95% of Everything

This relates to the post on supporting local business . I'm not a big reader but my SIL gave me a book to read entitled "95% of Everything". It is about the movement of manufacturing to other countries and the movement of goods back to North America. It hinges on the shipping industry and the use of containers , relatively cheap fuel for these mammoth ships , cheap labour and increased profit. The book makes the point that 95% of the good we use, in our homes and work places have come from China , Asia ,Taiwan and other Asian countries. Car parts , clothes , and food. As an example Australian sheep are loaded on stock ships and taken to Taiwan to be slaughtered , the frozen carcasses are then shipped back to Australia where they are processed into various cuts , packaged and ready for export....all this is cheaper than slaughter houses can do it in Australia..its mind boggling ! The mega ships make cheap transportation and are responsible for this world wide trade phenomina. However I read an article by an economist who claims that in time this will all revert back to the way it was. His claim is that when oil prices rise, shipping will slow down. When Chinese workers organize they will no longer work for 12 cents an hour , they will demand better wages and benefits and manufacturing costs will rise , they already have wages from 2-6 dollars an hour. This book is an incredible read and really explains what is going on. And finally I have another son in law whose is in the tool and die business. He works out of Goderich Ontario at a place called Akrmold. They make every kind of die and businesses in North America France and Russia buy from them. He told me of an extrusion die for making rubber gromet for passenger car doors where the electrical wiring runs into the door. The company in Mexico complained of their poor production so my SIL had to go to Mexico. He found the die which produced 5 pieces at a time was incorrectly set up so it was extruding in only 4 of 5 channels (15% loss) and the operator had no idea how to use the die. He did not know to clean out the die after removing the molded piece , leaving debris in the die for the next extrusion...thus the 85% production failure was all about operator error. This happens daily in Mexico. SIL hates going there because it is seldom the die's failure...stuff like that , increase wages and high oil prices may well turn things around. The Book it explains it much better than I

I see one flaw in the logic - Chinese workers will never be allow to organize and push up wages. They are tightly controlled by the communist government.

Yes, but Taiwan , asian and Mexican workers have and Chinese workers have had significant increases but still well below NA wages

yeah. waaaay too much stuff is made over there.

to me the 'scary" part is we've lost/are loosing some of our technical and skilled edge.

i've seen alot of tool making move over there so there are fewer companies here doing it and certainly fewer people doing skilled tool work. as the boomers are retiring not as many younger guys (or girls) will have that expertise to learn from.

Big changes are coming in cheap shipping, International Maritime Organization low sulphur fuel regulations take effect in 2020 and lower cost bunker fuel will effectively be outlawed everywhere that matters. The world is still awash in oil but the refinery capacity for low sulphur fuel is currently no where near able to meet the expected surge, not too likely to be many extentions either as the regulations were passed 5 years ago to take effect in 2020.

How about the book " POORLY MADE IN CHINA". Pretty funny .Talk about Americans getting screwed.

Charlie .... not sure about being organized but wages in China are in a growth mode, see the link below, somehow it is happening. Did anyone think that they would stay the same forever? Meanwhile, China is outsourcing some of their factory work to places that have cheaper labor costs. Sort of what North American companies did when they decided to send so much of their manufacturing to China. What's that old expression, what goes around comes around?
Factory wages in China .....

When I was a young man in the 70's & early 80's, people stood in line to get an application in the car plants, steel mills and coal mines. Those jobs were in high demand along with the spinoff industries that support them.
During the late 80's into early 90's, the construction industry was wide open with good jobs.
I think the time will come (if govt allows us to continue to prosper) that trade jobs will return when the 3rd world countries can't or won't supply the world with cheap throwaway electronics and plastic crap.
The young people will eventually figure out where the good jobs are and seek them out creating a strong economy like things were before all the cheap mfg took over.

Maybe a wish or a dream??

Until the revolt and everything gets messy. Watch prices in a country experiencing civil war or internal strife.

I pray you are right. I pray that quality
in all things will out.

(quoted from post at 09:16:34 12/10/19) Yes, but Taiwan , asian and Mexican workers have and Chinese workers have had significant increases but still well below NA wages

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Their cost of living is much lower. They don't need "NA wages" to live and have a few niceties to make things more comfortable.

I feel the author's probably on the right track. It's not something that's going to happen overnight, but even China is going to have to keep raising wages and improving work conditions to prevent a full on revolt.

