China Trade Policy - Where Do We Go From Here?

Three months away from the start of a new administration or the continuation of the existing.

What are the goals of a redefined economic relationship with China?

What tactics should the administration employee to meet those goals?

(Discussion originated as an offshoot of a covid topic)

China has turned into a juggernaut. Now we have a battle between profits, cheap goods and national welfare.

Indeed. Time to choose.

Choice is obvious, but greed will battle back.

Choice seems obvious.

I think a balance is required.

True. Isolation won’t work.

An interesting detail of the trade war is the focus on intellectual property rights. China steals innovation and it should be punished.

But part of the drive is to allow US business to manufacture in China without risk of China taking the technology. So even in the midst of focusing on this the greedy have a dog in the race.

They still want to manufacture in China.

Some things need to be made here.

We need to become as disciplined as they are about long range strategy also. Define our goals, set a course and work on it for decades. Resource security and manufacturing capability should be well defined to the public so we can stay on track through party changes in government.

Not possible. Competing goals changing every 4-8 years.

For that to happen, we have to split the country.

1 Like

Depends on how well the threat can be distilled to the public. If protecting pre-existing conditions can become shared goal, defined Goals for relationship with China should be possible.

I don’t know anyone in the last 10-15 years that is not unnerved by China’s emerging power over us economically.

Yeah, I thought I was seeing for the first time US companies starting to plan their supply chains and going away from China, and that did happen through the first half of the year. A lot have just gone back to business as usual, the ones who are more concerned about broken supply chains are pushing to move manufacturing to places like Mexico and Singapore, not the US.

And we’re talking about $15 minwage and more regulations.

We’re off topic.

@Snowfinch this is a good discussion, maybe you could start a thread. If you do, I’ll move these to it.

Good idea. I’m headed on a 15 min errand first.

1 Like

The lowest paid workers I can think of from the CNC, injection molding, 3DP, and casting work I am involved with are probably mold press operators and they’re in the high teens/hr. . A good machinist should get $30-45 depending on the market and level of experience, $50-60 if they can program as well (learn to code).

Average wage for a decent CNC guy in China is $2.25/hr.

Explain to me where a $15/hr minimum wage comes into play here. Apparently workers in US manufacturing are making way too much.

How about the people packaging etc.? Why is it so much cheaper to manufacture in China?

Never mind, I see it.

That’s my point. The minwage sets the floor. A CNC operator in China makes 1/7th of our minimum wage, how are we supposed to compete?

Those types of jobs have been being automated out for a long while now. US manufacturing output (covid aside) has never been higher and that’s been a trend since the 90’s. It just takes a lot less people to do it through automation, and low skill jobs like packaging or making the headstock on a manual lathe go back and forth all day are long gone. What used to take a crew of 12 is replaced by one or two people, who are much more highly trained and make a lot per hour.

We’re supposed to compete through innovation, doing things that can’t be done elsewhere, doing it faster, that sort of thing. It’s tough though when I go to one of my favorite CNC shops in Houston and they quote at 5-6 weeks and 5X the price, when I can get the exact same thing landed from China in 8-11 days.

In many ways US manufacturers are lazy and always have been. It’s like when the auto industry first started getting overseas competition. When things like safety glass and seat belts and catalytic became Federal standards, how did the US auto industry adapt? They claimed it would bankrupt them, they made up BS “studies” how they actually were less safe, they bought off politicians to try and enact trade restrictions when they couldn’t get the laws reversed.

What did the German and Japanese manufacturers do? Just said “OK” and went and did it.

Competing would take a serious effort in training and education and it will take a lot of gummint cheese to do that because industry won’t do it, not unless they can charge a kid $40K for a private program. The 2 year college programs are OK but there aren’t enough and they really don’t teach the latest tech. There’s no apprenticeships, no trade guilds or unions to speak of. Finding qualified manufacturing talent is a constant challenge in the US.

Or I guess just tell everybody they need to have wages more like what they get in China so US businesses can compete better.

Getting it yet? The US can’t compete, not unless it’s willing to make a huge investment in training and education, or force business to do it, or have some draconian trade laws that no industry is going to support. I’m all about having 4 year ME’s go into manufacturing, the guys running the machines know how to do that but they don’t know anything about design and stress analysis or thermal dynamics, and the engineers couldn’t make a ball of clay if you handed them a cube.

Or, we could go the other direction and have US consumers pay the actual price for what US manufactured goods should cost if made in the US. That 65 inch 4K TV you just got at Costco for $699? Add another zero to it, now you can have it made in the US.

There’s a lot of pressure in multiple directions that keeps the US from being able to compete directly with countries like China. The training and education isn’t there. Our standard of living is dependent on cheap Chinese goods. We won’t support higher wages, and given the current environment business is perfectly happy to keep domestic wages low while getting their things made for pennies overseas.

Considering the current environment, the best bet US manufacturers have to compete is investing in the latest technology for automation and to innovate, do the things that can’t be done or can’t be done easily. Last weekend I was at a shop watching a newly installed machine identical to this on it’s first run:

The one I was looking at had 24’ automatic bar feeders on it, so you load it up with material, turn off the lights and it just runs parts all night long, unattended. If a tool breaks or wears out of spec, it senses that and automatically changes out the tool. Add a palletizing system to it and it there’s not a lot of low skilled labor left to make it run. The guys who program it and service it make excellent wages though.

Too many people think if we just do this or do that it will go back to like the old days, where a guy working a relatively low skilled manufacturing job could make a good wage and support a family. Those days are long gone and they’re not coming back. “Learn to code” is a crappy punch line or response liberals say to people who are trying to protect coal jobs or low skilled manufacturing jobs, but it’s not bad advice. The problem is the places where someone can get low cost, high quality training for those types of jobs are way too few.


How does “training and education” compete with 1/7th of the cost?

So we don’t manufacture anything, we just learn code and depend on them?

Topic created.