Many are still much more expensive than elsewhere (we’re a small and insignificant market with some fairly stringent consumer protection laws, and most suppliers need fat margins in order to take any interest at all) but for the most part we have all the same stuff that most Western countries do. Let’s hope it hasn’t fallen completely out of our collective memory.
Speaking of wire – – in the Aust’ bush, I believe, it was once the
practice, should your car break down in the back of beyond, to cut out a suitable piece of wire fence & repair your car. Then, asap, go back & repair the farmer’s fence.
NZ is a small lightly populated country, going it alone is difficult. but they had a higher standard of living than most free trade countries.
their land mass is big enough, but not the population to support large car factories, or other factories like that.
we are a free trade country that had a lot of stuff one could buy, but many people cannot. now we even have not so much to buy.
i would prefer a older car and a higher standard of living.
The high prices New Zealanders paid for made-in-New Zealand appliances, rubber, et al were the “fair price employment privatax” which New Zealanders were willing to pay in order to keep their fellow New Zealanders at work and paid for making appliances, rubber, et al . . . . instead of sleeping in soggy boxes under freezing bridges.
We are not asked. Policy is just done, in our name, as the Fed spigot is turned on for those connected.
Perhaps people wouldn’t mind paying more for stuff if they were also paid more for their work? People might also be willing to pay more for stuff if they knew it would last a long time.
Both of these things seem highly unlikely at this point.
I just bought some sheets from Red Land Cotton. I was tired of cheap sheets ripping and decided to try some more expensive ones. They look and feel great, but we’ll see how long they last. The cotton is grown in Alabama with the weaving, cutting, and finishing being done in South Carolina and Georgia.
Stating it as a speculative possibility is the first step towards working and fighting for it as an achievable goal.
Excellent critique, Yves. A lot of these articles that seem to address our mounting list of crises, whether it’s improving ventilation for viruses, switching to renewables for power generation, or onshoring, seem to be written with the assumption that the massive changes they’re advocating amount to flipping a switch.
There is a silver lining in all these dark clouds approaching. Covid is still tamping down carbon emissions, not nearly as dramatically as 2020, but it’s better than it would be otherwise. And these supply chain problems, in combination with the inflation they’re producing, may land us in recession or worse. That could deliver some good news on the carbon front. If you take a look at this graph of world carbon emissions since 1750, you can observe that the most recent downticks in emissions occurred during U. S. recessions in 1975, 1981, 1991 and 2008. (That’s how central the U.S. is to carbon emissions because we’re the worst large country by far in per capita emissions.) A real humdinger of a depression would give us the reduction in consumption we need in the WEIRD countries. Sadly, since Neoliberalism’s response to those in any kind of distress is, “Die sooner!,” that will entail a lot of misery.
But then, even that is dwarfed by the impact of global overshoot. And you can build back from a depression, but not from the kind of overshoot that destroys the planet’s ability to maintain a livable climate by losing the albedo effect at the North Pole, melting the permafrost in borreal forest areas, burning forests in the temperate zone, and cutting down tropical forests to produce Big Macs and coconut oil. Overshoot will even impact the oceans’ phytoplankton, changing species distribution in complex ways. These phytoplankton produce at least 50% of the oxygen we breathe.
Limits to Growth looks more spot on with each passing month.
while i would also like to reduce fossil fuels usage, i am quite aware that just saying cut it by 50% next year, isnt even remotely possible. even in a much longer time frame (say 5-10-25 years) will be difficult for the same reasons that Yves mentions in pushing on shoring. we must also accept that accepting some less than perfect means to do it, replacing some usage with others that arent perfect, but are an improvement over what exists today. others may require keeping current sources because the new one has usage shortfalls. otherwise what will happen, is more than just misery, but a repeats of the black plague, and many wars for resources
Milton and his Chicago boys really screwed the planet.
I hate to say it, but it goes back way further than that. Kate Raworth does a nice job of embedding some history of economics in Doughnut Economics. John Stuart Mill contributed two things:
1) a distorted anthropology of homo economicus that defined as us wholly egoistic, satisfied only by material consumption and uninterested in non-material comforts (with some “credit” to Jevons and Bentham along the way); and
2) a portrayal of economics as a “science” with laws to be discovered rather than “political economy” that sought to provide guidance for a society to determine its goals.
The latter allowed what Raworth calls the “cuckoo” of growth to steal the nest and become humanity’s reason for existence. She also takes a swipe at Samuelson and his Circular Flow diagram of money flows for failing to embed any human economy within the context of the Earth that ultimately provides everything we consume along with the power provided by the Sun.
Raworth isn’t the first to make some of these points. Our host devoted an entire chapter in Econned to unraveling the story of neoclassical economics under the subheading, “The Triumph of Simplistic Math Over Messy Facts.”
but they did not implement policy. the world is full of cranks, but if they get a hold of a country, watch out.
bill clinton sold off our entire strategic reserve of rare earths between 1994 and 1998: trump will have to face the facts and quite trying to save free trade, bill clinton rigged the game so well for the chinese communist party, we may never recover
http://www.nationaldefensemagazine.org/articles/2019/3/21/viewpoint-china-solidifies-dominance-in-rare-earth-processing
cant forget that GWB actually allowed plants to be exported equipment and all, just not the workers. cant have them leave too
agreed. but it was nafta billys policies that led to that.
I believe you give the Chicago Boys more credit than they deserve. They are but a footnote to the much much larger efforts undermining Civilization for their short-term aggregation and seizure of Wealth and Power.
>Think the US will have enough fabs any time soon to meaningfully reduce our dependence on China, Taiwan, and South Korea?
The number of fabs is only part of the story. Fabs require huge amounts of energy and water.
They also create biblical amounts of toxic waste, that in turn require more water and energy to be treated.
Intel, for example, is expanding in Arizona, a desert area with a shrinking water supply. And the US and European power networks are very fragile.
China and Taiwan have their own issues with water scarcity.
And those problems don’t start with the plant itself or the workers in the plants.
They start with the design, not the manufacturing.
And the deliberate basic philosophy of planned hyperspeed obsolescence to maintain a constant fast-forward turnover and trashunder of digital things makes it all many times bigger and worse.
Someone should figure out how to suggest to people that Moore’s Law is just an observation-based rule of thumb and is not an actual law deserving of any actual enforcement.
