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What will manufacturing & the economy look like under a 'reshored' world?
Posted on 3/25/20 at 11:38 am
Posted on 3/25/20 at 11:38 am
Thought experiment here:
So say we do move industry back through some kind of regulation or decoupling, and now things are made in the USA again. Your TV, lawn mower, North Face jacket, whatever. Prices will necessarily rise. Just from what I know on the cost difference, it would probably be 20-100% more expensive depending on the item.
What changes about our daily lives when people have to pay twice the price for goods?
- My first thought it that the profession of repairman will return. Now a days, if your TV breaks, its cheaper to get a new one than repair it. Ditto for a lot of household items. Would people start to pay $150 for a repair instead of $400 for a new item, when they used to get a cheap replacement for $200?
- Second: It makes more sense to move back to riverine and rail transport for goods under this model. Costs will have to be cut, and a big expense is shipping. The cost to move goods, especially raw materials, via river barge vs truck is huge. The Mississippi connects a lot of the midwest towns to the ocean very cheaply, and our rail transport system for freight is still pretty good. If you're shipping bulk goods for intermediate value added manufacture, we could see a renaissance of river transport, and in NOLA specifically, a boom.
- Less military spending, more tax revenue generated from internal manufacture. With less connectivity economically with the rest of the world, the American Military Empire's raison d'etre dies out. More focus on protecting American shipping exclusively. The American Navy probably ages into mass obsolescence, focusing on drone carrier capability to protect our merchant vessels.
- Automation, automation, automation. The American factory of the future will be one of two things: a large central warehouse of robots/3d printers, or a disconnected 'cottage factory' made of people working from home as an almost remote assembly line. I've already seen this in action in Houston, and it's a concept that will blow up. A 'factory owner' gets a contract to make 200 shirts, and he sends orders to a dozen or so stay at home moms who take the raw materials and make portions of the order. Each of them has an industrial sewing machine set up in their house that the factory owner provides.
So say we do move industry back through some kind of regulation or decoupling, and now things are made in the USA again. Your TV, lawn mower, North Face jacket, whatever. Prices will necessarily rise. Just from what I know on the cost difference, it would probably be 20-100% more expensive depending on the item.
What changes about our daily lives when people have to pay twice the price for goods?
- My first thought it that the profession of repairman will return. Now a days, if your TV breaks, its cheaper to get a new one than repair it. Ditto for a lot of household items. Would people start to pay $150 for a repair instead of $400 for a new item, when they used to get a cheap replacement for $200?
- Second: It makes more sense to move back to riverine and rail transport for goods under this model. Costs will have to be cut, and a big expense is shipping. The cost to move goods, especially raw materials, via river barge vs truck is huge. The Mississippi connects a lot of the midwest towns to the ocean very cheaply, and our rail transport system for freight is still pretty good. If you're shipping bulk goods for intermediate value added manufacture, we could see a renaissance of river transport, and in NOLA specifically, a boom.
- Less military spending, more tax revenue generated from internal manufacture. With less connectivity economically with the rest of the world, the American Military Empire's raison d'etre dies out. More focus on protecting American shipping exclusively. The American Navy probably ages into mass obsolescence, focusing on drone carrier capability to protect our merchant vessels.
- Automation, automation, automation. The American factory of the future will be one of two things: a large central warehouse of robots/3d printers, or a disconnected 'cottage factory' made of people working from home as an almost remote assembly line. I've already seen this in action in Houston, and it's a concept that will blow up. A 'factory owner' gets a contract to make 200 shirts, and he sends orders to a dozen or so stay at home moms who take the raw materials and make portions of the order. Each of them has an industrial sewing machine set up in their house that the factory owner provides.
Posted on 3/25/20 at 11:41 am to bAGginsAGinbarry
quote:
Your TV, lawn mower, North Face jacket, whatever.
None of this shite matters
Only vital things should be pushed hard to come back.
Posted on 3/25/20 at 11:42 am to bAGginsAGinbarry
quote:
Second: It makes more sense to move back to riverine and rail transport for goods under this model.
You do realize they still ship by rail, correct?
Posted on 3/25/20 at 11:43 am to Cosmo
quote:
Only vital things should be pushed hard to come back.
I agree but what do we consider vital?
Posted on 3/25/20 at 11:46 am to bAGginsAGinbarry
We need to make a major push to bring critical national security manufacturing back to North America at a minimum.
Posted on 3/25/20 at 11:54 am to CyrustheVirus
Medicine/antibiotics for starters.
This post was edited on 3/25/20 at 11:55 am
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