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Comment by throwaway2016a | Hacker News Reader

throwaway2016a

I haven't been myself but my wife is a process engineer and had to go to China to install and train people on a new machine so this is only second hand...

But one of the reasons China is so good at manufacturing is because everything is in one place (or at least clusters)... need 10,000 of an Integrated Circuit? The company that makes it is literally down the street. Need some raw materials? That's down the other street.

I can't think of a place in the US that is like that. If we need parts we have to wait for them to ship. (often from China)

It's not just a labor problem. It is my understanding to be competitive in manufacturing you need to be vertically integrated. And I think that is harder to do in the US.

Although I hope it is true. I live in the US but I don't believe in inherit United States exceptionalism but I do feel like shipping goods by container ship is bad for the environment and bad for consumers. I'd much rather see things made locally.

View on HN

Silicon Valley is called that because that's how it used to be. They actually made the chips there, and if you grew up there, you could get computer parts cheaply and easily. Jobs and Wozniak could build the Apple I in a garage only because of where they were.

Exactly this. North San Jose (the 237 triangle) used to have PCB, chip, chassis, component, etc., manufacturers in proximity to each other. Consider: Sun used to make and assemble their "workstations" over in the East Bay not far from the 237 triangle. As the late '90s approached much of that local manufacturing was off-shored to the Foxconns and Flextronics, etc. as well as overseas foundries.

As a consequence of all of that concentrated manufacturing, Silicon Valley is now a cluster of EPA superfund sites. https://en.wikipedia.org/wiki/List_of_Superfund_sites_in_Cal...

Check out the SuperFund sites in the original Silicon Valleys of NJ & Boston.

https://upload.wikimedia.org/wikipedia/commons/9/91/Superfun...

Lorentz Barrel and Drum was particularly reckless. That lot is across the street from the Solar For America Ice complex (formerly Sharks Ice) on 10th.

And when it all went over there it made room for Google and Facebook. Today it's hard for a startup to find space in downtown PA because of Palantir.

What's a "problem" for the rest of the U.S. is creative destruction here. I worry we may have learned the wrong lessons because of current politics and inequalities. And it's worth remembering that automation is going to result in that manufacturing resulting in less jobs. What's going to happen when people expect the jobs to come back but then they don't?

I know this has all been said, but I'm not sure everyone's connected all the dots.

>it's worth remembering that automation is going to result in that manufacturing resulting in less jobs. What's going to happen when people expect the jobs to come back but then they don't?

/u/Brightball posted this on HN and I felt it was a good response to your concern.

"One of the big perks to manufacturing is that it draws the entire supply chain around it naturally. Even if the manufacturing job itself isn't as abundant, the peripheral jobs that comes with it from shipping materials, producing materials, distribution, sales agreements, logistics, building construction and maintenance...they all provide benefits."

Ya, I don't think most people think past the surface of this issue, but than, most people don't think at all.

On a side note, unemployment rates are at a low, so we relly don't need to worry too much. If you look at the charts: https://www.google.ca/publicdata/explore?ds=z1ebjpgk2654c1_&... you see that it really was all due to the recession. Now that the economy has recovered, jobs are back.

All the talk of outsourcing, automation, and all that doesn't seem to show in numbers. Even full time employment is up: http://www.tradingeconomics.com/united-states/full-time-empl...

I wish our society valued data driven decisions a little more. Successful businesses do it all the time, why not politics?

Because you get elected by stirring emotion in voters.

Exactly, there may well be a lot more manufacture and assembly here in the US, but that's to support US deliveries with lower-cost shipments of final products. And most of that is automated, which is what allows US mfg to compete with overseas.

shit, that was true as recently as 15 years ago, from personal experience. You can't just drive down 101 from SF and buy shit at Greybar anymore?

HSC, Anchor Electronics and Wierdstuff but that's about it

And Jameco, just off 101 in Belmont, and Fry's.

That's the one I was thinking of. Thank gawd.

For off-the-shelf electronic parts in small quantities, everybody orders from Digi-Key, or maybe Mouser. Order by 8 PM Central time, delivery by 10:30 AM the next morning if you pay for FedEx.

That's what wiped out local parts stores. You never knew what they had in stock, and the markups were huge.