First, a blast from the past:
nakedcapitalism.com/2018/08/another-deadly-pandemic-coming-us-not-ready.html
Will Global Supply Chains Collapse?
Second, Stoller’s answer involves Group Purchasing Organizations, and is not optimistic:
mattstoller.substack.com/p/the-villains-behind-our-medical-supply
I have been managing factories for 45 years. Let me clarify a few things. Just in time is not going away ever. The reasons for just in time are quality, quality and quality. Reduced inventories are a secondary result. No one will go back to building inventories because of the huge risk to quality. Reduced inventories are not the cause of any delivery issues. The issues have one root cause which leads to a second root cause. In the US we actually believe in the Pareto Principle. Investment is justified only for the vital few. This is complete nonsense but it is embraced by managers and taught to all western employees. This results in US financial managers and business managers only investing in “vital” things and disinvesting in “trivial” things. The failure is to understand that power law functions which are the “Pareto” foundation are scale free. Everything is vital or trivial depending on your point of view. There are two results. Manufacturing investment as a % of gdp has declined steadily as a % of gdp since 1975 in the US. We constantly ignore the trivial. Secondly we create a culture that rewards doing things half assed.
The entire supply chain problem is a lack of investment in the US and in the world globally. Demand in the US is about 20% above the capacity to supply, due to the pandemic cash infusions. Higher wages will persist. There will be new investment to support the resulting higher demand.
Great manufacturing investors can invest successfully regardless of the scale of the opportunity. — Toyota, Tesla, People that invest only in large scale things are shirking the responsibility to invest for everyones benefit. The US has one shot to regain some of this work but it will require investing in “trivial” things at the appropriate scale. Wall Street will not be able to participate. There are many structures of production that exist in the US that can make this work but they have a hard time getting funded. Co-ops are a good example. There are large scale corporate plants that run without managers — P&G Lima plant for example and can compete. Small private manufactures here in Connecticut ship fastener commodities to China because they improve their processing skills over time. They would never scale but they make good money for the owners and the employees. I am not sure how this gets fixed in the US. We need to get low cost investment money down to people who already know how to make “trivial” things.
Can you explain this? I would’ve guessed the opposite.
Sorry, I’m not seeing the connection between JIT and quality. Why does having an inventory of materials, parts, and components make your product quality worse? Seems it could also improve it if concerns about supply chain are diminished.
There’s JIT the way Toyota does it, and the JIT which is used to extract value and squeeze suppliers.
Roughly said, because it forces the irganization to pay attention. It exposes problems. The same logic goes for must things “lean”. If you have a large inventory, and a delivered component is not up to spec, you just get a new one from the inventory. Same if some supplies came in later than expected.
If your buffer is thin, these things become clear problems, that the organization wants to reduce. You talk with the supplier, learn about their situation and challenges, start an investigation into root causes, work to get a higher percentage of supplies on time and within spec. You work to improve the situation, instead of learning to live with it by buffering and overcapacity.
In theory you could do those things without running lean, but in practice it doesn’t quite work that way. There is always some other problem that takes priority right now, instead of the problem that was already “fixed” by dipping into the buffer.
as a small timer in manufacturing, i never have my eggs all in one basket. i keep my toes in the water with multiple suppliers. if i have a problem with one, i have a history with others, i simply try another supplier.
this has worked well for me.
so if you one supplier comes under the influence of nafta billy clintons wall street, good luck trying to work with them and iron things out.
they are there for one purpose only, extraction at all costs. and if you went with one supplier like most have nowadays, who ya gonna turn to when things go off the rails.
seems that things have gone off the rails, this was all quite predictable.
according to nafta billy clinton, no one is going to upset the apple cart under free trade, except, free trade always upsets the apple cart, and china is the only source today for most manufactured items.
i remember when dupont told the nafta billy regime that their policies would destroy americas supply chain, they were right.
so in reality, communist china is your supplier, whether you know it or not. what are you going to do now?
Sounds like PR from executive mgmt to next lower tier. We’re talking about onshoring. Assuming you are correct that quality is the issue and that it suffers lax mgmt from too much inventory, why would quality issues of a local JIT supply chain (stripped of inventory) be any different from those of a foreign one?
It seems more obvious that cost is the issue, always the issue, and offshoring resolves a lot of cost issues: 1) savings from foreign slave wages, 2) savings from foreign lack of costly pollution controls 3) elimination of facility and equipment investment by far more modest transportation costs on ever more giant super tankers.
If something goes wrong, hit up the tax payer.
In this case, I am talking about JIT, not offshoring. They are different things that might overlap, but often they do not. Stereotypical JIT supply chains tend to be rather localized.
Of course, if the management goal is to move production to some low-wage country, then its attractive to package that in stories about JIT and quality even if that’s not the real goal.
It’s not my specialty, but Zamfir got to the heart of it pretty well.
Also, one thing to keep in mind is that in modern manufacturing, “quality” is a term-of-art with lots of technical connotations. You still have to account and plan for issues that can’t be reduced to metrics, but much of the time, it’s related to the standardized components or steps in your process being statistically reliable.
Like if you’ve ever heard of 6 Sigma, I’m pretty sure the name literally came from refining each step in your process until even outliers of several standard deviations would still be within tolerance. It eventually got repackaged as another totalizing, management ideology (complete with consultants & certifications), but that’s sort of a whole different issue.
Perhaps it’s because when a supplier makes a batch of bad parts you will at least have fewer of them on hand or can get the problem corrected in a more timely manner.
We also need to ban the import of trivial things from alien countries to be sold at a lower price than any American manufacturer will ever be able to charge for a made-in-America trivial thing.
But I am not a professional anything. I am just a bi-weekly wage worker and an amateur blog-thread commentator.
All those people who think they are smarter than I am are free to try investing here in America in making trivial things here in America. If their investments are all washed away by the swift import of lower-priced trivial things from any substandard foreign country in order to exterminate any trivial thingmaker who dares to make a trivial thing in America, don’t come crying to me.
If we don’t exterminate Free Trade first, not one other thing will ever be possible in America.
Don’t believe it? Try it and see.
Re: the final point, a war with China, I never see it mentioned that China has incredible leverage over us if a war were to break out. They could stop all exports to the US. Chips, medical supplies, automotive supplies, everything. Sure it would hurt them tremendously, but are most wars pyrrhic victories?
We are in a Chinese war against America now. It is China’s war of economic extermination against America in order to turn America into one big strip mine for China.
