Obama mistakenly wants to restore American manufacturing base

Brendan Erne has written a great little column that focuses on just how misguided it is when Obama (or anyone) starts talking about "restoring the manufacturing base in America." Here are the two key sentences from the column:

"According to the U.S. Bureau of Labor Statistics, compensation costs for manufacturing in Taiwan (where Hon Hai is based) were $8.36 per hour in 2010. They were $34.74 in the United States."

That says it all. High tech manufacturing in Silicon Valley is dead and has been dead for 15 years. The reason why is that labor costs in the United States are just too high. So, when Obama starts talking about "restoring the manufacturing base in America," either a.) he is stupid and has no clue about economic reality, or b.) he is merely trying to promote the narrow economic interests of his union supporters, who work largely in the manufacturing sector.

As Erne points out, the history of the United States has been one of progress from agriculture, to manufacturing, to services (which includes software development). For Obama constantly to insist at the dawn of the 21st century that we "restore our manufacturing base" is no different than if Teddy Roosevelt had constantly insisted at the dawn of 20th century that we "restore our agricultural base" and return our workforce to the plantations.

It is simply laughable how utterly out of touch Obama is with the forces operating in the global economy today. He keeps trying to restore a static, union-based workforce compensated by wages for working in manufacturing when the future belongs to a highly mobile, non-unionized workforce compensated by stock options for working, say, in the software industry (take it from someone who just went through his third IPO). Obama, the so-called "Progressive," is stuck in a pro-labor, 1950's, proletariat workers paradigm. That was fine back in the Hippy days when Saul-Alinsky-style radical organizing of the workers was all the rage, but the world has moved on. Obama attacks Mitt Romney for being a vulture capitalist, but all we get from Obama is Krugmanesque Nostalgianomics.

Erne's column should be read in conjunction with my earlier blog post in which I pointed out how misguided the self-avowed socialist Harold Meyerson was when he called for Apple to reopen manufacturing facilities in the United States. As I pointed out in that post, Solyndra was precisely the kind of "high-tech manufacturing" facility that Meyerson and Obama envision. And we can see where that led.