Is Obama a manufacturing genius?

posted at 4:15 pm on February 17, 2012 by Jazz Shaw

Bruce Bartlett has an interesting column at The Fiscal Times posing the question, can Obama’s manufacturing initiative really work? Some of the conclusions will be controversial at best, but it’s worth a read if only for some important history lessons. One of the key items takes a look back at a time when Japan was still the envy of the world – manufacturingwise at least – and the United States government was poking around in the then emerging technology of HDTV.

Even among Republicans there was admiration for the Japanese model. During the George H.W. Bush administration, where I worked in the Treasury Department, it had strong supporters at the Commerce and Defense departments. One of the key battlegrounds was high-definition television (HDTV), which was just in its infancy. Commerce was very keen to support American manufacturers of HD televisions and DOD agreed in order to support the American semiconductor industry. (Semiconductors are a major component of HDTV.)

The author notes that there was internal strife in the administration, with Treasury and the Council of Economic Advisers advising a hands off, free market policy. In the end they were shouted down and Washington chose to place a bet on American semiconductors. How did that work out?

Years later, one of the people at Commerce who supported subsidies for HDTV admitted to me that the technology that it wanted to support turned out to be inferior to that which ended up being the standard. It also turned out that the real money was not to be made manufacturing HDTV’s, but in producing the programming, an area where the U.S. remains dominant.

The Obama administration should, in some sense, be supported for taking an interest in seeing American manufacturing restored. But whether it’s Barack Obama or his eventual GOP challenger in office next year, we need to be wary of what kind of support is offered.

On the one hand, we could see more Solyndra style, federal nose under the tent activity trying to apply some ham handed “help” to manufacturing under Obama. One of the alternatives, offered by Rick Santorum, would see a bizarrely deformed tax code offering special preferences to manufacturing. Unfortunately, both of these ignore the lessons of the G.H.W.B administration and their experience in meddling with the free market. As the author found, a group of elected bureaucrats with little to no knowledge or experience in technology and industry are almost perfectly unsuitable to pick winners and losers. Offer a level playing field with the fewest impediments possible and the clearest path to success and prosperity, and innovation (along with the associated jobs and GDP) will follow.

Those who fail to to learn from history are doomed to repeat it. I’m sure I read that somewhere…


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Talk amongst yourselves…

Mahdi on February 17, 2012 at 4:16 PM

…only at manufacturing lies and bullshirts!

KOOLAID2 on February 17, 2012 at 4:18 PM

He’s a little too busy demanding a gold watch for selling Boeing products.

teke184 on February 17, 2012 at 4:19 PM

“American manufacturing,” in the eyes of Obamuh, is the creation of several People’s Tractor Factories … pursuant to several Five Year Plans.

OhEssYouCowboys on February 17, 2012 at 4:20 PM

“….manufacturing genius?” Ahhh, no.

major dad on February 17, 2012 at 4:21 PM

Those who fail to to learn from history are doomed to repeat it.

Those governed by those who fail to learn from history are doomed — period.

hillbillyjim on February 17, 2012 at 4:21 PM

At the end of the day a subsidy works like this:

Item costs $100 without govt intervention
Govt subsidizes it by $20 making the cost $80
Your taxes increase by $20.

angryed on February 17, 2012 at 4:22 PM

OMG… a criticism of Rickypoo…

Critic2029 on February 17, 2012 at 4:22 PM

support is a fascist takeover.

definitions.

ted c on February 17, 2012 at 4:22 PM

…only at manufacturing lies and bullshirts!

KOOLAID2 on February 17, 2012 at 4:18 PM

Beat me to it.

The Rogue Tomato on February 17, 2012 at 4:23 PM

Hey, if politicians leave the free market alone, they’d have to run for office with their own money. We can’t have it, right?

Archivarix on February 17, 2012 at 4:23 PM

The azz touts the plant he tried to close. Mock and ‘discard’ the sausage made of Muenchhausen, Machiavelli, Orwell and Pinocchio.

The truest thing ever said about him

“You lie”.

Schadenfreude on February 17, 2012 at 4:23 PM

It’s amazing how the light bulb, telephone, cotton gin and the PC were all able to prosper as American inventions without govt help.

angryed on February 17, 2012 at 4:24 PM

genius? really? did you use that word?…..dude.

ted c on February 17, 2012 at 4:24 PM

…a group of elected bureaucrats with little to no knowledge or experience in technology and industry are almost perfectly unsuitable to pick winners and losers.