Also, Digi-Key doesn't have a counterfeit parts problem. Digi-Key deals directly with manufacturers. The supply chain is simple and has no anonymous resellers. If someone finds a bad part and reports it to Digi-Key, their systems can trace it back to the manufacturer lot. So not many duds get through.

The problem with digikey (in my mind, as a hobbyist) is that you don't actually know the total until after the order has shipped.

This is a problem with shipping with Fedex too. There are a bunch of variable charges that aren't finalized until after the shipment has been delivered. In practice it is rarely and issue and using post paid labels instead of prepaid shipping labels is a better system for most businesses anyways.

Is the order cost variable with digikey because the shipping weight is not known or is there another reason?

Im not sure.

Digi-key, Mouser should have retails office location in Silicon Valley where anyone can order on-line and pickup in person when notified the order is ready via email/txt.

Jameco has one in Belmont: https://www.google.com/maps/place/Jameco+Electronics,+1355+S...

Can you explain how this works?

I live in Canada, shipping is $8 flat rate, and all the taxes and shipping are totalled on the "preview" screen.

I've never paid customs fees in all the years of ordering, so for my situation I know the full price upfront before ordering

Yeah, I understand a DB9 solder cup is a niche product for a local Radio Shack and they have to pay for store space and employees, but there was just no way I was going to pay $6 per connector when I could order them for $0.30 each from Digikey and have it in two days. It wasn't just that part. Every part was like that. $2 for a single capacitor. $15 for a pack of 100 resistors. Etc. And good luck finding the exact one you wanted. Those parts shelves were only stocked every 5+ years ... I could easily see four generations of packaging for the same part in those things.

It's really a shame because it was great to have that "I can get this part in ten minutes" feeling when I was in the middle of a project and I ran out of something I needed, or realized I was missing a part.

Plus, many of the major electronics distributors were either based here or had presence here (Hamilton/Avnet, Wyle, and Marshall at least were within a couple-mile radius of each other). Fry's also started here, with its first electronics store in a former Fry's Market building on Oakmead in Sunnyvale.

> Although I hope it is true.

I don't know if being a manufacturing powerhouse is actually all that exciting anymore. There aren't really that many jobs in manufacturing anymore. Some of Toyota's modern car plants employ a meager 1500 people which is about and order of magnitude decrease from what car plants used to employ.

This las election was frustrating for this very reason everybody assumes getting manufacturing back is going to be great. It's not. Sorry, it just won't be.

Manufacturing is moving back to the US because distributed supply chains are becoming worth the cost increase in labor.

Or worth the cost increase of higher automation.. I don't see people living off of what it costs to manufacture goods today. I don't think those particular jobs are coming back.

One of the big perks to manufacturing is that it draws the entire supply chain around it naturally. Even if the manufacturing job itself isn't as abundant, the peripheral jobs that comes with it from shipping materials, producing materials, distribution, sales agreements, logistics, building construction and maintenance...they all provide benefits.

With the manufacturing hub overseas all of that's overseas too, which is why China is more vertically integrated.

If I recall, one of the major reasons that Dell took off years ago was that they consolidated the entire supply chain for production and significantly increased profit margins.

Yes, but since China is the manufacturing hub for so much of the world, its local surrounding galaxy of expertise, supply chain, and related resources will exceed the size of such a galaxy built only in the US — especially if the US efforts are by dint of tariffs and related policies, and not economics.

Does that mean that nobody should attempt to compete with China?

No, I wasn't suggesting nobody compete. By all means, compete. But I don't think measures like 35% tariffs, local tax abatements, overseas profit repatriation discounts, or political bluster are likely to mash more than a little bit of the toothpaste back into this tube.

The US was a larger manufacturing nation than China as recently as five years ago. Cutting the US corporate income tax rate nearly in half and lightening economic regulations, will do wonders for boosting US manufacturing.

Given China's $3.x trillion in manufacturing is heavily tilted toward low cost, low value manufacturing, it's not going to be surprising to see their global share of manufacturing shrink in the next decade as other low cost competitors continue to take share from them (whether in Vietnam or Mexico).

Think Africa. Vietnams is already too expensive. Mexico probably is, too.

Is Africa stable enough? I feel like South America has a better shot at this than Africa. Maybe in a few generations?

