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It's hard to believe that this product can be manufactured for less money in China than it can be in America. The difference in cost (including importing, and all that goes along with that) can't be more than a couple of pennies per piece. It will sell here for the same $2 regardless of where it is manufactured...
I think it was about 15 years ago that the Japanese were buying our scrap steel like there was no tomorrow. They put it on ships and took it to Japan where they melted it down and then shipped the finished stock back to the US and sold it at a profit. Think of that... transportation to a west coast port, shipping it across the Pacific Ocean, re-melting the scrap and manufacturing new steel, then shipping it back across the Pacific to sell it to the people they bought it from. And turning a profit. How could they do that?
5 years ago my son was driving for a local trucking company. He would take a semi truck load of new tractor tires (other drivers were taking wheels) from our local John Deere Waterloo Tractor Works to a parking lot on the Mexican border in Texas where a crew from a Mexican company would come and trade his trailer for one that had tires mounted to wheels. He would then bring the completed assemblies back from Texas to be installed on new John Deere tractors here. That is a 2400 mile round trip. Someone local finally figured out that they could buy a couple of tire machines and a few trucks and do this work here and make a bunch of money at a cost to John Deere of less than what they could do it for themselves.
There are certainly a lot of issues involved, the biggest of which is the cost of American labor.
Why does a new Ford pickup cost $50,000? Why does a new John Deere tractor cost $250,000? A new combine $400,000? How much would those vehicles cost if Deere and Ford still did all of their work in house, rather than farming it out to less expensive local shops?
Most Americans can't afford American made products. Well, they can buy the products, but can't really afford them. It's all about the easy availability of consumer credit... "Creative" financing. Bankers. Stock holders. Government subsidies...
I remember the uproar when Jaclyn Smith opened her garment factory in Central America. American (California) Labor screamed about Ms. Smith taking advantage of the locals by paying them a dollar and a half an hour. What Labor failed to tell you was that the average wage on the local economy was about two-thirds of what JS was paying and that the working conditions were better. (Change Jaclyn Smith to Nike, Reebok, Lee, Levis, and every manufacturer of small electrical components in America today...)
Maintaining one of the highest standards of living in the world has a price...
How did we get to where we are today? Is it natural evolution that a growing economy has to, at some point, stop? What happens then?
How detrimental to our economy is the cost of compliance with government rules and regulations? How many of those rules and regulations are unnecessary? How many of them are legal?
I'm not an economist. I don't have the answers. Merely thinking aloud.
