Monday, May 07, 2012

The Little Red Hen Story - updated

The American industrial base has relocated to international locales and a concern of the military is that we may not have enough local industry to produce defense equipment in its entirety here in America.  On the Spring Break trip’s visit to Boeing Headquarters, we learned that Boeing has over 20 foreign partners that help build one of its airplanes.  Defense contractors also outsource.  Along with that comes the concern that foreign corporations are also learning technological and industrial secrets and with their penchants for reverse engineering, gaining technological advantage as well.

Obama has been championing re-industrialization of America or “in-sourcing”.  I wonder how he will win over corporate America, though – ObamaCare is a disincentive to reindustrialization. With the second highest corporate tax rates in the world at 39.2 percent (combined federal and state taxes), some economists have likened it to an economic Berlin Wall around the US. Government.  Government regulations (EPA and OSHA mostly) have shut down many businesses and there are other government mandates that make business in America unattractive.

The President wants to create jobs – our unemployment rate is 8.1 percent, with 12.5 million unemployed.  Even though the private sector gained 130,000 new jobs and the government (en toto) cut 15,000 posts in March, the number of unemployed people didn’t change.  What’s interesting about this is that those who haven’t been able to find jobs in the last six months are now at 41.3 percent of the total unemployed.  American workers don’t seem to be interested in blue collar work, either, though, so this in itself is a disincentive to reindustrialization. Americans want high pay, benefits and easy work – the product of a consumption lifestyle. This 41.3 percent is not interested in the hard work of creating jobs and will instead be looking for government handouts (unemployment benefits, additional strain on (Medicaid/Medicare). 

Le Monde Diplomatique reports that Europe has been hoping for the last twenty years to reach a “post-industrial Leisure society”. French elections are protesting against the deindustrialization of France and Europe is realizing that they can’t afford the American consumption lifestyle that we exported.  American politicians have yet to realize that we can’t afford it either, as they aren’t slashing the government jobs that prevent industrialization from re-entering America.

Obama has been searching for a new campaign slogan, but he has one now: “Forward”. Romney has made fun of him by asking, “Forward where? Off a cliff?” Not really…no one is interested in building a refinery that can produce the lubricant needed to oil the machinery to create a steam shovel that can mine some marble that was found in the ground that prompted a business man to build a quarry, that incidentally now employs several hundred people, that created a cliff off which Obama CAN walk.

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