To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...

--
Ed Huntress

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


How about a comparison of actual take home pay after taxes and other
deductions?

David

On Mon, 26 Dec 2011 05:50:50 -0600, "David R. Birch"
wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


How about a comparison of actual take home pay after taxes and other
deductions?

You probably can find that somewhere around the Web. Try the OECD
stats first, or possibly the World Bank.

--
Ed Huntress


David

On Mon, 26 Dec 2011 05:50:50 -0600, "David R. Birch"
wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


How about a comparison of actual take home pay after taxes and other
deductions?

David

You may also be interested in this current article in _Forbes_:

"How Germany Builds Twice as Many Cars as the U.S. While Paying Its
Workers Twice as Much"

http://www.forbes.com/sites/frederic...twice-as-much/

If you aren't familiar with the term, "neo-liberal," as used by IG
Metall's executive, means free-enterprise, privatization, and
globalized trade -- what we would call "conservative economics."

--
Ed Huntress

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

--

On Mon, 26 Dec 2011 08:22:45 -0600, dpb wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.

--
Ed Huntress

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

--
Steve Walker
(remove brain when replying)

On 12/26/2011 8:46 AM, Ed Huntress wrote:
....

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.

Well, it's not so much the current hourly salary altho that's a
contributor to overall cost per vehicle, of course. It's the total
combined cost of present plus previous labor-related costs--the
accumulated pension and medical benefits accrued that are in most other
countries far more heavily government-subsidized so the costs aren't
directly carried by the companies that skews the comparison.

The reorginzation of Chrysler and GM plus the similar concessions won by
Ford under threat of "we, too, unless" and a little better starting
position has rolled back quite a lot of that and now they're actually
building vehicles at a comparative cost that still is profitable.

There's also, of course, the difference in plant infrastructure in that
both Germany and the eastern countries began w/ all new (and heavily
subsidized by the US in reconstruction) at the time facilities while the
US simply kept on w/ their existing. Over the period from the early
post-war years until the beginning of the Japanese invasion that
differential in facilities gradually worsened to the point it was a
major deficit in the US that has had to be overcome.

As everything else, it's a far more complicated analysis than simply
looking at any one part of the equation.

--

On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.

In Germany, labor sits on corporate boards. It's written into the
German constitution.

--
Ed Huntress

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
....

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

--

On Mon, 26 Dec 2011 09:41:18 -0600, dpb wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

Germany has had import restrictions on cars in the past (Japan was
once limited to 10% or 12% of the total German market; France did the
same thing), but I don't know their status on that now. It's unlikely
that there is any overt restrictions, or the WTO would have stepped
in.

--
Ed Huntress

On Mon, 26 Dec 2011 10:31:15 -0500, Ed Huntress
wrote:

On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.

In Germany, labor sits on corporate boards. It's written into the
German constitution.
Correct.
And in America it is not so much the dollars per hour cost, but the
dollars per unit cost since, ( or the units per hour , if you want to
put it that way) with the union/management adversarial system, worker
output is not as high as in many of the Euro nations.

On 2011-12-26, Ed Huntress wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, dpb wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed Huntress wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, dpb wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

Then take a tour of GM or Ford in the US. Of course, it was much more
extreme back in the '80s, when I visited them. For good measure, throw
in a visit to a non-union automobile plant in the South.

Those German companies are roughly 100% unionized. And those aren't
Japanese-style unions, which I've also seen at work.

You're assuming an adversarial union/management relationship.

--
Ed Huntress

On Mon, 26 Dec 2011 12:31:03 -0500, wrote:

On Mon, 26 Dec 2011 10:31:15 -0500, Ed Huntress
wrote:

On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.

In Germany, labor sits on corporate boards. It's written into the
German constitution.
Correct.
And in America it is not so much the dollars per hour cost, but the
dollars per unit cost since, ( or the units per hour , if you want to
put it that way) with the union/management adversarial system, worker
output is not as high as in many of the Euro nations.

That's all well and good, but the point is, they're doing it, and
we're not. And AFAIC, there are no excuses, only things that need to
change.

--
Ed Huntress

On 12/26/2011 11:16 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 09:41:18 -0600, wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

But hardly then to make comparisons to those against whom those
restrictions are imposed as to their superiority....

Germany has had import restrictions on cars in the past (Japan was
once limited to 10% or 12% of the total German market; France did the
same thing), but I don't know their status on that now. It's unlikely
that there is any overt restrictions, or the WTO would have stepped
in.

Not hardly; the WTO is an European invention and is heavily biased in
that direction.

