
Staying Rich Without Manufacturing Will Be Hard - jseliger
https://www.bloomberg.com/view/articles/2017-03-28/staying-rich-without-manufacturing-will-be-hard
======
AnthonyMouse
You can't pay an American worker 20 times as much to make the same product in
the same number of hours. The only way to be competitive at 20 times the pay
is for each worker to produce 20 times the output, i.e. automation. So what we
have is a choice between fewer American manufacturing jobs (automation) or no
American manufacturing jobs (outsourcing). People don't want to hear that, but
those are the alternatives.

And given that, automation is clearly the right answer. Some manufacturing
jobs is better than no manufacturing jobs, and more local manufacturing
creates more local non-manufacturing jobs in sales, transportation,
administration, etc.

~~~
lettergram
Hmmm I don't know about that. Growing up my father was a tool maker (worked
for Molex), that means he figured out how to make the molds people designed.
That sounds easy to some, but understanding how to cut different materials the
right way is a pretty unique skill.

Anyways, he basically trained his replacement(s) before they laid off a large
portion of his machine shop. He trained probably 15 - 20 Chinese over the
course of a few years. In the end, as expected, they laid him off. Fast
forward 10 years and they had to bring a lot of the tool making back.

Turns out the Chinese either had worse quality control or poorer skill, but
they simply couldn't produce at the same level. You only need a few molds for
a production line, but each needs to be near perfect. The Chinese couldn't do
it. And even when they did / could, the intellectual property was often
stolen, so competitors would pop up and customers would get pissed.

You're correct automation is needed. However, so is high quality standards,
higher education, higher moral codes / higher pay to keep people honest. The
fact is, you can't really find skilled labor elsewhere easily (they want the
same as the US wages). That's why the US's number one export is education, and
probably why every company still fights over software engineers and really
every STEM field.

Unfortunately for manufacturing, the fight is over. When they tried to bring
the tool making back there were very few people still doing it. Every single
one of my dad's friends (including my dad) had moved on to other jobs. The
fact is, all that tribal knowledgewas passed down from master to apprentice
was lost. After they laid off the masters, there was/is no one left to really
continue.

Personally, I view this as a loss of critical mass and now our skills are
likely no better than anywhere else, at least for tool making.

I think this is a warning for every business. Sometimes it's worth paying the
price to keep talent. Companies like Google, Apple, et al, know this.
Hopefully, that will keep tech and a lot of the other large US companies from
losing their way.

~~~
jasode
_> the Chinese either had worse quality control or poorer skill, but they
simply couldn't produce at the same level. ... The Chinese couldn't do it. _

It seems that China's workers can make Macbooks and iPhones with high
precision and low tolerances according to Apple's specifications. Were the
Molex molds more complicated than that?

In other words, if those specific 15-20 Chinese workers failed, maybe choosing
a different set of 20 Chinese employees (or partner manufacturer) would have
given the quality desired?

~~~
csomar
I don't know the OP but I think his father is biased. The story is repeated a
lot (The Chinese/Indians/Other-Race are cheaper but can't produce the same!)
even for Software developers (Indians). In most cases (at least for the
software engineering) the problem turns out that the other-race pay was low,
and thus attracted low talent. The company probably wanted to cut costs and
picked cheap foreign workers that didn't perform.

~~~
gozur88
If it's that easy to move highly skilled positions to the Far East, how do you
explain Germany's prowess in high-end manufacturing? Surely all those jobs
should have moved to China by now? It's been two generations since Deng opened
the country up to foreign manufacturers.

~~~
mistermann
Germans may think beyond next quarters earnings.

~~~
jerven
Its because most of these companies are small and largely family owned. i.e.
the owners understand the product, and moving it to china means they would
need to move to china as well.

In many ways the difference is that headquarters is next or on top of the
factory instead of in a different state.

~~~
rusk
_Its because most of these companies are small and largely family owned_

Sorry I have to question this .. Bosch, Mercedes, BMW? There are a few
notables such as Krupps that were _once upon a time_ family owned but
increasingly these companies are owned by global conglomerates.

Yes, these companies do outsource many functions to poorer countries but their
centre of gravity is very certainly in Germany.

------
terminallyunix
This reminds me of a quote from Neal Stephenson's epic Snow Crash novel:

“When it gets down to it — talking trade balances here — once we've brain-
drained all our technology into other countries, once things have evened out,
they're making cars in Bolivia and microwave ovens in Tadzhikistan and selling
them here — once our edge in natural resources has been made irrelevant by
giant Hong Kong ships and dirigibles that can ship North Dakota all the way to
New Zealand for a nickel — once the Invisible Hand has taken away all those
historical inequities and smeared them out into a broad global layer of what a
Pakistani brickmaker would consider to be prosperity — y'know what? There's
only four things we do better than anyone else: music movies microcode
(software) high-speed pizza delivery” ― Neal Stephenson, Snow Crash