We may yet be driven to the point of finding our own American Mao who will lead an American effort to round up and mass murder all the millions of Americans who support Free Trade in order to have one last chance to save America as a country with an economy.
Anybody remember Thomas Friedman’s THE WORLD IS FLAT? It was published way back in 2005, and extols the glories of offshoring, just-in-time-manufacturing, etc., the dawn of a glorious new age of commerce.
Hmm. Seems to me that the Flat World Theory has as much rational basis as the Flat Earth Theory. I’m awaiting the update.
he should be demonized out of publication.
He would be one of many people whom an American Mao would have shot in the back of the head and buried in a mass grave along with millions of other American Traitors for Free Trade against America.
I think the headline could be more precise. Will the supply chain clusterfamilyblog lead to more onshoring? Without a doubt yes. Will that amount be massive as the anti-globalisation/Trump tarriff booster types hope? Clearly not, for the reasons Yves underscores. I’d say how much is more the question.
History is replete with examples of economies making radical adjustments that, pre-shock, seemed structurally impossible, until the mierda hit the fan (off the top of my head, Meiji Japan, USSR pre-1940, Argentina 2001, or even now Russia vs US sanctions). But even more replete are the graveyards of economies whose elites preferred self-immolation to change.
The (debatable) argument for voting for crappy sois-disant left parties like UK Labour, PSOE, US Dems, is that the amount of good they actually do is so minimal, but when that minimal is scaled up to millions/hundreds of millions of beneficiaries, it makes a big difference. By analogy, I suspect the same will be true of these supply chain disruptions viz. onshoring. The onshoring will not be as significant as some are forecasting/hoping/preaching, and it will be easier for economies that are smaller and less entrenched (ie not the US) to react accordingly. But even those larger entrenched economies will experience a degree of onshoring whose effects should not be written off.
IMO, it’s more likely that the re-shoring will be (if there will be one) via startups. Mind you, that doesn’t mean they won’t need capital, but it’s much easier for a startup(ish) company to get the capital than a reestablished one where the investors are used to getting dividends and buybacks.
The business of offshoring is the business of tax avoidance. Not labor ( the labor quotient generally is around 15% to less that 10%), not raw materials (many raw material prices are set by the commodity markets on a global scale) and so on.
Tax avoidance is a way to gain profit without the bother of actually buying new equipment, building or improving facilities, dealing with HR issues an so on. So the chiselers, the operators, the yes men, the armies of MBA consultants are rewarded while the builders, the makers, the visionaries are tossed in the rubbish bin.
Unless or until the offshore boys pay their fair share of taxes offshoring is here to stay.
Also environmental regulatory avoidance. Externalities uber alles …
The other day I came across an RT article featuring a Norwegian professor talking about general trends today. Taking bits and pieces from this article made me ponder a question – what if the present capitalism system is running out of steam? Yeah, this is taking the 40,000 feet view here but this article reminded me of it. Seriously, think about it for a moment. The stock market has now been decoupled from the real economy, world debt has reached levels that is running about $300 trillion and most of which will never be repaid, more and more wealth is being concentrated into the hands of a tiny few which is impoverishing and destabilizing their societies, the shamble with the supply network is demonstrating the vital need for resiliency and more local production (which will be resisted to the utmost).
Also energy cost continue to rise which will make a shambles of our economy and whenever there is a shortage of a raw resource, instead of conserving it, the present approach is to use it up as fast as possible. Finally the present capitalist system is not only depleting the world’s resources, it is catastrophically altering the climate of our planet that may leave huge tracts unlivable. So you sit back and chew this over and the only conclusion is that the present system has to go. This is not a workable system – period. It is not only unfit for purpose but is incredibly destructive to all life on our planet. What will have to replace it? I can only identify bits and pieces but sooner or later it will have to be done. We have no choice.
In passing, Yves’s mention of XCrop from her book “ECONNED” made me wonder if John Michael Greer may have pinched that idea in his book “Retrotopia.” A civil war splits the United States when the introduction of a genetically engineered corn named DM-386 is found to found to cause pregnant women to abort. The trouble started when the corporation said it was safe, the government said that it was safe, the experts said it was safe, the media ignored the story and anybody who said it was dangerous was sued for libel by that corporation who would win in the courts because they were back by the experts. This is sounding very familiar so I will stop now.
A lot of people are finding what you’re finding. For me, the more I learn, the more radical I get. And that’s from someone who would have described himself as an anarchist a decade ago. Now I don’t mean radical in terms of use of violence. I’m trending against that more and more as time goes by. But there’s very little about our culture, society or political system that is worth keeping. It’s been wrong-headed since the Enlightenment (that’s what I mean by more radical), and it looks as if Nature is going to have to beat the hell out of us to make us realize that.
I hope Greer and Kunstler aren’t way too optimistic.
I think this post is today’s ‘must read’. [I believe I also need to dig out my old copy of Econned and read it again!]
As somebody or other said, a Civil War 2.0 in America won’t be a delightful LARPing romp through the stations of the Civil War Re-Enactment Hobby. It will be Syria or maybe Yugoslavia/Bosnia or maybe a tasty combination of both. With neutron bombs and hydrogen bombs included.
100% agree. Investmenting money in good small manufacturing is a much sounder strategy then trying to reform the larger firms. Plus leveling the playing field by providing Medicare For All to remove healthcare from the equation. And completely avoiding the Wall St money suck too.
Re: back to the USA – Not expecting mass re-shoring, but perhaps a redistribution of the offshoring. Some of it might go to Mexico or Canada too, which is where most of US industry has been since NAFTA.
Re: JIT – it’s not about the inventory savings, it’s about the flow of process. (and thereby quality as another comment very correctly says). The Long Beach port fiasco being a nice example relevant to discussion of the limitations of fixing flow problems with inventory. But supply chain robustness is a thing. What might happen is a wider recognition that single-sourcing to the global lowest bidder is a pattern of risk.
The other problem, elephant in the room perhaps, is that we in the US are doing the best we can to starve 4 major energy producers of investment (Iran, Iraq, Venezuela, Russia), and economically sabotage the big dog, China. Who is our first industrial supplier, and also the first supplier of all our potential alternative suppliers, and the biggest importer of energy and materials to boot. So that just might be something to keep in the back of one’s mind. Reshoring would not be enough to insulate from the blowback here, export controls on things like energy would also be required, to decouple price of US energy (or whatever goods) from global shocks.