I’m hard pressed to think of anything a group of elected bureaucrats are suited to do.

SukieTawdry on February 17, 2012 at 4:24 PM

Those who fail to to learn from history are doomed to repeat it. I’m sure I read that somewhere…

I wrote it.

Well, maybe I wasn’t the first.

The Rogue Tomato on February 17, 2012 at 4:25 PM

quick jazz; check it out. Here’s a caption contest story if I’ve ever seen one.

http://washington.cbslocal.com/2012/02/17/woman-gets-grabby-with-president-obamas-backside/

ted c on February 17, 2012 at 4:25 PM

The second I saw the term “Japanese model” I knew it was a bad idea. Japan has had, what, a decade and a half of near-0 growth? That’s the model I want to be using!

Professor de la Paz on February 17, 2012 at 4:25 PM

At the end of the day a subsidy works like this:

Item costs $100 without govt intervention Govt subsidizes it by $20 making the cost $80 Your taxes increase by $20.

angryed on February 17, 2012 at 4:22 PM

I would think that the taxes in this scenario would be closer to $25-30. The agency that oversees the subsidies needs to pay it’s employees too.

Flange on February 17, 2012 at 4:26 PM

This is not about ‘American manufacturing’. Idiots.

It’s about Obama giving money to liberal and union friends so they will re-elect him.

faraway on February 17, 2012 at 4:26 PM

Sorry, this plant

Schadenfreude on February 17, 2012 at 4:26 PM

The media and White House are promoting failure as success. And those that don’t see the failure as a success as being the problem.

albill on February 17, 2012 at 4:27 PM

Pare the federal govt to its constitutional confines and everyone will prosper. P.E.R.I.O.D.

Akzed on February 17, 2012 at 4:29 PM

The second I saw the term “Japanese model” I knew it was a bad idea. Japan has had, what, a decade and a half of near-0 growth? That’s the model I want to be using!

Professor de la Paz on February 17, 2012 at 4:25 PM

I think it means the Japan Model of the 70′s 80′s and Early 90′s when everyone though they were going to take over the world. i.e. selectively subsidizing their tech industry to keep it on top and drive their economy. The incredible expansion in technology in Japan had a lot to do with this additional government capital. i.e. the reason they had HDTV and robust wireless communication services almost 15-20 year before we did…

Critic2029 on February 17, 2012 at 4:29 PM

Nope.

cgoode777 on February 17, 2012 at 4:30 PM

I was about to answer the headline question with a resounding “YES!!!” when I abruptly realized that I had read “manufacturing” as “manufactured“.

So, I change my answer to not just “no” but “FCUK NO!!” . I don’t think a guy who clearly has no understanding of either business or economics, and who has never held a real (in the sense of “productive”) job, could even remotely begin to comprehend the impossibility or foolishness of trying to centrally manage even the pathetic rump that remains of once-great American manufacturing. Not even close.

mr.blacksheep on February 17, 2012 at 4:31 PM

ted c on February 17, 2012 at 4:25 PM

I’m sue Axe is looking at selling future grabs for campaign donations. Going after the woman and, well, other votes…

Kraken on February 17, 2012 at 4:33 PM

Is Obama a manufacturing genius?

 
Sure, and he admits it, too. Read his “blank screen” quote. He’s a manufactured-
 
Wait, manufacturing? Oh. Nevermind.

rogerb on February 17, 2012 at 4:34 PM

quick jazz; check it out. Here’s a caption contest story if I’ve ever seen one.

http://washington.cbslocal.com/2012/02/17/woman-gets-grabby-with-president-obamas-backside/

ted c on February 17, 2012 at 4:25 PM

Give me back my wallet, you thieving thief.”

herm2416 on February 17, 2012 at 4:34 PM

I don’t know if he is a manufacturing genius, but he is a genius at fabricating lies. Does that count?

