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US manufacturing jobs continue to go to China...again. American companies are hiring, only it's overseas
US Poverty level at 15.1% soars to highest level in over 50 Years! In August, Standard and Poor's downgrades U.S. credit rating from a AAA rating to AA+, citing inability of U.S. government to 'stabilize debt dynamics,' marking first debt downgrade in U.S. history. The economy is actualy getting worse as China now overtakes U.S. as top manufacturer as Weekly Jobless Claims Continue to Rise. It's no wonder really since American companies are hiring only overseas.
Corporate profits are up. Stock prices are up. So why isn't anyone hiring?
Actually, many American companies are - just maybe not in your town. They're hiring overseas, where sales are surging and the pipeline of orders is fat.
More than half of the 15,000 people that Caterpillar Inc. has hired this year were outside the U.S. UPS is also hiring at a faster clip overseas. For both companies, sales in international markets are growing at least twice as fast as domestically.
The trend helps explain why unemployment remains high in the United States, edging up to 9.8 percent last month, even though companies are performing well: All but 4 percent of the top 500 U.S. corporations reported profits this year, and the stock market is close to its highest point since the 2008 financial meltdown.
But the jobs are going elsewhere. The Economic Policy Institute, a Washington think tank, says American companies have created 1.4 million jobs overseas this year, compared with less than 1 million in the U.S. The additional 1.4 million jobs would have lowered the U.S. unemployment rate to 8.9 percent, says Robert Scott, the institute's senior international economist.
"There's a huge difference between what is good for American companies versus what is good for the American economy," says Scott.
American jobs have been moving overseas for more than two decades. In recent years, though, those jobs have become more sophisticated - think semiconductors and software, not toys and clothes.
And now many of the products being made overseas aren't coming back to the United States. Demand has grown dramatically this year in emerging markets like India, China and Brazil.
Meanwhile, consumer demand in the U.S. has been subdued. Despite a strong holiday shopping season, Americans are still spending 3 percent less than before the recession on essential items like clothing and more than 10 percent less on jewelry, furniture, electronics, and big appliances, according to MasterCard's SpendingPulse.
"Companies will go where there are fast-growing markets and big profits," says Jeffrey Sachs, globalization expert and economist at Columbia University. "What's changed is that companies today are getting top talent in emerging economies, and the U.S. has to really watch out."
With the future looking brighter overseas, companies are building there, too. Caterpillar, maker of the signature yellow bulldozers and tractors, has invested in three new plants in China in just the last two months to design and manufacture equipment. The decision is based on demand: Asia-Pacific sales soared 38 percent in the first nine months of the year, compared with 16 percent in the U.S. Caterpillar stock is up 65 percent this year.
"There is a shift in economic power that's going on and will continue. China just became the world's second-largest economy," says David Wyss, chief economist at Standard & Poor's, who notes that half of the revenue for companies in the S&P 500 in the last couple of years has come from outside the U.S.
Take the example of DuPont, which wowed the world in 1938 with nylon stockings. Known as one of the most innovative American companies of the 20th century, DuPont now sells less than a third of its products in the U.S. In the first nine months of this year, sales to the Asia-Pacific region grew 50 percent, triple the U.S. rate. Its stock is up 47 percent this year.
DuPont's work force reflects the shift in its growth: In a presentation on emerging markets, the company said its number of employees in the U.S. shrank by 9 percent between January 2005 and October 2009. In the same period, its work force grew 54 percent in the Asia-Pacific countries.
"We are a global player out to succeed in any geography where we participate in," says Thomas M. Connelly, chief innovation officer at DuPont. "We want our resources close to where our customers are, to tailor products to their needs."
While most of DuPont's research labs are still stateside, Connelly says he's impressed with the company's overseas talent. The company opened a large research facility in Hyderabad, India, in 2008.
A key factor behind this runaway international growth is the rise of the middle class in these emerging countries. By 2015, for the first time, the number of consumers in Asia's middle class will equal those in Europe and North America combined.
"All of the growth over the next 10 years is happening in Asia," says Homi Kharas, a senior fellow at the Brookings Institute and formerly the World Bank's chief economist for East Asia and the Pacific.
Coca-Cola CEO Muhtar Kent often points out that a billion consumers will enter the middle class during the coming decade, mostly in Africa, China and India. He is aggressively targeting those markets. Of Coke's 93,000 global employees, less than 13 percent were in the U.S. in 2009, down from 19 percent five years ago.
The company would not say how many new U.S. hires it has made in 2010. But its latest new investments are overseas, including $240 million for three bottling plants in Inner Mongolia as part of a three-year, $2 billion investment in China. The three plants will create 2,000 new jobs in the area. In September, Coca-Cola pledged $1 billion to the Philippines over five years.
The strategy isn't restricted to just the largest American companies. Entrepreneurs, whether in technology, retail or in manufacturing, today hire globally from the start.
Consider Vast.com, which powers the search engines of sites like Yahoo Travel and AOL Autos. The company was founded in 2005 with employees based in San Francisco and Serbia.
