On Wed, 20 Aug 2008 11:58:13 -0500, Tim Daneliuk
wrote:

Tom G wrote:
"Leon" wrote in message
...
"Frank Boettcher" wrote in message
news My dear friend who was also a manufacturing superintendent for me
called last night to let me know that the new Unisaw will be unveiled
today at IWF and will have the "Made in America" badging.

"How can that be?" I asked. Well, it seems that all those decisions I
(we) fought against have been reversed. The Brazilian motor will be
gone in favor of a Marathon. Those chinese castings will be replaced
with castings from, in my opinion, the best all around foundry in the
country, Waupaca. So, with fabrication and assembly in Jackson, TN,
the content will meet the requirement for "Made in America".

I expect it could be pricey. The cost benefit of a very efficient and
nearly fully depreciated facility will not be there and I expect that
all important overhead absorption volume will be down due to those
disastrous decisions of the past. But it makes me feel good to see
this happen, and I'm happy to see that B & D may actually get it where
Pentair, didn't have a clue.

Wish I could be there to see it. I passed on IWF this year, it
conflicting with a fishing/scalloping trip planned some time ago and
it looks like TS Fay is going to wipe out that alternative.

Frank
Sounds like a Harley come back story revisited. Let's hope that they are
as successful.

Interesting story on NBC news last night. Seems that Chinese manufacturing
is in trouble. They estimate that 30 percent of the factories in one
province will shutter their doors in the next year. As one Chinese
interviewee stated "There's no cheap labor, anymore". Labor laws in China
have doubled the minimum wage in the last year or so. Many companies are
moving their manufacturing sites to Vietnam and Indonesia as a result.

Tom G.



Wow, what a shock, free markets actually work??? The anti-globalist,
anti-trade sentiment one frequently hears (especially here) is
foolish. The Chinese/Indian/Sri Lankan/Taiwanese... "cheap" labor
advantage was/is temporary. As these nations continue to participate
in global markets and thereby become more wealthy, their average
salaries will - in currency adjusted terms - start to converge to be
around the same as everyone else's. Sooner or later, people working in
market economies want the same things the wealthy Westerners do - a
nice car, a house, air conditioning, an education, etc. Wage inflation
has already hit Indian IT outsourcing and it is inevitable in China's
manufacturing sector. The only thing that can stop it is violent
suppression by their government (possible) or an invasion by a foreign
power (unlikely).

Tim, I agree in principle but the reality is it is very difficult to
bring anything back. When a successful and efficient manufacturing
facility is closed in favor of moving offshore, many times the state
of depreciation expense amortization and the present value of the
tooling is such that, if lost, it is rare to be able of afford to come
back, at least within a generation.

I was successful for many reasons. Well trained and efficient work
force, reasonable labor costs, good supply chain management, great
imbedded product knowledge, and a very reasonable depreciation expense
component of the overhead. If closed and all lost or made obselete,
the cost of retooling and equiping would cause depreciation expense to
be about four times what it was. That alone would put me out of the
running not to mention the impact of the lost imbedded knowledge.

So maybe in another generation that equilibrium you describe will be a
reality. In the meantime, I hope this Delta initiative will be a
success.

And I agree with your statement below about buying quality and value.
Quality is a component of value.


Trade not only benefits these people, it also makes nations more
interdependent and thus less likely to go to war or otherwise behave
in naughty and violent ways. Yet somehow, it is Westerners - the very
biggest beneficiaries of trade - that lead the whining chorus in
opposition to globalism and markets. Astonishing (and depressing).

One common example of this whining is the insistence that you only
"Buy American" regardless of how good a value an offshore product
might be. I prefer to buy *quality and value*. Sometimes that's an
American product, but not always. Sometimes even the better American
product has so much protectionist goo around it that buying it may be
a mistake. For instance, GM and the execrable UAW are discovering just
how bad the pain can be when you cease participating in fair markets
and hide behind union restraint-of-trade. This makes me disinclined
to buy another Chevy truck when I wonder if the company can even
survive as its unions bleed it to death. As always, Reality trumps
collectivist fantasy...

If you want more peace, slower population growth, better environmental
conditions, better work conditions, fewer poor people, and more good
things for more people, become a market Capitalist. If you hate your
fellow man, subscribe to limited trade, central government control,
tariffs, and "managed" economies.