OK, I have been under the weather, running a slight fever and binging on Netflix’s “iZombie” (where uber-capitalists slaver over the profits to be made in the new market for ….. yes … brains!), so my brain is a bit unstable.
I’m reading about the supply-chain debacle and the backups at west coast ports and no-one seems to know exactly what is wrong, never mind how to fix it. Or, if it is fixable. A lot of hand-waving.
I clicked on two links this morning: one, from a commenter on Matt Stoller’s tweet asking about reasons for the build-up of empty containers at the Port of LA/LB, and the one from Yve’s post above, to Doomsberg (love the name.)
God forgive me, but the ‘prepper’ video (from a site called City Prepper, titled Port System Collapse: What to Expect Next) sounded more relevant than the conclusions made in Opposite George, which ended in the usual spate of business optimism, the ‘we can all make some money from this debacle … eventually.’
My fevered mind needs a rest; back to Season 3 of ‘iZombie.’
Although I am not optimistic by nature, I am surprised that technological advance is so heavily discounted in the latest wave of structural collapse anxiety commentary. The steady advance of computing power into every aspect of industry will not stop, and that means self-driving trucks. Although fully autonomous driving capability hasn’t been achieved for all driving conditions, it is a much easier problem for predictable long-haul routes. The current trucker shortage bottleneck will thus disappear within a decade.
Logistics is all about optimization, and computers are very good at it. A fully-automated container port is not a fantasy. The main obstacles are the bureaucratic inertia and uncooperative cussedness of the people responsible for these operations. Since the US government is essentially a coin-operated organization, once enough plutocrats bring sufficient influence to bear, you will see “national defense” legislation to cut the Gordian knots of localized stupidity causing the present bottlenecks. Better days may not be coming, but efficient movement of goods will be restored.
Have you ever been in an ice strorm on the texas panhandle?Self driving whatevers are always a decade away, year after year, after year…I’d say most tech these days is surveillance and siloing, judging by my interactions with the bank and phone company.
Although fully autonomous driving capability hasn’t been achieved for all driving conditions, it is a much easier problem for predictable long-haul routes.
Dream on…
https://www.wired.com/video/watch/uber-s-self-driving-truck-delivers-50-000-beers
not sure that it will any time soon, it will take a while to train new truckers, and it will also be hard to make enough trucks (shortages will hit them too) to alleviate the train wrecks at ports. mostly because the way imports get shipped to foreign markets, is by ship, then offloaded to the port, then moved by truck to its destination in the country its exported too. since products are stacking up at the port, because the warehouses there are full, the most likely reason for the backup is loading the trucks and shipping the products out. and being a trucker was never a fun job, as you are away from home (and family) for long periods of time, and pay hasnt been all that great, and truck companies dont exactly treat them well, so many retired, and many went to other jobs (local delivery services for example) so there was a large drain of workers, and its not quick to learn to drive big rigs safely.
I guess I partly agree the kinks will get ironed out some. Technology or policy changes may play one small part of that, but my gut says we may (already?) see a lot of previous expectations collapse slowly until there’s a new equilibrium somewhere in the middle.
Beyond all the details about what’s currently possible or not, there’s always that contradiction in high-tech solutions: they usually take more fixed investment overall. And that often means they’re only economical with more output / throughput.
I think it all comes down to the unit fixed cost. They may save some money on hiring truckers, but does the higher cost of a self-driving truck make sense for a profit-maximizer if it’s not spread out over significantly higher throughput?
Even if somehow the higher demand for goods from the pandemic started looking permanent, production issues are starting to cascade too (e.g. semiconductors). So that arguably puts a ceiling on whatever forecasts a shipping company would use to make the investment decision.
Of course, the one exception would be society deciding to override the normal market and just make it happen, possibly indirectly by subsidizing consumers or something like that. But then we’re back into policy, and technology is just the tail wagging the dog.
It’s hard to have technological advances with chip shortages, and who knows how long it will be before that supply is restored.
Edward Jones is partially right. This correlates to the want of a nail proverb.The fault lies in Wall Street and private equity.The design of the economic system is flawed. Stakeholders have been worshipped while Labor and infrastructure has been ignored.
Manufacturing has been strip mined in this country, export shipping consists of mainly bulk products. We are a third world country when it comes to exports.
Cargo Transportation is service industry. Even with containers, there is tremendous variability, which requires flexibility to maintain efficient productivity. The system has been stretched too thin to maintain efficiency. Warehouse space in logistical hubs is almost nonexistent.
To achieve greater economies of scale, container vessels were built that too big for terminals to maintain efficiency when volumes expand too quickly. Intermodal truck drivers have been exploited since deregulation of trucking. The shipping lines, not wanting to bear the cost of chassis maintenance, disposed of their container chassis. Port development must project twenty years into the future and the size of vessels have outpaced that development.
Roads and bridges aren’t not designed to take the volume of trucks required. The railroads, consolidated mostly by private equity, have reduced their maintenance, their equipment, and their labor. Due to abuse of the Transportation Act, railroad management has been able to impose labor contracts without negotiating fairly with railroad workers for decades leading to disgruntled workers.
As CEO’s and Investment bankers have extracted wealth from the transportation systems, they have neglected the people and resources that created that wealth while reducing the flexibility needed to maintain efficiency.
A few last points, I worked in the stevedore industry for forty years, the longshore workers are well paid, productive, and proud. The productivity gains have been tremendous in the last forty years. Teamsters intermodal truck drivers were well paid, safe drivers, and very efficient. Allowing the intermodal to organize to achieve better wages and working conditions would improve productivity.
William Deming’s just in time production system can apply to most aspects of the economy. However, in this country, management precludes proper feedback and statistical analysis to continually improve systems. As long as robber barons rule that isn’t going to happen. Don’t blame the workers when system sucks. This is the fault of the highest level of management. You can’t hit home runs with a wiffle ball and a plastic bat.
p.s. consultants like McKinsey don’t know squat. If one talks to workers at every piece of the puzzle you will find out where to grease the wheels. It won’t come from Wall Street or the invisible hand of the market.
bill clinton did this to us, he was warned: china now has a strangle hold on americas drug industry: US drug companies shifted production to China not just to save cost but to escape regulation; This picture is particularly troubling given China’s poor record on production quality and sanitation. And worse, the US can’t even afford to bar imports of all substandard products.
you can free trade, or have a civil society, but you cannot have both.
https://www.nakedcapitalism.com/2018/06/china-rx-us-depends-china-drugs.html
“Even if a very brave company got religion and decided to embark on that path, what would it entail? Massive up front expenses, not all of which could be capitalized. That means trashed earnings until the new reshored company is humming, which is years down the road. And would retained earnings be enough to pay for all the investment? If not, that means borrowing or issuing stock. Gee, do you think investors would be keen about that?”