Harvard Business School Dean Nitin Nohria worries that the trend could be dangerous. In an article in the November issue of the Harvard Business Review, he says that if U.S. businesses keep prospering while Americans are struggling, business leaders will lose legitimacy in society. He exhorted business leaders to find a way to link growth with job creation at home.
Other economists, like Columbia University's Sachs, say multinational corporations have no choice, especially now that the quality of the global work force has improved. Sachs points out that the U.S. is falling in most global rankings for higher education while others are rising.
"We are not fulfilling the educational needs of our young people," says Sachs. "In a globalized world, there are serious consequences to that."
China has now ended America's 110 year run as the leading manufacturer of the world, the number of people filing new claims for jobless benefits jumped last week after three straight declines, another sign that hiring remains weak.
WASHINGTON -- New jobless claims in the U.S. jumped last week by the most since February, reversing a sharp fall two weeks ago. The rise is partly a result of seasonal factors but also reflects the job market's weakness. The Labor Department says new claims for unemployment insurance jumped by 37,000 to a seasonally adjusted 464,000. Analysts expected a smaller rise, according to a survey by Thomson Reuters.
First-time claims have hovered near 450,000 since the beginning of the year after falling steadily in the second half of 2009. That has raised concerns that hiring is lackluster and could slow the recovery.
The number of people continuing to claim benefits rose by 88,000 to 4.57 million
One Light Bulb at a Time
A physics teacher in high school, once told the students that while one grasshopper on the railroad tracks wouldn't slow a train very much, a billion of them would. With that thought in mind, read the following, obviously written by a good American ..
Good idea .. . . one light bulb at a time .. . . . Check this out .. I can verify this because I was in Lowes the other day for some reason and just for the heck of it I was looking at the hose attachments . They were all made in China . The next day I was in Ace Hardware and just for the heck of it I checked the hose attachments there. They were made in USA . Start looking ..
In our current economic situation, every little thing we buy or do affects someone else - even their job . So, after reading this email, I think this lady is on the right track . Let's get behind her!
My grandson likes Hershey's candy . I noticed, though, that it is marked made in Mexico now. I do not buy it any more.
My favorite toothpaste Colgate is made in Mexico ... now I have switched to Crest. You have to read the labels on everything .. This past weekend I was at Kroger. I needed 60 W light bulbs and Bounce dryer sheets.
I was in the light bulb aisle, and right next to the GE brand I normally buy was an off-brand labeled, "Everyday Value". I picked up both types of bulbs and compared the stats - they were the same except for the price .. The GE bulbs were more money than the Everyday Value brand but the thing that surprised me the most was the fact that GE was made in MEXICO and the Everyday Value brand was made in - get ready for this - the USA in a company in Cleveland , Ohio .
So throw out the myth that you cannot find products you use every day that are made right here .. So on to another aisle - Bounce Dryer Sheets . .. . yep, you guessed it, Bounce cost more money and is made in Canada . The Everyday Value brand was less money and MADE IN THE USA ! I did laundry yesterday and the dryer sheets performed just like the Bounce Free I have been using for years and at almost half the price!
My challenge to you is to start reading the labels when you shop for everyday things and see what you can find that is made in the USA - the job you save may be your own or your neighbors! If you accept the challenge, pass this on to others in your address book so we can all start buying American, one light bulb at a time! Stop buying from overseas companies!
We should have awakened a decade ago .. . .. . . . ) Let's get with the program........ help our fellow Americans keep their jobs and create more jobs here in the USA.
What does the Economic Stimulus Bill really say - Where are the Jobs for Americans? Why aren't new manufacturing jobs being created and why are existing jobs being lost? The car industry alone will now lose thousands of jobs.....
Las Vegas online retailer, www.USAB2C.com, focused exclusively on American made products, believes that its manufacturing suppliers, which produce made in USA goods, will not benefit from the Congressional Stimulus Bill as written because it does not address job creation for Americans. This Congressional Bill does not decisively link government spending to required purchases from American Small Businesses or American Large Businesses. The error of not linking the 2008 Economic Stimulus Rebates to "buy American" has not been corrected by the current bill. Did we not learn from our previous lack of targeted conditions on spending the rebate checks?
Las Vegas, NV (PRWEB) February 6, 2009 -- The new Obama administration had embraced "buy American" in the congressional passed bill yet was later changed and removed. Indeed, there were provisions that infrastructure projects such as roads and bridges contain American made steel and iron products. Vice President Biden had publicly stated that these provisions are necessary for the stimulus to work in creating jobs. Some of our trading partners have objected, calling this protectionism, but no one is protesting that the China stimulus package is protectionism. No one is protesting that prior British government spending programs were protectionist. And the list goes on throughout Europe.