Nathan_OH on February 17, 2012 at 4:34 PM

He couldn’t run a lemonade stand.

natasha333 on February 17, 2012 at 4:35 PM

What kind of Plu-Perfect IDIOT would even POST something as STUPID as this Post?

williamg on February 17, 2012 at 4:35 PM

Didn’t read the article: the title made me spew coffee all over the monitor…

affenhauer on February 17, 2012 at 4:37 PM

Devaluing the dollar makes our exports more competitively priced abroad. It’s also cheaper for foreign companies to invest in American manufacturing plants. The downside is it hurts our standard of living as almost everything we need to buy will be more expensive. Wage growth may not keep pace with inflation.

Wigglesworth on February 17, 2012 at 4:38 PM

I stood at the window this morning and watched Air Force One taxi around Paine Field. My supervisor (a liberal) was standing next to me. He turned to me and said, “Don’t move. If you get any closer, the Secret Service is going to double-up on its level of security. What will today’s commute traffic look like then?.” My co-worker (a conservative) turned to the supervisor and said, “No need to worry. I know for certain that he is all too cognizant of the world’s finest insurance policy — and you KNOW who I’m talking about. That’s right, none other than Joe Biden.”

My collie says:

You should never let it be known that you’re a Tea Partier, CC.

Sometimes, I don’t have to say anything. All I have to do is “show up”.

CyberCipher on February 17, 2012 at 4:40 PM

“Offer a level playing field with the fewest impediments possible and the clearest path to success and prosperity, and innovation (along with the associated jobs and GDP) will follow.”

Jazz…

… You do realize that Obowma’s core ideology would go super nova if it came in contact with that quote, don’t you?

It’s heresy…!

… It would physically hurt his ears to hear such a thing.

Forcing him to read it is tantamount to water boarding…

… What kind of a sadistic monster are you!

This is sick…!

/

Seven Percent Solution on February 17, 2012 at 4:45 PM

He couldn’t run a lemonade stand.

natasha333 on February 17, 2012 at 4:35 PM

He has some experience with running guns to Mexico.

BobMbx on February 17, 2012 at 4:46 PM

Those who fail to to learn from history are doomed to repeat it. I’m sure I read that somewhere…

“Progress, far from consisting in change, depends on retentiveness. When change is absolute there remains no being to improve and no direction is set for possible improvement: and when experience is not retained, as among savages, infancy is perpetual. Those who cannot remember the past are condemned to repeat it.

– George Santayana, The Life of Reason, Volume 1, 1905

cheeflo on February 17, 2012 at 4:48 PM

Your taxes increase by $20.

angryed on February 17, 2012 at 4:22 PM

more like taxes go up by $40. You forget the cost of govt help. Bureaucrats to process the aid and there’s politicians to be paid off. That’s why even those there was a $7500 rebate on volts but the actual cost to taxpayers is like double. Worse is the cash for clunkers which costed taxpayers $28000 for each car sold and gave no bump.

AH_C on February 17, 2012 at 4:48 PM

quick jazz; check it out. Here’s a caption contest story if I’ve ever seen one.

http://washington.cbslocal.com/2012/02/17/woman-gets-grabby-with-president-obamas-backside/

ted c on February 17, 2012 at 4:25 PM

“You just rike chinaman, all mouth no butt”

BobMbx on February 17, 2012 at 4:49 PM

He’s NO kind of genius, he doesn’t even qualify as ‘really smart’.

slickwillie2001 on February 17, 2012 at 4:50 PM

That’s why even those there was a $7500 rebate on volts but the actual cost to taxpayers is like double. Worse is the cash for clunkers which costed taxpayers $28000 for each car sold and gave no bump.

AH_C on February 17, 2012 at 4:48 PM

$10,000 subsidy this year (per Volt) for a company that just reported a $7,000,000,000, profit….its highest ever profit number.

(i don’t think they need a subsidy, do you?…..but then again, how do you subsidize something you own?)

BobMbx on February 17, 2012 at 4:52 PM

As a mechanical engineer who loves manufacturing but avoided it out of fear of losing my job, allow me to list how we could enjoy a manufacturing renaissance.

1. A sensible energy policy that provides for cheap, reliable electricity and natural gas. Kill the EPA.
2. Regulatory relief tat causes endless delays in the construction of manufacturing facilities.
3. Regulatory relief with respect to any liquid or gaseous discharges from a facility.
4. Larger pool of technical school grads, not BS BS holders.
5. Weak union presence.

US manufacturing didn’t leave because US companies are greedy, they left due to high regulatory and labor costs.

The solution is, as always, to get government out of the way.

