Saturday, August 22, 2009

Manufactured Objections

The Washington Post’s Harold Meyerson is wrong on trade.

by Daniel Ikenson - August 20th, 2009 - National Review Online

According to data from the 2009 Economic Report of the President, as gathered and reported recently by George Mason University economics professor Don Boudreaux, since 1987, real U.S. manufacturing output has increased by 81 percent. And as reported by the Bureau of Economic Analysis, American real manufacturing value-added — the market value of manufactured goods, over and above the costs that went into their production — reached a record-high level in 2007 (the last year for which final data are available), breaking the record set in 2006, which broke the record set in 2005, which broke the record set in 2004. Notwithstanding the recent recession that has affected all sectors of the economy, U.S. manufacturing has been thriving in recent years.

If Meyerson isn’t intentionally misleading Washington Post readers, he is simply unqualified to be rendering conclusions about the state of manufacturing. A basic look at the history of the statistic he used shows its uselessness to the point he wants to make. Manufacturing as a share of gross domestic product peaked in 1953 at about 28 percent of the economy — well before the period of U.S. industrial prowess Meyerson yearns for — and has been trending downward ever since. Today manufacturing accounts for about 12 percent of our services-dominated economy, but manufacturing output and value-added are higher than ever in real terms.

Much of my frustration with statistics is their use by liberals to lie through their teeth. I have watched it all my life and it still infuriates me. This article is filled with statistics and I hope they are real, but you just can't tell. Certainly I can tell you from the last manufacturing sector that I was involved with, the growth of auto manufacturing in the United States was primarily related to importing components of cars that Americans could not build competitively so that the processes that we were competitive in could be taken advantage of. It has created a huge number of American jobs.

There were no laws about local content that drove Mercedes and BMW to move to South Carolina. Yet great cars are being built by both companies in the American South. There are car factories all over America, built in recent years to take advantage of the American worker. They do not belong to American car companies. They are in right to work areas where unions are not allowed to sabotage productivity by ignorant work rules. In fact, there are studies that prove the disaster that happened to the clothing and textile factories in America had much more to do with unions than with American lack of competitiveness. The American worker has long been the envy of the world, and still is. So whose statistics do you believe?

Barack Obama and other liberals like him do not believe that we can be competitive unless we legally block imports and turn control of our factories over to the UAW. This is a mindless exercise - trying to head in two different directions at once. Every act that Barack Obama has taken since he was elected has been a disaster for free enterprise. Our economy is in shambles. And it will only get worse as Obama bankrupts Social Security, Medicare, Medicade and simultaneously runs interest rates into the Jimmy Carter range with profligate creation of dollars through his Federal Reserve policies. If he passes his socialized medicine health care reform and cap-an-tax, it will simply happen faster.

All of this will harm manufacturing and trade far more than foreign competition.


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