Most economic comments at USMB are shallow, pedestrian and ignorant, and motivated by ridiculous ultra-partisan prejudice. This is true especially of MAGA fantasists, but is certainly not exclusive to them or to Republicans in general.
Nobody is seriously confronting the tendency towards greater co-efficients of inequality and class divisions in the U.S.A. — but I am
not discussing that here.
I think we should note that the sad state of basic U.S. manufacturing — which has been devolving for many decades — appears actually to be entering an early stage where we may expect some significant improvement. The “re-shoring” or at least “friend-shoring” of strategic industries resulting from the new Cold War with China is likely to give impulse to this over time.
Of course this is not going to be true of basic commodity producing industries like textiles that require lots of cheap manual labor. Even China is moving much of its own such industry abroad to cheaper labor countries as it itself tries to move towards upstream high tech manufacturing. New Western industrial logistic chains are being made “more reliable” and forged closer to home in many industries, even if this is proving expensive. Continuing robotization and technical change is also forcing new manufacturing plants to be built all across the USA, though this is not yet reflected in overall manufacturing levels.
The war in Ukraine and possible war with China has also helped the Military-Industrial complex here, and of course new billions provided under the administration’s various legislative victories like the “Chips Act” will encourage expansion of chip manufacturing and many associated industries. The U.S. has the science and technique and plenty of financial wealth, but it will take time and effort to get new-style complex factories functioning, and train enough technically highly skilled engineers to run them.
All this, like the move toward more sustainable and renewable energy infrastructure, won’t happen immediately in our country, nor spontaneously arise from narrow capitalist self-interest, which has been overwhelmingly oriented toward creating wealth out of speculative financial investments in financial products rather than real state-of-the-art production and manufacture. Mass production of EV automobiles and related industries will go forward as well, despite inevitable problems and delays … with intense competition from abroad.
Probably the best index of real future positive evolution in U.S. manufacturing is in new manufacturing
factory construction, which is expanding even as credit is becoming more expensive, which would normally tend to lower industrial manufacturing (and housing) construction and create other headwinds. The truth is despite intense efforts by the Fed to slow the economy, and thus lower inflation, the “animal spirits” of U.S. investors and capitalism as a whole is holding up remarkably well … at least for now.
Here is a quote and graph indicating the rise in factory / manufacturing construction, likely the best indicator of future improvements in U.S. manufacturing efficiency and output:
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”The amount spent on building manufacturing plants in May in the US jumped by 73% from a year ago, and by 147% from May 2021, to $15.7 billion, according to Census Bureau data today [far more than inflation]…
“Over the six years between 2015 and 2020, construction spending on factories has stagnated roughly between $6 billion and $7 billion a month. But in the spring of 2021, spending began to rise, and then surge amid the global supply chain chaos raging at the time. The driver behind the surge of construction spending now is computer, electronic, and electrical manufacturing.
“Construction spending on factories is interesting because of the long-term outlook it provides on the US manufacturing sector – particularly regarding computer, electronic, and electrical manufacturing.”
www.upi.com
