Thursday, February 15, 2018

XXVII:"Where's our competitive edge if another country can produce it cheaper than the US?"

I attended 2 symposiums at The Brookings Institute on the US's new tax laws this past week.  It demonstrated the US' relatively new commitment to competitive taxes on imports and exports other countries use. But as our guru in the ad hoc think tank of Miriam's Kitchen asked--his name is 'Chuck'--"Why would the US produce a good (or, item) that is already produced in some other country at a much cheaper cost than it would be if from the US?"  Certainly, whatever the import duty is on such an item would not make a significant dent in the cost-of-good abroad as compared to its being produced here.

But if taxes upon items produced elsewhere won't penalize those companies who buy from abroad rather than make the item here, where is there a competitive advantage to the homebound manufacturers and producers to offset the greater cost of those goods made here than somewhere else?  There can only be one source, which as yet is not implemented fully in the US: robotics.  Picture a field of a cash crop, e.g., tomatoes, picked by machine, packed by machine and delivered with the aid of computers.  "AI assembly personnel" working 24 hours a day to get tomatoes to market!  That use of computer power to match the 'slave-labor' of children working in factories and in the fields some countries deploy might just be the competitive edge for which US agriculture and industry is searching.

The point is, Trump's proposal to bring back industries and agriculture gone overseas must cite a competitive advantage producing it here has over producing abroad.  The tremendous fluctuations in the Stock Market reflects the uncertainty of results were to penalize goods made abroad.  Without citing a competitive advantage to producing cheap goods here to rival the same goods cheaper-made or produced in other lands, attempts to promote American items VS. the foreign-produced is absurd:  ANOTHER WHACK-O THEORY IN THE MAKING!