ABOUT THOSE RUST BELT MANUFACTURING JOBS TRUMP PROMISED
IT'S AIN'T GOINNA TO HAPPEN NO MATTER WHAT TRUMP SAYS
So we are staying at a five star hotel, the Taj Vivanta, located in Cuff Parade just off Mumbai’s famed Marine Drive. Along with huge bath towels, double portions of toiletries and a sea view, came a small plate of fruit loaded with grapes, apples, a pear and a kiwi. I mean it’s all pretty nice, right? Yes, indeed. Catching up on some missed e-mails and blog posts, (our internet had been down for three days before we left Kochi), I reached for one of the two Red Delicious apples and took a bite. I noticed it had one of those stickers that get passed over some laser screen to record its vitals for the grocer’s records. Looking at it and thinking, “Gee, how modern India has become!” I noticed that the sticker read “Superfresh Growers.Inc., Washington.” How odd, I thought, since I knew that the “Washington” here referred to not to my hometown, Washington, D.C. the Capital of the Free World, but to West coast Washington State, which, indeed, is America’s largest producer of apples in the nation and the apple capital of the world.
Of course I’m thinking, too, that it might have been faster and would have been fewer miles had the Superfresh folks shipped their apples from Yakima heading west towards the Indian subcontinent but who knows. Maybe they did. But it doesn’t really matter all that much.
I did have to chuckle, however, as I realized just how many Red Delicious apples must sit not only here in the Travanta’s rooms, but in how many other hotels here in Mumbai, across India, across Asia and in how many other hotel rooms, kitchens, flats and spaces all around the world. And Trump’s voters think that Trump is going to be able to reverse this shipping of fresh fruit – Red Delicious apples from Washington state in this example – from the U.S. to God knows how many countries around the world? Right. He’s got about as much chance as does Walmart have of buying their cheap designer knock-offs from France or Germany. It’s not going to happen.
Just the other day the Trump administration announced tariffs in the amount of 20% additional on all items imported from Mexico. This pronouncement was rescinded a couple of hours later for reasons that were never made clear. (This is happening a lot, by the way.) But Trump’s “we’re gonna punish China and Mexico – (did he mention Canada, our second largest trading partner?) – for dumping their products in the U.S.” by “fining” them. Fines, in this case, means “import levies” or “tariffs” as they are known in the international trade world. Yes, that’s right, Trump voters. What Trump is promising you in “punishing” China and Mexico (& Canada maybe?) was – in reality, let’s say, and not Kellyanne’s “alternate set of facts reality” - to increase the cost of all the food, cars, toys, pants, baby carriages, dinner plates, socks, jeans, cell phones and virtually everything else you buy every single day. Of course we could all just stop buying shit from China and Mexico. Not sure this is going to happen though, given that food is pretty much a daily essential for humans to say nothing of our cats, dogs and parakeets.
Let’s take a look at what we actually import from China and Mexico. From Mexico, the U.S. imports around $300 billion annually. Top import item? Cars and trucks: $75 billion. Next comes electronics at $63 billion, machinery at $49 billion. Food items (vegetables, fruit and nuts) total $11 billion annually. From China our top import is electronics at $136 billion annually. Next comes machinery at $107 billion, followed by clothing and footwear at about $50 billion, furniture, lighting and signs at $31 billion, toys at $25.7 billion, and cars a paltry $13 billion annually.
By the way, our top imports from Canada are oil at $75 billion, vehicles at $55.7 billion and machinery at $20 billion.
So in essence, by punishing China and Mexico, Trump is punishing you. And the higher prices you’re going to pay for everything? That’s not gonna bring back manufacturing jobs or is it going to increase your salary. No. All it’s going to mean is that you are going to have less money left over once you’ve paid your monthly bills, bought your groceries and outfitted your kids for school even after you receive your latest tax cut proceeds that Trump promised you. And don’t even think of buying a new car since it’s going to cost you around 20% more. Let’s say you are buying a 2017 Ford Fusion for $26,000. Well, with Trump’s “punish Mexico tax” this “punishment” is going to cost you an extra $5,200 making the total $31,800 if you do the math right. So your $4,970 tax cut is already used up if you’re in the middle of middle earners ($84,000) and you buy a new car. You see, this is how Unfettered Free Market Capitalism actually works. If you’re thinking that the system is fucked up, you would be right. It is highly titled towards the rich since, in unfettered free market economic terms, it’s the rich who create jobs - a fiction that, while untrue, continues to “guide” U.S. economic policy.
So given the realities of world trade (my Washington State grown fresh Red Delicious apple delivered to my hotel room in Mumbai, India) Trump’s punishments for Mexico and China are actually punishing U.S. families. But, hey, as with virtually every world out of Trump’s mouth, It Sounds Good! Even if it makes no fucking sense. Even if our import numbers decline from both Mexico and China it will only mean that we consumers are buying less from these countries, which, according to Trump, will mean that our own manufacturing folks can step up and replace those imports we’re no longer importing. Actually, no. The long, world wide threads of manufacturing and trade mean that no longer are cars built in one country. Auto parts – as do parts for washing machines, cell phones, televisions, irons, teapots, computers - pretty much everything comes from a variety of sources and a variety of countries. Those pieces that make up your cell phone may have bits from Korea, Japan, Malaysia, Hong Kong and China coming to together in let’s say China, where the final assembly is done. This is precisely the same process for automobiles, washing machines, televisions and virtually everything else we import. Food is an exception, for obvious reasons.
So those factories that used to buy products locally, let’s say General Motors who bought batteries, light bulbs, tires, directional signals switches, etc. from other manufactures around Detroit or around the country and then assembled the final products, cars in this case, in Detroit, no longer exist. At least not here in America. The manufacturing world has long ago abandoned the “locally sourced” model of manufacturing and now draws on a world wide network of suppliers to fulfill its needs. This is what’s changed so markedly and it is for this reason that high paying manufacturing jobs in rust belt industries are not coming back to America. The nature of making stuff has changed so much that going back to this approach would be like substituting animal horsepower for the combustion engine.
Hope This Clears Things UP!