“The nationalist conservative obsession with blue-collar manufacturing jobs often ignores the interests of workers and the will of consumers. Sen. J.D. Vance (R–Ohio) provided a perfect illustration in an early August campaign speech in Nevada on “the American dream.”
In it, Donald Trump’s protectionist running mate declared that “a million cheap, knockoff toasters aren’t worth the price of a single American manufacturing job.”
On its face, that’s just rhetorical silliness. Common sense says anyone should be willing to make that trade: Affordable and abundant appliances are part of the reason that 21st century America is the best place to live in the history of the human race. Jobs are abundant too—there were 7.6 million unfilled jobs in August, per the Department of Labor—and the loss of a few should not worry vice presidential candidates.
But when right-wing populists such as Vance make this argument, they mean something less literal: that America would be better off if the nation manufactured more and imported less, and Americans would be better off working in metaphorical toaster factories than doing whatever job they have now.
Both ideas are wrong.
The supposed decline of American manufacturing is wildly overstated by politicians such as Trump and Vance (and across the aisle by President Joe Biden). Yes, a lot of low-level manufacturing has been outsourced via global trade, but American manufacturing output is running at near-record highs these days. Instead of making toasters, America makes BMWs and designs the components in, and apps on, your iPhone.
That’s a good tradeoff, especially for workers. You earn more building fancy cars than you do piecing together basic kitchen appliances. The average wage for manufacturing workers (excluding managers) has doubled since 1999, outpacing inflation.
Vance and his nationalist conservative allies think that’s a problem, one they wish to solve with more tariffs and other trade barriers that they hope will incentivize low-paying toaster-making jobs to return to the United States.”
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“When Biden expanded Trump’s tariffs on imported steel and aluminum earlier this year, one of the many objections came from the North American Association of Food Equipment Manufacturers (NAFEM). In a June letter to the U.S. Trade Representative, the trade association pointed out that higher tariffs on the raw materials needed to manufacture appliances would, predictably, harm American companies.
“Even in instances of growing sales, the costs of tariffs grow with business,” NAFEM wrote. Member companies would thus be forced to “reallocate the funds that would be used for wage increases and additional employees to pay for the increased tariff costs.”
The nationalist conservatives also misunderstand Americans’ willingness to accept Vance’s deal—even if many prefer the idea of boosting domestic manufacturing.
Earlier this year, the Cato Institute polled consumers to ask if they’d support a tariff on imported blue jeans in order to increase blue jeans manufacturing jobs in America. About 62 percent of respondents said yes.
But hold on. When told that the tariff would make jeans just $10 more expensive at the store, support for that policy flipped: Now, 66 percent opposed it. And if the tariff would make jeans $25 more expensive, an overwhelming 88 percent said no.”
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“How many Americans living in the year 2024 aspire to work—or see their children and grandchildren work—in a toaster factory?
The answer is pretty close to none. That’s great. We should prefer a country where young men and women aspire to be scientists, AI developers, and tech entrepreneurs over one where the dream job is a 40-hour-per-week gig at the local toaster plant.
Vance, and his nationalist conservative allies, are selling a vision of America that’s long out of date. It’s a backward-looking economic message that assumes people would be happier if they were less materially wealthy and had fewer prospects. Most Americans seem unwilling to go along when you show them the bill.”
“European industry — and Germany first and foremost — was battered by the surge in energy prices following Russia’s invasion of Ukraine. The bloc rode out the immediate emergency better than expected, finding alternatives to Russian gas, for example, through imports of U.S. liquefied natural gas.
But the hope that European industry would swiftly recover has faded, even as the eurozone economy in the aggregate returns to growth.
Eurostat’s industrial production index for the eurozone remains below its 2021 level, and is trending lower. And policymakers are starting to realize that the turnaround they had expected is not materializing.”
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“The numbers underline the challenge of maintaining Europe’s competitiveness — and relevance — as China and the U.S. race to reshape the global economy within the context of an increasingly acute geopolitical rivalry.”
“The Biden administration has a climate goal that 50 percent of all new car sales in the US will be electric by 2030. Meanwhile, China already reached that milestone this year, in 2024. Over the past decade, China has pulled numerous levers to scale up its electric vehicle industry, and key to that strategy has been the development of the most globally competitive EV battery. Their efforts have spawned the world’s biggest battery companies, like CATL and BYD.
The Biden administration wants to keep Chinese cars and batteries out of the country — but that could be counter to our own electric vehicle ambitions in the short term.”
“In a recent paper titled “Industrial Headwinds: Reducing the Burden of Regulations on U.S. Manufacturers,” published in the May 2024 Club for Growth Policy Handbook, economist Daniel Ikenson writes, “For manufacturing firms, the cost of federal regulations in 2022 was roughly $350 billion, or 13.5% of the sector’s GDP—a burden 26% greater than the inflation-adjusted cost of regulatory compliance in 2012.”
He adds that while the average U.S. company pays a regulatory compliance price of $13,000 per employee, large manufacturers shoulder a cost more than twice as much—$29,100. However, even some small-sized manufacturers face annual compliance costs of $50,100 per employee. This helps explain why manufacturing automation is so popular and why our fastest-growing companies are in service-sector tech, not manufacturing.”
“trade doesn’t need to balance. I have a trade deficit with my supermarket. They get more of my money every year. So, what? I don’t “lose.” I get food without having to grow it myself.
That’s a win for me and the food producer regardless of whether the food was grown locally or came from Mexico.
“Imports are great,” says Lincicome. “It means I can focus on what I want to do for a living and not go make my own food or make my own clothes. I can use those savings and buy other things that makes me better off.”
As long as trade is voluntary, trade is a win for both parties. It has to be; neither side would agree to it unless they think they get something out of the deal.”
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“Manufacturing output in the U.S. is near its all-time high. We make more than Japan, Germany, India, and South Korea combined.”
“Even if these subsidies were to create a manufacturing boom, it probably wouldn’t lead to an employment boom because most manufacturing output today is produced by robots.”
“Washington is spending another $61 billion to help Ukraine. But most of the money will flow through the US economy first.
The new law will allow the Pentagon to send existing weapons — everything from bullets to missiles to tank parts — to Kyiv and then simultaneously backfill that inventory with new manufacturing efforts for US armories.
There are 117 production lines in about 71 US cities that are set to produce those weapons systems, according to research from the American Enterprise Institute (AEI).”
“Rubio doesn’t even get through the first paragraph of the piece before making a significant error. “Today,” he writes, Congress no longer views industrial policy with the same skepticism that it once did, but “what replaces unfettered free trade remains hotly debated.”
Unfettered free trade? That’s hardly an accurate description of the current status quo in the United States—a fact that Rubio surely knows, since Florida’s sugar and fruit industries are the beneficiaries of some of the most aggressive protectionist policies on the books. Even before former President Donald Trump ramped up the use of tariffs, America had more protectionist policies than other large, developed economies: A 2015 report from Credit Suisse called the United States the world’s most protectionist developed nation.
Rubio’s inability to describe the current status quo matters. It’s a failure of the ideological Turing Test, and it reveals that he misunderstands the economic policies he’s trying to shift—or that he is deliberately misinforming readers about them. Either way, this ought to call the rest of his claims into question.
Unfortunately, that’s far from the only mistake in the piece.”