--

On 12/25/2011 7:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

No, nothing in that chart supports that conclusion. When was the last
time you bought a manufactured good from Norway? Austria? Switzerland?
In fact, of the countries on that list, only Germany is a major
exporter of manufactured products.



Back to the drawing board...

What an absurd proposition! So, Norway supposedly paid $57.53 in
average wages and benefits to its manufacturing sector workers, while
the US paid just $34.74. However, manufacturing as a percentage of the
Norwegian economy is less than 10% of GDP, while in the US it's about
14%. Of those developed countries in the chart that pay higher total
compensation in manufacturing, only Germany is a manufacturing
powerhouse, with over 20% of GDP generated by manufacturing. If Norway
hypothetically has just 10 Lars and Nils working in manufacturing,
that's not really meaningful.

The other thing that chart doesn't address is protectionism. *All*
European countries are more protectionist than the USA, particularly in
manufacturing. It's easy to prop up high wages in a sector of the
economy that is protected from foreign competition by high tariffs and
other protectionist measures.

It's worth noting that that Atlantic article does not contain any
reference to a claim that high wages are responsible for a decline in US
manufacturing.


There's no need to feel too bad about the US standard of living just
yet. In terms of per capita GDP at purchasing power parity (PPP), the
US has the second highest in the world after Norway among "real" countries:
http://en.wikipedia.org/wiki/List_of...%29_per_capita.
I say "real" countries because the countries (besides Norway and
Singapore) that are ahead of the US on that list are all small, freakish
places like Liechtenstein, Brunei, Qatar, UAE and so on that don't have
real economies; even Singapore is only "semi-real".

It's interesting to see a comparison of Norway and Singapore, the two
significant countries whose per capita PPP GDP exceed that of the US.
http://cia-world-fact-book.findtheda...y-vs-Singapore.
They have very similar populations and total GDP. However, Singapore
exports about double the dollar value of Norway's exports, and imports
more than triple the dollar value. Manufacturing in Singapore
represents more than 20% of total GDP...and according to that Atlantic
chart, average manufacturing hourly compensation is only $19.10, less
than 1/3 the amount in Norway; yet Singapore's per capita PPP GDP is
slightly ahead of Norway's, in all three of the the rankings in the
Wikipedia page (IMF, World Bank and CIA World Factbook.)

You can always count on leftists to try to lie with statistics.

On 12/26/2011 7:01 AM, Steve Walker wrote:
On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/


So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

With the exception of Germany, most of the countries don't export much
in the way of manufactured goods at all. When was the last time you
bought a Norwegian or Austrian or Belgian or Swiss manufactured product?

Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed Huntress wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, dpb wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

On 12/26/2011 12:23 PM, Pete C. wrote:

Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

There probably isn't a significant manufactured product in the world
that is made from start to finish in one country.

On Mon, 26 Dec 2011 14:23:38 -0600, "Pete C."
wrote:


Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed Huntress wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, dpb wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

Hertel was bought by Kennametal, an American company, in 1993. They
now use the cachet of the Hertel name to sell crap to Eastern European
countries.

Hertel used to be one of the world's quality tool makers, with a great
in-house education program, advanced automation, and so on. I don't
know what they do in Germany anymore.

--
Ed Huntress

On 12/26/2011 1:03 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 14:23:38 -0600, "Pete
wrote:


Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

Hertel was bought by Kennametal, an American company, in 1993. They
now use the cachet of the Hertel name to sell crap to Eastern European
countries.

What makes you think it's "crap"?


Hertel used to be one of the world's quality tool makers, with a great
in-house education program, advanced automation, and so on. I don't
know what they do in Germany anymore.

On Mon, 26 Dec 2011 13:37:43 -0600, dpb wrote:

On 12/26/2011 11:16 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 09:41:18 -0600, wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

But hardly then to make comparisons to those against whom those
restrictions are imposed as to their superiority....

No, I disagree. If they can pay double what we pay in the US, and
still run a trade surplus on premium products that are among the most
desired products in the world, then they're doing something right and
we're doing something wrong.

Again, the point is that unionization is not it -- they're more
unionized than we are. High wages and benefits aren't it -- they pay
twice as much as we do.

You can find an endless list of excuses for this, and I've probably
heard them all in the 35+ years I've reported on manufacturing and
trade. In the end, they're doing something right that we're doing
wrong.


Germany has had import restrictions on cars in the past (Japan was
once limited to 10% or 12% of the total German market; France did the
same thing), but I don't know their status on that now. It's unlikely
that there is any overt restrictions, or the WTO would have stepped
in.

Not hardly; the WTO is an European invention and is heavily biased in
that direction.

