51 ~ 49
… imagine an America in which 51% of all products sold in a Wal-Mart store were made in the USA
Eric LaMont Gregory
The decision to locate a business in one community or another is based upon a number of factors, and local communities entrust to their elected officials to work out the details. All negotiations are a matter of give and take.
The terms under which Wal-Mart, for example, settles into a community are highly favourable. One might say uniquely so.
When times are good, low unemployment, and the largely part-time workers at Wal-Mart have a second full-time wage earner in the same family who can include the medical insurance-less part-time Wal-Mart worker on their company’s insurance plan, communities have medical costs which are borne elsewhere.
That time is not now.
With many full-time wage earners out of work and therefore also without medical insurance, medical costs are now borne by the local community. With nearly 10% of full-time wage earners out of work other support services such as housing, food assistance, and in many cases income support itself is borne by local communities.
An American profit making company, Wal-Mart, passes the medical insurance costs of its employees on to the tax payer.
At one time it was a matter of pride to own that American made product from GE, Westinghouse, RCA, May Tag, and Schwinn, but these have been replaced largely by outwardly cheaper products from China primarily, in the case of Wal-Mart.
The allure of the cheaper and therefore more profitable Chinese product is when examined under the economic microscope more myth than reality.
Ceramic tiles made in China land in the USA at a cost of just over five dollars. The American manufacturer can deliver them at a cost of five dollars. There are many many examples of this. In fact, if one looks at the companies that have replaced American made goods with those made in China, they have largely gone out of business. Lobbying and myth have closed many American plants.
I recently met with a business owner in Clark County, the area in Ohio that has lost a higher percentage of manufacturing jobs than any other in this state, who told me that it took two years to convince another local company that those parts they imported from China were actually costing them more than what his company could produce them for locally. Eliminating the costly process of negotiating with a foreign concern, and increasing the ability to respond quickly to the inevitable design change.
Myth busting can be a slow process.
And, we do not have to pay the higher tax bill because we have to cover the medical, housing, food and income support costs of the displaced American worker because another American tile factory has shut down.
An economic analysis that does not include all costs is fiction, not sound fiscal planning.
These decisions are not made in Washington, or in our state capital, but in our local communities.
Now, imagine a world in which 51% of all products sold in a Wal-Mart store were made in the USA, or more correctly within the North American Free Trade Association, since by agreement made in the USA now includes Canada and Mexico, not withstanding the complication introduced by the maquiladores.
The argument that a 51% American participation would result in goods sold in Wal-Mart costing more is a false one, or at least an over simplification.
It also would suggest that the American worker would rather not pay a cent more or less and be employed, than to save a cent more or less on goods that he cannot afford because he is unemployed.
The American people will do what is necessary to have jobs and make their own decisions, rather than to not have jobs and make no economic decisions at all. The problem is not with China, Wal-Mart is an American company and it is the executives of that company, and that company alone with which we must negotiate.
I believe that Wal-Mart will make the right decision, when they realise that the American people want our corporate giants to remember that all Americans make it possible for them to prosper. Those imported goods that arrive at our ports, are able to do so because of a navy that keeps the sea lanes for commerce open, and that navy was not made in China, Singapore, or Malaysia.
Wal-Mart and other companies equally placed - it is time to re-negotiate and a ratio of 51% - 49%, American made vis-à-vis foreign imports, is a excellent place to start.
For details on all USA trade agreements including NAFTA and with China see: Office of the United States Trade Representative website: www.ustr.gov