January 14, 2009

What can Obama do to help the U.S. export more?

Basically, we're broke because for the whole decade we've been buying more stuff from abroad than they've been buying from us. So, what can a President do to help us sell more stuff overseas?

Screwing in lightbulbs and filling potholes won't do it. But what will?

The most obvious ways the government can quickly help business become more productive at making stuff that foreigners want to buy is by easing environmental and affirmative action regulations that add to the cost of everything we produce.

Similarly, the easiest way for the states and localities to save money on social services is for the federal government to pay for unemployed illegal immigrants to go home.

Funny, though, simple ideas like that don't seem to come up much.

My published articles are archived at iSteve.com -- Steve Sailer

29 comments:

Anonymous said...

Maybe we could build and export light rail?

Anonymous said...

Weakening the dollar would also help the U.S. export more. The recent flight to safety had had the opposite effect, but after the global financial system stabilizes, Obama's orgy of borrowing and spending will probably weaken the dollar again.

Dave

Richard Kimble said...

He could invade China.

king obama said...

Wrong, Steve.

The most important thing Obama could do to help the US export more is to renegociate the "one-sided" trade deals the US has with China, Mexico, Canada, etc (basically, every country the US has a "free trade"/WTO deal with).

Of course, since the Chinese buy so much US debt, this is unlikely to happen.

David Shockley said...

The Chinese won't accept manufactured goods from the US, but there is clean coal in Utah worth hundreds of billions of dollars that we could send them. Too bad the Democrats won't allow us to mine it. It seems the powers that be want there to be a huge trade deficit.

Danindc said...

I think his first priority should be erecting the tallest building. We need to get that title back from Malaysia or Dubai or something.

Also another Hands Across America would be awesome!!

Jeff said...

Exporting is difficult because most everything has gone to pot. There simply is not the work ethic or incentive structure to support massive industrialization within the United States. Few people, and no politicians, understand this point. Designing and manufacturing world-class goods in competitive markets is a massive organizational and intellectual challenge. There is absolutely no room for weakness. Off the top of my head, I can find many problems that will prevent the USA from regaining dominance.

1) Even if the EEOC went away tomorrow, the problems of affirmative action would remain because of social pressure. No business is suddenly going to resume rational hiring practices.
2) Massive population movement within the United States is a hidden tax on productivity. The constant moving of families is made necessary by the negatives of diversity. As people move they are unable to take root in communities and eventually there is little purpose in finding commonality with the neighbors. With reduced commonality comes increased stresses that impact dozens of life events. From my experience, I do not see how it is possible to build massive industrial organizations that can match or exceed Japan and Germany without strong communities. Unfortunately, the negative aspects of diversity only seem to be worsening and not improving.
3) The mentality of the US managerial and workforce populations is not conducive to success in industry. As the country has become more service-oriented, we have begun to adopt a near-term time orientation which is not not conducive to successful industrialization.
4) The incoherent nature of investment funds in the USA has also provided a mentality that does not match a long-term reality. Most capital investors that I have worked with are focused on short-term gains (fewer than five years). They want to be in a position to cash-out. This is something for which I have many years experience, and this dynamic is certainly not compatible with massive industrialization. A short-term outlook by investors cannot be reconciled with an industrial firm's need for a long-term outlook. If the original investors are pre-planning to cash-out in five years, no manager on earth is going to be able to weather the storm and develop a world class company.
5) The outsourcing focus within the United States is also completely against the grain of internal excellence and competency. While some studies suggest that outsourcing works for some companies, for most, it is a catastrophic mistake. Most outsourcing initiatives are employed to boost short-term results so that managers can avoid hard "g" problems like systems development and control and maximize short-term profits. When firm's outsource functions they are failing to mechanize, failing to innovate, and failing to develop strong internal competencies. I have yet to see one department that does not provide a critical element to enterprise success. When any element is outsourced, the ability of managers to innovate is reduced, and the long-term position of the company is weakened. There will be no change in this mentality anytime soon.
6) Massive immigration makes it easy to profit. You need only sell to the immigrant crowd. Since this requires no furtherance of technology, this is a very easy way to make money. Unfortunately, it has destroyed the reference point for how easy/difficult profit should be. Moreover, so long as new immigrants continue to arrive, and to enter adulthood, it makes little investment sense to invest in long-term industrialization when it is fast and easy to profit from a greater population.
7) The diversity of the United States has also ensured that few, if any people, feel as if they truly belong to a larger nation. The high trust factor is disappearing fast and this is one of the most basic elements needed for massive industrialization.
8) Wage rates. With such massive differentials in world wage rates, the United States might need to enact a wage equalization tariff. This is unlikely to happen.