~~~
polynomial
> There's only four things

Weaponry.

~~~
quanticle
That's not necessarily true. Excluding the obvious comparisons with Russian
and Chinese weapons sales, France, Sweden, and Israel also have significant
defense exports. America has a huge export market for weapons because America
has a huge defense industry. Even a small percentage of that turning into
export sales results in some pretty eye-popping numbers. I would be willing to
bet that, as a proportion of their overall defense industries, French and
Swedish export sales are much larger than America's.

------
Animats
Those numbers are worse than I thought they were. I thought US production had
recovered to 2008 levels. This isn't good, and it's really important.

To some extent, Trump was elected to fix this, but so far, no initiatives have
appeared which help US manufacturing. How much protectionism the US should
have is a real question. China has a considerable amount, and is trying to
become an autarky, not dependent of the rest of the world. That's been quite
successful in the Internet sector. China can probably do it; they're big
enough.

~~~
PKop
Pretty sure removing regulations on energy development (and therefore, cost)
are an effort to supporting manufacturing, and Trump has taken an aggressive
stance at repealing as much regulation especially in the energy sector, as he
can[0][1][2].

Those are just a few citations, but just look up some of his executive actions
and orders, as well as some recent legislation he's signed. Some of these
addresses repeal of regulations (Using the Congressional Review Act).

The GOP border-adjustment tax is being worked on currently. While debatable in
how it does or does not favor imports or exports, at the very least seems to
favor establishing business in the US and eliminate tax benefits of
incorporating outside the US.[3]

This, and his general desire for a slashing of the corporate rate, should
incentivize corporations (manufacturing and otherwise) to move, stay, and hire
in US, and move US from one of highest rate countries to one of the lowest.

[0]
[https://www.forbes.com/sites/christopherhelman/2017/03/28/tr...](https://www.forbes.com/sites/christopherhelman/2017/03/28/trump-
in-the-name-of-american-energy-independence-scraps-obamas-climate-
plans/#4c2ab7442258)

[1] [http://dailycaller.com/2017/02/02/trump-to-sign-repeal-of-
ob...](http://dailycaller.com/2017/02/02/trump-to-sign-repeal-of-obama-era-
coal-mining-regulation/)

[2][http://thehill.com/policy/energy-environment/319488-trump-
si...](http://thehill.com/policy/energy-environment/319488-trump-signs-repeal-
of-transparency-rule-for-oil-companies)

[3] [https://taxfoundation.org/faqs-border-
adjustment/](https://taxfoundation.org/faqs-border-adjustment/)

~~~
WorldMaker
These are supply-side arguments that still continue to fail to impress when
implemented in reality.

Just to narrow to one obvious piece: the difference in type of energy matters
if the _goal_ is to support local manufacturing. It's a variation of the "Buy
Local" argument applied to manufacturing suppliers. Reducing the
cost/regulation of oil/gas/coal doesn't support local manufacturing near as
much as it continues to support/cheapen global shipping costs (because
oil/gas/coal continue to transport well across borders, and continue to keep
cargo ships/planes fed). On the other hand, increasing solar/wind is a much
more "local" energy resource investment (it's tough enough just to store it
for time-shifting, much less to transport across borders) and _might_ be
better for the stated goal.

------
ffjffsfr
The article doesn't present any sound evidence for hypothesis in the title.
Manufacturing output has declined sure, but real gross domestic product grew
and it is still growing. This means that maufacturing production is replaced
by other sectors of economy: mostly services.

It seems logical to expect that in the future we'll have more jobs in services
(e.g. tech) and less jobs in manufacturing. This is good for everybody, good
for workers, because jobs in services are less dangerous, and good for economy
too.

~~~
porpoisemonkey
> jobs in services are less dangerous

This depends on how you define dangerous. Heart disease is the number one
cause of death in the United States killing ~614,000 people per year whereas
accidents account for ~136,000. Sedentary behavior has been shown to increase
the odds of heart related disease. Moving from more active manufacturing jobs
to more sedentary service jobs could arguably be more dangerous to the
longevity of a person's life.

