Richard McCormack
"Richard McCormack is editor and publisher of Manufacturing & Technology News, a publication he
created in 1994. The publication is read by executives in industry, government and academia on five
continents. Mr. McCormack is an active journalist covering the profound financial and economic
ramifications of the shift of industrial capability from the United States to Asian competitors... He has
written thousands of articles on outsourcing, industrial and technological competitiveness, government
policies, and trends related to management, quality, technology and markets." (Source - click McCormack's picture on the home page).

Richard McCormack is author of the book, “Lean Machines: Learning from the Leaders of the Next
Industrial Revolution.” And he is the editor of the new book, “Manufacturing A Better Future for
America,” for which he wrote the first chapter, “The Plight of American Manufacturing.”

"For American manufacturers, the bad years didn’t begin with the banking crisis of 2008. Indeed, the U.
S. manufacturing sector never emerged from the 2001 recession, which coincided with China’s entry
into the World Trade Organization. Since 2001, the country has lost 42,400 factories, including 36
percent of factories that employ more than 1,000 workers (which declined from 1,479 to 947), and 38
percent of factories that employ between 500 and 999 employees (from 3,198 to 1,972). An additional
90,000 manufacturing companies are now at risk of going out of business." (Richard McCormack, "The
Plight of American Manufacturing," The American Prospect, December 21, 2009).

"Manufacturing employment dropped to 11.7 million in October 2009, a loss of 5.5 million or 32 percent
of all manufacturing jobs since October 2000." (Ibid).

"Without an industrial base, an increase in consumer spending, which pulled the country out of past
recessions, will not put Americans back to work." (Ibid).

"Proponents of free trade and outsourcing argue that the United States remains the largest
manufacturing economy in the world. Yet, total manufacturing gross domestic product in 2008 (at $1.64
trillion) represented 11.5 percent of U.S. economic output, down from 17 percent in 1999, and 28 percent
in 1959. As for our balance of trade, U.S. imports of goods totaled $2.52 trillion in 2008, while exports
came to $1.29 trillion—creating a goods deficit of $821 billion. Those imported goods represented 17.6
percent of U.S. GDP." (Ibid).

"Indeed, the U.S. is losing the industries of the future. In 2004, it lost world dominance in high-tech
exports, when China exported $180 billion worth of information- and communications--technology
products and the U.S. exported just $149 billion." (Ibid).

"What domestic manufacturers want is for the United States government to shift its economic policies
away from consumption to incentives that favor investment in new factories, equipment, and jobs in the
United States. They want the United States to abandon policies that favor geopolitical global interests
that have no regard for the economic health of the United States and its millions of taxpayers and
retirees." (Ibid).

"Americans have lost their country to a few people who make a lot of money off outsourcing, off-shoring
and importing everything Americans used to make and continue to buy. Americans must take their
country back before it is too late." (Leo Gerard, "Q&A with Manufacturing Business Expert Richard
McCormack," Campaign for America's Future, February 26, 2010).

"People are just starting to realize that as manufacturing goes offshore, high-end jobs in design and
research and development go with it. When a plant closes, the supply chain disappears. This supply
chain includes materials and parts producers, software providers, like CAD (computer-aided design),
ERP (enterprise resource planning) and dozens of other high-tech equipment providers, machine tool
companies, maintenance, accounting, packaging – the list goes on to include such things as the local
restaurants, janitorial services and those dependent on the plant’s tax revenues, like librarians, county
clerks, police officers and teachers. These are service jobs, all of which depend on manufacturing. One
manufacturing job supports 15 other jobs. No other category of job has such a high multiplier. The
United State must do whatever it can to start creating manufacturing jobs." (Ibid).

"The country is perilously close to a period of sustained pain caused by continuing huge trade and
budget deficits. The United States is assuming greater and greater debt. The country cannot borrow its
way to prosperity. At some point very soon, the United States has to stop accumulating debt and start
the process of paying it down. The only way to do this is by producing the products Americans consume
– like cellphones, televisions, digital cameras, computers, semiconductors, printed circuit boards,
autos, steel, household items, appliances, luggage, clothes – everything – and to start producing a new
generation of radical and revolutionary products that the rest of the world needs to buy." (Ibid).

