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What Are the Hiccups With This Idea of Americans Buying Products That Are Only Made in the USA?
Published May 31 / 2010
As long as we continue to function under a crony capitalist system the need to justify our actions will always be overshadowed by our cyclical consumption.
Some believe that by buying products that are made in the USA will help stimulate the economy while keeping the dollar recirculating longer within the country. Although it is not a bad idea to have Americans invest in American products; to have actually exercised this strategy fully would have developed tensions that could lead to policy change or even sanctions between US and some foreign countries.
The core problem of today’s society begins with the introduction of globalization. Although globalization may be viewed as a good idea under a crony capitalist system globalization wont work for all our people. Globalization opens the door for all countries to trade freely in these forums known as NASDAQ, NYSE or FOREX EXCHANGE.
It is undoubtedly forecasted by some Americans that if most of them where to purchase products that were made in the USA it would have helped revolutionize the American manufacturing industry. Which mean more American manufactures would have find it in their interest to move their line of production in the US to avoid being sanctioned. This assumption is obviously base on the statistic that Americans consume more than the rest of the world, and by that any discouragement to buy foreign made products is a counter act to minimize foreign import.
Although, the above reasoning is satisfactory to some; the truth dictates that the gravitation towards buying American made products have not completely taken flight since “The Nation’s international trade deficit, goods and services have increased to $40.4 billion in March 2010 from $39.4 billion (revised) in February, as imports increased more than exports. (May 12, 2010)”. This tells us; while we may be good at talking the talk; walking it is a whole different ball game. You can’t eliminate competition out of trades by taking a patriotic approach in buying American made products. People need to have choices so that they make intelligent decisions; taking a patriotic approach can only leave the patriot with fewer options, thus making them vulnerable to monopoly.
The American business can move their lines of production into other countries as they wish, but the transportation fees and taxes that the US Government will charge may offset the anticipated profit for that company. Given that the American government is less likely to discourage the transfer of American jobs overseas on the basis of a free market system made possible with globalization; the American producers would have had to lower their prices to stay competitive with foreign import.
The ability to move production to a different region can be viewed as a comparative advantage between the producer, and the entrepreneur, it doesn’t help the people if they have to buy this product at an inflated price while their jobs get shipped overseas. Inflation is destroying the dollar, and therefore making tradeoff between US and other industrialized countries economically disadvantageous year after year.
There is however a fundamental error in thinking that there is such a thing as the American economy, and that this economy function independently from all other economies. Even though we may not have implied that the American economy is independent, to have actually kept trying to isolate Americans from buying foreign good is an informed consent that proves our intent is to minimize foreign market from our economic system. The reason is understood, but the means by which we go about doing it may seems as a discouragement to a free market system. Unless of-course we don't believe in a free market system.
This would have been an excellent idea had we not been introduced with globalization. To imply sanctions on foreign made products signified that we can manage without them. Meanwhile, the recent free trade agreement dictates otherwise. The free market system has long opened all barricades for any country to trade as they please. This way of limiting trades on foreign import, although it may be beneficial for some American businesses to some extent can restrict a business long term growth. In that sense, there is a comparative advantage that is underlined here, and to understand this point we can read the next paragraph.
As an American businessman if profit encourages us to expand our business into a foreign country as a mean to increase on sales; having some of our products manufactured in that country would have discouraged some Americans to buy that product simply because they were not made in the USA. This is obviously not a reasonable way to conduct trades, especially if the profit that is generated from those sells is being channeled back into the American economy. Therefore, the encouragement to limit foreign import by buying only American may be a dream, but this sort of economic constraint on foreign import can never be a reality.
In fact, this is what Globalization is about; Globalization discourages regulation on trades whether it be labor or goods. But the problem arises when labor has been transferred into a different region, looking for the cheapest cost of production under the Capitalistic System. While profit is socialized social services is capitalized. And the American Economy doesn't benefit from it. In order for the American economy to have benefit from social services human development must have become a factor. People are being managed, they are not being cared for. Whereas, human development produces entrepreneurs human management produces consumerism for profit maximization. That is the main problem the foreign investor is faced with when manufacturing in the United States. Any lack in development is going to result in lack of skill and creativity. The Toyota prius malfunction that took place in the United States were all made in the United States.This problem did not persist with other brands that were made in Japan.This is why the American people opposed it, because if distribution of labor takes a Capitalistic approach why not profit. Another word, why must profit be socialized and human development capitalized.
The absolute advantage is one in which the American entrepreneur cut cost by moving his industry to a foreign country where the cost of production may be cheaper. He sells the same products that are manufactured in foreign countries to the American Public at a price that is way above the equilibrium price when compare to some other countries. He does so because he calculate the price elasticity of demand for that same product, and realizes that Americans are more likely to pay more for it. Meanwhile, he makes a greater profit selling the same product in India for less. His profit is greater in India because he has a larger market to sale to. This condition is what we would consider to be an absolute advantage.
