We are not alone/ An editorial

[Anonymous]

Dave, your're absolutly right. But should we then stop supporting South Korea for the same reason? Are all the people driving Hyundai's un-American?

But that is the responsibility of the manufacturer, to know where the raw materials come from. China may import workers, but they don't import product from North Korea. So products made in N Korea won't end up in the US. At least not yet.

[Frank53]

I buy Made In America whenever I can. I guess I have watched way too much History Channel.

[FJ and G]

Lizard,

I was in mainland China in 1985 when Mao clothing was the norm and cars were rare. I recently heard that one of the reasons the Chinese and S. Koreans are not putting more pressure on the N. Koreans to end their nuclear program is because both countries see N.Korean workers (nearly everyone) as a new pool of cheap labor for them.

Who knows if soon our trains will be labeled made in China, after being outsourced to workers in N. Korea, in order to support their nuclear program against us and Japan?

[Anonymous]

QUOTE: Originally posted by brianel027


I know there are many on the Forum who wi***hat Lionel (and others) had kept their manufacturing in the US. But the vast amounts of new scale high tech product development and new tooling that 3-rail buyers today demand from the companies, wouldn't have been possible had the companies remained in the US. Tooling costs here in the US are just prohibiitive to making so many totally new and different train items in such a short span of time. Does any one here really think MTH for example, could have tooled up so many new engines in such a short time span had the work been done in the mainland US? Another irony, at least to me.

Brianel027 made some great points, but one thing about manufacturing is that plastic injection made parts are not much cheaper in China than the US. It's the assembly that is expensive. Most of the machines used to make those parts in China are either made in the US, JAPAN or now Taiwan. Dies and steel tools are made cheaper in Asia than the US, but the plastic costs are about the same. We buy several plastic parts in the US at a cheaper cost than from China or Taiwan. It's when you have to sit down and hand paint, or glue those parts that you look to the far east. MTH could have gotten the steel tools made in China and had them imported and produced the parts in the US. It's the fact that the Baltimore DC subburbs are not exactly a manufacturing hub that prevented them from doing so.

It's also interesting to see more manufacturers selling products direct. If you think about it, there is at least a 4 step distribution process:

1. Sub contractor makes raw materials (takes markup)
2. Contractor in China, Korea, etc manufactures product (takes markup)
3. MTH, KLine, Atlas, Lionel market, design, sell product (takes markup)
4. Dealer sells products to enduser (takes markup)

and of course
5. collector keeps for 20 years then sells on Ebay in like new condition (takes markup)

[Anonymous]

Ok, I'm going to be slightly contrary to some of the other posts.... but before I do, let me give you some background and some things to consider.

1. I've been to China many times
2. I've been in a Chinese factory that made HO trains.
3. I've been to Taiwan many times,
4. I'd rather be poor in America than middle class in either.

American businesses are far, far, far more efficient and productive than Chinese. The only thing they have going for them is labor. And that is drying up. There are actual labor shortages in China in areas like Shenzhen and Shanghai. That is driving the cost of labor up, which in turn will raise prices, which will lower demand, and so forth. Soon goods from China may be cheaper, but the new markets are Vietnam, Korea, and the Philippines, and of course India.

Now, regarding the article on hot rods, it was said " It must be more than obvious that China and other countries don’t work under the same ethics that we seem to be schooled under. Once the U.S. manufacturers decided to move operations overseas, they should have realized that they opening themselves up to unscrupulous business tactics." What exactly is unscrupulous about taking something that is NOT trademarked, copy righted, or patented, and making it cheaper? Isn't that called progress? If you had a machine that could build something better, and there was a market for it, wouldn't you build it and sell it? It's the AMERICAN WAY.

The autoworker, train maker, parts supplier, widget builder who blames the Chinese for being more American is severely misguided. The person in New York who looses their job to someone in China would be just as upset if they lost their job to someone in Georgia, wouldn't they? Regarding the price of steel, well we haven't opened a new steel refinery in the country since the 80s. That's not China's fault is it? If you want to ask why we're not competitive or why prices are expensive in this country, look at the regulations and red tape we have allowed. Oil prices are the same way. We haven't built refineries, we haven't allowed drilling, and we haven't even explored all the oil fields because of regulations.

This is the exact same argument from the early 1980s and the auto industry. They were upset at these cheap Japanese imports.

The answer lies with us, the consumer. If we DEMAND better quality, we'll get it. If we ONLY buy things made in the US, there will be a market for it. If we stop shopping at WALMART then maybe the demand will go down. The problem with China is not that they do anything unscrupulously, EVERYBODY DOES. I don't think Enron was a Chinese company. The situation with Lionel and Korean Brass, etc. was someone BREAKING THE LAW (in this country and Korea). There are protections, there are patents, there are trademarks.


Yes the Chinese government helps it's companies, yes there has been dumping, but so has our Country. We pay farmers subsidies don't we. Why not manufacturers? We've had tarifs on things like steel up until recently, but we haven't worked on the productivity side of the equation. The US can compete with China, if we make the necessary infrastructure investments to do it.

The other thing to ask is.....with China growing and gaining more disposable income why doesn't Lionel or MTH open a Hong Kong or Beijing sales office? If they are going to be producing in China, how about opening it up as a market?

