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Columns

Making America 1953 Again

December 29, 2016 - 7:00am

It is axiomatic that if someone is sufficiently eager to disbelieve something, there is no Everest of evidence too large to be ignored. This explains today's revival of protectionism, which is a plan to make America great again by making it 1953 again.     

This was when manufacturing's postwar share of the labor force peaked at about 30 percent. The decline that began then was not caused by manufactured imports from today's designated villain, China, which was a peasant society. Rather, the war-devastated economies of competitor nations were reviving. And, domestically, the age of highly technological manufacturing was dawning.    

Since 1900, the portion of the American workforce in agriculture has declined from 40 percent to 2 percent. Output per remaining farmer and per acre has soared since millions of agricultural workers made the modernization trek from farms to more productive employment in city factories. Was this trek regrettable?

According to a Ball State University study, of the 5.6 million manufacturing jobs lost between 2000 and 2010, trade accounted for 13 percent of job losses and productivity improvements accounted for more than 85 percent: "Had we kept 2000-levels of productivity and applied them to 2010-levels of production, we would have required 20.9 million manufacturing workers [in 2010]. Instead, we employed only 12.1 million." Is this regrettable? China, too, is shedding manufacturing jobs because of productivity improvements.

Douglas A. Irwin of Dartmouth College notes that Chinese imports may have cost almost one million manufacturing jobs in nearly a decade, but "the normal churn of U.S. labor markets results in roughly 1.7 million layoffs every month." He notes that here are more than 45 million Americans in poverty, "stretching every dollar they have." The apparel industry employs 135,000 Americans. Can one really justify tariffs that increase the price of clothing for the 45 million in order to save some of the 135,000 low-wage jobs? Anyway, if tariffs target apparel imports from China, imports will surge from other low-wage developing nations.

The Wall Street Journal's Greg Ip, who reports that there currently are 334,000 vacant manufacturing jobs, says that when Jimmy Carter tried to protect U.S. manufacturers by restricting imports of Japanese televisions, imports from South Korea and Taiwan increased. When those were restricted, Mexican and Singapore manufacturers benefited.

In his book "An Extraordinary Time: The End of the Postwar Boom and the Return of the Ordinary Economy," Marc Levinson recalls the 1970 agonies about Japanese bolts, nuts and screws. Under the 1974 Trade Act, companies or unions claiming "serious injury" -- undefined by the law -- from imports could demand tariffs to price the imports out of the market. Of the hundreds of U.S. bolt, nut and screw factories, some were, Levinson writes, "highly automated, others so old that gloved workers held individual bolts with tongs to heat them in a forge." A three-year 15 percent tariff enabled domestic producers to raise their prices, thereby raisingthe costs of many American manufacturers. By one estimate, each U.S. job "saved" cost $550,000 as the average bolt-nut-screw worker was earning $23,000 annually. And by the mid-1980s, inflation-adjusted sales of domestic makers were 15 percent below the 1979 level.

Levinson notes that Ronald Reagan imposed "voluntary restraints" on Japanese automobile exports, thereby creating 44,100 U.S. jobs. But the cost to consumers was $8.5 billion in higher prices, or $193,000 per job created, six times the average annual pay of a U.S. autoworker. And there were job losses in sectors of the economy into which the $8.5 billion of consumer spending could not flow. The Japanese responded by sending higher-end cars, from which they made higher profits, which they used to build North American assembly plants and to develop more expensive and profitable cars to compete with those of U.S. manufacturers.

In 2012, Barack Obama boasted that "over a thousand Americans are working today because we stopped a surge in Chinese tires." But this cost about $900,000 per job, paid by American purchasers of vehicles and tires. And the Peterson Institute for International Economics says that this money taken from consumers reduced their spending on other retail goods, bringing the net job loss from the job-saving tire tariffs to around 2,500. And this was before China imposed retaliatory duties on U.S. chicken parts, costing the U.S. industry $1 billion in sales. Imports of low-end tires from Thailand, Indonesia, Mexico and elsewhere largely replaced Chinese imports.

The past is prologue. The future probably will feature many more such self-defeating government interventions in the name of compassion as protectionist America tries to cower its way to being great again.

    

George Will's email address is georgewill@washpost.com.

