Another stupid idea -
outsource our Navy to China?
by
Mike Crane
The current administration seems determined to continue
pushing outsourcing. Growing concerns from many sectors just bounce
off like "flubber." It does not take a rocket scientist to
understand that you only outsource so many jobs and industries
before problems arise.
As has been shown on these pages - advanced technology
products, financial services, call centers and IT product
development industries are leaving empty facilities all over our
landscape. But the current Administration tells us, "this
is good for us."
Buried in the excerpt of an article (by Paul Craig Roberts)
below is a major potential problem these failed policies are
bringing to you:
Manufacturing &
Technology News (July 8) reports that 80% of the components for the
Virginia Class submarine come from sole sources.
(Source:
http://www.manufacturingnews.com/)
Outsourcing and the expensive
trade agreements have decimated our manufacturing base. H ow
can this be a surprise? Empty facilities do not produce very much.
Now many do not give a hoot about where your TVs or even Maytag
washing machines are built. But how about the widgets on the ships,
jets and other major hardware that our military require?
It has not happened yet, so this
is a potential problem, but how would you like our military being
dependent on China (or any country for that matter) for their
hardware? I mean after all lets let a potential enemy build our top
secret weapons.
Isn't that the stupidest idea you
have ever heard?
Well hang on to your seats, it is
slowly happening:
The Pentagon,
seeking lowest cost, is pushing defense contractors to outsource
offshore for more materials, components and systems.
Read that again:
The Pentagon,
seeking lowest cost, is pushing defense contractors to outsource
offshore for more materials, components and systems.
Given that many components only
have a single source, what happens when you move that company's
facilities to a foreign country? Well that company's suppliers have
to move also. So over time you have the chain reaction that is
occurring industry after industry in our country. The entire
industry loses critical mass and disappears.
In some industries, such as TVs,
the impact is limited to lost jobs, increased deficits, increased
burden on tax payers for social costs, etc. You also lose the future
growth due to technological advances (such as new digital TVs). So
whole new product lines and industries develop in foreign countries,
bypassing our country. None of this is very good for our citizens.
When this effect spreads to
defense industries we will wake up one day and find in addition to
the economic losses - we can't even build our own equipment
for our national defense.
Apparently the day of reckoning
is approaching on US ship building:
This year
the US is producing 6 ships, one-tenth of South Korea's output.
In 2006 the US is scheduled to produce only 4 ships, because
China has outbid us for the steel. The US "superpower" can no
longer afford to compete against China for essential materials.
Cynthia
Brown, president of the American Shipbuilding Association says
that "the manufacture of entire components and systems will
migrate to China in the next several years under current
Department of Defense policy with respect to outsourcing."
(Source:
http://www.americanshipbuilding.com)
The Chinese know a sucker when they see one. They are taking
advantage of American multi-national corporate greed and will let
American companies provide them with the technology that they are
missing. From the Department of Defense report on the China Navy:
One
hindrance to China’s military development has been the reliance on
foreign suppliers for key technologies. Presently, China has the
capability to produce 40% of critical ship systems and components
domestically, but is striving for 100% self-sufficiency. In a
Lloyd’s List International article excerpted in the May 2005 issue
of American Shipbuilder, the President of the China Association of
National Shipbuilding Industry was quoted as saying that "the
government should plan in entirety for this [shipbuilding] industry,
and create some enterprises which are able to innovate and compete
with international rivals."
(Source:
http://www.americanshipbuilding.com/news.cfm)
You can take it to the bank that
as the Defense Department continues its focus on increasing
outsourcing, there will be many very competitive bids from Chinese
firms. Of course they would never use the technology for their own
purposes, would they? As we continue down the road to losing
self-sufficiency, China will gladly jump on the opportunity. This is
stupid at best.
These very questionable policies
are being brought to you by your elected and appointed officials.
Since we have entered the era of high immigration, so-called free
trade and outsourcing our country has converted from the world's
largest creditor nation to the world's largest debtor nation. Today,
with deficit spending and trade deficit of over a trillion dollars
($1,000,000,000,000.00) a year we have a sluggish economy. With a
trillion dollars of debt a year being dumped into the economy it
should be booming!
What will happen when the debt can
not be sustained any longer? We all know that a trillion dollars a
year debt can not continue forever and the trend has not depended on
which of the two major parties was in power.
American citizens and our children
are the real losers of these polices. Are we also going to let these
failed policies continue to the point where they not only undermine
our economy but our national defense?
