Paying Japanese companies to move their production facilities out of the PRC. High value goods to Japan. Lesser value to other countries. The PRC is Japan's largest trading "partner". Do you think Americans will wise up to lowest-price-at-any-cost addiction. Can railroads have an impact on this?
Heck, even Chinese companies are moving some production of lower value goods to SE Asia (Vietnam is often mentioned) as well as to Africa (countries like Ethopia).
I know that it's popular right now to blame consumers for the empty shelves in stores, with all the panic buying that I am sure did take place.
However, I've seen some store shelves remaining empty for going on 5 weeks now. I'm not sure where the breakdown is, but I'm growing more willing to suspect that at least a part of the problem, is in the supply chain. It's not unthinkable that at least a portion of this problem is due to overly long supply channels coupled with JIT inventory control methods.
I've never had any problem paying a little extra for "made in America", but have often wondered what extent manufacturers are willing to go to, to downplay the fact that their production is off shore.
I'm wondering if some of these empty shelves might be that smoking gun?
Those empty shelves may very well be a smoking gun.
As far as the Japanese pulling out of China, I'm going to take a very wild guess considering my own background.
I retired a year and a half ago from a Japanese copier company. I won't say who, that's not important. Many of the electronic components in the machines, and other parts as well, were outsourced to China. The problem is, once that was done the Japanese lost any control over quality, a very bad thing in this age of increasing sophistication in electronics, and it did show in some of the end products we recieved. Also, if my company wanted to sell machines to American federal and state government organizations the electronic components HAD to be made in Japan, not China. Security concerns, you know.
That being the case, for the US and now I'm sure other countrys, why duplicate the production in two locations?
And I'm guessing other Japanese companys are having quality control issues as well.
Just a guess. I certainly don't know for sure. I'm out of the loop now.
The Japanese are not the only ones. American companies have been doing this for a while.
I have a friend who is a graphic artist. He has quite a few clients who he designs labels for, that go on boxes or bottles.
This already started for him two years ago. He had to design new labels that said, "Made in Vietnam", or, "Made in Thailand", etc., instead of China.
Part of it was due to the tariffs. Part was due to the rising labor costs in China. I will assume that this virus issue will just speed this along.
York1 John
Gramp Paying Japanese companies to move their production facilities out of the PRC. High value goods to Japan. Lesser value to other countries. The PRC is Japan's largest trading "partner". Do you think Americans will wise up to lowest-price-at-any-cost addiction. Can railroads have an impact on this?
Are you saying Japan is paying Janpanese companies to move out of PRC? I assume that is what you mean.
We were never able to compete with China and so now we are in a trade war with them because we never accepted the truth about our inability to compete with them.
I think we should pass a law saying that we cannot import products from communist countries. Let the jobs go where they may. Some of those jobs will come to this country. But they won’t be the high paid jobs making high quality product as was the case before the jobs left this country. Our consumer market no longer demands high quality after the experience of cheap Chinese products. That trend cannot be reversed.
But I would totally disagree with the concept of us subsidizing high quality U.S. made products to make them price attractive to our consumers who are accustomed to cheap, low quality Chinese products. That is a horrible idea (if that is what you mean).
EuclidI think we should pass a law saying that we cannot import products from communist countries.
What you actually pass is a law that says any country that wants to export to the United States must meet all the terms and conditions imposed on a domestic United States company for the same work. Including all safety requirements, government wage setasides, union 'contributions', and the wide range of saprophytic leeching that various agencies make on business. If foreign businesses continue to act without making their accounting of such costs freely open to our inspection and confirmation -- hit 'em with a tariff calculated on that basis. (Then earmark the proceeds for investment in a fund that provides directed small-business relief and incentive...)
Let the jobs go where they may. Some of those jobs will come to this country...
None of 'those jobs' will come to this country -- they will constitute unemployment, and 'all that implies', in the country of origin. Some percentage of the market may come to be served by companies or efforts in the United States, and those entities may hire people for jobs or careers, but don't pretend that the effect is 'fungible' as some of these wannabe economists seem to assume.
But they won’t be the high-paid jobs making high-quality product as was the case before the jobs left this country.
You evidently haven't studied the practical effect of various kinds of 'automation' on either the overall job market or historical 'skilled' jobs or their compensation, over the years. Particularly the last few, when there are recognized opportunities for a great many skilled jobs, but in completely different contexts and different industries than 'formerly'.
This also applies to any 'well-paid' worker who enjoyed their level of compensation based on some powerful union agreement or sequential negotiation. Even in the '70s it was increasingly practical to replace people paid $30 for assembly-line work with industrial robots; much of practical production even of low-nominal-price goods is done with programmable machinery, including much of the specialized equipment and tooling that is otherwise used to facilitate mass production. To think that eliminating Chinese, or Taiwanese, or Korean or Mexican competition will 'bring that sort of job home again' is to be trying to live with rose-colored glasses in the fifties somehow.
