Have you who live in the US noticed how the European and Asian automation and control companies have reduced their footprint in America? Not only that, have you noted how (except for Rockwell Automation) the US-based companies increasingly held their conferences overseas?
Long before Trump, a few politicians recognized American manufacturing’s demise.
Reflecting on my experiences in manufacturing and then writing about it, I long ago noted the “Walmart effect”. That company changed advertising decades ago from “Made in America” to “Lowest Prices Always.” Forcing their suppliers to reduce their price every year forced them to drive all costs both material and labor to the lowest possible. And not only Walmart.
Checking today’s News Items by John Ellis, I spotted this item he cites from the Wall Street Journal.
The manufacturing boom President Trump promised would usher in a golden age for America is going in reverse. After years of economic interventions by the Trump and Biden administrations, fewer Americans work in manufacturing than any point since the pandemic ended. Manufacturers shed workers in each of the eight months after Trump unveiled “Liberation Day” tariffs, according to federal figures, extending a contraction that has seen more than 200,000 roles disappear since 2023. An index of factory activity tracked by the Institute for Supply Management shrunk in 26 straight months through December, but showed a January uptick in new orders and production that surprised analysts. The Census Bureau estimates that manufacturing construction spending, which surged with Biden-era funding for chips and renewable energy, fell in each of Trump’s first nine months in office. (Source: wsj.com)
Investment is good. However, it doesn’t come first. What comes first are entrepreneurs—either independent or in a corporation—who see a customer need to solve. They develop a product. Then they need investment to make it—especially investment and encouragement to make it here. And encouragement in a way that does not screw the locality through sucking up resources without paying for them.
I suggest that it’s not merely the Walmart effect. It’s really the lack of imagination and engineering coupled with too many finance majors.
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