Those are a few of the problems we face (to say nothing of falling IQs and a horrific education system). I think it would be fantastic to sell things, but there is not much left. Farming equipment would be a natural, but with so many immigrants ready to work so cheaply, our innovation in this field is grealty lacking. Morever, the second it makes sense to innovate in farm equipment, the US firm is likely to import some cheap engineer instead of using home grown talent. There is no easy solution to a problem with hundreds of variables.

beowulf said...

Who cares if China buys our debt?
Its like Keynes said, if you owe your bank a thousand pounds, you have a problem. But if you owe your bank a million, it has.

We can always cancel our debt. Yes I know, America always pays its debts... until its reclassified Trading With The Enemy. Somehow I doubt FDR kept paying on T-bills held by Japan or Germany after Pearl Harbor.

No one has a more sensible plan to get the trade deficit fixed than Warren Buffet's Import Certificate plan.
http://en.wikipedia.org/wiki/Import_Certificates

Has Buffet made any comments on how he'd structure the stimulus package? He really is a very smart fellow.

RKU said...

Ha, ha! I know, I know!

The world has a huge, unfilled demand for spare organs, far too massive to be filled by Albanians kidnapping the odd Serb here and there.

Meanwhile, America has a vast supply of "bad people." And although these people may be "bad," their livers, kidneys, thumbs, and eyes are probably good enough for international trade.

Offhand, I'd guess that something like 95% of all the people located in Washington D.C. are "bad", and just shipping them off in bulk quantities to the organbanks would do wonders both for our balance-of-trade and also our social, political, and economic well-being.

It's always nice to be able to find a real win-win situation.

Anonymous said...

if the US shuts down trade rather than exporting more, that will be a sign of the apocalypse. get ready.

Anonymous said...

"Richard Kimble said...

He could invade China.

1/14/2009"

Why invade?

Simply defaulting on our debt to China would be far more devastating to them.

PeterW said...

It's unlikely that we can export our way out of this recession. Even China is hurting, and if they can't pull it off, with all their export subsidies and currency devaluations, it's certain that red-tape tangled American industries can't.

headache said...

A big factor in this was the shameless outsourcing campaign begun by McKinsey and co 15 years ago. There was a good article to this effect on VDare recently. That’s probably done more damage than everything else combined. Most of the income loss is due to factories and even engineering jobs being shifted to Mexico, China and India. The same thing happened in countries like Germany but there the local attachedness to manufacturing, the fairly high status of artisanship and the interference of politicians stopped it from becoming as bad as in the US. Many companies in Germany are family businesses and the wife and kids ain't too keen on moving to Shanghai. Also most people still have some sense of patriotism so they feel they should let their fellow countrymen have jobs too. The funny thing is that during the bubble years financial “experts” and bosses routinely called for outsourcing and how we don’t need all the smoking chimneys. Now these same dunces and the pols are all beside themselves how well Germany is placed to overcome the recession because we have the factories here. Talk about opportunists! How this will change with the Muslim invasion is unclear.

I think Buchanan's suggestion of slapping taxes on imports (including the stuff from Mexico) will immediately stop the worst and encourage slow reindustrialisation. In addition outsourcers should be made to pay full taxes for moving things away since most of them got tax breaks down the line when setting up shop. It’s clear the full cost of outsourcing was never paid by those cashing in.

headache said...

Good points Jeff! It takes generations to build a manufacturing base. Unfortunately modern day western pols have an uncanny talent for destroying the wealth of western nations which has been built up over centuries. Where they get the legitimisation for that irresponsible action is beyond me. I think it all has to do with the 1968 movement and its offspring.

Pseudothyrum said...

A good first step would be to start making or rebuilding walkable town/community centers in many of America's soulless and demoralizing SWPL suburbs. America's white majority suburbs DESPERATELY need to rebuild a sense of community, and this is the best way to do it. As it stands now many White suburbanites don't interact much with their local community and watch too much TV - this has caused a massive deterioration of America's white communities and economy.

Exporting a lot of America's plastic widget industries hasn't been all bad - in the process of doing so we have exported a ton of pollution along with it which has made America a much cleaner country. Meanwhile, pollution in China and other countries which imported a lot of our manufacturing is utterly obliterating their environment in the long term solely for short term economic gain...not too smart.

headache said...

The US is still strong in Aeronautical, defence engineering. As far as I can tell the US Army Corps of Engineers know their stuff too. Big corporations like Bechtel and most of the IT industry all have the outsourcing disease. But maybe the way to go is to have a look at what those companies which still function are doing right.