[https://www.cdc.gov/nchs/fastats/leading-causes-of-
death.htm](https://www.cdc.gov/nchs/fastats/leading-causes-of-death.htm)

"Physical inactivity has become a major public health concern because it is
the second leading single cause of death in the United States, trailing only
tobacco use (31)."

[https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2857522/](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2857522/)

~~~
aidenn0
Also to note: when I worked retail, I was significantly less active than when
I started working software. With retail, my feet just hurt too damn much for
me to want to play sports on my days off. When I started a software job, I had
3 weekly semi-organized games I played in most weeks, as well as occasional
pickup games on other days.

~~~
porpoisemonkey
Could you clarify why this should be noteworthy? I mean this in the nicest and
most respectful way possible - I'm not sure how the statement fits into the
discussion.

~~~
aidenn0
Always happy to clarify!

My logic is roughly this:

1\. The comment I replied to was talking about harms to health by being
sedentary.

2\. A lot of people on HN are young professionals with desk jobs, which at
first glance seems more sedentary than most service jobs.

3\. I thought it would be enlightening to realize that many of those service
jobs can cause one to be _more_ sedentary than a desk job. If I had not
experienced it myself, I would not have considered this.

~~~
porpoisemonkey
I think I've identified my confusion.

I had interpreted the original post to be a comparison of the levels of
physical danger in manufacturing vs. service industry jobs. From my
perspective _both_ programming and retail are service industry jobs since they
don't involve creating physical products by hand or through the use of tools.

~~~
aidenn0
Service industry is where no goods are produced. Non-live entertainment and
software development both produce intangible goods, but still produce goods.

Furthermore when one talks about the movement of low-wage jobs from
manufacturing to services, it's assumed we aren't talking about professional
services (e.g. lawyers, accountants), but unskilled and low-skill service jobs
such as retail, food-services, and child-care.

------
jitix
To move to a more automated manufacturing industry and to expand the service
industry the US needs more educated people. You can't do hi-tech manufacturing
with high school graduates.

I think US needs to fix it's education system first to make sure that all
deserving people get a chance to go to college without incurring debt. It can
easily be done considering the money the government spends on defense and
other (I'd call useless) agencies like NSA, DEA, etc.

One of the first steps could be to pay college tuition for students matching
certain criteria (I'm not sure what the criteria could be - maybe GPA - but
I'm certain that some elibility criteria can be defined).

~~~
Joeri
Why draw lines at all in deciding who is deserving? In my country anyone can
study anything without going into debt. The only requirements are prior
degrees. It leaves young people free to choose their path in life. We spend
6.6% of our gdp to have that system. The US spends 5.6% of gdp on its system.
That's close enough that the US education system should be offering better
choices and outcomes to students. Why isn't it?

~~~
jitix
I agree. Thats why I said "to start with". Universal free education should be
a right in this day and age. However if the Congress is to pass such a bill
they most probably won't make it all free on day one. They (and the
population) need to ease into it, so reimbursing tuition fee as a
"scholarship" could be a good starting point.

------
Spooky23
This is why people don't trust news media and government.

This stuff was 100% obvious back in the 90s days, when the left wing people
were protesting globalism, what was left of manufacturing imploded, and big
agribusiness crushed Mexicos economy.

Since that time, we've been told time and time again by economists that we're
all wrong, the service economy is great and life is great... just go to
college for retraining.

~~~
vkou
That's because the left (Or more specifically, its social policies) has been
co-opted by neo-liberalism. We now have people who, with a straight face, can
claim that Hillary or Obama have liberal policies.

~~~
mozumder
That's because they ARE liberal policies.

Globalization means everybody in the world benefits, not just Americans.

Or did you want Nigerians and Sri Lankans to remain in poverty forever?

~~~
vkou
Yes, offshoring all our manufacturing to places with no worker protections, no
environmental protections, long work weeks, and poor wages is absolutely a
liberal policy. We're all about winning the race to the bottom.

The World Bank and the IMF have always been the left's shining beacons, that
bring progressive enlightenment to the downtrodden masses, the global south is
not being ruthlessly exploited by multinationals, and we've always been at war
with Eastasia.

I mean, that's not how _I_ remember the politics of the 90s, but who's to say?

~~~
mozumder
If you want those places to start having worker rights and environmental
protections, then you better make sure they're rich first, by giving them jobs
and trade.

The only reason they don't have these things is because they're poor in the
first place. Only wealthy societies can afford those things.

Free trade is the global labor and environment solution.

Or maybe you want those countries to be environmentally destructive forever?