Charlemagne on February 17, 2012 at 4:53 PM

Obama MIGHT be a manufacturing genious.

The same way I might be a concert-level violin player.

You really never know until you try.

logis on February 17, 2012 at 4:54 PM

He’s NO kind of genius, he doesn’t even qualify as ‘really smart’.

slickwillie2001 on February 17, 2012 at 4:50 PM

Chew on this….his wife gets to take million-dollar vacations with her closest 200 friends….at your expense, because of him.

Can you do the same for your wife?

BobMbx on February 17, 2012 at 4:54 PM

He’s something mf’g but manufacturing wasn’t the word that came to mind.

Tennman on February 17, 2012 at 4:59 PM

Chew on this….his wife gets to take million-dollar vacations with her closest 200 friends….at your expense, because of him.

Can you do the same for your wife?

Doesn’t make him smart, just a freeloader. Doesn’t take smarts to have available for your spending desires, other peoples money, a printing press, and ious in a system already set in place to provide for your vacations and other perks one can enjoy playing pResident.

hawkeye54 on February 17, 2012 at 5:22 PM

US manufacturing didn’t leave because US companies are greedy, they left due to high regulatory and labor costs.

The solution is, as always, to get government out of the way.

Exactly. Business always seeks the most profitable and least costly ways to do business, which today,for manufacturing, generally leads that sector overseas.

hawkeye54 on February 17, 2012 at 5:25 PM

Is Obama a manufacturing genius?

Yes.

rich801 on February 17, 2012 at 5:28 PM

It is getting supper time. bho and genius together just left me without a desire to eat or fix supper.
L

letget on February 17, 2012 at 5:31 PM

Ga. just landed a new Cat plant 3000 jobs.. No 0 had nothing to do with it. The only thing he manufactures is BS.

Bmore on February 17, 2012 at 5:33 PM

Is Obama a manufacturing genius?

He is a manufactured genius, which is not quite the same thing.

Mr. Arkadin on February 17, 2012 at 5:37 PM

Bringing back buggy whips and wheelwrights…after all, it is green technology.

Yep, that Obama guy sure knows a lot about industry and technology and manufacturing.

Thank you, Prezdit Obama.

coldwarrior on February 17, 2012 at 5:41 PM

if we had an honest government with really sharp people it might work. we don’t have that, and most certainly Obama is not capable of anything remotely sensible, he’s a complete failure, a fraud dishonest and corrupt.

exceller on February 17, 2012 at 5:47 PM

I don’t know. Maybe he is really a manufacturing genius. Manufacturing in Brazil and China have increased massively due to his direct actions.

LegendHasIt on February 17, 2012 at 5:53 PM

I remember that. We were without HDTV while Japan had had it for over 10 years. It was ridiculous. It was basically a hold on emerging technology.

MrX on February 17, 2012 at 6:02 PM

Joe Biddie Brains told Omarxist to plagiarize it from Santorums debate talking points- but not to worry the fraud of an occupier in the WH will screw that up- media will not comment -
- Boeing shrugs

FlaMurph on February 17, 2012 at 6:02 PM

Ga. just landed a new Cat plant 3000 jobs.. No 0 had nothing to do with it. The only thing he manufactures is BS.

Bmore on February 17, 2012 at 5:33 PM

Is that the plant that stiffed Illinois last month?

slickwillie2001 on February 17, 2012 at 6:03 PM

I don’t know if anyone has posted this before so if so sorry. I seems bho thinks he deserves a ‘gold watch’? The problem look where this goes and who will pay?

http://www.breitbart.tv/i-deserve-a-gold-watch-obama-claims-credit-for-boeing-deal-propped-up-by-fed-loan-guarantees/?utm_medium=twitter&utm_source=twitterfee
L

letget on February 17, 2012 at 6:04 PM

US manufacturing didn’t leave because US companies are greedy, they left due to high regulatory and labor costs.

The solution is, as always, to get government out of the way.