Jeff said...

"The US is still strong in Aeronautical, defence engineering."

See my previous post on why industrialization in the USA is so difficult. I lived in Seattle for a few years and was good friends with talented Boeing people. More than one remarked that the aircraft parts built in Japan far exceeded, in craftsmanship, those parts built in the USA. This is naturally to be expected given the dynamics of the USA and the high civil order found among the Japanese. I think the potential among some Americans to match the Japanese exists, however, no part of society is a vacuum and everyone is subject to the litany of dynamics that prevent true excellence from manifesting. Our lead in aerospace is easy to understand given the massive defense contracts enjoyed by aero firms. Moreover, our government has provided huge subsidies to airports and to the airline industries. Government interference has created a false efficiency, which has resulted in the redirection of investment capital into aerospace and away from other industries. In such a situation, the manufacturing lead is not built upon organizational talent, and rational market demand, but is dependent upon constant government handouts. Thus our lead in aerospace is nothing but a phantom.

Anonymous said...

"America's soulless and demoralizing SWPL suburbs."

SWPLers don't live in the 'burbs.

Half Sigma said...

We export fiat currency, which costs us nothing to manufacturer.

Who needs to laugh all the way to the bank when we ARE the bank?

dearieme said...

The notion that the USA has always paid its debts is fantasy.
http://faculty.chicagogsb.edu/randall.kroszner/research/repudiation4.pdf

John Seiler said...

Steve makes some good points. But basically, Ron Paul had it right. First, you have to start with sound money. End the Bushflation (gold tripled in value under Bush). Return to the pre-1971 gold standard. Next, cut spending, the easiest way being to end the global empire. But domestic has to be cut, too. There was no reason for Bush's wild domestic spending increases, highest since LBJ. Third, don't raise taxes.

What all this does is return to an honest system: honest money, honest budgets (no shifting the burden to your grandchildren), honest work without high taxes.

Obama is going to do the opposite, although his tax hikes might be delayed a year or two.

Ronduck said...

Headache said...

The US is still strong in Aeronautical, defence engineering. As far as I can tell the US Army Corps of Engineers know their stuff too.
This sounds like the Former Soviet Union, with defense exports and raw materials being the bedrock of their economy. Both parts are government connected anyway, which explains why the feds don't let them go overseas. I agree that the Corps of Engineers is good, but Katrina didn't help their image, although that was a joint federal-local failure.

Big corporations like Bechtel and most of the IT industry all have the outsourcing disease. But maybe the way to go is to have a look at what those companies which still function are doing right.

I agree.

Anonymous said...

He should start by trying to export as many illegal aliens as he can, starting with the criminals.

Ronduck said...

Next, cut spending, the easiest way being to end the global empire.

Nice, but I would completely end food stamps, and all other forms of welfare. Then I would kill the EPA, OSHA, and EEOC. After that I would kill the Justice department Office of Civil Rights.

As for America's military I would finally admit that we are a naval power and have most of the funding directed to the Navy after the end of the Iraq war.

Brown Ram said...

Wait a minute....don't you want more immigrants so that they will drive down wages, thus making our products more competitive?

We should also ignore intellectual property laws. China flouts our laws.... But then I guess that would make us as bad them.

Anonymous said...

"A good first step would be to start making or rebuilding walkable town/community centers in many of America's soulless and demoralizing SWPL suburbs."

The only way to do this would be to ban blacks from being in these places. Black street violence(and general bad behavior) is what made public places in America unusable.

Also, the SWPL crowd doesn't live in soulless suburbs, they live in gentrifies inner cities. It amazes me how hard of a time so many people have grasping what SWPL is talking about. SWPL is about young, educated, trendy, liberal urban dwellers.

Anonymous said...

Anon sed:
"The only way to do this would be to ban blacks from being in these places. "

Mmm, I heard that before, let me see....oh yea, South Africa, I think it was called Apartheid. Wahddaya know, history keeps moving in giant circles. Ha ha

Half Sigma said...

"Black street violence(and general bad behavior) is what made public places in America unusable."

Indeed, shopping malls have replaced the downtown shopping area. The shopping mall is private property, so the owners can kick out undesirables like loitering minority teenagers.

Anonymous said...

Indeed, shopping malls have replaced the downtown shopping area. The shopping mall is private property, so the owners can kick out undesirables like loitering minority teenagers.

And wouldn't ya know, but the latest trend in shopping malls is basically an adaptation of the old "retail on the bottom, living quarters above" paradigm? Except that rather than being on a public street, it's on a private street, policed by the owners.

It's amazing how much damage and destruction judicial activism has done.