Our consumer market no longer demands high quality after the experience of cheap Chinese products.
This is only partially true, in addition to being needlessly pejorative in a number of significant ways. There are still plenty of places that the consumer market values and even 'demands' satisfactory quality; I well remember avoiding places like Wal-Mart in the Seventies, and still avoid places like Superlo Foods at present, because of the general concentration on cheap price and even cheaper quality. There were plenty of such cheap places patronized by 'those who value price alone' right back to the chain stores that proliferated in the United States even before WW1 ... and there were plenty of United States firms that 'built to a price' or played the creeping-featurism that the Japanese would later adopt and make a market specialty in the '80s along with embracing Demingism.
The real thing that inexpensive Chinese merchandise introduced was that acceptable levels of cheap were increasingly 'just as good' as the often-overpriced domestically-produced or branded equivalent. Even comparatively recently when you bought 'store brands' -- I'm thinking of the Pathmark 'generic label' stuff -- it was almost intentionally made to have lower quality...
Now, we shouldn't forget that America is also the land that made planned product obsolescence a 'thing' -- and not always just by changing style or perception. I'd love to go back to the '30s when every year products were better, lasted longer, had more features, and cost less. Now businesses are more savvy about where and how to 'recapture' all that perceived improvement benefit ... and if they're not, there's sure to be a Steinberg, or an Icahn, or a Soros, who will do regime change to ensure they do. Not for your benefit, of course. Just like PSR, isn't it?
That trend cannot be reversed.
Certainly not while we have organized policies working with a wild will to cut the heart out of 'middle class' earning potential, and at least by implication throw it into the putative 70% of people dependent on 'the powerful' to survive.
But I would totally disagree with the concept of us subsidizing high quality U.S. made products to make them price-attractive to our consumers who are accustomed to cheap, low quality Chinese products. That is a horrible idea (if that is what you mean).
You'll have to explain this better, or at least explain the logic by which you've 'concluded' this is necessarily so.
While I do agree in advance that it's better to 'level the playing field' by making foreigners pay the same overhead that domestic firms "have to", there are certainly places where positive incentives to make 'higher-quality' goods that are net cost-effective (i.e. available at lower consumer price, in this context), while 'putting Americans to work' in (implicitly) something better than dead-end minimum-wage jobs, will be a good idea. Both in policy and practical effect.
Another issue rarely discussed is the fact that the U.S. has two obstacles:
1. Strict environmental laws. Many industrial processes have dirty by-products. Trying to clean the processes and get rid of the wastes are very expensive. China and some other Asian countries don't worry too much about those things.
2. Centralized governments. In China, land acquisition, waste disposal, wages, work hours, etc., are all basically controlled by the communist government.
I don't want our government to do those things, but we also then need to realize we can't realistically compete with many products with countries that are not like ours.
York1Another issue rarely discussed is the fact that the U.S. has two obstacles: 1. Strict environmental laws. Many industrial processes have dirty by-products. Trying to clean the processes and get rid of the wastes are very expensive. China and some other Asian countries don't worry too much about those things. 2. Centralized governments. In China, land acquisition, waste disposal, wages, work hours, etc., are all basically controlled by the communist government. I don't want our government to do those things, but we also then need to realize we can't realistically compete with many products with countries that are not like ours.
The present administration is trying to eliminate the past 50 years of enviornmental regulations. The adminsitration also believes it has the centralized power that dictatorial governments have.
Never too old to have a happy childhood!
I'm deleting this...
My new pandemic resolution is that I am not going to get sucked into a goofy political discussion that is completely off topic.
Remind me if I break this resolution.
Bravo York 1. Well said.
I'm on the outside looking in and can only observe but the mob seems a 'tad bit' consumed with TDS. It's amusing to watch, they are silly actually.
"Mr. President the mob is revolting"
" I'll say did you see them on ice!"
( changed it a bit ...from Mel Brooks )
Here's one article I found.
https://www.forbes.com/sites/kenrapoza/2020/04/09/japan-ditches-china-in-multi-billion-dollar-coronavirus-shakeout/
York1I understand completely. We have a president who lives in your side's heads. Your side can't talk about the virus, trains, or Star Trek without it being about Trump.
I never had 'sides' - I am a Republican - the real variety, the Eisehhower variety - not those that inhabit the name today.
I did not vote for Trump, that being the case, I wanted him to be a huge success to benefit the railroads and the rest of the population of the USA. That has not happened. Siding with enemies of the USA against the USA is and has been treason, no matter how you couple the cars in the Trump train.
Are you willing to try injecting bleach and UV lights as your 'salvation' ?
