How America has lost its competitive manufacturing edge, and what can be done about it
The shrinking 'Made in America' product
There was a time when the “Made in America” emblem evoked high-quality manufacturing, competitive pricing and superiority in the international marketplace. Up until the 1990s, we witnessed challengers’ attempts to unseat America’s manufacturing prowess, but only with modest success. However, in the past decade, a consumer would be hard-pressed to find a product made in America.
Fast forward to 2019. Products of all types that are “Made in America” are few and far between. Even if a product does claim to be manufactured in America, after a closer look you will find it usually has the disclaimer, “with components from around the world or assembled in America with products made in …”. America has lost its competitive manufacturing edge and the jobs that go with it.
The most notable example of American manufacturers being overshadowed by our international competitors is the automobile industry. In the early 1900s, the U.S. had three manufacturing giants: General Motors, Ford and Chrysler, whose products were reliable, affordable and sought after. However, as Japan began to rebuild post-World War II, with help from investments under the Marshall Plan, their industries, specifically the automobile industry, became stronger and more competitive — rivaling the United States.
Japan’s accession to the international marketplace was in part due to Japan simultaneously rebuilding their political doctrine. Their leaders were no longer fixated on imperialism, but open to building democracy and instituting free market ideals. While Japanese products had previously been considered poorly made and of little value, their presence in the international market gained recognition thanks to their low-cost manufacturing and rising quality and performance. Japan’s willingness to embrace democracy and free-market ideals allowed them to enter the world stage as one of our strongest allies in trade and national security.
In the past, as manufacturers lost market shares or switched production lines to other countries, as was the case with Japan, it made both countries stronger and we forged relationships based on trade and complimentary forms of governments. Our countries worked together to be mutually beneficial. However, as we now witness China rivaling the United States as a manufacturing powerhouse, this is not the case.
China is a predatory Communist country that seeks only to increase the strength of China. As manufactures flocked to China for cheap labor, what they soon discovered was this: China would often own a controlling interest of the business and intellectual property would have to be turned over to Chinese companies in order for those companies to have market access. China would then reverse-manufacture those products and compete against the original manufacturers. This has empowered China to grow its economy to the second largest in the world, subsequent only to the United States.
China has a track record of stealing intellectual property, copying designs and selling products in direct competition to the original manufacturer at a much cheaper selling price. In strategy documents like “Made in China 2025,” the Chinese Communist Party (CCP) and the Chinese state have repeatedly made clear that China’s industrial policy intends to take innovation from foreign competitors, surpass them in the industries of the future, and replace them in China and globally. This should be reason enough to pull all manufacturing operations out of China.
Their economic success thus far has allowed China to aggressively march around the world with their predatory lending practices, provided under their Belt Road Initiative, and saddle smaller, developing countries with unsustainable debt. As their initiative grows and strengthens, China will continue to rise as an economic power, rivaling the United States.
Suffice it to say, that if we as Americans and others around the world continue to support and encourage manufacturing in China and continue to buy products “Made in China,” it will only empower the CCP. The CCP will not embrace open economies, human rights or become trusted partners. The CCP’s goal is to become a dominant economic and military power worldwide. This was succinctly and clearly stated by Xi Jinping in 2017 during his address to the Communist Party Congress, where he stated, “The Era of China has arrived. No longer will China be forced to swallow its interests around the world. It’s time for China to take the world center stage.”
As a consumer, I have experienced China’s economic dominance firsthand. I went shopping recently to buy three items, a pocket comb (infrequently used), a drill bit and some swivels for fishing. All three were made in China. I could not find a single product manufactured outside of China. I also recently bought a new foam mattress and before making the purchase, I asked the storeowner where it was manufactured. He assured me it was from Italy. When it arrived, the carton said in bold, proud letters, “Made in China.” I called and told the owner, who profusely apologized and found a comparable bed that was made in America.
We can prevent this advancement with what I have coined the “ABC” approach. Manufacture and buy “Anywhere But China.” We should tell our manufactures that production in China is no longer acceptable and that we as consumers must buy from countries other than China.
While I acknowledge the repeated claims from manufacturers that they must stay engaged in China because of their large market — more than 1.3 billion people — I would like to remind these manufacturers that there is a market of 6.2 billion people outside of China, in markets that do not share China’s unfair and predatory track record against foreign firms and their goal of world dominance.
This transition will take time and effort, but it will send a much-needed message to the CCP. Through this adjustment, we can restrict the fuel that feeds a country that is determined to achieve world domination at the expense of others. However, we must start today.
Ted S. Yoho, a U.S. representative from Florida, is the lead Republican for the House Foreign Affairs Subcommittee on Asia, the Pacific, and Nonproliferation.