Edited to add that I'm speaking in very broad terms, I know that Africa as a whole is enormous, but I don't think of any particular African nation as being stable enough to be able to support the infrastructure needed.

But think of all those hopeless souls that will work for nothing for businesses to take advantage of. It must be done, market demands it.

Producing our own food is not exciting either, but would you like to live in a place that produces no food and has to import 100% of what is needed to survive? This is the same thing here. Manufacturing is not a sexy activity anymore, but it is necessary, as long as we still live in a physical (non-virtual) world.

> a place that produces no food and has to import 100% of what is needed to survive

like, say, New York City? Sure!

No, the rooftop garden on the Park Slope Whole Foods does not count.

Ny is not in a position where the people whom feed it could use it as a leverage in diplomatic relationships

'Who feed it', not 'whom'. The latter is the objective case of the pronoun, parallel to e.g. "them"; just as we wouldn't say "them feed it", we wouldn't say "whom feed it", either.

NYC was actually very pro confederacy at the very beginning of the civil war because they were so economically dependent on the south.

He's obviously talking about doing so on an international level. As long as the US is around, New York will never have to question whether or not the other states will be willing to do business with it.

While its highly unlikely, its slightly more believable that in the event of another world war or some kind of global food epidemic, a country that doesn't produce its own food might be completely screwed.

NYC is part of a larger constituent unit. Japan, for example not being part of a larger state, goes to great pains to subsidize its inefficient agriculture in order that they not rely entirely on trade for their foodstuffs. It's not that they think being dependent _right now_ is an issue. The issue is what state would they be putting themselves in were large producers to put an embargo on them (or there be plagues elsewhere affecting production and thus the little which gets produced by other countries gets reserved for those countries's local consumption).

Such dependencies were the British Empire's key vulnerability during WWI and WWII. They are a part of the reason why the British had to mortgage their empire to the US to pay for those wars.

I believe most countries import massive amounts of food, including the U.S. It's much more efficient: Let those who can produce the food most efficiently do that, and you produce whatever you do most efficiently, then you trade. It's called 'comparative advantage' in economics.

Trade is necessary for the wealth of modern economies. Self-sufficiency is North Korea's approach.

The US has been a net exported of food for a long time. The gap changes, but as far back as I looked, we've never been a net importer. The whole "amber waves of grain" thing.

The US is most definitely a net food exporter and it has been that way for a long time. "U.S. agricultural exports have been larger than U.S. agricultural imports since 1960, generating a surplus in U.S. agricultural trade." https://www.ers.usda.gov/topics/international-markets-trade/...

That doesn't contradict what I said: The U.S. imports large amounts of food. The charts on a related page show tens of billions of dollars of imports per year:

https://www.ers.usda.gov/topics/international-markets-trade/...

Net imports is a different question.

It still means that the US could probably rely on domestic production if it was forced to do so. In a war, no other country could leverage their position by threatening to stop food exports to the US. It would surely result in less choice, but wouldn't really hurt the US.

> wouldn't really hurt the US.

My expectation is that it would far more expensive, raising food prices and doing significant harm to the economy. Also imagine the massive costs of shifting production and the gap in food availability during the shift. But I agree that the U.S. wouldn't starve.

I'm not sure about that... a large part of subsidies is to compete in foreign markets. A LOT of food is produced in the U.S. and the majority of trade is so we can get the likes of strawberries year round. A lot of the food staples like grains, beans, nuts, cereals, etc are domestic. Even a lot of the soy and corn. That doesn't mention that we do supply our own meat the vast majority of the time.

I think what would harm us more in total isolation would be the lack of more scarce resources (those used in electronics, batteries etc). We have a lot of materials here, but there are others where China and Africa trade are needed.

I understand the speculation, but if one learns about how economics, trade and the U.S. economy (and all other economies) really work, these hypotheses are clearly wrong.

His point wasn't that we don't import. It's that if we were to somehow have everyone say "we aren't selling food to the US", we wouldn't be totally screwed.

Singapore?

Even more than food, Singapore is acutely conscious of its water dependency on Malaysia and goes to great lengths to limit this.

https://en.wikipedia.org/wiki/NEWater

https://en.wikipedia.org/wiki/Marina_Reservoir

< Some of Toyota's modern car plants employ a meager 1500 people which is about and order of magnitude decrease from what car plants used to employ.