"Politicians need to be hit over their heads with a baseball bat as forcefully as is possible, with
Americans insisting that they at least acknowledge that a country that doesn’t make what is consumes is
going to fail. It is a simple concept. There are many historical precedents of countries and empires
failing after having lost their productive capacity. It is an ancient concept: a country that does not have
industry cannot support an army." (Ibid).  

"The financial meltdown wasn’t caused by the housing bubble or the financial bubble or the dot-com
bubble, although all of those things contributed. It was caused by the simple fact that American
consumers have sent all of their wealth to China, Korea, Japan, Germany and Mexico buying all of the
things they once made. Tell that to the politicians. They don’t get it. They don’t get it and they don’t get
it, which means they have to be hit over the head and be hit over the head and be hit over the head as
hard as is possible to hit them with the simple message, over and again: the country cannot survive if it
sends all of its wealth offshore. The country has to produce what it consumes. Our politicians do not
understand this basic FACT. Have they looked at why China is becoming a superpower? It’s not because
China exports its sports heroes and pop culture. It’s because China has embraced manufacturing as
THE means to economic superiority. It is the same path the United States took to reach global
dominance. Inexplicably, the United States abandoned that path." (Ibid).  

My Comments:

I have not found an actual plan to return manufacturing to America in Richard's articles that I read online
(which doesn't mean he hasn't written one). However, I have my own plan to end the flow of American
wealth to China and to make it financially impractical for American companies to outsource
manufacturing to China. Here it is, from an article on my website.

"I am very concerned about the trade deficit with China. China is not developing internal markets, most
of its workers are too underpaid to be consumers. Instead, China is using currency manipulation and
other questionable trade practices to exploit the markets of its trading partners and denying American
manufacturers access to its markets. China has been a permanent member of the World Trade
Organization since 2000. This situation has allowed it to take advantage of its trading partners.

"Rather than continuing to attempt to get fair treatment from China, I would suggest that the United
States unilaterally withdraw from the World Trade Organization. This would not affect our relationship
with our NAFTA partners, Canada and Mexico. Our arrangement with them is controlled by a separate
treaty. It would allow America freedom to deal with its trade partners as they deserve.

"For example, if a trade partner has generally dealt with us fairly, we could simply continue to deal with
them as in the past, conforming to the standards of the World Trade Organization. Trade grievances that
arise could be dealt with immediately through direct country to country talks.

"China is a special case. I suggest that America add a 25% federal sales tax on all goods made in China
until such time as the minimum wage in China is at least half the minimum wage in America. (Use the UPC
bar code to identify country of origin. Be prepared to seize Chinese goods with no UPC codes or false
UPC codes.) This federal sales tax should raise over $150 billion a year.

"This sales tax could be collected by existing agencies in states that have sales tax (for a small
processing fee). Collection agencies would be required in those five states that don't have sales tax.
Warn our other trade partners that within a few years we will be looking at their minimum wages also.

"What I am proposing is a long term trade war with China. The trade war would not end until China
adjusted both its minimum wage and its trading practices. We have a great advantage in this trade war.
In 2010, we sent almost $92 billion worth of goods to China. In that same year, China sent almost $365
billion worth of goods to us. In a direct trade war, China can only inflict only 1/4 of the pain on us that we
inflict on them." (No. 122, "Economic Misery 101").

Globalism is only a terrible idea because it has been preempted by the uber-rich. Globalism has allowed
the uber-rich to own and control the vast majority of the wealth of the world. The uber-rich have
achieved this ownership and control by doing business where they don't have to pay fair wages. In
many countries, the difference between fair wages and actual wages is huge. The manufacturing
companies and shipping companies pour that wealth into the pockets of their uber-rich owners.

What are fair wages? Minimally, fair wages allow working people to have the necessities of life, like
food, shelter, and clothing and also some of life's luxuries like refrigerators, plumbing, vehicles from
bicycles to trucks, televisions, computers, etc. When every worker on the earth can afford to be a
consumer, then the world will have fair wages. As a direct result of world wide fair wages, the world will
have billions of consumers, and that will insure world prosperity.   

America can lead the world to reasonably fair minimum wages by taxing the products of its trading
partners that allow their workers to be exploited, or that, like China, exploit their workers as a national
economic policy.  

Amo Paul Bishop Roden