George Hanos, COO of USAb2c.com, agrees: "As a small business, our company applauds this 'buy American' attitude which has been long overdue. In fact, we so strongly believed in this buy American motto that our company was established to promote American craftsmanship, preserve American jobs, and demonstrate American quality to the world via our world wide website, which is accessible by the entire Global market. We at www.USAb2c.com, which is the Internet shopping mall of America's Business to Consumers Inc., sells only American made products. Our criteria requires that the manufacturers we partner with use American labor and American materials."
We at USAb2c.com encourage all United States Senators, as they take up the stimulus bill, to clearly link stimulus provisions with American labor and American products. Our products are competitively priced and superior in quality as compared with similar items available in the world market. Clearly, there is no need nor benefit to purchasing imports with stimulus, tax payer money. Mr. Hanos goes on to add, however, that the stimulus package approved by the Democratic led Congress does not go far enough to stimulate creation of jobs in small businesses, which are the primary venues leading to job growth. "Announced layoffs by major U.S. corporations and by departments of various state agencies will not be impacted by these types of buy American provisions. We need a grass roots effort to stimulate job growth and encourage spending on products made in the USA. Government spending on the country's infrastructure, National Electric Grid, and modernizing healthcare record keeping will indeed add some jobs. However, to make it more effective, the spending should be directed towards American companies and local suppliers. What we don't want, for example, is to send medical records to India, Pakistan or the Philippines for electronic conversion and maintenance. Outsourcing should not be the outcome of the stimulus spending package."
The 2008 summer rebate program did not work to provide the needed stimulus. Statistics that are now coming to light indicate that only 15% of the funds distributed were spent on products. The rest was spent on paying down debt or deposited into savings accounts. What has not been revealed is how much of the 15% used to purchase products benefited American products and services? It is our anecdotal belief that most of the 15% went to purchase imported goods from China, India, and other Asian countries.
Mr. Hanos feels the solution is simple: "We at USAb2c.com encourage all United States Senators, as they take up the stimulus bill, to clearly link stimulus provisions with American labor and American products. Our products are competitively priced and superior in quality as compared with similar items available in the world market. Clearly, there is no need nor benefit to purchasing imports with stimulus, tax payer money."
For Media interviews with Mr. George Hanos, please call 845-627-6140.
Saturday, August 11, 2012
Plant in Illinois is profitable, but Bain Capital has decided to ship jobs to China – and forced workers to train their replacements
The shock of losing a precious job in a town afflicted by high unemployment is always hard. A foundation for a stable family life and secure home instantly disappears, replaced with a future filled with fears over health insurance, missed mortgage payments and the potential for a slip below the breadline.
But for Bonnie Borman – and 170 other men and women in Freeport, Illinois – there is a brutal twist to the torture. Borman, 52, and the other workers of a soon-to-be-shuttered car parts plant are personally training the Chinese workers who will replace them.
It's a surreal experience, they say. For months they have watched their plant being dismantled and shipped to China, piece by piece, as they show teams of Chinese workers how to do the jobs they have dedicated their lives to.
"It's not easy to get up in the morning, training them to do your job so that you can be made unemployed," said Borman, pictured, a mother of three who has worked for 23 years at the Sensata auto sensors plant.
Borman knows her eventual fate in the stricken economy that surrounds Freeport. "I am going to be competing for minimum wage jobs with my own daughter," she said.
Such scenes have been common in America as manufacturing has fled abroad in search of cheaper wages.
But, in the midst of the 2012 presidential election, Freeport is different. For Sensata is majority-owned by Bain Capital, the private equity firm once led by Mitt Romney, that has become a hugely controversial symbol of how the modern globalised American economy works. Indeed, Romney still owns millions of dollars of shares in the Bain funds that own Sensata.
So as Sensata strips out costs by sacking American workers in favour of Chinese ones, the value of Romney's own investments could rise, putting money into the pockets of a Republican challenger who has placed job creation in America at the heart of his bid for the White House.
The story of how Bain became involved in a car factory in a small town amid the rolling farmland of northern Illinois is emblematic of modern financial wheeling and dealing.
Bain bought the firm that was to become Sensata in 2006, when it was the Texan arm of a Dutch company. It then floated it on the stock exchange in 2010, but kept a majority stake. Sensata came to own the Freeport plant at the beginning of 2011 as part of a wider purchase of a car parts business from Honeywell.
Sensata spokesman Jacob Sayer said closing the Freeport plant to cut costs was a key element of the Honeywell deal. "If that had not been part of the strategy, then the deal would not have been so attractive," he said.
Bain has declined to comment. But it has made a lot of money from owning Sensata, quadrupling its initial 2006 investment. In business circles that focus on the bottom line is all that matters. But, not surprisingly, it cuts less ice in Illinois.
Workers insist their operation is profitable and makes top quality auto sensors.
"I understand business needs to make a profit. But this product has always made a ton of money. It's just that they think it is not enough money. They are greedy," said Tom Gaulraupp, who has put in 33 years at the plant and is facing the prospect of becoming jobless at the age of 54.
Mark Shreck, a 36-year-old father-of-three, confessed he was one of the few workers not surprised at the layoffs, as this is the second time his job has moved to China. "I feel this is what companies do nowadays," he said.