Part of China's situation is the same that many successful countries face.
A country with a low level of economic development thrives on out-competing others by offering low wages and few restrictions.
As success evolves, wages rise. Now the advantage they had may begin to fade, as other countries offer lower costs of production.
One ace China holds is government supported technology-pirating. For many years, the government encouraged, by lack of enforcement, Chinese companies to ignore international patents.
U.S. and Japanese companies have lost billions of dollars to this sanctioned pirating.
Getting back to Gramp's original post about "Japan paying," since I haven't seen anything elsewhere about it (No foolin', with all the 'All coronavirus, all the time!' news coverage) I'm guessing the Japanese government is advancing loans to those companies doing the pulling, since they're going to have to leave everything behind.
Oh yeah, send your tooling, dies, presses, molds, and other manufacturing machinery to China and you can kiss it goodbye! They won't give it back. This is the bind American toy train makers like Lionel, MTH, Bachmann, and others have gotten themselves into.
If anything positive can come from the virus, it may be an increased awareness of how vulnerable the U.S. has become to a potential enemy country.
What if this pandemic was biological? The U.S. does not produce any antibiotics. Antibiotics, or the materials to produce them, are mostly made in China. The last penicillin was made in the U.S. in 2004. We are at the mercy of a country who, at the very least, is an idealogical enemy of ours.
I hope the U.S. and Canada follow Japan.
I was stunned, absolutely stunned, when I learned that 80% of all pharmaceuticals used here in the US are made in China!
Insanity! Why don't we just junk the American armaments industry and outfit the armed forces with AK-47's and other Chinese weaponry? It makes as much sense as having our medications made on the other side of the world.
I still believe that trying to change policy by targeting consumers is futile. Target stockholders, they are the reason we are in this mess. As soon as you get a few guys like Paul Hilal onboard, industry will be repatriated to these shores. Who will be the E. Hunter Harrison of Precision Scheduled Americanization?
York1 I'm deleting this... My new pandemic resolution is that I am not going to get sucked into a goofy political discussion that is completely off topic. Remind me if I break this resolution.
Thanks to Chris / CopCarSS for my avatar.
York1 I am not going to get sucked into a goofy political discussion that is completely off topic
Before you give up completely, could you please pass a message along to Mr Trump?
Tell him I've grown weary of all this winning, I can't take it anymore, please stop.
Flintlock76 Getting back to Gramp's original post about "Japan paying," since I haven't seen anything elsewhere about it (No foolin', with all the 'All coronavirus, all the time!' news coverage) I'm guessing the Japanese government is advancing loans to those companies doing the pulling, since they're going to have to leave everything behind. Oh yeah, send your tooling, dies, presses, molds, and other manufacturing machinery to China and you can kiss it goodbye! They won't give it back. This is the bind American toy train makers like Lionel, MTH, Bachmann, and others have gotten themselves into.
Murphy SidingHow 'bout I kick you in the shins nex time you're tempted. You're welcome.
You've got to find me first. I'm in hiding.
Convicted OneBefore you give up completely, could you please pass a message along to Mr Trump? Tell him I've grown weary of all this winning, I can't take it anymore, please stop.
I'll try, but a few months ago he quit taking my calls. The WH blocked my number as spam.
Mr. McFarlane brought up some interesting points, and maybe this belongs on the "Model Railroader" or "Classic Toy Trains" Forums, but I'm going to comment just the same.
Only the model railroading companies know what their profit margin is, and that's fine, it's none of our business. Maybe what they say is true that if the products were made domestically only 2% of the current market could afford them.
That being the case, the model makers should ask their clientele a few questions, such as:
"Would you be willing to pay more for a domestically produced product, and if so, how much more? $50 more? $100 more? $200 more?"
"If you would prefer an affordable domestically produced product, what features are you willing to give up to make this happen?"
Basic market research.
Many of todays model products are jam-packed with electronic features that drive the cost up. You can run trains with hand-held remotes, or from your computer, or from a SmartPhone. Is this necessary, or is it just a means to attract technology junkies who are a problematic model railroading target to begin with?
Personally, I run my O gauge trains conventionally, that is old-fashioned transformer control. I don't need or want all the gee-whiz electronics that are packed into the current product and am reluctant to pay for something I'll never use. Am I alone? Maybe, but I don't think so. Many on the "Classic Toy Trains" Forum have told me I'm not.
I did have some gee-whiz electronics blow on one model and it would have cost me $200 to replace the board package. Ouch! I found a conventional control drop-in replacement board from Dallee Electronics for $75 that solved the problem. I lost the gee-whiz features but I didn't care, I had a functional engine again, that was all that mattered.
Pardon the dissertation, but I'm guessing there's other model railroaders out there on this Forum wondering and asking the same questions I am.