The US did the same thing at the time, with restrictions on light
truck imports and "voluntary" import limits with Japan on cars. That's
what created the Lexus, the Acura, and the Infiniti, if you followed
international trade and the car industry at the time. Japan moved into
the premium car market not for ordinary business reasons, but rather
to keep up dollar sales volume with fewer units.

And all of those trade barriers preceeded the WTO by more than ten
years. Now, if you follow WTO rulings, you'll see that they're biased
toward the wealthy countries, including the US, on most items.
Developing countries are supposedly given some slack -- China is still
living on it -- but it's mostly a smokescreen for truly underdeveloped
countries, who suck wind under the WTO agreements.

--
Ed Huntress

On 12/26/2011 9:16 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 09:41:18 -0600, wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

But it hasn't led to a doubling of wages - it has led to a rise in wages
of manufacturing workers. That's good for those workers, provided their
wages rise faster than the cost of living, but not necessarily good for
the German consumer generally.

If protectionism means Germany isn't engaged in those economic
activities in which they have a true (unprotected) comparative
advantage, then Germans generally are worse off.



Germany has had import restrictions on cars in the past (Japan was
once limited to 10% or 12% of the total German market; France did the
same thing), but I don't know their status on that now. It's unlikely
that there is any overt restrictions, or the WTO would have stepped
in.

On Mon, 26 Dec 2011 13:22:50 -0800, George Plimpton
wrote:

On 12/26/2011 1:03 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 14:23:38 -0600, "Pete
wrote:


Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

Hertel was bought by Kennametal, an American company, in 1993. They
now use the cachet of the Hertel name to sell crap to Eastern European
countries.

What makes you think it's "crap"?

Substitute "stuff" if you prefer. I haven't bought any, but shop
people I've talked to say it ain't the Hertel they knew.

--
Ed Huntress



Hertel used to be one of the world's quality tool makers, with a great
in-house education program, advanced automation, and so on. I don't
know what they do in Germany anymore.

On 12/26/2011 1:52 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 13:22:50 -0800, George
wrote:

On 12/26/2011 1:03 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 14:23:38 -0600, "Pete
wrote:


Ed Huntress wrote:

On Mon, 26 Dec 2011 11:54:58 -0600, Ignoramus18557
wrote:

On 2011-12-26, Ed wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i

Then a visit to German factories is in order for you. One of my
favorites was Hertel, the cutting tool company. And Volkswagen.

The few end mills and what not that I have recently purchased in the
Hertel brand are made in Korea. Does this mean that German jobs are
being exported and soon Germany will be in similarly bad shape to the US
manufacturing wise?

Hertel was bought by Kennametal, an American company, in 1993. They
now use the cachet of the Hertel name to sell crap to Eastern European
countries.

What makes you think it's "crap"?

Substitute "stuff" if you prefer. I haven't bought any, but shop
people I've talked to say it ain't the Hertel they knew.

Maybe they're selling just as good stuff as before.

On 12/26/2011 3:44 PM, Ed Huntress wrote:
....

You can find an endless list of excuses for this, and I've probably
heard them all in the 35+ years I've reported on manufacturing and
trade. In the end, they're doing something right that we're doing
wrong.

For some specific definition of "right". They operate under different
constraints and w/ much different arrangements of (primarily) government
intervention. It isn't, however, the US.

....

And all of those trade barriers preceeded the WTO by more than ten
years. Now, if you follow WTO rulings, you'll see that they're biased
toward the wealthy countries, including the US, on most items.
....

Well, that's not so much the case imo, particularly wrt to ag products
where the European restrictions are enormous and the subsidies go along
with them (in different forms than in US, but even more in terms of
actual value per unit production).

This is, however, the wrong forum to try to delve into the depths
required to get anywhere meaningful on the subject; as noted elsewhere,
none of this is nearly as simple as a few comments would try to imply
that there is some magic elixir somewhere.

Germany is certainly not entirely w/o difficulties of their own
economically.

--

On Mon, 26 Dec 2011 13:50:56 -0800, George Plimpton
wrote:

On 12/26/2011 9:16 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 09:41:18 -0600, wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

But it hasn't led to a doubling of wages - it has led to a rise in wages
of manufacturing workers. That's good for those workers, provided their
wages rise faster than the cost of living, but not necessarily good for
the German consumer generally.

If protectionism means Germany isn't engaged in those economic
activities in which they have a true (unprotected) comparative
advantage, then Germans generally are worse off.

Not if there is a shortage of jobs. Then employment by almost any
means, including a distortion of the theoretical comparative-advantage
distribution of production, is a net advantage.