The Freeport workers have appealed to Bain and Romney to save their plant. The local town council, several Illinois politicians and the state's Democratic governor have all rallied to their cause. "This company is competitive globally. They make a profit here. But Bain Capital decided to squeeze it a little further. That is not what capitalism is meant to be about," said Freeport mayor George Gaulrapp, 52, pictured.
The anger towards Bain and Romney is palpable. Romney has become the target for the emotions of a community who built lives based on the idea of a steady manufacturing job: a concept out of place in the sort of fluid buy-and-sell world from which Bain prospers. "I didn't have a clue what Bain was before this happened," said Cheryl Randecker, 52. "Now when I hear Romney speak it makes me sick to my stomach."
President Barack Obama's campaign has sought to make Bain's record of buying and selling companies – often involving job losses – a key part of its strategy of painting Romney as an out-of-touch super-rich financier. In turn, Romney, who left Bain in 1999, has defended his long career there, saying Bain ends up generating economic growth and spurring job creation. Far from profiting from layoffs, Romney has portrayed Bain as a model for the American future.
That argument stuns Illinois governor Pat Quinn. "If he thinks that is the model for American economic growth then he is barking up the wrong tree," Quinn told The Guardian.
Of course, no one at the Romney campaign wants to be linked with the Freeport plant closure. "Governor Romney is not familiar with this issue and has not been involved in the management of Bain since 1999," said campaign spokeswoman Amanda Henneberg.
Nor does anyone at Sensata want to discuss the social costs of their decision. "We don't have any statement on the impact it has on Freeport," said Sayer. Bain did not return a request for comment.
But the impact is enormous on individuals and city alike. Freeport, a city of 26,000, is struggling. Its downtown features empty store fronts and businesses barely getting by.
The loss of 170 solid well-paying jobs will ripple out into this economy, further straining city resources, hurting businesses and eventually adding to Freeport's foreclosure problem. "There is a sense of fright. People don't know what this means for their families, their health insurance and whether they will keep their homes," said mayor Gaulrapp.
It is already happening.
Tom Gaulrapp – no relation to the mayor – worries he will be homeless. "It is a real possibility," he said. Randecker's daughter has already quit nursing college in Iowa to save money. Joanne Penniston, 35, is wondering if she will have to leave town. "I would have to uproot my whole family," she said.
Dot Turner, who joined the firm when she was 18 and freshly married and then put in 43 years on the factory floor, has suddenly found long cherished retirement plans thrown into disarray. She is 62 and knows finding another job will be tough. "I should not be standing in an unemployment line at this stage of my life," she said.
Turner too finds it hard to hear Romney talk of creating jobs when the post she has worked at for four decades – and which paid for three children to go to college – has just been sent overseas by a firm majority-controlled by Bain. "When Romney talks about creating jobs, it is just a big fairy tale," she said.
There is little chance of a happy ending for Freeport. The workers collect petitions and hold demonstrations. But they know they are likely doomed. "We are not stupid. We know we are unlikely to save our jobs. But if we get the next company that tries it to think twice, then maybe we save our neighbour's job. Or our children's," said Tom Gaulrapp.
Meanwhile, bit by bit, the machines inside the Freeport plant are being packed up, beginning their long journey to China. By the end of the year it will be over. "It is kind of like part of your family being shipped out - I worked with that stuff for years. Now there's nothing left but a discoloration on the floor where the equipment used to sit," Gaulrapp said.
The decline of US manufacturing jobs and living standards
BBC: August 8, 2012
For decades America's vibrant manufacturing sector provided poorly educated workers a bridge to the middle class. But today's plants need highly skilled workers who know their way around ultra-high tech machinery.
On the factory floor of AMI, a Michigan-based maker of fuel cells, one can hear the future of manufacturing.
It is very, very quiet.
The loudest noise in the brightly lit factory is the beeping of a hydraulic lift used to replace lightbulbs overhead.
The contrast with traditional manufacturing is sharp: Almost no noise, no dirt, little physical effort. And requirements for workers are very different.
"You've got to have the smart people that help build it from the bottom up," says AMI President Aaron Crum.
"We don't forge things anymore. We use lasers to cut metal, we extrude ceramics, we do things that are different. And so because of it, we need a different labour force to make it happen."
Decades of losses
Manufacturing in the US is undergoing the same technological revolution that sent workers from agriculture to industry at the end of the 19th Century, says Lou Glazer of consulting group Michigan Future Inc.
Aaron Crum says manufacturing today needs "smart people" In the '50s, he says, factory work was a third of the work in America; now it's below 10%.
Although manufacturing employment has ticked up in recent months, adding 30,000 jobs since March, the gains pale in comparison to the losses of the past decade.
Three and half million manufacturing jobs have vanished in 10 years, bringing the current total to just under 12 million.
As employment has plummeted, productivity has soared. Not for nothing does the US National Association of Manufacturers boast that American factory workers are "the most productive in the world".
