Friday, February 5, 2010

Trade Reform - A Macro-transformation

Most of us in the Lean Transformation world are focused on "micro" transformation issues, making individual companies more competitive, more sustainable, more profitable. We are making gains throughout various industries, in companies small and large. This is good stuff. There is, however, another issue that requires as much, if not more, effort from US manufacturing companies. It has to do with global trade policies and practices. Unfortunately, in trying to compete with China, companies making products in the US have barriers to deal with other than higher wages, greedy CEOs, restrictive unions and an apathetic society.

Did you know that much of the glass for the New World Trade Center in New York will be produced in China? It shouldn't surprise you that the Chinese glass was chosen by the Port Authority of New York. They wouldn't want to be viewed as wasting money on a more expensive product, or practicing protectionism. But, you gotta wonder how a low-labor-content product like glass from a Chinese manufacturer can be the lowest bid? Shipping costs alone should negate most of the gain from low labor costs. Unfortunately, the ugly little secret that's been ignored for years is that the Chinese government provides huge subsidies to certain industries in China. Many of these subsidies are illegal, in violation of trade laws.

Part of the problem is that we have no national manufacturing strategy. President Obama promised that his manufacturing czar (did you know we have one?), Ron Bloom, will develop a strategy, with emphasis on "21st century technologies". That's good, unless you're one of the millions of US workers in a 20th century industry. Who is going to help them?

We can't continue to allow jobs to be lost in this country by rolling over and allowing other countries to continue to violate trade policies and laws. Obama recently told the Senate, "If we are able to compete on a level playing field, nobody can beat us". Great statement; I just hope we have the guts to do something about it.

1 comment:

  1. As lean practitioners, this info gives us something to think about. Not sure exactly what to do though. Obama has made alot of promises, unfulfilled so far.

    Thanks for the post,