Employed Americans largely earn a lot more than employed chinese people, and there just aren't very many unemployed Americans. Based on the value of imports to the US from China vs Chinese GDP($440B vs $17.8T), we import about 2.5% of their output, or the equivalent of ~20M people's output if we naively scale. I don't think there is any way around the fact that significantly reducing imports from other countries means we significantly reduce our consumption in absolute terms (i.e. we have a poorer standard of living), just out of spite for other countries.
Or about 12% of the US labor force. Meanwhile the 12th percentile US income is ~$22,000, i.e. less than the $32k median in China, and half of the jobs there are above that median.
Obviously these numbers are all useless napkin math and none of it really works like that, but the premise isn't inherently absurd. If China is subsidizing manufacturing in order to capture manufacturing jobs and those jobs pay more than what many in the lowest quartile of the US are currently making, there are people who could be made better off by having those jobs back, and they'd still only be paid about what we're currently paying to China.
And this before considering the general arguments about advantages to proximity of manufacturing, e.g. being able to talk to the people in the factory in your timezone in your language assists in product development so the location of the factory has an easier time developing new products. Which allows not just the manufacturing jobs but the whole rest of the company to be there, instead of those jobs starting to get eroded going forward.
It’s like wishing all of America would return to farming jobs, which once employed the majority of people. Then farming got automated such that now only a few percent of workers produce vastly more than those ancient hordes.
That’s where manufacturing went, and the rest of the world is as surely automating out those jobs too.
More of what, exactly? I looked at steel production data (in metric tonnes, not dollar value), US production has been flat or slightly declining since 1970.
Steel is something where value matters. US steel is usually higher grade or recycled with more value. Korea churns out tons and tons of low value low margin rebar.
You bring back manufacturing by investing in clustered industries. New York has a bunch of semiconductors. There’s a ton of chemical industries around Philly and Houston.
The iPhone is made in China because they have the best manufacturing for precision products. If you want that here, you have to invest.
People normally show a slowly increasing graph to claim that the US manufactures more than ever- but it's primarily because of hedonic adjustments for Intel chips. If you take that out it falls off a cliff in the 2000s during the China Shock.
We can argue some nations have been pretty unfair with their tariff rates over the years, but let’s not ignore 200 years of economic science.
The US is more on the scale of a continent than a country.
the rate of profits can never be increased but by a fall in wages [...] If, therefore, by the extension of foreign trade, or by improvements in machinery, the food and necessaries of the labourer can be brought to market at a reduced price, profits will rise.
I.e., use trade to get to lower wages
When you scale up the thinking past rudimentaries like 'hanging drywall', it still applies to nations - instead of "do we have enough people who know how to mine ore" it's "do we have the capability of mining enough ore to meet our needs" and the various intricacies that come with those massive-scale problems - problems that are much more easily solved when backed by a global economy.
Suppose you have enough mining production to meet half of domestic demand. Then you still have mining production, and know how to do it, and if it was necessary you could scale it up or reduce domestic consumption somewhat from the uses that aren't as important. Whereas if you outsource all of it or nearly so, i.e. actual specialization, it's a vulnerability whether to enemy action or just a single point of failure that subjects the whole world to unexpected localized turmoil in the only place that makes that.
> a country the size of the US could certainly contain someone who knows how to do any given thing.
Ore may be much cheaper to mine in another country - maybe because of geology or weather or because they have a great tradition of mining including more local skills, or because their economy is better structured for it - financiers with expertise in financing it, laws and regulations that are better designed (because of greater local knowledge).
Those things actually happen.
And don't think such specializations are transferrable; nobody really succeeds in doing that - just try changing one company's culture. Why haven't other Silicon Valleys and Apple Computers been developed, despite so many efforts?
What is the sense of wasting resources on things the country doesn't do well, so some nationalists can ... do what?
It isn't. The point of specialization is that people can become experts in things, so that not everyone has to be able to do everything. But the goal explicitly isn't for there to be only one person or only one company that knows how to do something -- that's a monopoly, and it's very bad. And if there are going to be a dozen companies that know how to do something (rather than needing every individual at every company to know how to do it), at least one of those companies can be in the US.