Americans buying foreign goods is not the problem, what we would like to see though is for America to consume less, and produce more and there is nothing wrong with that; for that idea depends on cost over quality - not restriction. While saying that; I think it is fair to say that some foreign countries could have experienced more growth had they not been exploited and intimidated by shark investors who are overwhelmingly expanded with economic power.
The next argument implies that for the American to buy only products that were made in the USA, if successful will eventually reduce the competitive level of the market industry and thereby lower the quality of the American goods and services. In this situation, it is easier to think that if American manufactures don’t have to compete against foreign goods, than the competition will only be among American manufactures. This is why during the Toyota uncontrolled acceleration problem found in the Prius, Toyota blamed the American manufacturing line; claiming that those models were made in America.
Competition promotes quality, which mean if Joery motorcycles and Tom’s are the only two manufactures in the United States that Americans have access to; The v consumers will be left with minimal options and be forced to buy from a limited market niche. Those two manufactures would have had no incentive to improve quality if their motorcycles were selling because consumer's choices are limited. If anything they’ll just copy the new motorcycles design from the Japanese, modify them a bit and have Americans buy it. After all, Americans won’t buy the Japanese’s motorcycles if they were not made in America. You see, the problem with this concept on not buying none American made product is toxic for the American market; it is an idea that welcome patent infringement for the benefit of profit due to this social limitation that is placed on trade.
Whereas competition promotes creativity, it can also discourage good ideas from being part of the norm. If an idea does not project the most return on investment no matter how it would enhance our lives it is viewed in this society as a bad idea. Consequently, further projection of our lives lie on which idea will consume the most capital. Whether or not this idea will come with suffering for some is not the concern of the inventor or the investor; it is only interest that matter from that point. We ought to promote for Americans to buy foreign and domestic goods; for the next idea that can enhance our lives could be the result of the foreign inventor or the producer.
The idea is not to run away from completion, but to allow completion to make us into better inventors and wiser consumers. It is through competition that new ideas are developed. In that sense competition is not the problem, but greed the true cause of most economic failure. On a different note, if we are calling for Americans to buy only goods that are made in America; we should also think of what would have happened to America if most foreign countries were to stop buying products that were made in America just because American manufactures manufactured them. Being that America also benefit from export, one would think that any idea as such would be unreasonable, but from the ground development it is not what some Americans think.
We thought the final provisions of the North American Free Trade Agreement (NAFTA) contribute significantly to agriculture, a sector that United States agriculture dominates. Are they not the biggest exporters of food, a need that is essential for human existence? For those who promote that Americans should buy American made products only; I'm not sure it is a good idea because it brings to mind a double standard?
For argument sake let say the stock market crashes like it did in 1929 - the result of-course would have been another great depression. And even if all American products where made right here in America the outcome would still be the same. We would still experience a depression. Being that we need an influx of money to enter our borders so that our economy stay floating; trade is not an option for us but instead a necessary condition for growth.
We should also remember that goods and services are not sold at true value in America. We live under an inflated economic system, and therefore our costs of production is also inflated. This is one of the reasons why some corporations finds it in their interest to offer cheap labor abroad. Since inflation is already high in order for some corporations to satisfy their stockholders; they find it necessary to impose low wages on their workers.
Although some can argue that exploitation is not the reason why the rich continue getting richer; one thing that is indisputable is that exploitation is the byproduct of capitalism. Which mean they would be no reason for corporations to exploit workers if the capitalist system didn’t provide a need for them to engage in such behavior? As we have seen, it is the advantage to compete for investors that has necessitated the possibility to exploit workers.
In the film “the corporation” directed and produced by Mark Achbar, Noam Chomsky linguistic professor of MIT stated “Corporations were given the right of an immortal person, but a special kind of person. A person who has no moral conscience, these are special kinds of persons which are designed by law to be concern only for their stockholders not the stakeholders.” He continues to say that “they concerns only for the short term profits of their stockholders who are very highly concentrated.”
As we have seen in the past when a fine is given to a corporation because of a violation, if that fine is too minimal to create an effect, that fine somehow becomes part of the cost of operation. When that happens our lives and the environment is at stake; for the need to justify our actions will always be overshadowed by our cyclical consumption or the need to gain more profit even when what is just can be achieve without us longing for profit. For example, the need to sale drinking water that is provided to us by nature becomes costly due to a need to make profit. These are the result of an extreme capitalist system because under such system even the air we breathe will at some point becomes privatized.
We are one people sharing one planet living under one sky. Environmental problems have no boundaries, the cause may be different, but the effect is imprinted; for what is affecting people in china will eventually affects those in India and subsequently people in the USA. Environmental concerns are the world problem not individual country's worry. We live in a world that is profit driven and the process of reducing cost to maximize profit has left the world population with a tumor where if no real action is taken to revert this condition can develop into a cancer. Like The great historian Howard Zinn once said "you can't be neutral on a moving train" well, in this analogy the economy is the moving train, and the resistance for us to take appropriate action to minimize the negative effects that are caused by greed where if nothing is done will left us neutralized.