~~~
vkou
Look - you don't have to believe that these complaints are valid. You don't
even have to believe that viable alternatives to unrestricted capitalism
should exist. I'm not trying to convince you of that!

However, you are incredibly unlikely to convince me that in decades past,
those beliefs were held by 'progressives.'

------
whack
_" Why should a country specialize in making things, when it can instead
specialize in designing, marketing and financing the making of things?"_

 _" This is a legitimate question... Ricardo Hausmann believes that a
country’s economic development depends crucially on where it lies in the so-
called product space. If a country makes complex products that are linked to
many other industries -- such as computers, cars and chemicals -- it will be
rich. But if it makes simple products that don’t have much of a supply chain
-- soybeans or oil -- it will stay poor. In the past, the U.S. was very
successful at positioning itself at the top of the global value chain."_

I would certainly call Google's search engines, Apple's iPhones and Intel's
processors "complex products that are linked to many other industries".
Comparing the fortunes of Apple vs Foxconn also shows that the top of the
value-chain certainly lies in design/marketing, as opposed to manufacturing.
The evidence the article presents is utterly baffling and unconvincing.

~~~
vkou
Google has a market cap of $570 billion USD, and employs 70,000 people.

GM, Ford, and Chrystler have a combined market cap of ~$130 billion USD, and
employ 600,000 people.

Google makes a lot of money, and pays its employees well. Unfortunately, it
hardly employs anyone.

~~~
wyldfire
You summed three competitors' employee counts as a comparison against Google.
I don't understand. You say "it hardly employs anyone" but from your numbers I
read, "70k is a little less than half of 200k".

~~~
freeone3000
It employs nearly half the people, and makes about five times the money.
That's a 10x spread.

~~~
vkou
It's actualy closer to a 40x spread, since the combined market cap of the Big
3 (Now including Fiat) is 130 billion.

The market doesn't value job creation. The ideal company is one that doesn't
have to employ anyone.

------
fovc
I was discussing something like this with an economist friend recently. His
view was that most economists (rightly I think) focus on consumption not
production. In theory, you can run a trade deficit forever to keep consuming
more than you produce.

Where I think the model probably breaks down is that you can't have infinite
debt levels, so your consumption growth is capped by your production growth. I
would think you run out of assets (e.g., Manhattan, London real estate) to
sell to net-export economies, but I guess there's always financial innovation
to bring you new products to sell

------
cylinder
The disturbing thing is that the US is not building its own robots to automate
the factories, they are being imported. Clearly we aren't as innovative a
nation as we think we are. Hey, at least we have Uber.

~~~
jfoutz
Pretty sure the us is the world leader in factory automation. We export robots
to build washing machines, and import washing machines.

~~~
dahauns
Sorry to burst that bubble - that couldn't be further from the truth,
especially when it comes to high-tech automation, i.e. industrial robotics.

Japan is still THE undisputed powerhouse in this field (Yasakawa, Kawasaki,
Fanuc, Mitsubishi, Epson...), with the EU a distant second (ABB, KUKA,
Stäubli, Comau...) and China rising quickly (e.g Siasun, Foxconn).

~~~
jfoutz
Fair enough. I was thinking Emerson, ge, Rockwell and the like. More
industrial processes kinds of things, but thanks for the clarification.

------
vinceguidry
Really this is about increasing demand and not supply. Americans need to be
trained to not want cheap shit. They need to learn to value stuff like
repairability and durability. Americans need to want things that only
Americans can make. As long as they want stuff that can be made by the dozen,
then they're just going to get all that from the cheapest maker.

~~~
sanderjd
This seems like a diffuse cost / concentrated benefit problem to me. It will
be an uphill battle to get a large number of people to pay more for things in
order to benefit a relatively small group of those employed in making those
things. This doesn't even really work for local face-to-face service work
where the benefit to the local community is fairly obvious, let alone for
manufacturers largely located in completely different states.

------
arbuge
The article does not prove the headline in any way. Towards the end it
mentions a couple of experts who believe in this premise, but doesn't actually
provide anything of substance to back up that belief.

------
AndrewDP
My wife works in fashion. What they have found is instructive. They have spent
20 years outsourcing their production to China. After 20 years of economic and
wage growth in China the cost savings once you take into account shipping etc
is eroding. Adding to increased demand from the local economy, the value for
outsourcing is quickly eroding and most fashion companies are looking for the
next low cost production region (Vietnam and Pakistan are two).

