Saturday, May 19, 2012

China, America, the EU, Energy, the Environment, Dumping, Antidumping, Protective Tariffs, Quality of Manufacture, Capitalism, Socialism

One can not escape the feeling that a lot of people in the United States government, and elsewhere, do not understand modern environmental needs and issues, especially as regards energy. Gas-guzzling vehicles. Apathy about the environment. No sensible energy policies. Worse, in this industrial sector, as most others as well, the manufacturing system is from yesteryear.

Keith Bradsher and Diane Cardwell have the story at the New York Times in U.S. Slaps Tariffs on Chinese Solar Panels - What a paradoxical sector on which to put up protective tariffs. One would think the more cheap solar panels the better, given the need to lower energy costs.

What is particularly baffling is that sources in the the USA are COMPLAINING that the Chinese "non-capitalist methods" give them an UNFAIR ADVANTAGE!

The article quotes lawyer Alan Price from the law firm representing the USA in the solar panel case, Wiley Rein, as follows:
"China’s method is straightforward: it sets forth industry-specific Five-Year Plans and then uses all forms of national and local subsidies and other governmental support to quickly transfer jobs, supply chains, intellectual property and wealth, to the permanent detriment of U.S. and global manufacturers," he said. "China’s ability to ramp up and overwhelm an industry is unique and particularly devastating with new and emerging technologies, where global competitors may be less established and can be knocked out more easily and quickly."
The question then arises what the "good old boys" and the staunch supporters of American capitalism are doing wrong in the USA in turning modern America into a manufacturing wasteland that is no match for socialist countries?

If we follow the train of Alan Price's thinking, and he may well be right, a much larger socialistic Chinese behemoth is apparently far more nimble and adaptable than the backward American manufacturing system, which, by our experience, is often mired in past nostalgic centuries, methods, ideas, attitudes and politically absurd conceptions.

What did we just read, that Hewelett-Packard is to let go of as many as 30,000 employees? at a company now headed by a political favorite of the GOP?

The only measures that most American CEOs seem to understand to increase profits are outsourcing and/or cost-cutting by getting rid of employees, leaving a mass of unemployed for the government to look after.

The idea at HP is said to be that the money saved will be invested in a better-trained sales force able to generate more cash. Surely that is a joke. Is the delusion there that such measures will make HP more competitive with Canon and other competitors? Not on my desktop.

My first printer was an HP. Since then, the company HP has been resting on its laurels. Grow, or die. That is a rule of life, and a rule of business.

How about better and more competitive products? Where, in Europe, does one find products on sale that are "made in the USA"? American wares, with few exceptions, are also-rans. How much of American resources are going into research and progress, rather into the ever-filling pockets of the upper income classes?

Start there if you want to keep from being over-rolled by the Chinese.

If America thinks it is going to prosper in the future, putting up protective tariffs is not going to help a defunct system living from patent trolling, trade barriers, and completely out-of-date political ideas. No way.

Either you have free trade, or you go back in all product sectors to the old system of protective tariffs, which may not be advisable for an American manufacturing sector that has been less competitive as time goes on.

America's problem is not dumping by China.

America's problem is a structurally unsound economy geared to filling the wealth demands of company owners, vastly over-inflated salary levels of corporate executives, and unrealistic demands of stockholders for stock price appreciation. The idea that companies should concentrate on state-of-the-art production of goods and services appears to be a novelty.

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