That means trashed earnings until the new reshored company is humming, which is years down the road.
This brings to mind the high flying stock of alleged “tech” type company’s and their stock prices getting a pass on Wall St. Why has the pass on being profitable before having an outrageous share price been extended to one sector, one with a lot of faux players that don’t technically fit into the category they are being squeezed in called “tech”? You know that ones that spend money like drunken sailors and everyone talks about new valuation metrics that have been pulled out their butts (wink, wink). But suddenly they can’t pull new valuation metrics out of their butts for this type of investment?
Another thing, the financial world has attached more value on betting on risk and market volatility than actually taking it in the actual economy, more than investing in the future. It’s like going to Vegas, but getting all of your bets insured before hand. Can you imagine? No, you can’t. That’s BS.
The number of exotic derivatives that are still out there are valued at a higher right than necessary investment in the future.
This kind of behavior, in my mind, demonstrates ZERO “faith” in the alleged superiority of an economy.
And the name of the economist that said it escapes me, but he said that risk can never be eliminated only shifted to somewhere else.
So they tell us that this risk in onshoring and the cost is not tenable, but it’s only because not enough of it can be shifted onto someone else. So there are no risks being taken that benefit the majority of people unless more risk can be shifted onto them, but the majority of us will find us on the hook again for all the betting on risk and market volatility that benefits only a few.
And of course it would take years to get the systems in place and the skilled workers in the right place.
But it doesn’t happen until it starts.
So I think the reasons you pointed out about financialization are THE ONLY thing preventing this show from getting on the road.
free trade requires war and police states to sorta function. but it never lasts to long. i remember when the likes of nafta billy clinton, gene sperling, and robert riech were all saying free trade is stable, no one wants to upset the apple cart.
now the apples and carts are in very short supply. countries are fighting to get them.
The global supply chains, offshoring, and deindustrialization have a common root cause, a chronic lack of demand for output due to a chronic oversupply of goods.
Basically at a global scale we all make nearly identical copies of each others stuff forcing the demand and price point for any given good down.
This in turn forces producers to seek the lowest cost methods of creating the things they sell. (Such methods include just in time inventory and finding a workforce that will accept the lowest wage possible.)
I highly recommend “Automation and the Future of Work”
by Aaron Benanav which explains the reality and causes of the chronic lack of demand for output far better than I can here. (Don’t let the title of the book dissuade you, it sets out to prove the automation theorist wrong by explaining the other causes for the lack of demand for labor in both service sector and the manufacturing sector.)
“…chronic lack of demand for output due to a chronic oversupply of goods.” Huh!? Are you for real?! What oversupplies concern you? I notice you feel inadequate to explain your claim: “…which explains the reality and causes of the chronic lack of demand for output far better than I can here.” Is oversupply the reason I had trouble buying ground turkey meat last month? Does it explain the increasing price for dried beans?
Read the book I mentioned it’s full of data for you to sink your teeth into or look up the author and watch an interview with them.
The author had an interview with Mark Blyth at the Rhodes Center Podcast that is pretty recent and it’s free.
You know you can have a chronic oversupply and a sudden demand shock with shortages. These things aren’t mutually exclusive they just happen in different time intervals (one in decades the other in months and years)
Cheers and God Bless
Perhaps I will read the source you referenced. But your comment losses weight if you can only support it with a book reference, much as I value book references — Thank you for the reference. I also very much appreciate the podcast reference. I have a problem I must deal with soon. I prefer, strongly prefer to download a podcast and listen to it as mp3 via my television’s USB port. I am very reluctant to adapt my preferences … however … I might one-day, break down, and find a discarded television with an intact Internet port to play an audiofeed — although I am extremely reluctant to interface a television or phone to the Internet via any app or via other means. As matters stand, I am contemplating adding a hardware switch to separate my computer hard drives, and other permanent memory devices from any and all ties to the Internet or any ‘other’ means tying Internet to my computer’s long-term memories, and to later access of those memory areas.
“You know you can have a chronic oversupply and a sudden demand shock with shortages.” — Yes, that is the lesson I have learned from the writings of Gail Tverberg.
I do not doubt the impacts of automation — though I do doubt their vanilla mechanizations. “Basically at a global scale we all make nearly identical copies of each others stuff forcing the demand and price point for any given good down.” But basically there is no good reason, and no particular ‘competitive’ advantage that recommends allowing foreign sources to swamp u.s. markets with cheap nearly identical copies of common goods. There are many very good reasons to preserve local production of goods — I could enumerate more but one reason should suffice — the local preservation of employment and production capability.
“The one thing that could make Doomberg right is war with China. And that’s not implausible given the bizarre US love of eyepoking, particularly over issues that China regards as non-negotiable, number one being the status of Taiwan.”
And yes there are circumstances like this and maybe others that might force the move to start.
Which is why the establishment is still militant about keeping the austerity in worker benefits:
“Paid Family Leave Dropped From Biden Economic Plan” Bloomberg.
Perhaps the supply chain crisis will cause businesses to onshore…..to Mexico. No ocean crossings and unloadings needed,.
Re-shoring requires workers, no matter whether it’s banging out the metal for a mason jar lid, and then applying the rubber gasket, or running a semiconductor fab. All require varying materials and equipment. But all require workers.
Where in the US will you find 2,000 or more workers for a factory that requires numeracy and computer literacy and staying on your feet for 9 hours? Even more of a challenge, we don’t have a reserve pool of unemployed factory managers, but they are central to quality control, maintenance and production management. Creating such skilled workers takes a decade. In the short run, the only option for a manufacturer is to poach someone from another manufacturer. The jobs remain subject to booms and busts and technological obsolescence. Skills are also less generic, and so are tied to a region or even a single employer.
In contrast, demographics means healthcare jobs aren’t going to go away, and the skills are geographically mobile – there’s a hospital everywhere, and nursing facilities and insurance claims specialists in every healthcare practice. It’s also possible to get training and move up or specialize (or both) over time, while continuing to work. Such functions are also impossible to compete away, and new technologies if anything increase demand, rendering at most one element of a skill set obsolete rather than undermining large numbers of jobs.