About 30 minutes' drive from the AMI plant is the ghost of manufacturing past: Willow Run.
It is an almost unfeasibly large plant that once turned out Liberator bombers, then Kaiser cars, then transmissions and car bodies for General Motors.
Willow Run closed in 2010 when GM went bankrupt. Of the plant's five million square feet, one million has been cleared for sale.
The rest of the factory is an astonishing reminder of what manufacturing used to be like.
Hulking presses the size of three-storey houses gather dust, corridors stretch into the gloom seemingly without end, and the warm air is thick with the smell of machine oil.
'No diploma needed'
Gathered round a table at a nearby diner, former Willow Run workers remember their first days at the plant. Now in their 50s, they reminisce about what it took to get a job at the plant.
"You didn't need a high school diploma," says Sterling Mullins.
GM's old Willow Run plant is a reminder of manufacturing past "You just needed to be a hard worker," says Gerry Gardner, "and you needed to show up every day, because it wasn't easy work."
Tom White grew up on a farm, "so the skills I had weren't really applicable".
Those were the days when manufacturing lifted poorly educated men and put them into America's industrial middle class.
"You could put the kids through college, we had a couple of weeks vacation," Mr Gardner says.
"And you had enough money to go out and buy a new car. We weren't rich - I'm not driving no Rolls Royce or anything - but I bought me a GM car."
Manufacturing jobs still pay well - an average of $77,186 (£49,223) in pay and benefits in 2010. But there are far fewer of them and, says Mr Glazer the consultant, they are changing.
"That path to mass middle-class work is gone," he says.
"The only high-paid factory work left is going be people who both programme and maintain machines. That work is going to be high-paid but it requires much higher skills."
The US is still a big player in manufacturing. More than 18% of global manufacturing output comes from the US factories.
And even if American manufacturing has stumbled a little recently as eurozone orders dry up, many of Michigan's manufacturers are optimistic about the future.
But the genie cannot be put back in the bottle.
Manufacturing in the US has already changed and will change further, pressed on one side by technology and on the other by globalisation.
It will be hugely difficult for less-skilled American workers to attain anything like the living standards of the generation before them
Why American Made Macs Won't Revive the Economy
Wed, Dec 12, 2012 - Digital Trends
When Apple announced last week that it would begin building one product line here in the United States, reactions ranged from cynical to hyper-cynical, as can be expected when news from the world’s most successful company crosses the wire.
First, what we know: not much. Tim Cook went on NBC with Brian Williams and gabbed like a schoolgirl that Apple would be “doing” one of their products here in the US in 2013. He neglected to define “doing,” or which product, or where in the U.S. this doing would be done. We do know some of the new iMacs are being assembled in the USA, but Cook’s announcement sounded like a bigger deal than just assembly. The rumor is the new line of Mac Pros, but no one knows for sure.
Some tried to use the news as proof that Tim Cook, and by extension Apple, were backing Mitt Romney in the recent election. After all, if they had supported President Obama, they would have made this announcement just before the polls opened and let him trumpet the coming renaissance of American manufacturing. That was just Twitter rumormongering, though.
Perhaps more accurately, some viewed the move as a simplistic marketing ploy, something to cleanse the consumer’s palate after Apple’s manufacturing transgressions of the past few years.
“Made in the USA” has been a staple of American marketing since the 80s. It started when American consumers were shocked to find out a majority of their textiles – clothing and such – were manufactured overseas. Couple that with the ascendancy of Japanese and European cars, and people found marketers tugging on their patriotic heartstrings. The message is particularly effective during times of economic stagnation (such as the one we are struggling to emerge from).
But just with other trends, “Buy American” slowly ebbed away. Most consumers simply cannot afford to be patriotic when they are struggling to make ends meet. The small number usually beats the bigger number at the retailer, no matter what flag appears on the box. But there might be a new marketing trend that Apple is banking on.
According to the Harrison Group and American Express, 65 percent of high-end shoppers – the people who can afford to be patriotic with their wallets – prefer to buy American. Say what you will about Apple’s products, but no one can refute it’s a high-end brand. And if the rumors are correct, the Mac Pro is the highest-end product they have. Apple could simply be looking to gain a stranglehold in a segment of the population that it traditionally dominates: yuppies.
Smarter people, thankfully, are refusing to see the move through the spectrum of bias. In a recent Forbes article, Steve Denning goes into great detail on why manufacturing is slowly moving back to the U.S. One of his key points: It turns out that it’s not that easy or cost-effective to ship thousands of items from Asia. If there are any supply chain snafus, such as (ahem) strikes and riots, whatever cost savings you were anticipating from overseas manufacturing erode quickly.
With the right product, a company can actually increase profits by onshoring its workforce. The product cannot be very complicated, because we simply do not have much of a workforce educated in complex manufacturing practices, but the Mac Pro might be the least complicated product Apple makes right now. It’s an ordinary tower computer, something Americans have been assembling and manufacturing for decades.
