Monday, December 19, 2011
Despite what one blogger at The American Interest calls, "efforts to regulate it out of existence," manufacturing is making a comeback across America. The blog links to a longer article by Joel Kotkin of New Geography, who names the following proximate causes:
Already the boom in natural gas has sparked a considerable industrial rebound in parts of eastern Ohio including the building of a new $650 million steel plant for gas pipes in the Youngstown area. Karen Wright, whose Ariel Corporation sells compressors used in gas plants, has added more than 300 positions in the past two years. "There's a huge amount of drilling throughout the Midwest," Wright says. "This is a game changer."The American Interest also rightly points out that, "Solyndra style subsidized and government planned 'green jobs'", are not part of the picture. But this mere slap at central planning verges on generosity when we consider the enormous costs to our economy exacted by regulations and the mis-allocation of resources that also result from the "investments" of know-nothing government "planners". It cannot be stressed enough that American manufacturing is coming back because of the remaining capitalist elements of our mixed economy, and despite the increasingly numerous and large statist elements. Without the latter, we would be enjoying a roaring comeback that would not have required a bloodhound like Joel Kotkin to sniff out
But the industrial rebound is not only about energy. Another critical factor is rising wages in East Asia, including China. Increasingly, American-based manufacturing is in a favored position as a lower-cost producer. Concerns over "knock offs" and lack of patent protection in China may also spark a growing "Made in the USA" trend.