People who aren't producing anything, or who are underemployed and
producing very little, are a bigger economic problem than
inefficiencies in the comparative-advantage situation.

--
Ed Huntress




Germany has had import restrictions on cars in the past (Japan was
once limited to 10% or 12% of the total German market; France did the
same thing), but I don't know their status on that now. It's unlikely
that there is any overt restrictions, or the WTO would have stepped
in.

On Mon, 26 Dec 2011 12:03:25 -0800, George Plimpton
wrote:

On 12/25/2011 7:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

No, nothing in that chart supports that conclusion. When was the last
time you bought a manufactured good from Norway? Austria? Switzerland?

Uh, they don't have to trade with the US. g

In fact, of the countries on that list, only Germany is a major
exporter of manufactured products.

As I said, some of the countries on that list are among the most
successful exporters of manufactured goods -- in the sense that their
trade balances are in surplus. Volume is no measure of success -- our
volumes of exports are huge, but our imports are even bigger.

Here's the list of current accounts:

http://en.wikipedia.org/wiki/List_of...ount_balanc e

Of the 13, MOST of them are running trade surpluses. They're also
sizeable exporters:

http://en.wikipedia.org/wiki/List_of...ies_by_exports




Back to the drawing board...

What an absurd proposition! So, Norway supposedly paid $57.53 in
average wages and benefits to its manufacturing sector workers, while
the US paid just $34.74. However, manufacturing as a percentage of the
Norwegian economy is less than 10% of GDP, while in the US it's about
14%. Of those developed countries in the chart that pay higher total
compensation in manufacturing, only Germany is a manufacturing
powerhouse, with over 20% of GDP generated by manufacturing. If Norway
hypothetically has just 10 Lars and Nils working in manufacturing,
that's not really meaningful.

Nonsense. The US is not a net exporter. Most of those countries are.
And if the US is a "successful" exporter, then Norway is much more
successful in terms of net results.


The other thing that chart doesn't address is protectionism. *All*
European countries are more protectionist than the USA, particularly in
manufacturing. It's easy to prop up high wages in a sector of the
economy that is protected from foreign competition by high tariffs and
other protectionist measures.

Then we're doing it wrong and they're doing it right, correct? Or does
that clash with Milton Friedman's theories about trade balance, or the
simplistic version of "comparative advantage"?

According to Milt, we should just sit back, keep buying more imports,
and wait for the dollar to drop until we've achieved PPP (parity) with
China, or maybe with Tierra del Fuego.


It's worth noting that that Atlantic article does not contain any
reference to a claim that high wages are responsible for a decline in US
manufacturing.

Nobody with knowledge of the subject is making that claim. That's a
claim made by people who haven't studied the subject and are looking
for an excuse.



There's no need to feel too bad about the US standard of living just
yet. In terms of per capita GDP at purchasing power parity (PPP), the
US has the second highest in the world after Norway among "real" countries:
http://en.wikipedia.org/wiki/List_of...%29_per_capita.
I say "real" countries because the countries (besides Norway and
Singapore) that are ahead of the US on that list are all small, freakish
places like Liechtenstein, Brunei, Qatar, UAE and so on that don't have
real economies; even Singapore is only "semi-real".

It's amazing how you can hold up appearances if you have the world's
goldest credit card, eh?


It's interesting to see a comparison of Norway and Singapore, the two
significant countries whose per capita PPP GDP exceed that of the US.
http://cia-world-fact-book.findtheda...y-vs-Singapore.
They have very similar populations and total GDP. However, Singapore
exports about double the dollar value of Norway's exports, and imports
more than triple the dollar value. Manufacturing in Singapore
represents more than 20% of total GDP...and according to that Atlantic
chart, average manufacturing hourly compensation is only $19.10, less
than 1/3 the amount in Norway; yet Singapore's per capita PPP GDP is
slightly ahead of Norway's, in all three of the the rankings in the
Wikipedia page (IMF, World Bank and CIA World Factbook.)

You can always count on leftists to try to lie with statistics.

Plimpton, you're spinning like a top, trying to out-do the
excuse-makers.

Here are the simple facts: There are a bunch of countries that pay
much higher manfacturing wages and benefits than we do. Most of them
are running trade surpluses, while our trade *deficits* are
monumental.

Obviously, US manufacturing wages are not the cause of our trade
deficits, contrary to what you'll hear over lunch at a NAM meeting
(yes, I've attended many of them).

US manufacturers, particularly the small- to medium-sized ones, are
grasping at straws to explain what's happened to US manufacturing.
They've been doing it for decades. They doubtless were doing it before
we were born.

