It’s both amazing and disheartening to see the politicizing of a Covid 19 pandemic that has rocked the USA and the world. Too many politicians place getting elected above problem-solving from what amounts to serious bio-medical warfare, intentional or otherwise . Clearly, too, they’ve shifted the more important attention away from the real culprit in this ordeal. Their immediate focus should be on assuring that another pandemic is not on the horizon. Nor should stated adversaries be allowed to finance their nefarious strategies through business wealth that we have negotiated away over the years.
It is difficult to fathom the nonchalance and outright belligerence of the Chinese government. Not only do the Chinese discount any claim of responsibility, but they continue to attack on many different fronts ranging from regional territorial grabs, to human rights, to intellectual property thefts and espionage. Oh, and hoarding medical grade masks and other PPE.
Critical American manufacturers, including pharmaceutical companies, should immediately onshore every product made there. Any other company that is involved in a defense-capable or critical technology industry-related venture should be required to produce here if they choose to remain a USA-domiciled corporation. National security and patriotism isn’t an option. A case can be made that the U.S. Defense Dept. should play a bigger role in deciding what goods and services are allowed to be made abroad.
Free traders forget fair trade. Nothing is fair about the current imbalance with China. At a minimum, they have outflanked our government trade negotiators. They only take enough non-strategic goods to satisfy our modest export quotas, like agriculture products and cars, while reverse engineering all of the more valuable and critical technology we allow there. And try and get these Chinese government-owned companies to export their valuable resources, like the rare earth minerals that are vital to much of today’s technology. All in all, American companies that export technologies or manufacturing processes that threaten our way of life, health and national security need to be brought back home. And that return would also provide both capital and opportunity for our entrepreneurs and small businesses.
The old mantra of free markets and global trade is just that…old. The U.S. must restore a legacy of controlling its own destiny and ability to guard against any and all threats domestically and around the world if it effects American interests. That’s not to say we need to be the sole 1960’s Cold War Era world cop. What’s required is overwhelming domestic-made defense materiel capability and enough deployment flexibility to smother any attempt by rogue countries to sponsor violence and terrorism as they see fit. Another long overdue initiative is to prevail on so-called allies, most notably the French, Germans and Swiss that allow their military and companies to continue to arm and aid many of the most despicable worldwide terrorist groups and regimes.
Many investor and shareholder- beholden U.S. companies will complain about cost disadvantages of bringing home our manufacturing prowess. They forget the fact, as we’ve noted in earlier posts, that virtually every good or service made in a Far East country came from here originally or was copied or taught by U.S. providers after WW II. They ignore the reality that this economic transfer has significantly eroded a good share of middle class wealth. True, cheap imports lessen the supply-side cost of buying a good or service, but lesser wages paid in replacement alternative jobs, similarly lessens what consumers can buy. Consumption ability counts at least as much as supply and it behooves the U.S. to regain a bigger share of worldwide production. Not a good net/net trade-off that sends a healthy chunk of our economic output elsewhere. Who would have guessed that a formerly poor, largely agrarian economy like China would now have more billionaires than the U.S. in the space of 25 years or so. And possess state of the art technology and manufacturing production that we largely “gifted” away.
This loss of manufacturing and technology capacity to overseas providers exacerbates the other major deflator to future U.S. economic growth. The brilliance of technology on all fronts has more than halved the number of people and mid to high wage jobs needed to perform a wide variety of functions and tasks. This one-two punch of offshoring wealth and settling for more modest wages has to be addressed and reversed. When you combine preserving the prosperity of the American way of life with critical national defense and the peaceful protection of people around the world, why would you choose to do otherwise?