We can see that in the data. Manufacturing jobs as a share of the labor force have fallen monotonically since the July 1953 peak of 32.4% to the current 8.4%. Output is a different story, trade lets us focus on higher value-added products while productivity means we need fewer workers.
Putting all that together, and we will see selective re-shoring, but there is no unwinding our interdependency with the rest of the world. Nor should we want to do so. It would restrict the variety of products available to businesses and consumers, while raising their price. It would make shifting to new types of products and processes harder, and leave us with a less dynamic economy. And it would require a time frame much longer, a decade or more, than that implied by the “crisis” of short-term shortages. To return to my opening claim, it will also require a workforce that we would surely prefer be devoted to providing healthcare for all.
I agree with your comments about the challenges of finding, then keeping, trained and skilled workers.
There might not be much overlap between the Naked Capitalism readership and that of Practical Machinist, but the thread at this link would fit right in here at NC.
“Looking at Where Wages are Heading”.
The original poster asked this question –
Do you really believe there are no workers, or factory line managers, or skilled workers left in the u.s.? “…trade lets us focus on higher value-added products while productivity means we need fewer workers…” … “…require a workforce that we would surely prefer be devoted to providing healthcare for all…”You have swallowed way way too much Kool-Aid! There are plenty of skilled workers around. Go hang out around a few low-life bars in the Rust-Belt or around a Boeing plant, or outskirts of Detroit. The u.s. still has unemployed and highly skilled workers. I am not sure the u.s. ever had skilled managers above the factory line managers — foremen — who were promoted from below.
“It would restrict the variety of products available to businesses and consumers, while raising their price.” Your blind acceptance of the advantages of ‘free’ trade leave me aghast. Much as I treasure products like the hollow stainless steel chop-sticks, or Chinese porcelain, or the many wonderful foreign foods available in some coastal u.s. markets, I fail to see what competitive advantages accrue from the lags and uncertainties of long supply lines, and single source risks and pricing, while the u.s. dismantles its manufacturing capability on the altar of today’s price, ignoring the costs of the many disadvantages offshoring and ‘free’-trade provide.
“Do you really believe there are no workers, or factory line managers, or skilled workers left in the u.s.?”
I don’t. There is alot of talent going to waste in BS jobs.
See my comment above. This has zero to do with native capacity. It has 100% to having experienced senior workers and supervisers who can train the newbies. We don’t have them.
Are you saying they are dead? Or just laid off? What happened to them?
Didn’t it all start with having to train people? Some will have to go through trial and error.
We are going through trial and error with Tesla’s crashing all over the place and it’s just called the “price of progress”. All of this push to “AI” is trial and error.
Have you not been paying attention? The jobs in textiles left more than 20 years ago. Ditto shoes, clothing, furniture. Not only has everyone either forgotten what they knew and/or retired and/or gotten another job, the state of the art has moved on so whatever knowledge they had is stale. And the towns that had manufacturing in them have become rust-belt-y, with people moving away.
Readers here get that you can’t have a merely smart person drive a forklift with no training and not have bad outcomes. Apply that principle more broadly.
Everything wouldn’t have to happen all at once. There just has to be a start first.
There would be places to set up training for those sort of things. Using that one example, I’ll bet there are at least 10 people in the USA that can drive a forklift.
Training is not an impossibility – the will to fund it is the obstacle.
Priorities count. With what has been seen with manufacturing outcomes, initial design counts. Would manufacturing clothes be a higher priority than another essential survival next? All if that would have to start first, not denying that it would take time.
I agree with your points abiut funding and financialization because that is the main obastacle. Source materials would be the other main obstacle.
“Bad outcomes” …I go to back to my point about every psycho idea from SillyCon Valley that gets funded and everyone sits back while “smart” people go through trial and error AND they do their trials on a mass scale damn the consequences.
An undertaking doesn’t have to be grimy, loud, or physically demanding to have “bad outcomes.”
I know people who ran textile mills back in the day and my father ran paper mills.
First, you can’t acquire the skills to work in many of these industries without having worked in them, It’s circular. Go read Lambert’s post on working in a mill back in the day. He had to be trained by more senior workers. You can’t learn this in a classroom. All those “senior workers” are working outside the US.
Second, technical education in the US is so poor that hardly any workers can read diagrams.
I once spent a transpacific plane flight, 2+ decades ago, seated next to a textile buyer (college apparel) on his way to Hong Kong. It took over a decade for the Chinese industry to become competent, and that was with the advantage of Hong Kong ex-pats working in their grandparents’ village. Color matching – the U of Mich blue-and-gold – is a very specific pair of colors, and not all yarn takes dye the same way. Lettering has to be the proper font, properly spaced, horizontal, aligned. I have a wonderful economics club t-shirt from a Chinese university laid out by someone who knew only Chinese calligraphic aesthetics, letters of uneven size and spacing. On and on.
My son, who works in a factory, discovered last week that a couple of his co-workers didn’t understand Roman numerals, they though VI was an abbreviation of some sort. Most of what the plant does is metal bashing using old equipment, and they don’t rotate jobs much. Half of new hires quit before the week is out, despite pre-screening and orientation before they’re actually hired. In many of the factories I visit (I’ve been in roughly 100 different automotive plants in a dozen countries), ordinary workers need to be able to plot data and have a sense of mean and variance for a normal distribution, they are responsible for monitoring quality, and that means spotting problems before bad parts are produced.
So no, you can’t just open a plant and expect it to operate well, or at all. Production is a team effort, so even if people have the requisite skills, in a new plant they haven’t worked together. Who do you call for what, what do you have to puzzle out for yourself, Joan on the next shift knows how to recalibrate the machine and it’s not so out of whack that you can’t just leave it to her. Oh, and the paint oven gets out of kilter with a thunderstorm, unlike any of the other plants anyone had worked in the change in air pressure is enough to change the airflow and results in both over- and underspray. Since such storms were seasonal, and not every thunderstorm triggered problems, and the paint shop was frequently out of kilter the first 6 months of operation, it took over a year to diagnose.
Then there’s the supply chain, and the network of robot repair people – if you’re the only plant for an hour about with that particular equipment, well, everyone gets an unplanned vacation when a machine goes down, because it may not be until tomorrow that you can get someone in, and if they don’t have the right part, you have an extra day for while the technician waits on FedEx. Unless, as right now, it’s stuck in a container on a ship anchored off Long Beach.