Denial and excuse-making are their modus operandi. That's all I was
saying. Blaming those "unionized" workers and their "high" wages is an
attempt to find scapegoats for other problems.

--
Ed Huntress

On 12/26/2011 2:56 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 12:03:25 -0800, George
wrote:

On 12/25/2011 7:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

No, nothing in that chart supports that conclusion. When was the last
time you bought a manufactured good from Norway? Austria? Switzerland?

Uh, they don't have to trade with the US.g

Can you point to any manufacturing exports from Norway?


In fact, of the countries on that list, only Germany is a major
exporter of manufactured products.

As I said, some of the countries on that list are among the most
successful exporters of manufactured goods -- in the sense that their
trade balances are in surplus. Volume is no measure of success -- our
volumes of exports are huge, but our imports are even bigger.

Here's the list of current accounts:

http://en.wikipedia.org/wiki/List_of...ount_balanc e

Of the 13, MOST of them are running trade surpluses.

The current account balance includes exports of services and net factor
income. There's no indication in any of that what percentage of the
exports are made up of manufactures. In fact, most of Norway's exports
are primary products (71%). Of the rest, manufactured goods make up a
bit less than half, or 14.1% of all exports.
http://www.economywatch.com/world_ec...rt-import.html

Further, five of the countries with higher average manufacturing wages
than the US also are running current account deficits: Belgium,
Australia, France, Ireland and Canada.


They're also sizeable exporters:

http://en.wikipedia.org/wiki/List_of...ies_by_exports

Those are total exports, not net.



Back to the drawing board...

What an absurd proposition! So, Norway supposedly paid $57.53 in
average wages and benefits to its manufacturing sector workers, while
the US paid just $34.74. However, manufacturing as a percentage of the
Norwegian economy is less than 10% of GDP, while in the US it's about
14%. Of those developed countries in the chart that pay higher total
compensation in manufacturing, only Germany is a manufacturing
powerhouse, with over 20% of GDP generated by manufacturing. If Norway
hypothetically has just 10 Lars and Nils working in manufacturing,
that's not really meaningful.

Nonsense. The US is not a net exporter.

I didn't say it was.



Most of those countries are.
And if the US is a "successful" exporter, then Norway is much more
successful in terms of net results.

I'm talking about exports of manufactured goods specifically. Norway
does not export much in the way of manufactures. Of its exports, only
14.1% are manufactures. About 14.9% is services, and the rest - 71% -
is primary materials.



The other thing that chart doesn't address is protectionism. *All*
European countries are more protectionist than the USA, particularly in
manufacturing. It's easy to prop up high wages in a sector of the
economy that is protected from foreign competition by high tariffs and
other protectionist measures.

Then we're doing it wrong and they're doing it right, correct?

No - because the goal is not to be primarily a manufacturing economy.
Why would it be?



It's worth noting that that Atlantic article does not contain any
reference to a claim that high wages are responsible for a decline in US
manufacturing.

Nobody with knowledge of the subject is making that claim.

You're whacking at a straw man.



There's no need to feel too bad about the US standard of living just
yet. In terms of per capita GDP at purchasing power parity (PPP), the
US has the second highest in the world after Norway among "real" countries:
http://en.wikipedia.org/wiki/List_of...%29_per_capita.
I say "real" countries because the countries (besides Norway and
Singapore) that are ahead of the US on that list are all small, freakish
places like Liechtenstein, Brunei, Qatar, UAE and so on that don't have
real economies; even Singapore is only "semi-real".

It's amazing how you can hold up appearances if you have the world's
goldest credit card, eh?


It's interesting to see a comparison of Norway and Singapore, the two
significant countries whose per capita PPP GDP exceed that of the US.
http://cia-world-fact-book.findtheda...y-vs-Singapore.
They have very similar populations and total GDP. However, Singapore
exports about double the dollar value of Norway's exports, and imports
more than triple the dollar value. Manufacturing in Singapore
represents more than 20% of total GDP...and according to that Atlantic
chart, average manufacturing hourly compensation is only $19.10, less
than 1/3 the amount in Norway; yet Singapore's per capita PPP GDP is
slightly ahead of Norway's, in all three of the the rankings in the
Wikipedia page (IMF, World Bank and CIA World Factbook.)

You can always count on leftists to try to lie with statistics.

Plimpton, you're spinning like a top, trying to out-do the
excuse-makers.

Here are the simple facts: There are a bunch of countries that pay
much higher manfacturing wages and benefits than we do. Most of them
are running trade surpluses,

You have no idea if they're running surpluses specifically in
manufactures. Their current account balance doesn't indicate the
percentage of trade due to manufactures.