Perhaps Apple’s strategy is all of the above. Having the ability to point to some American manufacturing, however incremental compared to the overall output of the company, can only be beneficial. Patriotism had no effect when Apple’s largest rival was Microsoft, but now that’s thrashing around in a very messy fight for global dominance against South Korea’s Samsung, every little bit helps. Especially if your target consumer is typically swayed by such messages.
The bottom line is twofold: This isn’t as big of a deal as the breathless media would have you believe, and Apple is not going to lose their shirt over this.
It’s understandable to want this news to be a harbinger of things to come, both from Apple and for American manufacturing in general. That’s simply not the case. The obstacles required for that level of manufacturing to return here are simply too great, and the solutions are generational shifts in nature. Any new jobs in the US are good jobs, but this is a drop in the bucket.
This is also a drop in the bucket for Apple. Cook said that Apple is spending about $100 million on this project, or 0.002 percent of the company’s value. The worst-case scenario is that Apple has to move the production back to Asia in the next product cycle. The best-case scenario is they save a little money and get some positive publicity
Light bulb factory closes; End of era for U.S. means more jobs overseas. American flag seller files for bankruptcy
The remaining 200 workers at the plant here will lose their jobs.
"Now what're we going to do?" said Toby Savolainen, 49, who like many others worked for decades at the factory, making bulbs now deemed wasteful.
During the recession, political and business leaders have held out the promise that American advances, particularly in green technology, might stem the decades-long decline in U.S. manufacturing jobs. But as the lighting industry shows, even when the government pushes companies toward environmental innovations and Americans come up with them, the manufacture of the next generation technology can still end up overseas.
What made the plant here vulnerable is, in part, a 2007 energy conservation measure passed by Congress that set standards essentially banning ordinary incandescents by 2014. The law will force millions of American households to switch to more efficient bulbs.
The resulting savings in energy and greenhouse-gas emissions are expected to be immense. But the move also had unintended consequences.
Rather than setting off a boom in the U.S. manufacture of replacement lights, the leading replacement lights are compact fluorescents, or CFLs, which are made almost entirely overseas, mostly in China.
Consisting of glass tubes twisted into a spiral, they require more hand labor, which is cheaper there. So though they were first developed by American engineers in the 1970s, none of the major brands make CFLs in the United States.
"Everybody's jumping on the green bandwagon," said Pat Doyle, 54, who has worked at the plant for 26 years. But "we've been sold out. First sold out by the government. Then sold out by GE. "
Doyle was speaking after a shift last month surrounded by several co-workers around a picnic table near the punch clock. Many of the workers have been at the plant for decades, and most appeared to be in their 40s and 50s. Several worried aloud about finding another job.
"When you're 50 years old, no one wants you," Savolainen said. It was meant half in jest, but some of the men nod grimly.
Under the pressures of globalization, the number of manufacturing jobs in the United States has been shrinking for decades, from 19.5 million in 1979 to 11.6 million this year, a decline of 40 percent.
At textile mills in North Carolina, at auto parts plants in Ohio, at other assorted manufacturing plants around the country, the closures have pushed workers out, often leaving them to face an onslaught of personal defeats: lower wages, community college retraining and unemployment checks.
In Obama's vision, the nation's mastery of new technology will create American manufacturing jobs.
"See, when folks lift up the hoods on the cars of the future, I want them to see engines stamped "Made in America," Obama said in an Aug. 16 speech at a Wisconsin plant. "When new batteries to store solar power come off the line, I want to see printed on the side, "Made in America." When new technologies are developed and new industries are formed, I want them made right here in America. That's what we're fighting for." But a closer look at the lighting industry reveals that isn't going to be easy.
At one time, the United States was ahead of the game in CFLs.
Following the 1973 energy crisis, a GE engineer named Ed Hammer and others at the company's famed Nela Park research laboratories were tinkering with different methods of saving electricity with fluorescent lights.
In a standard incandescent bulb, in which the filament is electrified until it glows, only about 10 percent of the electricity is transformed into light; the rest generates heat as a side effect. A typical fluorescent uses about 75 percent less electricity than an incandescent to produce the same amount of light.
Once again, we see how Globalization destroys the American economy. Our leaders want us to be on par with the poorer countries...how sad this is for the average American worker...we must continue to bow down to globalization and lose our American identity and prosperity as well.
American flag seller files for bankruptcy
When selling the business of patriotism, put emphasis on the red.
A little over a week before America celebrates its 236th birthday, Wisconsin-based flag seller Liberty Flag & Specialty Co. filed for bankruptcy protection.
Running low on cash, the nine-employee shop located half a block south of Reedsburg’s Main Street immediately asked its bankruptcy judge for permission to spend the pools of money that it had promised to set aside for its lender, Community First Bank. The cash will keep the lights on at its headquarters as executives figure out if the company can find a way to survive using Chapter 11 protection.
Liberty Flag’s financial hardship, which is coming at the peak of the industry’s flag-selling season, raises broader concern about Americans’ sense of civic spirit.