1500 jobs + the peripheral jobs (as a another commentator pointed out) could be a boon for many of the small counties* in which these plants are located.

*https://en.wikipedia.org/wiki/List_of_Toyota_manufacturing_f...

It won't be 1500 forever. Automation hasn't stopped, or slowed, it just keeps increasing

And a lot of those peripheral jobs being talked about are also in line to be automated away.

The biggest cost gains have probably been realized, especially given the reduction in long term obligations (pension, healthcare, weakened union position). I could see another round or two of automation, but at some point it's not worth investing in.

lol

Jobs don't matter, the goods coming out of those plants are still valuable and making handsome profit with enough scale.

As we move towards automation, wherever the means of production are located is going to dictate who rules the world a hundred years from now. If you don't have a manufacturing base in your country in time it will be a losing battle to try to afford buying other countries unlimited goods with your limited human resources.

The article addresses this:

"It's natural to look at the phenomenon of declining manufacturing employment as a political failure that can be rectified. But the fact that China has lost more manufacturing jobs than the U.S. over the past 20 years is a strong indication that playing hardball with the Chinese isn't going to do anything to increase employment in the United States. Rather than a political failure, the decline of manufacturing employment is a natural economic process that many industries, like agriculture, have gone through in past eras. As sectors become better at what they do, they often require fewer people to get the work done."

Additionally, manufacturing is often an environmentally unfriendly process, so there are going to be some big added costs for the government and an increase in the importance of adequate regulation and enforcement. Given that the majority of the added revenue these manufacturers will generate is going to go into companies and individuals that are, on average, very good at hiding profits, the IRS is going to have to be very sharp indeed if the U.S. is to actually benefit from this. It's not going to be like it was in the seventies when a much higher share of gross revenue went to unionized workers who dutifully paid their taxes in full.

On the bright side, more Americans are going to find out what living next to a modern chip fab plant is like. This may cause them to actually reduce the frequency with which they buy new phones.

> On the bright side, more Americans are going to find out what living next to a modern chip fab plant is like.

A modern chip fab plant is one of the cleanest industries we have EVER produced.

Everything is really sealed, and even the "waste" gases are purer than what you get directly from most industrial suppliers. It used to be that most of these plants immediately dump industrial gases into their waste stream and purify them to the level they need.

This is different from a PCB manufacturing plant which creates lots of liquid waste that is contaminated with all manner of nasty metals.

Yes, mostly we sell the equipment and design services that make the manufacturing possible. There is huge leverage in that and the higher margins that WallStreet demands. For quite some time (mostly) Asian governments have been investing in education, infrastructure, and equipment to manufacture the consumer items of the world.

It is much harder to do development and understand the real manufacturing bottle necks when you don't see them first hand... even harder when you can't easily get the raw materials.

I was struck with this the first time I tried to order in the US a PCB to the tolerances available in China. The yield was so bad, they basically weren't available. It was cheaper and faster to have the parts built in China and shipped back than to order from a proto house in the US.

Why? They used similar equipment in China (I saw it myself), but they ran it 2-3 shifts every day and it was completely dialed in. In the US they turned it on once a week and tried to make enough prototypes to pay for it.

Yep. The feet on the ground experience tells you, me and others like us that in the war to create automation, the odds favor China, because in the end, they own the myriad little details that get expressed as "edge cases" and resolved issues during development of the automation solutions, and which are completely unavailable unless you own the literal physical factory. This feet on the ground experience is discounted by the policymakers, so it will be an interesting case study to watch unfold over the next couple of decades. If our experience-informed observations are correct, then US senior management will experience a nasty automotive-industry-style shock when it "suddenly" discovers China is far better at automation than the presumptive US comparative-advantaged expertise led them to believe.

My take is there are no shortcuts for doing the actual work. Just like there is no replacement for lifting the actual weight and eating a clean diet instead of reading yourself into expertise on fitness.

Well see "Musk Enterprises" (aka SpaceX and Tesla) for the new American idea of vertical integration. He's trying to literally own the entire supply chain from the bottom to the distribution of the finished goods at the top.

Seattle is this way.

Washington state has an airplane factory in the woods and a car fiber (BMW) plant out in the desert. In the city you can find businesses to build anything.