> Ore may be much cheaper to mine in another country
Ore isn't really specialization at all, it's resource availability. You simply cannot mine something in a country that doesn't have any. But the US is big enough to have almost everything and even to the extent that it doesn't, it can a) sell mining equipment to those countries that have it and b) ensure that it's more than one country acting as a supplier of those things, instead of allowing a dependency to form on a single one.
> Why haven't other Silicon Valleys and Apple Computers been developed, despite so many efforts?
Apple is an abnormal edge case because in the middle of their existence there was a monopolist (Microsoft) excluding all other competitors while keeping Apple around in an attempt to fend off antitrust scrutiny for their unlawful practices. That allowed Apple to a) invest in designing high quality products while Microsoft was stamping out any other competitors and b) build a strong brand (because the alternative was Microsoft).
To replicate that in other circumstances you have a chicken and egg problem, because you need the scale to have the resources to design high quality products and build a strong brand, but you don't have those resources or that brand with which to achieve that scale. The only ones who do are the other large behemoths, but large incumbent bureaucracies tend to become mismanaged and there aren't actually that many of them.
You also don't want others to replicate Apple, because Apple is a vertically integrated conglomerate. Everyone keeps trying to because they see Apple making a lot of money, but what they should be doing is playing "your margin is my opportunity" and establishing a competitive market where devices are made of fungible components using open standards, because that's how you defeat Apple instead of becoming Apple. It's no coincidence that PCs still have more desktop market share than Android has mobile market share, because the PC platform is still more open than mobile and to the extent that Microsoft has been losing market share it's because they're increasingly trying to lock down the platform and abuse their customers. If you have two closed platforms, the one with more resources is going to win, because then it's Apple vs. just you and Apple is bigger. But if you have an open platform, then it's Apple vs. everyone and everyone is bigger.
> What is the sense of wasting resources on things the country doesn't do well, so some nationalists can ... do what?
Not be dependent on a single supplier for 80-100% of the global production of some important product.
> Ore isn't really specialization at all, it's resource availability.
You just made that up. What is it based on? Also, resource availability is definitely part of specialization - countries specialize in what they can do more efficiently than other places, which depends partly on resource availability. It also depends on infrastructure, capital, laws, regulations, skills, labor, and many other variables.
People haven't copied Apple and SV because it's very hard to do it. Nobody does it with any successful company. You just can't copy those things.
> Not be dependent on a single supplier
Again, by reducing suppliers - and essentially worldwide in this case - you reduce competition. Now the public subsidizes a local supplier who is not good enough to compete, and therefore the public also gets a substandard product with little hope of competition arising.
I can frame, but I'm a disaster at hanging drywall. I finally hired a craftsman to do it, and zip slap bang he had hung it and it was straight and the joints were tight and even and I could hardly believe it.
Tariffs are going to put our high tech industries under enormous pressure. There are two reasons. It makes sense to import parts and lower tech components of everything we manufacture because our trading partners have developed an economic advantage in the production of those types of parts. If we make materials and those lower tech factors of production more expensive, we kill ourselves. It’s economic suicide. And high tech industries live by exporting. In equilibrium, the market outside the U.S. is much larger than the internal market. As we are to China and the rest of the world, as Germany, roughly, is to us, we will prosper only by exporting high tech, advanced design products. Everything we do has to cultivate that process.
It applies to countries too. It’s the core argument of comparative advantage, and it’s been mainstream economic theory for over 200 years. Your argument is incomplete because you’re not considering the wages paid in other countries, and crucially, the exchange rate.
1) They don't know how.
Specialization is a thing. But this is a thing that applies to individuals rather than nations. You don't need every person to know how to mine ore or hang drywall as long as somebody does. But a country the size of the US could certainly contain someone who knows how to do any given thing.
2) They get paid more to do something else.
This is the argument that you get paid $200,000 to be a doctor and people who mine ore get paid $80,000 so it's better for you to do $2000 more work as a doctor and then pay someone $800 for ore than to put on a miner's hat yourself.
But this is again something that applies to individuals rather than countries. There are people in the US who already get paid less than $80,000, or less than $30,000, or even who are unemployed. It makes no sense to convert doctors into miners but it makes plenty of sense for the people who are currently doing something that pays even less.