Or is the bankruptcy another sign of the slow drip of manufacturing jobs to cheaper overseas markets? The U.S. Census Bureau noted Tuesday in their perennial round-up of Fourth of July-centric facts that the U.S. imported $3.6 million worth of American flags last year. China alone shipped more than $3.3 million worth of flags.
Liberty Flag executives didn’t return a phone message, and the company’s bankruptcy attorney declined to explain why the company fell suddenly short on cash.
But the folks at Liberty Flag’s biggest business partner, nearby Eder Flag Manufacturing outside of Milwaukee insisted that the financial hardship isn’t evenly spread.
Eder Flag’s roughly 180 employees stitched together about 6.5 million U.S. flags during the last year to keep up with growing demand, said Jodi Goglio, Eder Flag’s director of operations. Sales of flagpoles outpaced flag sales with a 10% growth rate, she said.
“For us, that’s a good indication that new construction is on the rise and people have increased their discretionary spending,” she told Bankruptcy Beat, adding that she found the amount of foreign-made American flags brought into the country “appalling.”
As for Liberty Flag’s $205,931.30 debt to Eder Flag, Goglio explained that Liberty’s bill was more than two years old. Liberty Flag, which bought Eder-made flags to sell them to customers and retailers, bought its first batch in 1984
Tuesday, Dec 28, 2010 - China's Export Quota Cut Likely to Rile Tech Manufacturers
BEIJING — China said Tuesday it is reducing the amount of rare earths it will export next year by more than 10 percent — likely to be an unpopular move worldwide since the minerals are vital to the manufacture of high-tech products.
China accounts for 97 percent of the global production of rare earths, which are essential to devices as varied as cell phones, computer drives and hybrid cars. Countries were alarmed when Beijing blocked shipments of the minerals to Japan earlier this year amid a dispute over disputed islands.
Concerns over China's grip on rare earths has led countries on a hunt for alternative sources. A number of companies in North America — notably Molycorp Inc. in the U.S. and Thompson Creek Metals Co. in Canada — are hurrying to open or reopen rare earth mines. Two Australian companies are also preparing to mine rare earths.
Numbers released Tuesday by China's Commerce Ministry show export quotas of the rare minerals will be down 11 percent next year as compared to the same period this year. China usually issues a second batch of quotas during the year, and it is not known how the figures will change later in 2011.
The new numbers say China is allocating 14,446 tons of rare earths among 31 companies. China allocated 16,304 tons among 22 companies in the first batch of quotas this year.
China has been reducing export quotas of rare earths over the past several years to cope with growing demand at home. A Commerce Ministry spokesman has also said that China is cutting its exploration, production and exports out of environmental concerns.
Earlier this month, state media reported that China plans to raise duties on some rare earth exports starting next year, but it did not say which minerals would be affected or how much the tax would be.
A state media report Tuesday said China is preparing to set up a rare earths association that would include nearly all of the country's leading rare earth companies, and could help them to coordinate their negotiating position. The report posted on the Sina Corp. portal said the association should be set up in May.
The United States last week threatened to go to the World Trade Organization with its concerns over China and rare earths. When asked for comment during a regular press briefing Tuesday, China Foreign Ministry spokeswoman Jiang Yu declined to answer.
But China has had to address the global concerns numerous times since the spat with Japan.
"China is not using rare earth as a bargaining chip," Wen Jiabao, China's top economic official, told a China-European Union business summit in Brussels in October
Vets angry over American flag featuring Obama flying outside Democratic headquartersMarch 14, 2012
Tempers are flaring over a version of the American flag flying in Lake County. A veterans group says the flag is an outrage.
The flag, which features a picture of President Obama, was taken down Tuesday afternoon.
Korean war veteran Don Van Beck said his blood was boiling.
"I can't describe how upset was because you just don't do that to the American flag," Van Beck said.
Van Beck found it flying outside Lake County Democratic headquarters under the stars and stripes. Marine Corps vet John Masterjohn was seeing red
"Joseph Stalin, pictures of Mao, pictures of Adolph Hitler. The pomp, the ceremony -- the flags like that," Masterjohn said.
Nearly a dozen veterans went to the door and aimed to take it down.
"No. This is private property. This is private property. You're not allowed to touch anything. I'll call the police," Democratic Party chairwoman Nancy Hulbert said. "Just went online. Just went online and looked up the flag code. There is no higher-up in Lake County. I'm responsible. I take responsibility."
"If you've been a veteran and fought -- and some died for this flag -- you don't want to see it desecrated. That's how simple it is," Van Beck said.
Plans for Wichita's Hawker Beechcraft up in the air
Updated July 17, 2012
By ROXANA HEGEMAN & JOE MCDONALD Associated Press
WICHITA - In Beijing, Shenzong Cheng is known as the "Helicopter King of China," an industrialist who's been quietly building a small empire in aviation manufacturing. But he remains largely unknown in America, where the aviation industry was shocked last week with the news that Cheng's company, Beijing-based Superior Aviation Beijing Co. Ltd., would acquire the civilian operations of the Kansas aircraft maker Hawker Beechcraft for $1.79 billion.