(c) 2016, Washington Post Writers Group

Comments

Having a high regard for your clear thinking Mr. Will, You bring forth some valid statistics and facts. In the 50's as a child I remember the boat-loads of "junk from China", and my father's ability to "keep the money he earned". I do NOT hold the Government faultless in that what was then a "Five & Ten Cent Store" has been blown by inflation in today's "Dollar Stores", Walmarts, and "Machine-Assisted Manufacturing".... everything basically hand made with hand and electric tools. You could even tell the cars apart by looks, as they really DID change frequently. QUALITY was not an issue, and one could get a new car every year for your trade-in and $700.00. But the minds of men could not be stopped - EVER. Advances became TECHNOLOGY. It seemed that both morals and morale were much higher back then. My first job out of University was "Computer Programmer trainee", with rapid advancement. This job paid $45 per week, and I did fine - my own apartment, a used car, no hunger and friends. IBM led the way, and I followed, from the Rust-Belt to the West. Opportunities grew. I lived well, got married, had a family, as I watched the Modernization of America rumble by, led by.... technology. The "American Dream" was alive! So what did you expect would happen? Washington got involved with EVERYTHING, and tied for Utopia; help the poor, tax the rich, provide aid to any smaller country that needed help, and Defend the WORLD! It didn't just "Happen", Mr. Will... WE encouraged it and proudly wore our "Masters of the Universe" hat proudly. Meanwhile in Washington, New York, Chicago, those of "lower moral character" found the living easy through "Meetings on the Golf Course", and the "$100 Hammer" was injected into society, the well-educated steered the Stock Market into their own hands, those of the New Creative built garage-industry into the Microsofts, Dells, Googles and Facebooks of today. Political parties 'softened' and slowly became thoroughly confused by the demands of a hugely increasing population. Those of African descent were aided and "Helped"... or so we say. The Blacks were left behind, and I'll not even attempt to describe the myriad of issues surrounding THAT can-of-worms. Over the decades, America became what appeared on the surface to be the target for all humanity to aspire to. But the core of this apple grew increasingly diseased, with cancerous nodules of pure "Rot" growing from within. The ever increasing technology changes portend a future of "artificial intelligence" and a life of needing LESS work for human hands, a life free of disease and full of "more than acceptable". So what is our true goal, as mankind trudges on... to WHAT? I will live out my life of ease spent Learning things unfamiliar to me in my own "bubble of comfortable Florida living", feeling free of guilt for all that has passed in my lifetime... travel, write books, stay active and eventually leave behind my human existence. I believe in God and call myself a Christian -- so I will not go in fear to my ultimate destiny. Instead, I will continue to stand behind my own belief system of Hope for America, and the entire human race, to stumble into a meaningful continuation of life.

Correction! It was not Jimmy Hatlo that penned "there oughta be a law" altho his strip and characters were, more or less, stolen. Rather it was Harry Shorten. The Hatlo hit was "They'll Do It Every Time." Bout six of one half dozen of the other. I am still on board with 1953 being better than now and George sticking to the diamond.

Mr. Will - we know you are anti-Trump and that's your right. But it's our right to tell you we aren't listening to your negative nay-saying anymore. You sound like a bitter old man who isn't a lot different than the cry babies on the left. Trump won - we love it and his message. We've tolerated 8 years of Obama's anti-America, Muslim loving acts, we are happy to have someone like Mr. Trump in the White House. I agree with one of the other posters - stick to baseball writing, that's about all you're good at anymore.

Am old enough to remember Jimmy Hatlo and his comic "There oughta be a law". There ought to be a law to confine George to writing about baseball. I just love his baseball stuff. But the idea of turning back to 1953 is not without it's good points.

..... give it up, retire and acknowledge, your continued bias is irrelevant ........ it would seem - G Will is Over the Hill!

George Wills, We don't and never did live in a perfect World. You writing about all the negativity is right down your miserable path. How about naming Positive things from the 1950's and how great schools were and Jobs were plentiful. Write how T.V. shows and the media were for the most part honest and trustworthy. We want to make America Great again for all American Citizens and future Citizens. Time to roll up our sleeves and work together instead of against each other and maybe people that are so negative like you Wills, retire and allow the next generation of positive thinkers to take your place.

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