Thursday, July 8, 2010

Uplifting Americas!

There are reports that with the increasing labor costs in China and the recent move by China to no longer tether the Chinese yuan to the US Dollar, countries like Mexico, India and even Russia are cheaper for manufacturing products in many sectors like Life Sciences, Publishing and even hi-tech . So here is my idea - move manufacturing back to the Americas - namely Mexico and United States, from China !

With increasing opportunities in Mexico, it may reduce the illegal border crossings by Mexicans who are looking for opportunities to work in the United States. It may provide more opportunities for the entire transportation sector to truck materials and products across the border. With an improved Mexican economy it may create a bigger market for US products increasing the US exports. It may slow China's growth as a super power and strategically help the United States in the long run to continue its stature as an economic stalwart.

Despite severe economic distress and a prolonged recession I must admit that I have rarely seen protectionist attitudes in the corporate culture in America. The pressure and misguided short term focus in delivering to share holders have led American companies (read executives) to be unconcerned in their attitudes towards creating and preserving jobs in America. My hunch is that there will be a resurgent America (and hence the rest of the world) if we can bring back manufacturing jobs to America. Services and Innovation alone are not enough to keep Americans employed. In any population, there is a certain percentage of work force that can only do blue collar work and this is where we are hurting today and will continue to hurt in the decades to come if we can not bring back manufacturing.

The cost of printing a book now is more or less going to be be same whether it is done in China or in the United States ! Surprised ? If all things are equal, American companies have an obligation to contribute to the local ecosystem positively and this starts with a objective to preserve and create jobs locally. This is not against free trade. It is logical, rational, patriotic and sensible thing to do !

2 comments:

  1. Cool che, but will people in US take blue collar jobs? I can understand the point about Mexico and I believe some companies like Honda etc. already have their manufacturing plants there. - btw, I subscribe to your RSS feed.

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    Jeet

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  2. Absolutely! We are not talking about jobs similar to farm work which a lot of Americans don't want to do and most of this is taken up by migrant workers from Mexico. The South and Midwest are very conducive for such a setup.

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