I am no economist, but I believe that there will be a global rebalancing in
the near future: manufacturing will return as the rents in low-cost regions
approach the local cost of manufacturing.

~~~
kgwgk
This has been happening for a while:
[http://www.nytimes.com/2010/07/17/business/global/17textile....](http://www.nytimes.com/2010/07/17/business/global/17textile.html)

------
intrasight
Industry doesn't need a "helping hand". It needs a free hand and a level
playing field. If government wants to offer a helping hand, how about helping
to address the rampant industrial espionage on the part of our trading
partners.

~~~
tobltobs
> how about helping to address the rampant industrial espionage on the part of
> our trading partners.

That sounds like a Trump Tweet. Are there any facts supporting the theory that
the US is more of a victim than everybody else?

~~~
Fej
It's widely known that as products are manufactured in China, the
manufacturers copy the schematics and make the same product more cheaply as a
generic. Sometimes they straight-up steal the molds. Sometimes they blatantly
ape other manufacturers (see older Xiaomi phones - obviously rip-offs of
iPhone software look & feel - for that reason, they kept them in the Chinese
market, since Apple would sue anywhere else).

Is the US more of a victim than any other country? Well, insofar as US
businesses manufacture more in China by volume than anyone else, yes. Although
not on a case-by-case basis - a Canadian company is just as much a victim as
any American one.

~~~
gnaritas
Patents are a protection racket that prevent progress; if they can make a
generic version cheaper, good, that's how it should be. If people prefer the
genuine thing, they'll buy it. Patent holders aren't the victims, they're the
mob crying about being prevented from using their monopoly to keep prices
high.

~~~
krapht
Here's a study you might be interested in reading:

[https://www.weforum.org/agenda/2013/05/do-patents-help-or-
hi...](https://www.weforum.org/agenda/2013/05/do-patents-help-or-hinder-
innovation/)

~~~
gnaritas
Seems to agree with me, however, I don't need a study to know that legally
preventing people from copying other people, prevents all of those other
people from making progress. Patents make copying into theft, but copying is
not theft. The reason we have patents is not to grant patent holders a
monopoly, it's to ensure society doesn't lose knowledge that might otherwise
be locked up in trade secrets; granting patent holders a limited monopoly is
not the goal, it is the means by which the goal is achieved, making secrets
public knowledge. The system has however gotten out of hand and patents are
now collected and used as legal weapons against competitors to prevent
competition. Software patents in particular, should not exist, and are rarely
enforced because virtually everyone violates software patents on a daily basis
as the patent office is too ignorant to know what should and should not be
patent-able.

~~~
Nomentatus
It took James Watt a very long time to find a partner to fund his invention.
Without a patent, that partnership wouldn't have happened. That doesn't mean
that our IP law or practice is current or ideal; it's not a binary choice.

~~~
dredmorbius
What financing alternatives might have worked other than patents?

~~~
Nomentatus
None that were available to Watts, certainly. Developing a new technology at
the bleeding edge took a lot of money, even then. Steam engines useful for
warships were so far in the future that military funds weren't an option.

~~~
dredmorbius
To the contrary. There were a number of mechanisms instituted over the years
to protect and promote the spread and continuation of technical arts and
knowledge:

1\. Guilds. Frowned upon, but not without their uses, benefits, and sound
arguments. (Actually, part of Watts' problem was that he was thrown out of the
Hammermen's Guild -- the black-smithing union, in Scotland, from which Adam
Smith had Watt installed at the University of Edinburgh.)

2\. A royal charter. Rather than a patent, say, the formation of a public
corporation (similar to, say, the contemporaneous British East India
Corporation), to which subscribers could buy shares and steam power be
distributed throughout England (this was pre-Unification).

3\. A royal or parliamentary award or prize. This was offered to several other
of the major inventors of industrial technology (largely in the textiles
trade).

4\. An obligatory license. This would have allowed Watt a share of revenues on
his invention, but _not_ limited the rights of others to enter into trade.

5\. A guaranteed or favourable government contract. This is essentially what
Eli Whitney secured, not with his cotton gin, but with his mass-produced arms,
in the United States. And from whence he gained most his financial gains.

That's just off the top of my head.