I’ve learning to quickly eyeball a plant to judge its level. Two staff in one place is coordination, three in one place is a minor problem, four in one place is a major issue, five or more is a full-fledged crisis.
you worry about raising prices, have you seen what is going on price wise under free trade!! under trumans old Gatt, my parents purchased a 1953 volkswagon bug. there was no restrictions on products in most cases.
as lincoln said, if you got the money, than you pay the tax on your foreign purchase. if you do not purchase a foreign item, you pay no tax.
as far as new products? where have you been, not much of the way in new innovations, and we cannot even make our own aspirins, let alone rocket engines.
singapore needs to be fully integrated, we do not need to be.
america was much more dynamic under trumans Gatt.
I think you are having a problem with scale. A hundred years ago, things were produced in small factories (as well as large ones, cf Steinway Pianos) but in my lifetime, very small shops — 8 to 20 people — supplied springs, screws (oh yes, a fave was ‘Huron Automatic Screw’), various widgets and gaskets to the auto industry in Detroit. Small shops also produced many of the things we use every day or could use again, for instance, fountain pens, nail clippers, watches, (yes) Mason jars and lids, sportswear, socks, fur coats, pickles, cheese. Bigger plants made plumbing fixtures, copper tubing, Local farms grew white beans (as in Congressional Bean Soup), peaches, apples, and sugar beets.
Fifty years, later, It took me 6 whole %*&^(&$# weeks to find a local source for 500 ml Mason jars, and nearly that long to get my pressure canner, which my chain-affiliate guy said was in stock at their distribution centre (about 250 klicks away). Apparently the delay was due to an ongoing screw-up. He told me, word from the truck drivers, so I believe it, that the new inventory and picking system was totally stupid. It cannot not count, and does not understand, for instance, that lawn chairs can stack, so a truck would be sent out with a dozen lawn chairs b/c the algo said the truck was full after that. Apparently no manual overide. Also he will commonly get one of those store transfer boxes with 6 flowerpots and one pair of gloves in it, ie, mostly empty. The other 5 pairs of gloves may come in another (ie, again, mostly empty) box, or *maybe* he will get the other 5 pairs next week. The Corporate website is poorly updated and says that my store’s hours are 9 to 4, which is the old COVID lockdown hours, when he’s open to 6 most days and 9 on Fridays. I cannot access the corp website to order anything, although he, as a store owner, can get through. A search on “canning jars” gets me, “Oh gosh, you got us stumped! Can you rephrase your search and try again?” Cute. I tried “canning”, got same, tried “can” and got paint cans, cans of lubricant, can lamps, everything but canning jars. Even searching by brand name got nothing.
Many businesses depend on local resources, so why do we not have local potteries and brickworks? Doesn’t anybody have clay anymore? A huge part of our logjam is transport, and whether it is port facilities, or empty containers, or brake fluid filters for trucks, just do it locally. If raw materials or finished goods need to be moved, and I would ask why? FGS, use rail.
First time is happenstance, second time is coincidence, third time is ???
We don’t have to do it big, we just have to do it. Small enterprise, co-ops, local, local, local, — this is what will work, one market lack at a time.
I am on a mission to help policymakers and business leaders get a better grasp of how capitalism actually works.
I have come up with this equation, which really helps.
Disposable income = wages – (taxes + the cost of living)
What does the equation do?
The equation puts the rentiers back into the picture, who had been removed by the early neoclassical economists.
Employees want more disposable income
Employers want to maximise profit by keeping wages as low as possible
The rentiers gains push up the cost of living.
Governments push up taxes to gain more revenue
The dynamics of the capitalist system are more complex than policymakers and business leaders are aware of.
I’ve let the CBI (Confederation of British Industry) have a quick peek at the equation.
Disposable income = wages – (taxes + the cost of living)
Two seconds later …..
They realise the UK’s high housing costs push up wages and are actually paid by the UK’s employers reducing profit.
Employees do get their money from wages, so employers are actually paying through wages.
Why is this so important?
The interests of the capitalists and rentiers are opposed with free trade.
This nearly split the Tory Party in the 19th century over the Repeal of the Corn Laws.
The rentiers gains push up the cost of living.
The landowners wanted to get a high price for their crops, so they could make more money.
The capitalists want a low cost of living as they have to pay that in wages.
The capitalists wanted cheap bread, as that was the staple food of the working class, and they would be paying for it through wages.
The dynamics of the capitalist system are more complex than today’s policymakers realise.
You want a low cost of living with free trade, and the West has a high cost of living.
Western firms off-shored to places they could pay wages people couldn’t live on in the West.
The interests of the capitalists and rentiers are opposed with free trade.
No one told the Americans.
“Income inequality is not killing capitalism in the United States, but rent-seekers like the banking and the health-care sectors just might” Angus Deaton, Nobel prize winner.
Oh dear.
No wonder all their forms off-shore and import back into the US leading to a massive trade deficit.
I most often skip over your comments — sorry. Be that as it may, this sentence caught my attention:
“The interests of the capitalists and rentiers are opposed with free trade.” I doubt that. I believe capitalists and rentiers in a country might oppose the impacts of ‘free’ trade — locally — but I also suspect they are well-positioned to enjoy the ‘benefits’ of ‘free’ trade through some trivial adjustments to their portfolios.
It is true.
You have let your rentiers have free reign.
Your capitalists off-shore to maximize profit.
This is how they both win, but the US loses.
i have dealt with these people almost all of my life. their response to you is that we have money, they know we have it, because all they have to do is turn us upside down and shake us.
they do not believe that free trade has destroyed our wages, they say go get another job or learn how to code.
free trade was never about trade per say, free trade meant free of democratic control, and all of the pesky things that go along with democratic control.
nafta billy clinton was asked why governments, unions, and representatives of civil society were not allowed at the table as they let corporations craft it all, nafta billy relied we do not want anyone impeding trade.
what nafta billy clinton really said is, no democratic control.
when nafta billy said we were going to implement the W.T.O., he said its about time we got rid of GATT, what nafta billy really said was trumans GATT was democratic control.
so no matter how competitive western labor gets, they still cannot compete with human, environmental, and civil society degradation.
