Milwaukee In Decline?

[4everwarriors]

Sounds exactly like the s hit Americans are bein' fed daily.

[brandx]

Yes, but this is like the wired argument people make about Japan or Korea....size matters.  I could fall out of bed in Europe and be in another country they are so closely tied.  One day on a train and I'm in several countries.  This isn't the case in the States, a land mass far far greater with millions of square miles of rural land that Europe just doesn't compare to.

You're forgetting that the urban areas in the US at that time were basically east of the Mississippi. There are no logistical problems concerning distance with Boston, New York, Baltimore (one of the largest metropolitan areas at that time), Philadelphia, Chicago and St. Louis. You can check distances from London to major cities in Europe and not see a lot of difference.

[mu03eng]

You're forgetting that the urban areas in the US at that time were basically east of the Mississippi. There are no logistical problems concerning distance with Boston, New York, Baltimore (one of the largest metropolitan areas at that time), Philadelphia, Chicago and St. Louis. You can check distances from London to major cities in Europe and not see a lot of difference.

You are also forgetting population densities at the time.  Yes the majority of the population was east of the Mississippi but it was still less dense in urban areas than in Europe.  Europe had an established mass transit system that focused population in the major cities creating the densities that enabled an aviation industry.  The US was not nearly as dense in the urban areas limiting the potential for such a feature.

[77ncaachamps]

Just to clarify, I'm not using "outsourcing" in the first-shaking "THEY TOOK OUR JOBS!" sort of way.

But, factually, a lot of products that used to be manufactured in the US are now made elsewhere. Visit any major retailer and you'll see it. In 1950, if you went to a store, most things were made locally.

It's just part of the global economy.

The pendulum could certainly swing back to the US (or possibly Mexico) at some point. I know Africa is currently building infrastructure, but maybe that's more like 20-30yrs away.

The US still has a ridiculous amount of natural resources, so it's still a good place to manufacture, but companies have to figure out how to keep the costs down. Labor cost has been a big hurdle the past 30 years.

But the pollution of the factories stay in China, overseas. Is it worth the tradeoff?

[mu03eng]

But the pollution of the factories stay in China, overseas. Is it worth the tradeoff?

Except the pollution travels and China puts up factories that are WAY more pollution intensive than anything built in the last 15 years in the US.  That's what made the Kyoto treaty such a farce.

[MU Fan in Connecticut]

The skill base of precision manufacturing in China has been there for more than 20 years. What we are seeing is a ramp up in capacity at the higher end in China.

The quandary for China is that their cost advantage in manufacturing is almost entirely in direct labor rate which is far less of a factor in precision tooling. Overall, China offers significant advantages in cost but that advantage is eroding. There are new labor markets beginning to become viable but lack China's mass and scale in both labor and capital infrastructure will always mean that some % of production will remain there for the next several decades. Frankly, I would much rather pay incrementally more in China than relive the growing pains by sourcing in Vietnam or Bangladesh.
   

I agree with the precision thing based on my experience.  It was Hong Kongese running the factories and the smaller supplier shops.  They's take the KCR to the mainland Monday morning and back home on Friday.  (The weird side note to this was Hong Kongese who work at home all week purchasing weekend McMansions in the mainland in gated communities because they were so cheap comparably to Hong Kong as well as with of plenty of space compared to Hong Kong.)

The one thing I found odd when dealing with Chinese manufacturing was missing creativity.  I'd deal with a supplier and it always went like this, "What to do recommend or do you have a preferred way to do?"  The reply was always, "Well how do you want us to make it?"  I always assumed it was a cultural hierarchical don't want to lose face thing.

The pollution was horrible to see.  I almost choked to death on the first day of the first visit.  I had to go for my morning run and when I got back to my hotel room I spent the next minute coughing horribly.  The scary part was I seemed to actually aclimate to the pollution soon after.

[ChicosBailBonds]

You're forgetting that the urban areas in the US at that time were basically east of the Mississippi. There are no logistical problems concerning distance with Boston, New York, Baltimore (one of the largest metropolitan areas at that time), Philadelphia, Chicago and St. Louis. You can check distances from London to major cities in Europe and not see a lot of difference.

Population density

Much different in Europe, especially back then, vs the States. 

[akmarq]

Except the relative buying power of that extra dollar is negated by the producer having to charge more for the same widget.  So yes they are in absolute terms spending more money but it has little to no impact on overall money in the system or increasing the overall wealth of all.

Minimum wage isn't meant to increase wealth - it's meant to redistribute existing wealth. That might not be the narrative that either side of the political argument pushes, but it's the net effect. You may get some temporary bump in GDP due to the higher marginal propensity to consume of low income earners (meaning they spend more of every dollar they get) but that will likely be mitigated by price inflation (as you correctly mention).

You can find economics to make it look like a great or terrible idea. I agree that it would be more effective on the federal/state level but there are some pretty non-negligible costs to relocating a business from Milwaukee so it's  not as simple as claiming that a living wage law would drive out all businesses.

Those who support living wage laws (myself included) tend to fallback on the argument that anyone working 40+ hours ought to be compensated at above the poverty line as a matter of principal. Whether or not that is achieved through minimum wage or other means is irrelevant to me.

[Coleman]

Minimum wage isn't meant to increase wealth - it's meant to redistribute existing wealth. That might not be the narrative that either side of the political argument pushes, but it's the net effect. You may get some temporary bump in GDP due to the higher marginal propensity to consume of low income earners (meaning they spend more of every dollar they get) but that will likely be mitigated by price inflation (as you correctly mention).

You can find economics to make it look like a great or terrible idea. I agree that it would be more effective on the federal/state level but there are some pretty non-negligible costs to relocating a business from Milwaukee so it's  not as simple as claiming that a living wage law would drive out all businesses.

Those who support living wage laws (myself included) tend to fallback on the argument that anyone working 40+ hours ought to be compensated at above the poverty line as a matter of principal. Whether or not that is achieved through minimum wage or other means is irrelevant to me.

Well said!