undefined | Better HN

0 pointsdcolkitt3y ago0 comments

> Auto factory jobs (which were outsourced)

The decline of Detroit UAW auto industry definitely weren't outsourced. It certainly wasn't GM that opened car factories in Japan and Germany. And it certainly wasn't GM shareholders or executives that benefited from the rise of Japanese and German imports.

This isn't outsourcing, this is simply a case of American carmakers being outcompeted by better products from Japanese and European competitors. (A significant fraction of which were actually assembled in US-based plants owned by those overseas competitors.)

This has nothing to do with "mobility of capital", and unless you shut down trade completely, there's nothing in the world that can protect poorly managed American companies from foreign competition. (Nor should you, while one million UAW workers saw their pay decline, 300 million Americans benefited from a vast improvement in car reliability, affordability and safety.)

0 comments

whimsicalism3y ago

1. Both factors matter. Most manufacturing for the American automakers also happens outside of the US. That is outsourcing. People still buy American cars.

2. It does have to do with mobility of capital in that many of these "international" competitors are still reliant on American capital and are owned in no small part by American institutional investors.

> This has nothing to do with "mobility of capital", and unless you shut down trade completely, there's nothing in the world that can protect poorly managed American companies from foreign competition. (Nor should you, while one million UAW workers saw their pay decline, 300 million Americans benefited from a vast improvement in car reliability, affordability and safety.)

You are mixing in a moral argument about which is better but it is sort of irrelevant to the veracity of claims like "manufacturing jobs never paid close to $30/hr" and "high-skilled manufacturing was never outsourced."

dcolkittOP3y ago

> It does have to do with mobility of capital in that many of these "international" competitors are still reliant on American capital and are owned in no small part by American institutional investors.

The Japanese auto industry, like virtually all of postwar Japan, was almost entirely financed by Japan's persistently high domestic savings rate. You don't have to take my word for it, just look at the long and persistently high current account deficit Japan has with the US. Japan is a huge net exporter of capital, not importer, and it has been for 50 years.

j / k navigate · click thread line to collapse

0 comments

whimsicalism3y ago

1. Both factors matter. Most manufacturing for the American automakers also happens outside of the US. That is outsourcing. People still buy American cars.

dcolkittOP3y ago

j / k navigate · click thread line to collapse