Invented AND Made in the USA

Invented AND Made in the USA

by Vino Mody

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Product Details

ISBN-13: 9781457553981
Publisher: Dog Ear Publishing
Publication date: 05/22/2017
Pages: 288
Product dimensions: 6.00(w) x 1.25(h) x 9.00(d)

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CHAPTER 1

The U.S. Industrial History

• Chapter 1 Outline

• Introduction

• The Historic Employment Trend and Ramifications

• Early History of Jobs

• Immigration, Labor Pool and Growth of Output

• Infrastructure Expansion

• The Mining Boom

• Farming Challenges

• Panama Canal, a Phenomenal American Infrastructure Initiative

• World War 1 – Effect on the U.S. Industrial Economy

• World War 1 – the Negative Effects on the U.S.

• The Great Depression

• Major Impact of Wars

• World War 2 – the Challenges and Sacrifices

• World War 2 – the American Spirit

• World War 2 – Resulting Economic Progress

• World War 2 – Negatives

• World War 2 – Aftereffects

• What else the Wars Taught Us

• The Cruel Reality Wars

• The Post-Vietnam War Era

• Different Wars, Identical Economic Cycle

• 1999–2007 Economic Boom

• Ramifications of History on the Future of U.S. Industry

Chapter 1 Outline

I have my own long history of working in American manufacturing as an executive in several electronics firms. I have seen, personally, the American prowess in electronics manufacturing be shuttled out of the country to offshore manufacturers in Asia. I have also seen, from personal experience, that the quality of American products has suffered, not only from questionable quality control in the offshore factories, but also from pirating of American designs sent for offshoring and the production of cheap, poor quality copies of stolen ideas. This chapter will remind the reader the stunning history of American ingenuity and invention, which ranged from Eli Whitney's cotton gin and Ford's assembly line manufacturing genius to a man placing his foot on the surface of the moon. I describe how employment has traditionally been divided into three sectors: agriculture, industry, and services, and that modern day America has become largely a service oriented population as corporations have steadily offshored the manufacturing of labor-intensive products.

Introduction

Every new U.S. president announces as a top priority the expansion of manufacturing to provide good jobs, improve the American quality of life, establish a platform for more inventions, bolster the economy, and reinforce national security. Some presidents finish their terms with more growth in innovations and manufacturing than others do. Despite all the efforts, the trend in U.S. manufacturing has been downward for fifty years, with few exceptions, and tens of thousands of U.S. factories have been closed and outsourced to Asian countries. No recent president has had a winning strategy, even though they all seemed to understand the importance of the manufacturing sector. In fact, every new administration has reached out to industry and to state and local agencies to solicit their counsel.

The U.S. had a brilliant manufacturing history until twenty years ago, when outsourcing began due to rising labor and overhead costs in the U.S. Industrial leaders now want to reestablish the U.S. leadership in technology and manufacturing. Industry is unanimously for open but fair markets and for trade policies that would allow a level playing field with Asian competitors. American businesses also expect to see government policies that encourage investment in technology research, and an educational system that grooms the skills the industry needs.

The entire U.S. history before and after independence (1776) is replete with descriptions of enormous obstacles (more than any other nation faced) that seemed insurmountable, but the American people overcame them. Individuals and leaders tackled with determination all impediments to progress and every adversity – political upheavals, catastrophic wars, barriers to industrial development, weather calamities, massive illegal immigration, severe (often unfair) trade competition, and intellectual property thefts, to name a few. Each era brought new and harder challenges than before. Americans dealt with all of them and regained their top economic position.

This section includes a brief discussion of U.S. history to render an appreciation for the U.S. legacy of success, particularly among the members of the younger generation. History impacts the present and future. Past events were instrumental in shaping the U.S. industry and economy through the many periods of ups and downs, some very drastic, which have occurred since the eighteenth century.

A basic understanding and appreciation of U.S. history are essential, as history reveals the link between the past and present conditions and can guide future strategies. The U.S. industrial history directly relates to the theme of this book: How can the U.S. industry (re)assert its leadership and create (more) good jobs in technology innovation and manufacturing? The theme also includes expansion of the goods and service production in the U.S. and of exports to minimize imports and eliminate the trade deficit. Modern inventions like the TV and Internet have increased world trade between all nations and brought new challenges and extraordinary international competition.

History does matter and it acts as a useful guide for finding the right vision and leadership strategies for the U.S. government, industry, academic institutions, and, last but most important, the patriotic American people.