On 12/26/2011 2:17 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 13:50:56 -0800, George
wrote:

On 12/26/2011 9:16 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 09:41:18 -0600, wrote:

On 12/26/2011 9:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.
...

And, generally, have highly protectionist policies when it comes to
imports of the chosen competitive product areas.

Again, that varies. But if import restrictions in Germany have led to
a doubling of wages and a trade surplus, then it would be a good
argument in their favor.

But it hasn't led to a doubling of wages - it has led to a rise in wages
of manufacturing workers. That's good for those workers, provided their
wages rise faster than the cost of living, but not necessarily good for
the German consumer generally.

If protectionism means Germany isn't engaged in those economic
activities in which they have a true (unprotected) comparative
advantage, then Germans generally are worse off.

Not if there is a shortage of jobs. Then employment by almost any
means, including a distortion of the theoretical comparative-advantage
distribution of production, is a net advantage.

What does a "shortage" of jobs even mean?

And no, distorting markets never creates a higher net benefit from trade.


People who aren't producing anything, or who are underemployed and
producing very little, are a bigger economic problem than
inefficiencies in the comparative-advantage situation.

Giving them fake jobs doesn't help - certainly not those who don't get them.

On 12/26/2011 6:46 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


Come on, Ed. You're just talking about republicans' lying. They've been
doing that about Democrats since before Lincoln was shot. All the lies
revolve around the government getting in the way of business and
preventing it from growing. Back in 1920 it was the president of the
Chamber of Commerce giving speeches saying that if the Securities and
Exchange Commission was allowed to be established it would destroy
American business' ability to compete. They have been saying similar
things to that ever since. They have always been lies.

Now that your statistics have shown that American unions have not caused
us to be noncompetitive globally, or that they have made our products
too expensive to sell due to our high labor costs, what will the
republicans say next? We both know what it will be like. It will be very
easy to predict, and it will be a lie. Nothing new here, move along.

Hawke

On 12/26/2011 9:54 AM, Ignoramus18557 wrote:
On 2011-12-26, Ed wrote:
On Mon, 26 Dec 2011 08:22:45 -0600, wrote:

On 12/25/2011 9:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


There's something fishy in the counting methinks...

http://www.oica.net/category/production-statistics/

Overall US production is ~25% larger than Germany--I suspect many of the
SUVs, PUs that are used essentially as passenger cars, etc., are in the
"commercial" classification and therefore not in the above comparison.
There's a much different vehicle mix in US vis a vis Europe.

It's 8:6, roughly, overall production US:Germany

Right. We count SUVs as "light trucks," which typically are compared
with "light commercial vehicle" figures for Europe.

It does skew the production figures, but it doesn't skew the salaries
and benefits.

My point in posting that is actually a long, continuing discussion
we've had here on RCM, in which some people have claimed that we pay
too much (because of unions, in the usual narrative) and that's why we
can't compete in exports. As the Forbes story shows, this is nonsense.

I reported on production and trade for _American Machinist_ and other
magazines, dating back to the mid-'70s, and this is something I've
watched for decades. Exposed to a little research, it's clearly a
bunch of ideological nonsense. You'll hear small businessmen, like Tom
Gardner, bash unions here all the time, complaining that they've
driven up costs so that US companies can't compete.

A little sunshine shows that their problem lies elsewhere.


The unions have greatly diminished, and so has their impact, but I
cannot imagine how they could possibly not be a detriment to efficient
production process.

i


Then you don't really understand the function of unions. It's not the
intention of unions to impede a company from making and selling products
as efficiently as the company can. The function of the unions is simply
to force the management to give up a greater share of the company's
profits to the workers instead of the shareholders.

Hawke

In article ,
says...

On 12/26/2011 7:01 AM, Steve Walker wrote:
On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/


So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

With the exception of Germany, most of the countries don't export much
in the way of manufactured goods at all. When was the last time you
bought a Norwegian or Austrian or Belgian or Swiss manufactured product?

For Swiss about two years ago, when my 30 year old Swiss-made Bosch
jigsaw crapped out, I replaced it with another Swiss-made Bosch jigsaw.
Bosch also has some saws that are not made in Switzerland, but mine was.

On 12/26/2011 7:31 AM, Ed Huntress wrote:
On Mon, 26 Dec 2011 10:01:33 -0500, Steve Walker
wrote:

On 12/25/2011 22:35, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

Back to the drawing board...


As a lazy researcher when it comes to statistics, I'm gonna go out on a
limb and guess that most of the countries above us in the chart export
items that need a higher skill level to produce, thus the higher
production per hour cost.

