Well here is one way we can begin for starters....
Buffalo News headline November 21, 2005
GM to close nine plants 30,000 Jobs To Be Cut
Jack Davis asks today
Will you believe me now?
We are not deaf, dumb or blind. Why can't we comprehend that when we lose our manufacturing industries we weaken our economy and our ability to defend our country.
Domestic production is the economic activity that creates useful products, that is wealth and income, and when taxed, income for the state.
We are importing more and producing less in American-owned factories.
We are closing or selling our irreplaceable wealth-producing companies.
By closing plants and/or transferring production to foreign countries, it creates wealth in that country. When we buy their products our wealth is reduced, that is transferred to that country.
Every dollar of U.S. production is front loaded with the costs of thousands of regulations, fees and taxes that increase the costs of U.S. products by up to 80 percent. Social Security alone adds 15.3 percent to the cost of labor.
When imported products cross American borders tax-free American manufactured products are put at a huge price disadvantage.
The idea of no taxes at borders, i.e. free trade, was originated by an English economist David Ricardo over 100 years ago. It was called The Theory of Comparative Costs; today it's called the Theory of Comparative Advantage.
The theory may have worked one hundred years ago when we were an agricultural society. Ricardo in his wildest dreams could never have imagined multinational corporations with factories in many nations able to transfer hundreds of millions of dollars or choose the country where products will be manufactured with a touch of a keyboard.
Ricardo was even less likely to have envisioned China, a country with a controlled economy, a population of 1.3 billion with a stated mission of wanting to be the world's manufacturer and having that ability.
I am sure Ricardo would be the first to admit the theory of comparative costs would not work under those conditions.
The majority of Americans -- the blue, grey and white-collar workers know free trade is a job killer.
The wealthy, the elite and the elected of both parties kneel blindly at the altar of free trade. What will it take to convince them they are wrong?
The Chinese, Japanese, South Koreans, Germans, French, and Mexican government leaders, and many others don't believe in free trade. Their leaders know manufacturing produces jobs and wealth. They protect their jobs and industries with tariffs and other methods.
All industrialized countries target U.S. industries just like the Japanese targeted our electronic entertainment industry.
Liberals and Conservatives have repeatedly stated that outsourcing is good for Americans and that the economy is improving. I disagree with both.
Over the last 20 years we have accumulated a trade deficit of over 4 trillion dollars. This year it is estimated to be 700 billion dollars, a new record. This is a trade deficit of 2 billion dollars a day.
We have a National debt of over 7 trillion dollars; one-third owed to the Asians. This year the increase in our National debt is estimated at over 333 billion dollars, before Katrina.
Medicare will be broke by 2019 and Social Security insolvent by 2042. There is no Social Security lock box -- it is pay as you go. Fewer industries, fewer jobs, means fewer corporations and fewer workers being taxed. Therefore lower payments into Social Security. Therefore, earlier insolvency.
The largest auto parts manufacturer in the U.S. Delphi filed for bankruptcy, possibly negating contractual obligations of wages, health benefits, and pensions to present and retired employees. There will be other companies doing the same thing.
The U.S. Pension Benefit Guaranty Corp. that insures retirement benefits to employees of bankrupt corporations is under funded by 450 billion dollars.
Crude oil and natural gas prices have doubled over the last two years.
A good case can be made that our gasoline at $2.68 a gallon was driven by China's booming export economy being fed by U.S. consumers and it was ignited by our free trade policies.
If you stand at a machine or sit at a desk, your job is not safe. If you are retired or considering retirement your Social Security benefits are not guaranteed and are in danger. The Social Security payments depend on U.S. companies paying U.S. wages to U.S. workers.
Many call for an "all-out effort" by labor and management leaders to save jobs and industries. They have failed to understand the real problem.
If everyone in the auto industry from the presidents to floor sweepers were paid our minimum wage of $5.15/hour we still could not compete with the Chinese wages of pennies an hour.
The problem originated in Washington and therefore must be corrected in Washington.
We have lost the electronics industry, i.e. TV, cameras, VCR, DVD's and personal computers. We are losing auto, ceramics, glass, steel, textiles, garments, plastics, toys, furniture, machine tools, die casting, powdered metal industries, and losing all the jobs too. There is not an industry that has not been downsized.
U.S. manufacturing employment is at its lowest level in 55 years and it is not the result of improved efficiencies.
General Motors, Ford and Daimler Chrysler are losing U.S. market share declining from 73 percent to 60 percent in '04. Japanese, Europeans and Koreans all increased their market share. We will soon be importing Chinese autos, priced below ten thousand dollars. This will cause the U.S. auto companies and their suppliers a further decline in their market share.
General Motors plans to increase Chinese parts purchases from 3 billion dollars to 10 billion dollars by 2010. These will replace parts now being made by Americans.
Over the last 50 years, government officials, corporate officers, and small businessmen have made decisions to increase the pay of American workers. This provided the workers with a standard of living unequaled anywhere in the world. The workers were able to own homes, cars and pay for their children's education. They had the security of company funded healthcare and retirement plans.
No American expects American workers to work for Chinese wages of pennies an hour and be housed in military style dormitories.
No American industry front-loaded with the cost of regulations fees and taxes and paying American wage rates can compete with Chinese prices.
The destruction of manufacturing industries will continue unless we stop it. We must do it soon.
What can we do?
First, recognize the problem --
GLOBALIZATION AND FREE TRADE
DOES NOT WORK. IT IS DESTROYING
OUR WEALTH PRODUCING INDUSTRIES.
Free Traders preach protective tariffs would harm our economy. Too many believed this without questioning why. Question it now!
We have had trade deficits for over 20 years with all industrialized nations. They all used tariffs and or other forms of protectionism to protect their jobs and industries.
For centuries, nations have controlled foreign commerce with taxes at the borders called duties or tariffs.
In America from 1789 to 1930, only 75 years ago, tariffs were the main source of revenue for the Federal Government. From 1817 to 1862 tariffs were the only source of revenue.
The U.S. government never abandoned tariffs. In '04 they had tariff revenue of 20.7 billion dollars.
The Free Traders are wrong about tariffs. America needs tariffs. We are destroying our industries and our middle class and on the way to becoming a third world country.
History reveals that earlier super powers -- England, Russia and Rome have fallen from failed policies not from invading armies.
To save the America's industries we must abandon the flawed policies of globalization and free trade. We must cancel NAFTA, CAFTA, and the WTO. Then place trade-balancing tariffs on all products from countries that sell us more products than they buy from us.
Jack Davis is founder (1964) and President of I Squared R Element Company. They manufacture silicon carbide heating elements that are used in high-temperature industrial electric furnaces located in Akron, NY.
Jack is also the chairman of Save American Jobs Association. For more information visit the web site:
www.SaveAmericanJobs.us
Jack Davis is available for interviews:
Tel: 716.542.5200
Fax: 716.542.2100
http://www.saveamericanjobs.us/sa-news-pr-051129-buffalonews-fullpagead.shtml
