- The role of foreign competition In the loss of Rust Belt, the jobs were overestimated in the political debate on American manufacturing, according to the professor of the Middlebury College, Gary Winslett, who rather underlined interstate competition, namely the rise of the southern states as well as favorable places for companies to put factories.
Politicians on both sides of the aisle have ignored certain “uncomfortable truths” while the rust belt has hemorrract manufacturing jobs over the years, according to the university professor of Middlebury, Gary Winslett.
In particular, he underlined the account that China, Mexico and other countries have increased their manufacturing use via commercial transactions at the expense of the United States
“It is a politically practical story to court voters in the main states of Swing, spiring for the way things were in the past,” wrote Winslett in a Washington Post spur Wednesday. “The problem is that this is not true – and it leads to terrible political decisions.”
Admittedly, overall, American manufacturing employment has been decreasing for decades. After having peaks at almost 20 million in 1979, it was 12.8 million last month, according to Data from the Labor Department compiled by the Fed of Saint-Louis. And as part of total non -agricultural employment, Manufacturing jobs have been declining since 1953 As the economy has evolved towards more focused growth.
In the meantime, separated Research of the Institute of Economic Policy has shown that the United States has lost more than 5 million manufacturing jobs from 1998 to 2021 while the trade deficit of manufactured products with China, Japan, Mexico, the European Union and other countries have deepened.
But Winslett see the factors closer to their home.
“A missing part of history: interstate competition,” he wrote. “The drop in the manufacture of the rust belt does not mainly concern jobs in Mexico. These are jobs that go to Alabama, South Carolina, Georgia and Tennessee.”
Quoting data from World Trade OrganizationHe said that the rust belt represented almost half of all American manufacturing exports in 1970 against less than a quarter for the south. Today, these regions have changed space.
In fact, Alabama, which produces more than a million vehicles per year, is state 1 state expressing automatically, after having only one automotive factory as recently as 1992, he said.
Winslett has attributed the reversal of roles to conditions in the southern states which are more suitable for companies, including laws on labor, cheaper electricity, more accommodation, lower taxes and easier permits.
Immigration has also helped the South, which now has more immigrants than any other part of the country while the Midwest has the least, he added.
In addition, automation has also contributed to the decline in manufacturing employment, underlined Winslett, which means that the remodeling of factories today would not produce a big increase in jobs.
“But even taking into account this technological change, it is the continuous competition between states, much more than globalization, which has reshaped American manufacturing, creating uncomfortable truths that none of the parties wants to recognize,” he explained.
For example, Republicans like President Donald Trump presented the prices as the key to restoring the jobs of Rust Belt Factory, without recognizing the jobs that have gone to the south.
On the other hand, Democrats prefer to blame globalization that interstate competition and will not recognize deregulation, the laws on labor and the reduction in energy costs, said Winslett.
“The two parties prefer simple bad guys, be it China or gourmet companies,” he concluded. “But what is necessary, it is not more hot vagueness on how things were or the globalization of scapegoats. It is a clear approach which understands why companies choose Alabama rather than Ohio and which adopts the choices made by the southern states.”
This story was initially presented on Fortune.com
