Wednesday, April 27, 2016
Send the lunch pail to a museum
The idea, and the hope, that any political candidate can bring about a manufacturing resurgence in this country is just another "snipe hunt". Worldwide thanks to automation and increased productivity, manufacturing of all kinds is declining.
In America’s factories, jobs are inevitably disappearing, too. But despite the political rhetoric, the problem is not mainly globalization. Manufacturing jobs are on the decline in factories around the world.There may still be pockets of manufacturing sprouting up here and there but overall it is a field that needs less people every year. And when you take away the means to work without taking away the need to work you create a huge problem that does not lend itself to old solutions.
“The observation is uncontroversial,” said Joseph Stiglitz, the Nobel-winning economist at Columbia University. “Global employment in manufacturing is going down because productivity increases are exceeding increases in demand for manufactured products by a significant amount.”
The consequences of this dynamic are often misunderstood, not least by politicians offering slogans to fix them.
No matter how high the tariffs Mr. Trump wants to raise to encircle the American economy, he will not be able to produce a manufacturing renaissance at home. Neither would changing tax rules to limit corporate flight from the United States, as Mrs. Clinton proposes.
“The likelihood that we will get a manufacturing recovery is close to nil,” Professor Stiglitz said. “We are more likely to have a smaller share of a shrinking pie.”
Look at it this way: Over the course of the 20th century, farm employment in the United States dropped to 2 percent of the work force from 41 percent, even as output soared. Since 1950, manufacturing’s share has shrunk to 8.5 percent of nonfarm jobs, from 24 percent. It still has a ways to go.
The shrinking of manufacturing employment is global. In other words, strategies to restore manufacturing jobs in one country will amount to destroying them in another, in a worldwide zero-sum game.
The loss of such jobs has created plenty of problems in the United States. For the countless workers living in less developed reaches of the world, though, it adds up to a potential disaster.
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