The entire supply chain complex will have to die and stay dead enough long enough that there is no more supply of any single thing whatsoever across national borders until Free Trade Conspiracy “national” governments feel themselves tortured and terrorised into dropping out of the International Free Trade Conspiracy System and permitting the re-establishment of re-onshored mono-national political economic production and consumption ecosystems.
As long as any trace of cross-border “supply chain” is permitted to persist at all, even the least bit, there won’t be enough terror and torture against Free Trade Conspiracy “national” governments to permit re-shoring.
re-establish democratic control. it will be a long hard slog, but it might be doable. otherwise if we leave the perps live in darkness, their polices will never be run out of governments, and we may have a war, or a civil,war..
nafta joe biden helped nafta billy clinton create this free trade horror show. because we refuse to names names to the disastrous polices we are living under, the results are that we got the most progressive president since FDR, NOT!
if we had properly demonized them, biden would have been laughed off stage during the debates.
Man, I’m so old I remember when vertical integration was a thing. And I’m also so old that I’m not sure if vertical integration was displaced by “conglomeratization”, or if vertical integration displaced conglomeratization as the flavor of the month. A bit more vertical integration might be helpful going forward, but this would interfere with the newest monthly flavors; short-termism, stock buybacks, rentierism and IBGYBG…our post-modern de-facto industrial policies.
Great post and comments by the way.
a lot of this sounds much similar to capitalist apologia of some sort: “the alternatives are all hard and costly, so we had best just keep what we have even though it makes no sense except to Rentier-class rapists. maybe we can make some little ameliorative amendments to what we have, but nothing else.”
i do understand that position at least has the greater likelihood of bearing out to reality, thus proving those who hold it correct. but “we have this (crappy system) and we can have no other system” is not really quite the answer we should all be willing to settle on, is it? even if it is what we are mostly likely to have to come to terms with.
There are such things as existing conditions and path dependency. You can complain about them all you like but they limit options.
John Meirsheimer has a new article in this month’s Foreign Affairs on American foreign policy with respect to China:
https://www.foreignaffairs.com/articles/china/2021-10-19/inevitable-rivalry-cold-war?utm_source=twitter_posts&utm_campaign=tw_daily_soc&utm_medium=social
It does seem that the Wall Street Central Planning Committee saw a great way to stick it to American labor power and line their pockets, without ever considering the geopolitical impacts of off shoring and turning China into a monster.
While I agree that it is much easier to offshore manufacturing and supply chains (that is, destroy the existing capital investments in originating countries) than to rebuild that capacity, it is inevitable as the global supply chain has zero resiliency. People discuss China’s designs on Taiwan, but even an earthquake or a volcano if it took out a significant chunk of the Taiwanese semiconductor industry would have a devastating impact, and that is only one node of the economy.
Certain parts of the left seem to believe that realpolitik is outdated, but as Meirsheimer notes, the roots of great power conflicts are structural, and it is wishful thinking that a confrontation may be avoided. In fact, he generally gets a better reception in China than in the West for his ideas.
As you note, exterminating American industry in order to exterminate American industrial unions was the point of Free Trade. Turning China into a geopolitical monster was just gravy.
Gravy? Why sure. The same people who imposed Free Trade upon a Victim America hope to use ” big monster China” as a social mobilization threat to demand more money from society for their pet military industrial complex and for establishing fear-based social control over the America population. And it may work. But lets not let people forget that that is what they are doing.
China would not be an “economic” threat under Protectionism. Or under Forced Fair Trade. And the abolition of Free Trade would create the national economic sovereignty forcefield within which America could restore some kind of national survival industrial ecosystem. We could become the United States of Autarkamerica. And then we wouldn’t have to care any more who else China might or might not threaten.
It would become not our problem.
It is hard to believe that American elites wanted to put their country in a Cold War where the U.S. would play the role of the former USSR so as to generate social cohesion. By 2050, even assuming depressed Chinese growth, China will have the capacity to outproduce and out conscript and out nuke the U.S. The U.S. is f__ked, the leadership inept, and even if they tried to do the right thing, the government is paralyzed. Moreover, even if they got their ducks in a row now, the structural demographic trend is stacked against them.
I believe Walt, Mearsheimer, Kissinger and all the rest would have been classed among what C. Wright Mills would have called the Crackpot Realist Elite. The Foreign Relations Expertise-mongers.
Mearsheimer has his structural realist model, in many ways it is similar to Peter Turchin. That model is either sound or it is not. His approach is distinct from Kissinger, and he is critical of Kissinger in his essay.
As far as Kissinger goes, his political realism extends to the personal, which may be logically consistent, but it means you cannot trust his pronouncements, especially alongside someone like George Kennan who wasn’t worried about saying the right thing to advance his political career.
Most objections to realism in international relations are usually moralistic, in other words, realism is true but it shouldn’t be true. In times of crisis, people embrace realism because it is critical for survival. In times of peace and prosperity, people prefer pretty stories about the world because it makes them feel good and they aren’t worried about security.
This may be a structural problem in democracy, that people will always default to prefer utopian bullshit over taking their medicine.
trade deficit is now 1.2 trillion, annualized.
why build, just buy.
It took 40 years to get into this mess. Perhaps we can get out of it in 20. We cannot easily get out of it in 2.
There are paths to encouraging onshoring. They are called ‘protective tariffs’. Applying them all at once is a bad idea. Applying them over time is not the same thing. They have bad as well as good consequences.
It took on the order of 180 years to build an industrial-based, export economy. It took 40 years to gut it. It would probably take at least 80 to 120 years to build it back, assuming the political will. Given the propaganda in the Academy in the form of neoliberal cheerleaders, people won’t even have the conceptual tools to see the problem, let alone do anything about it.
Why should we have an export-based economy?
If we produced all our own consumption, we would not have to import any of our consumption.
Then we would not have to export anything in order to pay for imports, because we would not have any imports.
“Re-building an export economy” is simply a mercantilist delusion and a mercantilist distraction. Especially in tomorrow’s world of less and then far less of everything.
All ignoring at least three elephants in the room:
1, Resources
2, Global Warming
3. The “Train the trainers” Corps
Whatever the US could do, could be achieved by China faster, and the US would loose the race.
“Running the race” is the fatal fallacy right there.
If we had a sealed-off Protectionised production-for-consumption political-economic society, we would not have to care about what China does. Let China win the race with everyone else who still believes in running the race. If we are not running the race, we don’t have to care who runs in it.
Not our circus, not our monkeys.