Maybe, but I wouldn't count on it.

It doesn't have a simple answer. The closest thing to a summary
reason, though, is that the best exorters with high wages tend to have
strong coordination among labor, management, and government.

In Germany, labor sits on corporate boards. It's written into the
German constitution.


So in other words, it's up to the policies of the government's whether
they allow a system that works well or not for the people who live in
their country. As we have seen in the past, countries like Japan and
Germany put policies in place that make it easier for their people to
compete successfully and to earn enough to have a high standard of
living. In other countries it doesn't work that way.

Just as we have "right to work" states you find that workers in those
states have lower pay and lower standards of living. So the policies the
individual government pursues are what allows the people of a country to
have it good or to have it bad when it comes to living standards. If
high living standards for its workers is a high priority to a government
you see that reflected in the country's living standards. If a
government does not make a high living standard for it's workers a
priority you can see that as well. Over the last three decades in the
U.S. keeping American workers at a high living standard has not been a
high priority to the American government, especially under the Bush
administration's pro business government. For those of us who live here
you can't help but notice the change.

Hawke

Then you don't really understand the function of unions. It's not the
intention of unions to impede a company from making and selling products
as efficiently as the company can. The function of the unions is simply
to force the management to give up a greater share of the company's
profits to the workers instead of the shareholders.

Hawke

The unions are like the oil cartel, they get together and conspire to do price fixing.

The unions are like the Wehrmacht, they invade, take over, and then consider the place to be theirs.

The unions are like mosquitoes, they try not to suck all the blood out of the host, but sometimes it dies anyway.

I was a union organizer for engineers, and I signed up everyone in my area, except an acid head hippie liberal and a bigoted old John Birch society member. How could I have been so stupid?

George Plimpton
What an absurd proposition! So, Norway supposedly paid $57.53 in
average wages and benefits to its manufacturing sector workers, while
the US paid just $34.74. However, manufacturing as a percentage of the
Norwegian economy is less than 10% of GDP, while in the US it's about
14%. ..

You can always count on leftists to try to lie with statistics.

Norway is #1 because they do a couple things right:
1) Drill for oil
2) Keep immigrants out

But if you asked a Norwegian, he would probably say it is because they have circle jerk meeting about global warming and tolerance.

On Mon, 26 Dec 2011 18:12:46 -0800, George Plimpton
wrote:

On 12/26/2011 2:56 PM, Ed Huntress wrote:
On Mon, 26 Dec 2011 12:03:25 -0800, George
wrote:

On 12/25/2011 7:35 PM, Ed Huntress wrote:
To anyone who thinks that US manufacturing salaries, including
benefits, are harming our industries or trade, consider that there are
13 other countries that pay mo

http://www.theatlantic.com/business/...the-us/250460/

So much for that idea. Some of the countries on that list are among
the most successful exporters of manufactured goods.

No, nothing in that chart supports that conclusion. When was the last
time you bought a manufactured good from Norway? Austria? Switzerland?

Uh, they don't have to trade with the US.g

Can you point to any manufacturing exports from Norway?

Semi-finished steel, oil rigs, aluminum, industrial machinery...



In fact, of the countries on that list, only Germany is a major
exporter of manufactured products.

As I said, some of the countries on that list are among the most
successful exporters of manufactured goods -- in the sense that their
trade balances are in surplus. Volume is no measure of success -- our
volumes of exports are huge, but our imports are even bigger.

Here's the list of current accounts:

http://en.wikipedia.org/wiki/List_of...ount_balanc e

Of the 13, MOST of them are running trade surpluses.

The current account balance includes exports of services and net factor
income. There's no indication in any of that what percentage of the
exports are made up of manufactures.

Plimpton, instead of speculating, why don't you just look it up?
Services are roughly a wash for Norway. Net factor income is trivial,
as it is in most cases.

In fact, most of Norway's exports
are primary products (71%). Of the rest, manufactured goods make up a
bit less than half, or 14.1% of all exports.
http://www.economywatch.com/world_ec...rt-import.html

Further, five of the countries with higher average manufacturing wages
than the US also are running current account deficits: Belgium,
Australia, France, Ireland and Canada.

Which means that eight are not. And, if it was true that high wages
lead to trade deficits, then there would be NO countries with trade
surpluses.

I haven't looked at the other five, but I wouldn't be surprised if
their deficits, as a percentage of total trade or of GDP, were less
than ours.

In any case, if wages are the issue, then why are eight of 13
higher-wage countries running surpluses?



They're also sizeable exporters:

http://en.wikipedia.org/wiki/List_of...ies_by_exports

Those are total exports, not net.