The Historic Employment Trend and Ramifications

Let us first look at the U.S. employment trend to get a feel for the magnitude of the issue that industry must solve. The majority of jobs recorded in the early U.S. history after 1900 were in agriculture. From the early nineteenth century onwards, industrial expansion caught on and generated more jobs than agriculture. Contrary to the prevailing notion that the services sector employs more people than goods production now than it did in the past; the fact is the U.S. service segment always required more employees than the manufacturing sector for the entire duration since 1840. The Private Sector Employment chart (Figure 1) presented later in this section reveals the employment trends for the three broad sectors since 1840.

Key factors that influenced the evolution of job profiles include:

• Farm productivity increased manifold as agricultural machinery replaced much slower manual labor in labor-consuming farming activities. Horses or mules did the plowing, planting, and harvesting, and people did the picking. Then, John Deere and many other companies came up with mechanized tractors, planters, cultivators, and harvesters. The earliest machines were three times faster than horses and people; later, the speed increased with newer designs. The price of farming devices was quite high, so neighboring farmers formed partnerships to purchase or lease new equipment. Another notable change was that the government established output quotas for some farm commodities to protect the price levels and avoid the scrapping of excess food. The combination of the faster machinery and reduced production volumes produced an agricultural labor surplus, so the farm jobs moved to fill the enlarging labor demand in the higher-paying manufacturing and service sectors.

• Industrial productivity increased substantially as the industry invented mass production techniques and smart automation, which enabled fewer people to produce more output when compared to the output of craftsmen doing small-scale manufacturing in their shops or homes. The U.S. invented mass production techniques. Businesses regularly changed the design of their products, processes, and materials to reduce their costs and improve quality, for the benefit of consumers and businesses. At some point, though, the internal cost-cutting ideas reached an impasse, and further reductions in labor costs were not feasible without outsourcing assembly lines to countries where lower wages prevailed. Since the 1970s, the U.S. companies began offshoring (moving) their manufacturing of labor-intensive products. Factories moved to other nations. In summary, the efficient U.S. designs and processes, combined with production offshoring, drastically reduced the demand for labor in the U.S.

• The service industry offered the largest job growth in the U.S. The increase in the average income escalated the demand for more and better services, such as healthcare, restaurants, repairs, personal grooming, and financial services. New businesses, like call centers, emerged to address consumer inquiries regarding products and services. More couples joined the workforce, which raised family incomes, and people could afford to pay for various services. The numbers of service jobs went up in the post-war years.

• The constant discovery of new types of services has been continually expanding the service jobs, particularly in the healthcare, business services, and personal grooming areas. While some call centers and IT went offshore, a significant recent change in trend is that foreign companies are establishing their call centers in the U.S. for better delivery of the sophisticated services that are beyond the capability of the overseas contact centers. In fact, the U.S. is exporting more services than it is importing, and it is running a trade surplus, in contrast to the goods-producing sector, which is running trade deficits.

• The service sector is expected to show continued growth, and, in fact, many service jobs available in 2016 remained unfilled due to lack of qualified candidates. Services are getting sophisticated and therefore require new skills. Appropriate and affordable training programs are needed to meet the changing skill requirements of the service industry, as discussed later in Chapter 7.

• Note that overall growth in service has also occurred in Europe and Japan for the same reasons that drove the service sector prosperity in the U.S. Services are also expected to grow in countries like China and India as these nations become wealthy. The global growth in services translates into a valuable opportunity for the U.S. industry. It is now more important than ever for American service business leadership to innovate new services and tools locally in the country, rather than outsourcing, to avoid or delay intellectual property theft.

• The U.S. has a significant trade surplus in the service sector. A word of caution based on the lessons learned from the past decisions: Industry must guard intellectual property in services and explore all local options before deciding to outsource the development of new service platforms and tools. Outsourcing may lower costs, but it is a suicidal strategy as the U.S. can lose its control and fall behind other nations in the international service trade – an outcome similar to what has occurred in the goods manufacturing sector.

Early History of Jobs

It took 100 years for the U.S. to move from a predominantly agricultural to an industrial economy, and from handmade to mass-produced machine-made products. Initially, textiles, along with agriculture, led the way. The first mechanized textile mill was built in 1790. Women entered the workforce in textile mills; they worked at the same efficiency level as men, thereby boosting the progress faster than expected.

• New transportation systems multiplied industrial development by facilitating the rapid movement of raw materials from long distances to factories and finished goods to customers across the country.

• This may all sound so primitive now, but the development of the waterways infrastructure that augmented road transport was instrumental in the American progress. The waterways moved goods faster and in higher volumes than was possible by roads.

• The canals brought the different regions of the U.S. closer and enabled faster goods movement, thereby leading to the most rapid expansion of business and jobs.

* A 350-mile canal connecting the Hudson River and the Great Lakes was built in 1825, and a channel was constructed to connect the Great Lakes to the Mississippi Valley.

* The 364-mile Erie Canal in New York was completed by 1840, and soon steamboats were moving a thousand times more goods and people than wagons could move.

