Sand in the Gears: How Public Policy Has Crippled American Manufacturing

Sand in the Gears: How Public Policy Has Crippled American Manufacturing

by Andrew O. Smith


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American manufacturing has been on the decline for at least two generations; that fact is plain to any observer who travels through the Rust Belt of the Midwest, where the closing of steel plants and automobile factories has created ghost towns that dot the landscape. It is also clear in the dormant New England textile mills, whose owners surrendered their production first to cheaper mills in the Southeast before they, in turn, lost out to Asian labor.What caused this calamity, and what can be done about it?

Andrew Smith argues that we lost our manufacturing not to forces beyond our control, such as globalization and cheaper labor overseas, but as the result of misguided policies that are well within our abilities to reform for the benefit of manufacturing. Examining six areas of public policy—the tax system, health care, the legal system, workers’ compensation, government regulations, and labor policy—Smith demonstrates that in each of these areas, the current policy choices have created a hostile environment for manufacturing. Grounding his arguments not in polemic or ideology but in historical analysis and current research, Smith illustrates his points with real-world examples to show how a “new social compact” can fix the problems that manufacturers face without sacrificing public policy goals.

Product Details

ISBN-13: 9781612345888
Publisher: Potomac Books
Publication date: 02/01/2013
Pages: 320
Product dimensions: 6.30(w) x 9.00(h) x 1.30(d)

About the Author

ANDREW O. SMITH is a manufacturing executive and former consultant for Booz Allen Hamilton with a long-standing interest in economic policy. As chief operating officer of the Yenkin-Majestic Paint Corporation, one of the largest independent paint companies in the United States, he has firsthand experience running a diverse chemical manufacturing company. Smith earned an engineering degree from the School of Engineering and Applied Science and a finance degree from the Wharton School, both at the University of Pennsylvania. He also earned a JD and an MBA from the University of Chicago. He lives in Columbus, Ohio.

Table of Contents

List of Illustrations vii

Introduction ix

Prologue: Yankee Ingenuity xi

1 Manufacturing 1

2 Taxes: The Good, the Bad, and the Ugly 15

3 Health Care, Heal Thyself 29

4 Law Hurts 55

5 The Cost of Justice 93

6 "Workers" Compensation 123

7 The Regulatory Environment 145

8 Unions 179

9 A New Social Compact 205

10 Making It Happen 223

11 Conclusion 247

Acknowledgments 253

Notes 255

Selected Bibliography 279

Index 287

About the Author 297

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