One last thing. There's post-war produced Lionel locomotives out there that were built simple, rugged, and reliable, and are still running 60, 70, almost 80 years after they were built. There's some pre-war Lionels 100 years old and still running. Will todays models with all the sophisticated electronics still be running 50 years from now? No-one knows. Personally, I doubt it.
Flintlock76Only the model railroading companies know what their profit margin is, and that's fine, it's none of our business. Maybe what they say is true that if the products were made domestically only 2% of the current market could afford them. That being the case, the model makers should ask their clientele a few questions, such as: "Would you be willing to pay more for a domestically produced product, and if so, how much more? $50 more? $100 more? $200 more?" "If you would prefer an affordable domestically produced product, what features are you willing to give up to make this happen?"
I'm not really an avid hobbyist at the present time, but I have gone into a few hobby stores in the past several years and can only say that I am dumbfounded over the prices that I see.
I scale modeled cars extensively in the late 60's and early 70s, and did HO scale slotcars and railroads.....and just looking at what they are selling boxcar kits for...defies belief. Locomotives are out of this world......and scale model car kits are insane compared to what I recall.
I remember being able to buy 1/25 scale car kits for $2.00....now the very same kits, in the same boxes...$44-$48.
Now in the relevant time period I remember $200/week was considered decent blue collar pay. I think my parents were doing a bit better than that, but the older kids in the neighborhood who were graduating highschool and going to work in factories were starting right about there.
I don't see many entry level jobs today offering $4800/week to high school graduates
So, something is out of kilter there. Perhaps those $48 kits I'm seeing are collectable originals that have been sitting in a ware house for 50 years.....but the hobby stores seem to be awfully full of them for that to be the case. One would think that with modern technology and efficiencies, there should be kit makers able to out compete the model companies of yore.
C-O, I know exactly what you mean. I was modeling at the same time you were, in my case model airplanes, and I remember paying 75 cents, a dollar, or at the most two dollars for the kits. When I'm in a hobby shop now and see the prices on the same kits I remember from 50 years back I almost have heart failure!
Hey, everything's gone up, but really!
Mind you, I keep a VERY tactful silence when I see those prices!
They're not all outrageous mind you, some are still fairly reasonable, but those 1970-era prices are long gone!
Flintlock76They're not all outrageous mind you, some are still fairly reasonable, but those 1970-era prices are long gone!
Glad I'm not alone. But the point I think is worth making is, if those kits were priced 1/100th of an average entry level blue collar job 50 years ago, why should that not be possible today? What is a "standard" pay grade make these days? $600/week?
How did those kits go from 1/100th of a weeks pay to 1/15 of a weeks pay?
I'm thinking a good share of those manufacturers laments about the challenge of making a decent margin are crocodile tears.
Some claim that in the olden days, the major automobile manufacturers actually paid the cost of tooling the molds for the kit makers, so that they would stimulate interest in buying the full sized version. While that may be the case in s limited amount of instances, I don't think it held true for my Don Garlits dragster, nor for the B-24 you were modeling.
I more suspect the material diffenence is that in the olden days, the owner of the kit companies was also the entrepreneuer, was also the CEO, and likely actually did useful work in the production room.
Now we are paying stockholders, a CEO, a CFO, and a board of directors to sit around all day and decide who best to lay-off next out on the floor to "maximize yield".
The main reason that there is no money to pay production staff a decent wage is because the "Wall Street" business model is top heavy.
C-O, you're spot-on in your supposition that in the olden days, the times we remember of plastic modeling, the owners were the CEO's, CFO's, developers, marketers, and "everything-else-that-needs-doing" guys.
Here's a video if you've got 46 minutes to spare. It's a history of Aurora, Revell, and Monogram, names I'm sure you'll remember. Very nostalgic!
https://www.youtube.com/watch?v=KBgCRQ2wIvw
York11. Strict environmental laws. Many industrial processes have dirty by-products. Trying to clean the processes and get rid of the wastes are very expensive. China and some other Asian countries don't worry too much about those things.
The Cheeto is working on rolling back the enforcement of ,any of them.
Electroliner 1935 York1 1. Strict environmental laws. Many industrial processes have dirty by-products. Trying to clean the processes and get rid of the wastes are very expensive. China and some other Asian countries don't worry too much about those things. The Cheeto is working on rolling back the enforcement of ,any of them.
York1 1. Strict environmental laws. Many industrial processes have dirty by-products. Trying to clean the processes and get rid of the wastes are very expensive. China and some other Asian countries don't worry too much about those things.
I do have an answer for you that you wouldn't like, but I have sworn off responding to silly political statements. Someone will kick me if I get sucked in again.
I do like Cheetos, but plain potato chips are actually better.
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