* Textile products were made in factories in the North using cotton from the South, where the cotton output went up fifty-fold due to the newly developed cotton gins that replaced manual methods. As a result, the cotton export business also grew.

• The government and banking systems responded by providing the investment capital for facilities and infrastructure.

You see the greatness of American ingenuity in the creation of faster and more efficient manufacturing processes, infrastructure and transport systems that boosted industrial progress and the output of goods – making more and better-paying jobs available than the farm jobs prevalent in the previous period.

Immigration, the Labor Pool, and the Growth of Output

In the early days of its history, the U.S. relied on human resources, efficient machinery, and rapid infrastructure to increase production output. The migration of people from other nations and between different regions within the U.S. substantially increased the size of the U.S. industrial workforce. Some immigrants brought with them the knowledge of sophisticated technology. The skill upgrade and increased workforce expedited the U.S. industrial progress further.

• Massive immigration from Ireland, Germany and other parts of Europe started in the eighteen hundred.

• Between 1829 and 1870, seven and a half million immigrants moved to the U.S. due to economic hardships and political unrest in their countries.

* The U.S. population doubled due to the immigration.

* The immigrants mostly settled in the major cities.

• Germans and other European immigrants brought with them scientific knowledge and technical skills and made a remarkable contribution to industrial growth and the development of new inventions in the U.S.

European immigrants initially encountered religious opposition and rejection, but they quickly adjusted themselves and merged into the mainstream to transform themselves into productive citizens. No major civil unrest occurred, as the immigrants were able to find productive employment. One of the most potent cures for social unrest is to provide unemployed people with jobs that pay enough to sustain their livelihoods.

• Other significant additions to the American workforce were women and African Americans

* African Americans migrated to the Northern cities by transcending opposition from their employers and overcoming numerous adversities and restrictions.

* In the beginning, the Underground Railroad was set up for safe movement of African American slaves from the South to the North to bypass employer resistance.

* African Americans eventually joined the U.S. industrial workforce and quickly attained the required competence and efficiency.

* Also, many women switched from a home-making to an industrial role, thereby raising the average income of the family.

Thus, the infrastructure development, innovation, immigration, improved skills, inclusion of women and African Americans – all these factors combined – moved American progress at a phenomenal speed in the late seventeenth and eighteenth centuries onwards that caught the eyes of the whole world. The U.S. industrial capability and progress led the country to achieve the number one industrial status in the world. Everyone everywhere wanted the top quality Made In U.S. products.

Infrastructure Expansion

The U.S. government made an extraordinary investment in developing infrastructure throughout the country for faster movement of goods and people and for improved communication. These new infrastructures (a partial list is below) raised the American standard of living and created thousands of new jobs. People could reach their destinations rapidly with new modes of transportation – subway systems, railroads, trolleys, waterways, and bus systems. The U.S. economy also benefited, since the infrastructure development projects created new jobs in other industry segments (e.g., sports and education).

• Railroads reached a wide area of the country. Also, thousands of miles of new roads were constructed to connect factories to their markets and suppliers

* Railroads and automobiles led to the concept of living in urban areas, thereby relieving congestion in the cities.

• Bridges, such as the Brooklyn Bridge, were built to enable people to work farther from their homes.

• After the invention of airplanes in the early twentieth century, many airlines went into business and established commercial flying and airports in the main cities.

• Large networks of electric transmission systems and fuel pipelines were set up everywhere to distribute energy.

• Advances in steel processing revolutionized the construction business due to the availability of iron in the form of frames, long bars, and pipes.

* The new steel, along with the invention of fast elevators, triggered the construction of high-rise buildings.

* The younger generation may not appreciate the significance of the design of steel bars to the development of infrastructure, but high-rise buildings cannot be constructed without them.

* The high-rise office and residential buildings and skyscrapers relieved congestion and made the rising land prices more affordable.

* High-rises offered all modern conveniences and housed many more people and businesses in a given land area. Urban and rural residential areas were built across the country.

(Continues…)



Excerpted from "Invented and Made in the USA"
by .
Copyright © 2017 Vino Mody.
Excerpted by permission of Dog Ear Publishing.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Foreword,
Preface,
Acknowledgements,
Introduction,
Chapter 1 The U.S. Industrial History,
Chapter 2 Trade:,
Chapter 3 Tariffs:,
Chapter 4 Employment:,
Chapter 5 Manufacturing:,
Chapter 6 What Went Wrong?:,
Chapter 7 Quality – Leading Solutions for Economic Growth:,
Chapter 8 – Innovation The Most Precious U.S. Wealth:,
Chapter 9 Reshoring:,
Closing Thoughts,
Epilogue,
Bibliography,
Index,
Author's Background,
Words of Praise,

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