That's true. To say one is a "sizeable exporter" means their total
exports are substantial. Which is what I said.

In other words, their wages are higher than ours; eight of those 13
are running current-account surpluses, and several are sizeable
exporters.

So, how many excuses are you going to have to make for us, before you
run out of excuses?




Back to the drawing board...

What an absurd proposition! So, Norway supposedly paid $57.53 in
average wages and benefits to its manufacturing sector workers, while
the US paid just $34.74. However, manufacturing as a percentage of the
Norwegian economy is less than 10% of GDP, while in the US it's about
14%. Of those developed countries in the chart that pay higher total
compensation in manufacturing, only Germany is a manufacturing
powerhouse, with over 20% of GDP generated by manufacturing. If Norway
hypothetically has just 10 Lars and Nils working in manufacturing,
that's not really meaningful.

Nonsense. The US is not a net exporter.

I didn't say it was.



Most of those countries are.
And if the US is a "successful" exporter, then Norway is much more
successful in terms of net results.

I'm talking about exports of manufactured goods specifically. Norway
does not export much in the way of manufactures. Of its exports, only
14.1% are manufactures. About 14.9% is services, and the rest - 71% -
is primary materials.



The other thing that chart doesn't address is protectionism. *All*
European countries are more protectionist than the USA, particularly in
manufacturing. It's easy to prop up high wages in a sector of the
economy that is protected from foreign competition by high tariffs and
other protectionist measures.

Then we're doing it wrong and they're doing it right, correct?

No - because the goal is not to be primarily a manufacturing economy.
Why would it be?

The goal is to have a high standard of living without running up big
cumulative debts. We're running up big debts -- a smart thing in the
short run, when the economy is sagging, but not in the long run.

Those countries are doing better at it than we are.




It's worth noting that that Atlantic article does not contain any
reference to a claim that high wages are responsible for a decline in US
manufacturing.

Nobody with knowledge of the subject is making that claim.

You're whacking at a straw man.

There's a lot of straw out there, which is more noticeable if you
spend your working days visiting and interviewing managers of
manufacturing operations.




There's no need to feel too bad about the US standard of living just
yet. In terms of per capita GDP at purchasing power parity (PPP), the
US has the second highest in the world after Norway among "real" countries:
http://en.wikipedia.org/wiki/List_of...%29_per_capita.
I say "real" countries because the countries (besides Norway and
Singapore) that are ahead of the US on that list are all small, freakish
places like Liechtenstein, Brunei, Qatar, UAE and so on that don't have
real economies; even Singapore is only "semi-real".

It's amazing how you can hold up appearances if you have the world's
goldest credit card, eh?


It's interesting to see a comparison of Norway and Singapore, the two
significant countries whose per capita PPP GDP exceed that of the US.
http://cia-world-fact-book.findtheda...y-vs-Singapore.
They have very similar populations and total GDP. However, Singapore
exports about double the dollar value of Norway's exports, and imports
more than triple the dollar value. Manufacturing in Singapore
represents more than 20% of total GDP...and according to that Atlantic
chart, average manufacturing hourly compensation is only $19.10, less
than 1/3 the amount in Norway; yet Singapore's per capita PPP GDP is
slightly ahead of Norway's, in all three of the the rankings in the
Wikipedia page (IMF, World Bank and CIA World Factbook.)

You can always count on leftists to try to lie with statistics.

Plimpton, you're spinning like a top, trying to out-do the
excuse-makers.

Here are the simple facts: There are a bunch of countries that pay
much higher manfacturing wages and benefits than we do. Most of them
are running trade surpluses,

You have no idea if they're running surpluses specifically in
manufactures. Their current account balance doesn't indicate the
percentage of trade due to manufactures.

Yes, actually, I do have some idea. As I said, I've reported on
manufacturing and trade for several decades.

And you would, too, if, instead of speculating to produce excuses, you
did a little digging into the facts.

--

Ed Huntress

On 12/26/2011 10:05 PM, Hawke wrote:
....

Just as we have "right to work" states you find that workers in those
states have lower pay and lower standards of living....

One doesn't necessarily imply the other--the cost of living is generally
significantly lower in the right to work states.

--

On 12/27/2011 2:03 AM, John B. wrote:
....

parts. Dutze air cooled engines manufactured in China. In the first
case because the tax on a fully assembled auto would be prohibitive
and in the second, I would guess, for much the same reasons.

More likely because the Chinese government requires at least some
manufacturing be onshore by foreign corporations for access to their
markets. It's a form of forced technology transfer that essentially
puts the industrial espionage target at convenient hand...

--