Cheng isn't speaking publicly of his plans for the Wichita-based company. His silence has left thousands of workers scouring for clues about their suitor and what he may have in store. "Anytime a Chinese company proposes to move in, in such a massive scale, there are going to be concerns on a number of issues - both the assurances regarding jobs and facilities, as well as technology transfers and what type of precedent this sets," said Frank Larkin, a spokesman for a machinists' union representing roughly 2,600 of Hawker's Wichita workforce.
Hawker Beechcraft said it was premature to comment on Cheng's role, though Superior CEO Tim Archer told The Associated Press in a written statement that Superior Aviation will "aggressively work to keep jobs in the United States by continued production of the Hawker and Beechcraft product lines and expanding the production, design, and servicing of civilian aircraft at all locations including Kansas, Arkansas and Texas, and many other states across America."
But without a deeper sense of Cheng's history, anxieties about his plans for Hawker Beechcraft are likely to linger. When reached by The Associated Press, an assistant for Cheng in China, Qian Chunyuan, said Cheng was too busy to give interviews.
Superior is 60 percent owned by Beijing Superior Aviation Technology Corp. Ltd. - a private entity entirely owned by Cheng and his wife, Qin Wang, according to a letter outlining the proposal.
Cheng also is chairman of aircraft manufacturer Qingdao Haili Helicopter Co. Ltd. A Shanghai news outlet reports that this company has suspended helicopter production due to poor export orders.
Weifang Tianxiang Aviation Technology Co. Ltd., another of Cheng's companies, formed a joint venture with U.S. helicopter manufacturer Brantly International Ltd. in 2009. The two companies merged operations at Superior's facilities in Coppell, Texas, and Brantly says all its manufacturing is now conducted at its parent facility in Qingdao on the east coast of China.
In 2009, some of Cheng's companies joined an umbrella group to buy U.S. aircraft parts supplier Superior Air Parts Co., which at the time was in bankruptcy proceedings.
Hawker Beechcraft employs about 7,400 people, with roughly 4,700 working at its Wichita facility. It also has factories in Little Rock, the U.K. and Mexico, as well as more than 100 service centers worldwide.
Chinese-Made Drinking Glasses Contain 1000 Times Allowable Levels of Lead
Drinking glasses depicting comic book and movie characters such as Superman, Wonder Woman and the Tin Man from 'The Wizard of Oz' exceed federal limits for lead in children's products by up to 1,000 times, according to laboratory testing commissioned by The Associated Press.
"The decorative enamel on the superhero and Oz sets - made in China and purchased at a Warner Brothers Studios store in Burbank - contained between 16 percent and 30.2 percent lead. The federal limit on children's products is 0.03 percent."
Now, come on--hasn't China been caught enough times that it might have sunk in by now that slathering lead all over just about everything they send our way might not seem like such a great idea anymore?
The AP's testing, conducted by ToyTestingLab of Rhode Island, "found that the enamel used to color the Tin Man had the highest lead levels, at 1,006 times the federal limit for children's products. Every Oz and superhero glass tested exceeded the government limit: The Lion by 827 times and Dorothy by 770 times; Wonder Woman by 533 times, Superman by 617 times, Batman by 750 times and the Green Lantern by 677 times."
When the safest piece of glassware "only" exceeds federal standards by 6,770%, it may be time to a) stop importing painted glasses from China, or b) stop importing painted glasses from China.
Why do they keep doing it?
Price, of course.
A report by David Barboza in the New York Times explains:
"Paint with higher levels of lead often sells for a third of the cost of paint with low levels. So Chinese factory owners, trying to eke out profits in an intensely competitive and poorly regulated market, sometimes cut corners and use the cheaper leaded paint.
"On the books, China’s paint standards are stricter than those in the United States, requiring that paint intended for household or consumer-product use contain no more than 90 parts of lead per million. By comparison, American regulations allow up to 600 parts per million.
“'The standard doesn’t matter,' said Scott Clark, a professor of environmental health at the University of Cincinnati. 'Remember, in the Soviet Union during the cold war, they had very high standards on the books, but they never enforced them. It was just for show.'”
Hang on, didn't China swear to god, cross its heart, hope to die, stick a needle in its eye in 2007 that it was banning lead paint on toys exported to the US?
Chuanzhong Wei, vice minister of China’s General Administration of Quality Supervision, Inspection and Quarantine, seemed so serious about it, so dedicated to fixing the problem.
Well, about that...don't forget that he also said that, "We should not over-propagandize the problem."
Good point, my man. Why get all tangled up in "over-propagandizing" this whole lead thing? It's not like lead is a neurotoxin that causes impulsivity and aggression. Or that a study by economist Rick Nevin shows a relationship between early childhood lead exposure and criminal behavior later in life.
“It is stunning how strong the association is,” Nevin told the Washington Post. “65 to 90% or more of the substantial variation in violent crime was explained by lead.”