The Ugly Truth About Trumponics

On April 12, 2017, Robert Reich writs on Alternate:

When Donald Trump spoke at Boeing’s factory in North Charleston, South Carolina––unveiling Boeing’s new 787 “Dreamliner”––he congratulated Boeing for building the plan “right here in the great state of South Carolina.”

But that is pure fantasy.

Trump also used the occasion to tout his “America First” economics, stating “our goal as a nation must be to rely less on imports and more on products made here in the I.S.A.”

Trump seems utterly ignorant about global competition––and about what’s really holding back American workers.

Start with Boeing’s Dreamliner itself. it is not “made in the U.S.A.” it is assembled in the U.S.A. Most of the parts and almost a third of the cost of the entire plane come from overseas.

For example:

The center fuselage and horizontal stabilizers came from Italy.

The aircraft’s landing gears, doors, electrical power conversion system––from France.

The main cabin lighting came from Germany.

The lavatories, flight deck interiors, and galleys from Japan.

The moveable trailing edge of the wings from Canada.

Notably, the foreign companies that made these parts don’t pay their workers low wages. In fact, when you add in the value of health and pension benefits, most of these foreign workers get a better deal than do Boeing’s workers.

These nations also provide most young people with excellent educations and technical training, as well as universally available health care.

To pay for all this, these countries also impose higher tax rates on their corporations and wealthy individuals than does the United States. And their health, safety, environmental, and labor regulations are stricter.

Not incidentally, they have stronger unions.

So why is so much of Boeing’s Dreamliner coming from these high-wage, high-tax, high-cost places?

Because the parts made by workers in these countries are better, last longer, and are more reliable than parts made anywhere else.

There’s a critical lesson here.

The way to make the American workforce more competitive isn’t to build an economic wall around America.

It’s to invest more in the education and skills of Americans, in on-the-job- training, in a healthcare system that reaches more of us. And to give workers a say in their companies through strong unions.

In other words, we get a first-class workforce by investing in the productive capacities of Americans––and rewarding them with high wages.

Economic nationalism is no substitute for building the competitiveness of American workers.

While it is true that our citizens education is paramount, even with an educated labor force, technological invention and innovation will continue to exponentially obsolete the necessity for vast bodies of workers contributing their labor skills. Even where Robert Recih cites other countries manufacturing he fails to point out that their manufacturing corporations also use highly sophisticated non-human means to produce components for Boeing’s Dreamliner. Reich cannot think beyond job creation to turn his focus on productive capital ownership creation, with the future economy broadly owned by our citizens as individuals (not collectively as in socialism).

Reich should become an advocate for enacting the Capital Homestead Act, a comprehensive legislative program of Kelsonian (based on binary economist Louis Kelso) tax, monetary, and fiscal reforms to make every citizen a shareholder in the technological frontier. It is designed to connect every person to the global economy as a fully empowered participant and owner of new technologies, by dismantling structural barriers in our basic institutions and financing capital formation through ownership democratization vehicles.

This economic agenda for the 21st Century provides a blueprint for leaders committed to restructuring the legal and financial system to grow the economy at maximum rates with no inflation, in ways that build a Just Third Way version of economic democracy as the essential foundation for effective political democracy.

The Capital Homestead Act offers a new national policy to foster life-long  “capital self-sufficiency” as a means to achieve true economic independence for all Americans. If implemented, capital ownership would be systematically de-concentrated and made directly accessible to every person, without reducing property rights of the wealthy.

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