Mar 4, 2020
Fixing the Wrong Problems
An outsider’s perspective on the situation in US right now and how they are attacking the wrong problem.
Cities need to come to the people, not people going to the cities.
US citizenship is based on birth. So if companies are still picking immigrants to do the job, it is more a sign of the availability of skilled people.
US does not need to do manufacturing — they have moved on to doing high level design. Manufacturing is commoditized.
During this time of change, people who are on the gaining edge — the west and east coast of the US, which does fashion design, industrial design, software design — are all happy and see the prosperity that the US is gaining. They were fortunate to have education in the relevant areas that eventually made it big.
On the other hand, people in the center of the country, people into manufacturing, farming and other industries are hurt because over time due to work that the west and east coast people did, these tasks became commoditized and it was easier to import labour and do these things. In many cases, machinery and industrial automation (again a work of the coastal people) caused the central people to lose their livelihood.
Hence when it came time to vote, the media, the influencers and everybody jumped into it saying we need to focus on things like equality and making america more open. While the people in the center said — hey — just give our jobs back.
Now we know how that turned out — people on the coasts are less in numbers compared to the center — and if it was a voting game, the center had to win.
But the deeper problem is that we are attacking the symptom directly. Here is the chain of thought:
- I lost my job.
- I want my job back.
- This presidential candidate keeps saying he’ll get my job back.
- Give me my job back.
- Who took away my job? That immigrant!
- They do not belong here, send them back.
- Give me my job back!
Now I don’t mean that in jest — someone losing their job is serious and I sympathesize with the situation, but again, we are attacking the symptom instead of solving the root of the problem.
Currently the proposed solution is to force companies to setup manufacturing bases back in the US. This sounds familiar — this is exactly what China got really good at in the past decade — competing with US for crude oil resources along the way. Have we come to a point that US political strategy is guided by what China has been doing over the past few years? Even India is heavily focused on bringing manufacturing into the country with the “Make in India” program.
So where does this leave the current state of the economy?
Most computer and vehicle manufacturers will setup a triplet of bases — US, India and China. For example, it is rumoured that the other two sites for Tesla’s battery megafactories will be China and India. I don’t think this will bring any economic benefit to the US. To really understand who gets the lion’s share of the value chain, we need to understand where the design is happening.
This is not because of the number of people design oriented jobs employ, but because the wave of manufacturing automation is going to be led by the industry that can pioneer automation.
If the United States is going to be distracted by bringing jobs back to the country by forcing manufacturing back into the country, they might lose their current status as design leads and eventual manufacturing automation pioneers — the challenge being that they would bring manufacturing back into the country, but run by robots instead of humans.