Patents are both tremendously distortionary, and not particularly good at
rewarding actual inventors.

~~~
Nomentatus
An obligatory license is a kind of patent. That modifications of our current
patent system are possible is not something I'm likely to argue against, and
haven't here.

The guy tried. That a spaceship or marvelous benefactor or coincidental prize
could have landed and paid him money is true, but not probable. Governments
weren't in the business of mining (the application then.) They had no
interest, but in any case do you really want them picking winners today? Their
record is horrible in that way. You cite a military example with Eli Whitney,
but I had answered that in advance. As for industry prizes only he understood
that such an advance in fuel-efficiency was possible.

I really don't think you've ever tried to sell an idea of this kind.

------
eldavido
What it really comes down to is societal priorities. The Chinese have been
willing to do things over the past few decades that the US isn't, and it's
given them an advantage in low-cost production.

One of those things is trash their environment. In the US, we have the federal
clean air act, an EPA to enforce it, and various similar laws and enforcement
bodies at the state and local level (e.g. CEQA).

A second major example of this is labor laws. Workers in the US have strong
protections including the right to organize, vote, minimum wage protections,
not to endure wrongful termination or sexual harassment, as well as various
overtime provisions and strong protections of salary in bankruptcy. They have
none of this in China. In China, due to lax enforcement of safety, major
industrial accidents happen as a matter of course. I recall reading two
separate times in the Economist over the last several years when workers were
trapped inside of a burning building, leading to hundreds of deaths. And I
keep hearing stories about workers getting woken up in the middle of the
night, handed tea and biscuits, and asked to start working.

Anecdotally (I'm not as sure about this) I think many people in China work
much longer hours than we do in the US. Most middle-class jobs in the US give
at least a day or two off per week; I'm not sure how common this is in China.

We also have strong protections of rights in the US including freedom of
speech, rights to a fair, speedy and open trial, break time to vote, and
various protections relating to bona fide religious practice, including
exemption from some collective bargaining agreements.

All of these things cost money -- a lot of it. So we're going to have a
slightly higher cost of production, or perhaps a bit higher taxes.

The real telling thing though is the flow, not of goods or money, but of
_people_. Net in-migration to the US from Asia feels much stronger than vice
versa. And so I ask: perhaps our manufacturing is in decline, but, why do so
many people move here from the rest of the world? Is it possible that the
Chinese middle class is getting tired of lead paint in their food, random
lengthy incarcerations of political prisoners, a one-party state that openly
engages in religious persecution, lack of a free press, or lack of a
functioning civil court system?

Now, one can certainly make the argument that some of these protections have
gone too far in the US. Perhaps unions have too much power. Maybe companies
like Uber/Lyft will force the discussion on making the employment regime less
onerous in places like Illinois (my home state), where firing someone is
almost always a lengthy court case due to a shockingly pro-labor employment
law regime. Perhaps the pendulum could stand to swing back a big in the
direction of economic competitiveness. Or maybe the US and China will
converge.

I consider myself a pretty strong libertarian, but it really makes me think.

------
rm_-rf_slash
This piece is lacking in details about non-manufacturing, non-agricultural
output, with the obvious exceptions of finance and real estate.

Completely lacking is any assessment of American economic juggernauts: high-
tech (like Silicon Valley) and culture (like Hollywood). Both represent
industries that are very very hard to replicate because they require immense
talent ecosystems. You can't simply cut taxes and labor costs and get a
Hollywood - with massive global consumption - out of nowhere.

America is very safe in these kinds of industries. Typically when other
countries develop their own they either end up with extremely niche products
(like India's Bollywood) or bland products with little real mass appeal
(quick, think of the last Chinese movie you enjoyed that wasn't _Ip Man_ ).

~~~
varjag
Problem is this view makes 90% of American population and territory redundant.
You can just substitute 'America' with 'California' and that won't alter the
sentiment at all.

~~~
arcanus
Finance in NYC

Oil refining and seismology in Houston

Biotechnology in Boston

The USA absolutely has a series of high tech clusters outside of California
that are globally competitive.

------
bwb
How does manufacturing view internet businesses where the product is a SAAS
and pulling in global revenue?

------
wiz21c
Nobody talks about software, damn is it HN ?

------
ben_says
People shop for the best deal. Companies look at countries and do the same.
Give them a better deal by lower taxes and reducing regulation, and back they
come. Raise taxes and regulation, and away they flee.

~~~
ben_w
That has to be an oversimplification, else all the companies would have
already moved.

Suspect that "I am used to things as they are" is a powerful incentive to keep
business, not just citizens. (I say this as someone trying to move out of the
UK because of the combination of Brexit and the Investigatory Powers Act:
moving is extremely unpleasant).

~~~
abfan1127
there is always a barrier to leave... but there is also a barrier to return.