That's interesting to hear. In South Carolina we've got BMW in the Greenville area and Boeing in Charleston. The Greenville area itself virtually imploded 30 years ago with the textile industry and BMW has largely driven the recovery. Now it's one of the best places to live in the state.

We also have a LIGO detector out by walla walla in case gravity gets shifty in the pursuit of red.

The big question is what happens when the Chinese government puts a high priority on getting into aerospace and tries to replicate their own 787s or A-350s.

That said, Boeing's defense contracts might keep is secure regardless of what happens in civil aviation. United Airlines might buy a plane from China (in a decade), but the US Navy certainly wouldn't.

The "quick, cheap, disposable" stereotype of Chinese manufacturing (whether deserved or not) seems like it would be a major hurdle for breaking into the Western civil aviation market. I see a lot of people leery of Airbus due to their approach to computer control and fly-by-wire, and that's without any doubts about their manufacturing care or attention to quality control.

China has been trying to improve their commercial air industry, but engines have been a problem, both for their airliners and their military jets.

Which is why the single-aisle twin-engine commercial jetliner that China is already building uses foreign engines.

https://en.wikipedia.org/wiki/Comac_C919

Which is why they're licensing the An-225 and jet engine technology from Ukraine.

http://www.popsci.com/china-will-resurrect-worlds-largest-pl...:

> The second stage of the project will involve the complete transfer of technology, including the 23 ton thrust Progress D-18T turbofan engines, to China, for licensed production of a modernized version in Sichuan Province.

They haven't even cracked the automobile market yet. No one in the west will buy a Chinese car, let alone a Chinese plane.

Subaru is a Chinese version of yakuza. They have cracked the market for sure.

Also, mitsubishi can build rockets similar to anything spacex can put up.

Except both are Japanese companies?

Paper ownership and proximity ownership and value ownership are all very different things on that side of the planet.

Both are Japanese companies in the American version of ownership.

In the proximity version of ownership, both are pirate flags.

Japanese cars aren't manufactured in China. This isn't a tricky situation to unravel.

That feel when you confuse China and Japan.

Zero confusion whatsoever. I've been over there and sat with them and talked about infrastructure and who gets to use it.

China would have very little reason to enter the broken US car market.

Especially when there is an island sitting right there that is close enough for them to buy their own Mitsubishi 787s

They sell Chinese pickup trucks here in New Zealand under the brand "Great Wall".

Everything I've heard about them is that they're unreliable and unsafe to an extreme degree. You're apparently better off buying a 3 year old Toyota Hilux or Nissan Navara for the same price as a brand new Chinese truck.

How long ago did these vehicles go on sale and has there been any improvement in quality since? Japanese and Korean vehicles in general had a rough time entering the US market (decades ago). They did start off being lower quality. But they got better. I wonder if this "Great Wall" manufacturer has it in them to make vehicles that are competitive on a global basis.

what happens when the Chinese government puts a high priority on getting into aerospace and tries to replicate their own 787s or A-350s

I am late to this discussion, but James Fallows wrote China Airborn, a book about precisely this topic! The answer is complicated—if it weren't, he'd not bother writing a whole book about it—but the short answer is that so far China's not succeeded.

China does lots of stuff well and deserves credit for it but is not the indomitable powerhouse sometimes suggested in the media (e.g. http://www.marketplace.org/2015/12/10/world/why-cant-china-m..., although I don't know if this piece or others like it are for real).

I would think that this would be the lesser of the problems. Growing up in metro-Detroit, the Big 3 had thousands of smaller 3rd party companies surrounding it that made molds, plastic components..etc. The larger issue that I see would be union's and the large wage gaps. There were plenty of my friends parents that worked on the line making well over $100k each a year (as a line worker!). Everyone enjoys good news, but line work, manufacturing, and coal are not "coming back" beyond those that are highly skilled in the field.

> I do feel like shipping goods by container ship is bad for the environment and bad for consumers.

How is it bad for consumers (beyond the environment)?

Shipping goods does include an environmental cost which is not incorporated into the price of things - an unfortunate externality. We should have a carbon tax to properly reflect the true cost of items made and shipped so the market can choose between a locally made good and one made elsewhere.

There seems to be a popular opinion that even if the environmental cost were accounted for (carbon neutral) that it is still somehow inherently superior to make things nearby rather then trade for them from another city, state or country (especially food).