Charlemagne on February 17, 2012 at 4:53 PM

Exactly. Business always seeks the most profitable and least costly ways to do business, which today,for manufacturing, generally leads that sector overseas.

hawkeye54 on February 17, 2012 at 5:25 PM

Yes, and if corporations don’t do what is best for the owners, the stockholders can and will often sue them.

slickwillie2001 on February 17, 2012 at 6:06 PM

Is that the plant that stiffed Illinois last month?

slickwillie2001 on February 17, 2012 at 6:03 PM

My understanding at this point is it is a new plant that won’t be going to China and that work for hire was part of what landed it. If I get anymore info I’ll pass it along. It just happened and I had heard a brief interview with our Governor around 4:00 p.m. Small excavators and crawlers i.e. dozers.

Bmore on February 17, 2012 at 6:06 PM

P.S. Check out Drudge.

Bmore on February 17, 2012 at 6:07 PM

I’m an aircraft structures engineer for Boeing Everett. My husband does technology R&D for Boeing in Everett. It is people like us who make sure there will be a quality plane to build and sell. We do not want the government to meddle in our work. It will ruin our ability to be nimble and competitive. As it is, Boeing is already bureaucracy-heavy, and people who are technically savvy have to SCREAM to be heard when decisions are made.

Every day, we work hard to make the case that American engineering & manufacturing is superior. We the face of American ingenuity and tech savvy. We are winning the internal argument about insourcing right now WITHOUT the government’s meddling.

Let the government enforce its existing trade agreements and stay out of decisions best left to technical experts.

redaerobaby on February 17, 2012 at 6:57 PM

To answer the question, “Sure. Ever seen his real birth certificate?”

It clearly states,
“Wily Coyote, Super Genius.”

SnarkySam on February 17, 2012 at 7:18 PM

Is that the plant that stiffed Illinois last month?

slickwillie2001 on February 17, 2012 at 6:03 PM

My understanding at this point is it is a new plant that won’t be going to China and that work for hire was part of what landed it. If I get anymore info I’ll pass it along. It just happened and I had heard a brief interview with our Governor around 4:00 p.m. Small excavators and crawlers i.e. dozers.

Bmore on February 17, 2012 at 6:06 PM

Here’s the story I remembered: Caterpillar: Illinois won’t get factory

Can’t be certain that it is literally the same operation.

slickwillie2001 on February 17, 2012 at 7:20 PM

The Obama administration should, in some sense, be supported for taking an interest in seeing American manufacturing restored.

No, no, no! Free market capitalism works when businesses are free to cut costs. The simple fact is that things can be manufactured more economically in the third world. This produces less expensive goods here and thus frees up capital for investment which expands the economy. As jobs are provided in places like China, a middle class grows there. This middle class wants nice things and they begin ordering them from us. It’s all good.

The only reason Øbama wants to bring manufacturing back to this country is he knows that most of those jobs will be unionized.

Odysseus on February 17, 2012 at 7:46 PM

Can’t be certain that it is literally the same operation.

slickwillie2001 on February 17, 2012 at 7:20 PM

7

yeah, Illinois got stuffed after they passed a tax exemption giving cat IIRC a $200mil break in order to keep cat in state. The way I understand it, cat agreed to stay, but there never was any discussion about expansion, even tho it was an open secret that sooner or later there would be expansion. So cat got the break for existing operations, and Illinois got stuffed on expansion . Seems like Oboobi and the dems can’t get along with cat. Remember when Oboobi had a Presser at cat in indiana and declared there would be no layoffs. The very same afternoon, the CEO said Oboobi lied about him giving Oboobi such a rosy outlook. Months later cat had a big round of layoffs.

Pretty ballsy. Waiting for Norbert to sweep in and forbid cat from moving forward, a la Boeing.

AH_C on February 17, 2012 at 10:53 PM

Pretty ballsy. Waiting for Norbert to sweep in and forbid cat from moving forward, a la Boeing.

AH_C on February 17, 2012 at 10:53 PM

Norbert should be NLRB.

AH_C on February 17, 2012 at 11:41 PM

There are millions of people that do not know the definition and difference between profit and profit margin yet converse freely about them truly believing they know what they are talking about.

mixplix on February 18, 2012 at 4:45 AM

Obama:The Dreamliner really is the plane of the future. And by building it here, Boeing is taking advantage of a huge opportunity that exists right now to bring jobs and manufacturing back to America.

So South Carolina is a foreign country according to Obama?

Obama:And technology has also made it easier for more companies to set up shop and hire workers anywhere there’s an internet connection.

You can’t turn a wrench with the internet. This is a truly stupid line

DSchoen on February 18, 2012 at 5:33 AM