A friend of mine has a big tool shop here in the states. They make injection molds, blowmolds and stamping dies for the most part. He also does injection molding. He partnered up with a tool shop in China after spending months over there looking at different shops. He tells me the good old USA has nothing on them as far as technology goes. Cheap labor they have, but there tools shops are top notch. He also tells me they have issues getting good materials to build there tools from.

I've heard similar stories of sending materials to Mexico to set up production lines.

Overheard a conversation at the electric supply house, the engineer carefully bought and packaged supplies to connect each machine, sent the package with the machine.

Once it arrived they had no idea what to do with it. Some of it disappeared, probably stolen and sold. The SO cords were wire nutted together and strung across the parking lot, used for extension cords. Everything had to be resupplied at enormous cost along with people to stay there and guard it, set every thing up.

One cousin worked for the John Deere Dubuque plant as an engineer on big excavators. He was constantly in China. He told me some of the shops over there that are John Deere suppliers for excavator parts look like our farm shop back home. It wasn't very big, was dirty, and only a few guys there. And they're supplying a big company like Deere. He was really surprised. I think he had to visit because of a quality control issue.

A few years ago Walmart was going to buy x% of their goods from American companies. Dont hear anymore about that. I had read they were having trouble finding enough American suppliers.

I think this is going to even out in time. I started in '68 at a GM plant, completed my apprenticeship and was laid off the same day in '73. Watched the US auto companies go through all their pain from Japanese competition but have to admit the US carmakers were building junk in those days. Those 70' pickups and cars are fun to have now if you can find one that hasn't disintegrated. That competition was the best thing that could happen. You mention Asian countries but there is a lot of parts production from Turkey and India as well as eastern Europe and Russia. Back in the 70s and 80s everybody was worried the Japanese would take over everything. They were pointing out their technology and factories as shining examples but in reality only about 15 to 20% of the workers were in them. The rest were still in sweat shops. The gains American labor made took 60 to 70 years. In Japan only about 30. China, maybe less but they're growing too fast and the cracks are starting.

Better be careful what you ask for,as the US slides into 3rd world status and China becomes the economic driver and powerhouse in the world factories here in the USA will be where the Chinese handy man gets his cheap stuff from.Don't expect much in the way of wages(LOL)

So what is your original point? You cannot possibly think that inexpensive energy is a bad thing.

Yes, when things change (as they always do), they, well, they change. Change is not always bad, it just is different and we always adapt. People need to get over this obssesion with thinking China is always bad. China is a fact of life that we have to deal with. So deal with it and move on. Does nothing positive to bellyache.

That oil pipeline our leader approved is taking oil cross country to be refined for the Asian market. Former leader wouldn't allow it as he knew it was for cheaper shipping.

It has always boggled my mind how they can ship all those good across the ocean then back for cheaper than we can build them here . One day it will change and we will be the third world country .

It?s to bad that it?s about impossible to find anything that is made in the USA or anywhere but China and when you do it?s five times the cost of the China one

I make it a point to buy American when I can. I once went 5 different places to find some steel stock for a project that was made in the USA. I don't mind paying a little extra for made in the USA products.

If they get to demanding in China they just run the tanks over them like they did in Teneman Square a few years ago. Communists /bolsheviks and the like, will starve millions to death. And you think they will worry about a revolt over wages.

I wonder, do they pay workman?s comp on employees in China, do they pay employee withholding tax, and all the other things a employer has to pay here, they don?t even have minimum wage! No wonder they can make it cheaper and ship it here! Sickening Isn?t it! Lol

If the only goal of America is to maximize profits for the owners....a lot of citizens will get hurt....have been hurt.
Who is looking out for all of America? By the way, Henry Ford knew a hundred years ago that there was no reason to build cars if no one could afford to buy one. We now have the continent of Africa. Very little manufacturing, because very few customers can afford anything.

They must not pay much of anything I don?t care how cheap those ships run there used to be a show on tv called mega ships it showed them refueling one well when Gomer finished topping off the tank he?d only put on 2000 tons of fuel not gallon ton for a trip from China to here. There?s no way that system will ever back fire can it

Back about the time you completed your apprenticeship I heard the GM CEO on live TV, back when his salary was $400k (per the article) he said "We are going to build what we want and they (we the consumer) will just have to buy it as they have no alternative"............fat chance sucker Pfffffffft.

That was about the time Toyota, Datson, and Honda found their way over here and blew the socks off the good ole Made in the USA FARSE. Course nowadays to get a super vehicle made in the USA you need to buy one of them as my Honda was made here and my Chevy 1500 was made in Mexico!!!!!!

Prolly wang sue tong fueled it up! Lol