> We should have a carbon tax to properly reflect the true cost of items made and shipped so the market can choose between a locally made good and one made elsewhere.

I agree, but the results may be a bit surprising. Shipping by container ship is extremely efficient [1]. On the West coast, for example, it might be cheaper (possibly far cheaper) to buy goods from Asia than from the Midwest. And wine drinkers in New York who care about energy consumption might be better of with French wine than "local" California wine.

[1] http://business.tenntom.org/why-use-the-waterway/shipping-co... for example

It's not so bad if your land transport uses the train. Although I'm really surprised at how unsafe trains are, according to that. Is that all from automobile/train collisions at level crossings?

I don't know, but I'd guess so. On the other hand, the N/A for nonfatal truck injuries is suspicious.

This probably also explains factories in the middle of the US closing, since they do not have easy transport links in and out of the country. They would have been built there in the past because of easy transport links within the country.

You'd be surprised how negligible the environmental impact of shipping compared to production is. As an extreme example, it's cheaper in terms of CO2e emissions to produce and ship lamb from New Zealand to the United Kingdom than produce it in the UK.

How is that possible?

why wouldn't it be?

raising sheep requires land, remember? it's livestock, grass/feed, water, veterinarians, medication, sheepdogs, abattoir, compliance, inspection, processing, packing, refrigeration, shipping.

if you're producing wool, let's substitute/add shearing, washing, drying, processing, packing, etc.

not to mention sales, marketing, client relations, accounting, human resources, payroll taxes, corporate taxes, property taxes, sales taxes, value added taxes, etc. because a ranch is a business that turns over probably millions a year.

how much does all that cost in the UK? how much does it cost in NZ? find the difference, and compared to the shipping costs, which are trivial, probably a couple of thousand dollars to get a refrigerated 30 foot container from Auckland to Amsterdam, then another few hundred pounds to get it across the channel and into a distribution center in the south of england.

i don't know a damn thing about farming or logistics, but all it takes is about 2 minutes of thought to see how the economics would work.

I dunno about NZ and the UK, but from what I've seen of farms in Australia and Sweden, I can believe it. In Australia, I see cattle in absolutely massive fields where they eat whatever is growing there. In Sweden, I see small fields that can't sustain the livestock (especially not in winter) and they need to feed them farmed food, which takes a lot of energy to grow, store and harvest.

Producing lamb in NZ is a veryow intensity operation. Usually lambs are just out on a hill and left there for a few months before slaughter. There's also drenching and other stuff, but the actual land they're in isn't irrigated or worked at all.

Not so much these days, but it used to be fairly common to just run sheep up a mountain valley and then twice a year muster them down the valley (often with only horses and dogs) for shearing and slaughter. Any sheep that fall ill would either recover or die.

That's still the case usually, a lamb is worth a lot less than the vet costs.

Don't know about these days, but Michigan/Ohio area with car parts comes to mind.

Still a lot of truth to this. Here in West Michigan, there are tons of auto parts manufacturers, both "boring" manufacturing (plastic molding, etc.) and emerging tech.

Preserving this cluster was the reason for the auto bailout, correct?

Yes, that was a big part of it. If even one of the Big Three had failed, the ripple effects would have crushed the entire industry, as well as the region. The resulting failure of many suppliers (due to them losing ~33% of their business overnight) would have crippled the surviving auto companies as well.

I read an article from the economist awhile back detailing how Mexico is a better source of manufacturing than China due to raw materials being available from within the country. In that article they stated that raw materials are actually scarce in China and have to come from abroad, causing larger fluctuations in pricing during depressions.

That may be true for inegrated circuits, but for other things north america has clusters. Im in vancouger. Want to film a movie? Everything from costumes to CG is here. And we can have whatever celebs you need here overnight. China cannot do that. Want to build something out of wood? We got that too, with a world-class wood sciences program in town (UBC). If you want you can see your product from tree to shelf all within an hour's drive. China cannot do that either. Get out of the consumer elecronics mindset and you will find all sorts of local clusters.

Wired just released a great docu on hardware in China. https://www.youtube.com/watch?v=SGJ5cZnoodY

Doing electronics here in the states is a pain in the ass. Maybe a little less so in some parts of CA, but for the rest of us it sucks. Pretty much everything has to be shipped to get anything done. You spend more days waiting on UPS then actually moving forward. Unless of course you can foot same day / next day shipping all the time.