That my fellow Americans is up to
you. You do not have to return the elected officials that support
these failed policies for another term. You can elect officials who
will represent your interests - not special interests. But you can
take it to the bank that if you do not make a change - nothing will
change!
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The US Navy...Made
in China
China-Mart Takes Over
By PAUL
CRAIG ROBERTS
My
poor beloved country, trapped in a Middle Eastern quagmire and
tricked by Osama bin Laden into subsidizing to the tune of
$300 billion (spent or appropriated) a training ground for
Muslim terrorists and insurgents while our once fabulous
economy disintegrates.
If the US were still rich
and just wanted to throw several hundred billion dollars at
bin Laden as a good will gesture, that would be one thing. But
we are borrowing the money that we are using to train Muslim
terrorists to kill and maim our troops in Iraq and Londoners
in England.
The money is being lent to
us mainly by Asians, especially the Chinese. China has so many
dollars to lend to us because we send so many dollars to China
to pay for the goods and services that patriotic American
corporations have decided to supply to us from China instead
of from America.
US corporations decided that
the way to get rich was to destroy their American consumer
base by closing their American factories, throwing their US
employees out of work and hiring Chinese instead. The Chinese
work for less, you see, and free trade economists say lowering
costs makes us better off.
What US corporations and the
free trade economists overlook is that giving Americans' jobs
to foreigners raises foreign incomes and lowers American
incomes. When credit cards and home equity lines are maxed
out, there will be nothing to support the US consumer market.
The American corporations who moved their capital and
technology to China will have to find new customers.
Maybe the Chinese government
will let the relocated US firms sell to Chinese customers, or
maybe the Chinese government will let the US firms go
bankrupt. The latter favors China's strategic interest.
Chinese businessmen will purchase the bankrupt firms, and
Chinese businesses will sell to Chinese customers.
Americans are pouring so
much money into China that China can finance our wars while it
buys up our companies.
Everyone was shocked that a
Chinese company could outbid Chevron for Unocal. China has
already purchased IBM's personal computer business, and is now
after US appliance maker Maytag (whose appliances are made in
Mexico).
The outsourcing mania has
hit the Pentagon, and China will soon be supplying the ships
for the US Navy. The Pentagon, seeking lowest cost, is pushing
defense contractors to outsource offshore for more materials,
components and systems.
This means the end of US
shipbuilding capability. Component suppliers to American
shipbuilding are already skeletal thin, with most components
only having sole suppliers. For example, Manufacturing &
Technology News (July 8) reports that 80% of the components
for the Virginia Class submarine come from sole sources.
With not enough US Navy
ships being built to support even an industry of sole
suppliers, Asia is fast becoming the only source for US Navy
ships.
While President Bush spends
$300 billion recruiting and training terrorists for bin Laden
in Iraq, US Navy ship procurement has fallen 33% since 2001.
Meanwhile China is on a rip.
China is now the third largest shipbuilder after South Korea
and Japan. In five years China's submarine fleet will be twice
the size of America's. In 10 years China's navy will be larger
than the American fleet.
This is amazing performance
for a country that as recently as 1989 had essentially no
shipbuilding industry.
This year the US is
producing 6 ships, one-tenth of South Korea's output. In 2006
the US is scheduled to produce only 4 ships, because China has
outbid us for the steel. The US "superpower" can no longer
afford to compete against China for essential materials.
Cynthia Brown, president of
the American Shipbuilding Association says that "the
manufacture of entire components and systems will migrate to
China in the next several years under current Department of
Defense policy with respect to outsourcing."
But, hey, we will get ships
cheaper, and it is making us rich!
Paul Craig Roberts
has held a number of academic appointments and has contributed
to numerous scholarly publications. He served as Assistant
Secretary of the Treasury in the Reagan administration. His
graduate economics education was at the University of
Virginia, the University of California at Berkeley, and Oxford
University. He is coauthor of
The Tyranny of Good Intentions. He can be reached at:
paulcraigroberts@yahoo.com
Source:
http://www.counterpunch.org/roberts07252005.html
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If you are concerned about this issue the following article
may be of interest:
Many
ask, "Why a Southern Party …?"
If you live in Georgia the following may be of interest:
Your Tax Dollars At Work...Offshore
Georgia loses another 180 jobs
to foreign countries - Earthlink this time and the lost jobs are in
Atlanta
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