Less than two months ago we told you about how the Washington Post is skewed way off base on American manufacturing. This week I missed another WaPo farce, but luckily our friend Don Boudreaux at Cafe Hayek noticed it and responded. First a brief quote (sorry, all I can stomach) from the WaPo article.
Just as the ghost dance of the Sioux failed to bring back the buffalo, so the declining dollar and the high price of gas have failed to bring back American manufacturing. Will America ever get its manufacturing back?
Gag. What's really scary is that people read, and some even believe, that drivel. Coincidentally we've also talked about how there is a very significant migration of companies back to the U.S., not to mention all the foreign companies building new plants in North America. But Don does a great job discounting this latest WaPo piece, via a letter he sent to the paper.
Harold Meyerson insists yet again that America has lost its manufacturing, alleging also that investors are abandoning the U.S in favor of "nations with far cheaper workforces" ("Obama's Factory Factor," August 21). Mr. Meyerson predictably singles out China as one such nation.
Facts utterly contradict Mr. Meyerson's fantasies. First, U.S. manufacturing revenues (adjusted for inflation) reached their all-time high in 2006. 2006 was also a peak year for inflation-adjusted manufacturing profits in the U.S. and for inflation-adjusted U.S. manufacturing exports. And the U.S. accounts for the largest share of the globe's manufacturing output; Americans today produce 2.5 times more manufactured goods than do the Chinese. [See here.]
Second, in 2007 the flow of per capita foreign direct investment into the U.S. was up 13 percent from 2006, to $675. In China, it was up 14 percent - to $55. [I derived these these figures from here, here, and here; I got population figures from the CIA World Factbook .]
Harold Meyerson is a perfect example of the Beatles' "Nowhere Man":
"He's as blind as he can be / Just sees what he wants to see."
Sincerely,
Donald J. Boudreaux
And that data was before the dollar's decline and rising fuel costs began to incent those companies that chased supposed cheap labor to return home. What's almost funny is that I bet there's a room full of WaPo execs trying to figure out why their circulation numbers are declining. Gee, I wonder why...