Relieved to see Deloitte issuing a report sure to ease the firm's path toward sizable billings from Chinese businesses, SOEs and government entities who are currently struggling with overcapacity and other existential economic threats. I chuckle as I see energy, currency and infrastructure inputs seemingly underweighted in their analysis. As one example... the USD is expected to continue appreciating sharply against developing nation currencies to the great detriment of US manufacturers who exports goods.

Shenzhen: The Silicon Valley of Hardware documentary illustrates this: https://www.youtube.com/watch?v=SGJ5cZnoodY

Once upon a time the USA was like that.

I think it's unrealistic to return to that with current production needs, but perhaps it's possible with select future industries.

The oil & gas industry in Texas is just like that. Someone else mentioned Silicon Valley too.

We need to figure out how to expand this to other regions and industries.

not to mention thousands of people willing to work tedious shifts and live in cramped quarters. People willing to leave their villages and move wherever the opportunity presents. People who culturally respect authority of their superiors. People whose memory of dire poverty is still fresh.

Contrast that with Americans who have been told from birth that they are special and their life is exceptional, a philosophy that doesn't gel very well with tedious work at factories.

China wasn't always that way: it was a choice they made to become the worlds manufacturers, with the complicity of the global financial elite. We moved the factories over there, we can move them back.

To be automated, which is what will, and is happening.

I'm perfectly happy with that, although I think it is oversold and used as an excuse in many cases. So long as the productive capacity, intellectual property and knock on effects are kept domestic, good.

Have you heard of comparative advantage? It may not be advantageous for the U.S. to keep such things domestic; instead the intellectual property may be better utilized in China.

I took two years of economics indoctrination at Cal. Yes, I'm aware of the theory.

Suffice to say, I no longer believe that ceteris is paribus.

Why?

Watching the asian economies thrive with mercantilist practices, learning about America's early mercantilist practices, and reading Vox Day, John C. Médaille and Steve Keen on the matter.

Why? After all the American people want cheaper things and that is done by moving factories to China.

For a lot of things, I'm not sure it saves people enough money to notice. Production isn't the entire price of a product - you also have things like transportation, retail markup, R&D, advertising, etc.

Let's say that there's a $3.50 product that costs $1.50 to produce, and a company can save 10% of production costs by producing it in China (even with lower wages you don't tend to have huge savings when things like transportation, lower quality, distance from quality inspectors, etc. are added in). So that's a 15 cents saving - now some of that the company is going to keep (let's say 5 cents), some will go to the businesses buying wholesale (let's say another 5 cents), and some will go to the consumer (let's say the remaining 5 cents). So in the end it might be the difference between paying $3.45 and $3.50 for the consumer - something most people wouldn't notice.

Of course, for a company it's a much bigger difference - if everything costs them $2.25, and they're selling it for $2.75, then an extra 5 cents per unit means their profit margins go up 10%.

Of course this is going to vary a great deal depending on a number of factors (what kind of product, if you're buying generic, etc.). But I think for a lot of products the average American wouldn't notice much of a price difference if they were being made in the U.S.

A notable example of electronics that is not made in China is the Raspberry PI which is made in the UK, in Pencoed, Wales, formerly the heart of the coal mining industry.

http://www.sonypencoed.co.uk/news/2016/03/01/latest-raspberr...

They haven't always been able to make it in the UK, but as the computer became more popular, the economics have worked out. But the driver for this has been the fact that the organization behind Raspberry PI wants to develop hi-tech engineering education and manufacturing in the UK.

There is an embedded computer called PICaxe that was launched in the UK for similar reasons, boosting engineering education in the country. It roughly competes with Arduino as a platform.

Most/all of the components are manufactured in China, so I'd guess that much less than half of the total retail price represents value added at the assembly stage in the UK.

There's a wide range of electronics/white goods still made in Japan as well, for the Japan domestic and Asian market as there's a quality reputation that people will pay a premium for.

For instance just walking through an electronics store, there are fridges, air conditioners, washing machines, room heaters etc with large "Made In Japan" logos.

It saves money for me; all my PC stuff is made in China or other Asian countries.

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