Steel processors cut saleries, closed plants, reduces dividends, sold interest, and laid off 1,600 employees. This is more than 1/5 of its work force. The nation's industrial belt is tighter than it was before the U.S. manufacturing sector is starting to exhale.Ohio has been known as a manufacturing state and we still are a manufacturing state and it is still a very important element in Ohio.
I think that the hit in manufacturing hurt tons of families in Ohio. I know for my family it has hit hard, my husband is a milwright and when factories are not up and running or producing like they should it impacts his job. My husband has been laid off for the most part for about 2 years with now sign of relief insight, so even though you may not think that a factory not running may not affefct your life you may be suprised.
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I generally don't consider myself a protectionist. I see the merits of markets. But when other nations are protectionist, dumping products at prices that have no reflection of the real economic costs, my preference turns more towards fair trade than free trade. Industries that create raw materials are important to the economy and our national security. To abandon these industries to countries that subsidize them (early on by allowing virtual slave labor, now by subsidizing the capital improvements) ignores the true economic costs to our economy.
ReplyDeleteIn America, during the last 25 years of the 20th century, we lost over 350,000 of the half-million jobs in the steel industry. These were good jobs that supported families (one income families, even). The industry’s refusal to move ahead with computerization, robotics, and automation contributed to the job losses. Certainly automation alone would have resulted in a reduced workforce, but the inefficiencies of the industry nearly killed all employment.
From the start of the industrial revolution to the nineteen-fifties, when the American steel industry was still vital, steel was recognized as a basic material necessary to America’s manufacturing strength. From the sixties to the eighties the industry’s demise was discussed with concern. From the early eighties to now, the industry seems to have been forgotten. In 1947 we produced 57% of the world output of steel. By 1958, we were down to 28%. By 1978, we were down to 17% and we imported more steel than we exported. Yours is the first thing I’ve read on the industry in – well, I have no idea when I’ve last read anything.
Now China is the world’s largest producer, accounting for about 1/3 of the world’s output. They are followed in capacity by Japan, Russia, and then the U.S. China cares nothing about the huge amounts of coal they use in polluting their environment. The pollution there is hard to explain. You may travel for days in China under skies overcast not by clouds, but by coal smoke. That pollution is an economic cost that the whole world is paying, but it certainly is not factored into their steel prices. But their steel production is contributing to the huge investment in infrastructure that they are making, and the huge boom in growth they are experiencing.
By contrast, from 1973 to 1985, the financial sector never earned more than 16 percent of domestic corporate profits in the U.S. In 1986, that figure reached 19 percent. This past decade, it reached 41 percent. The financial industry produces nothing. It helps finance things, but it produces nothing. This has been the result of the policies we have emphasized for the past thirty years. Our long term priorities seem askew.
I apologize for the length of my comment, but this is one of those things I think about a lot, but never get to talk about.