With the media endlessly trumpeting the decline in American manufacturing, you’d think there was absolutely nothing made in the United States anymore. Nothing could be further from the truth. Though the number has shrunk due to technology advancements and cheap labor overseas, there are still plenty of things manufactured in the US from appliances to yard tools.
What IS “American Made?”
One reason we don’t buy American more often is that we don’t know what is and isn’t manufactured in the USA. When 70 percent of a GM, or Ford vehicle is made from parts manufactured overseas, is it any wonder that we question what is and isn’t American? Honda (Japan), Mercedes (Germany), and Hyundai (Korea) all have manufacturing plants in Alabama, Michelin (France) has one in South Carolina. Are their products American made? Their US employees certainly think so. If 80 percent of your car is manufactured in other countries, is it really American? It’s hard to say with certainty. Sure, legislators assign a certain percentage of parts that must be American made to claim the Made In The USA label, but what is so miraculous about going from 59 percent to 60 percent?
Some would say that a product is “American” if it’s headquarters is in the US and the money stays in the USA. What about Chrysler? Formerly owned by Daimler Benz (Germany), but now owned by Fiat (Italy), do you really know which country receives their money? Regardless of any country’s public partnerships, do we really know whether those dollars are converted to Euros, or Yen, or Yuan as a hedge against the declining Dollar?
We’re disconnected from manufacturing
Not too many decades ago, you knew who manufactured your tires. You knew who wove your carpet yarn. You knew who operated the sewing machines, the presses, the giant machines of manufacturing. They were your friends, your cousins, your neighbors. Today, we’ve lost touch with people who make things.
We’re too interested in accounting
I call it the “accountification” of American business. We’re more interested in the buying process than in the manufacturing process, in how we can tweak the system to eek out another penny per share than in providing the highest quality product at the best price.
We’re too influenced by marketing
Whether we’re willing to admit it or not, marketing plays a crucial role in what we purchase. We’ve allowed ourselves to be convinced that a Lexus (Japan) is better than any other car out there and that having one in the driveway with a big red bow on top is the ultimate gift.
American business has been too slow
Not all the blame can be laid at the feet of the American consumer. American business has been very slow to react to changing conditions. When the gasoline shortages of the 1970’s hit the US, smaller foreign cars were snapped up like they were going out of style because they met the needs of the public. American manufacturing was incredibly slow to adapt and change. Not only that, but American manufacturers were perceived by the public as peddling shoddy materials as other countries (mostly Japanese) were steadily increasing the quality of their products.
Innovation comes from the field but accountants and “experts” are usually too slow to react to it.
The biggest reason is we’re a much more global economy
The interconnectedness of commerce today is astounding. Two hundred years ago, a chair manufacturer would buy lumber from a local forester, shape it with hammers and chisels made one town over, then sell it locally by delivering it on his own handmade wagon. Today, a chair manufacturer (even an American manufacturer) might buy veneers from a company in Canada, use adhesives made in India to attach it to a substrate made in Brazil, stain it with stains made in China after using power tools made with parts manufactured in 12 different countries, then ship it on a truck made in Sweden and a trailer made in Texas to a distributor based in France who will sell it to retailers all over the world using a marketing company that’s a partnership between and English and Japanese conglomerates. Assembled in the USA? Yes. Made in the USA? I’m not so sure.
What’s the solution?
We won’t be getting rid of the global economy anytime soon, not unless we’re hit by an asteroid or comet and life takes a radical change for the worse. What needs to happen is for manufacturers to focus on what they do best and for governments to get out of the way.
Does it really help a country to adopt protectionist measures when the problem is a lack of innovation, too much regulation, and politicians with ZERO business experience dictating how a company should be run?
History says no.