We need to stop acting like victims in this country. Stop blaming other people, and start taking responsibility for ourselves. Buy American, demand better Quality, write your Congressman about reducing regulations and barriers to competition. But don’t be a victim and don’t be a spectator.

[FJ and G]

I think Brian hit the nail on the head again.

[1688torpedo]

Hello Big Jim ! Thank you for the eye opening post. This is another reason why the U.S. should not be sending Jobs over to China at all ! It almost sounds like one of these days when the Chinese get enough confidence that they will provoke some type of military confrontation with the U.S. We send Jobs & Money all over this ungratful World and get no Goodwill for it and it just boils my blood.What did our ancestors come over here for anyway to build a Great Nation and then have our current generation of Politicians give it all away.? The Great Washington fought for Liberty. Now we are fighting shadows or so it seems. Toy Trains & other consumer goods can and should be made on our own soil,Unfortunately, Due to Regulations,High Taxes,and other Red Tape, this is almost Impossible in today's economy. Will it ever change,Who knows.? We need politicians who actually care for the American People more than they do their own interests and beliefs,And until this happens.only more of the same nonsense will happen[V][banghead][:(!]........Keith

[brianel027]

Big Jim, very good. I've read several articles by former government/military people who have concern over China's long stated intentions to have Taiwan as part of mainland China... by force if needed. China has been reported recently as to be in the market for new weapons systems. Why?

To China, Taiwan not being part of the mainland is an insult of the greatest magnitude. The Chinese have never been happy about that situation since 1949. Right now, more cilvil minds prevail in the Chinese government: they want American dollars and American technology. They've gotten the dollars and they are learning greatly from our manufacturing being located there.

But any change in the composition of the Chinese governement could change that viewpoint. Seems there are some people who are greatly concerned that it is only a matter of time until China feels confident enough to make a military move. One article I read stated that Americans on September 10th didn't believe that the US was so vulnerable to an attack until Spetermber 11th. I know articles like these can be written to drum up fear. But many I have read make very valid points.

Which is all interesting to me since the US has a defense treaty with Taiwan. The US has stated we would react with military force against China should they take action against Taiwan. How could we though? What would the US be able to do? We are and probably will be tied up in Iraq for sometime to come. And so much of our manufacturing now comes from China... would we actually bomb China? It would be somewhat akin to bombing ourselves. I'm sure it would take years for the US to rebuild our manufacturing capacity, especially if hostilities were to arise to such a point that all the American tooling, machines, dies, etc. remained in China.

Kind of funny that the desire for higher profits and more inexpensive cheap consumer goods may actually backfire.

I know there are many on the Forum who wi***hat Lionel (and others) had kept their manufacturing in the US. But the vast amounts of new scale high tech product development and new tooling that 3-rail buyers today demand from the companies, wouldn't have been possible had the companies remained in the US. Tooling costs here in the US are just prohibiitive to making so many totally new and different train items in such a short span of time. Does any one here really think MTH for example, could have tooled up so many new engines in such a short time span had the work been done in the mainland US? Another irony, at least to me.

Hey, everyone needs jobs, be it in the US or in China. But FREE trade needs to be FAIR trade. There's no way American workers can compete with the cheaper labor cost overseas. But without uniform prosperity in American, were going to need more cheaper goods.... and taxes, utilites, rent, fuel, healthcare, food, etc.

Come to think of it, all those other things have to be paid first before one can acutally buy the cheaper Chinese made consumer goods. Hmmm, what goes around, comes around.

[BigJim]

As model railroad hobbyists, we are not alone. I picked up the June 2005 issue of “Hot Rod” magazine the other day. The one with the red and white Shelby GT500 on the cover. What an eye opening experience that was to be. I will suggest that you take the time to read the Editor’s Letter by David Freiburger on page 10, “The New Imports: Speed Parts“. It is only a page long and it may open your mind as it did mine, in more ways than one.

You may ask what does hot rodding have in common with my model trains. According to Mr. Freiburger the parts industry is facing an onslaught of imports from foreign countries making it hard for U.S. companies to compete. This is going on while we model railroaders are seeing companies moving their manufacturing overseas. Obviously, the same is happening in other areas as well.

Two things Mr. Freiburger mentions stand out. The first, in relation to recent shenanigans in the 3 rail community. I quote from column 2, paragraph 2, “ Then there’s China. The current joke around the industry is, “You know what R&D means in China? Receive and Duplicate.” That’s exactly what’s been happening, and there’s hardly an intake manifold that Edelbrock makes for a Chevy or Ford that hasn’t been duped overseas.” End quote.

Now where have we seen this before? Did you read the Pecos Brass saga in O Scale Magazine? Did you read the book written about the Wall Streeter that went to China to open markets? It must be more than obvious that China and other countries don’t work under the same ethics that we seem to be schooled under. Once the U.S. manufacturers decided to move operations overseas, they should have realized that they opening themselves up to unscrupulous business tactics. As I have said before, you have made your bed, now you have to lie in it. Unfortunately for our hobby, Mike either knowingly or unknowingly set himself up for what happened.

The second item Mr. Freiburger mentions is so scary that the previous paragraph pales in comparison. Again I quote, “ China became the biggest user of steel in 1994 and its consumption has grown steadily ever since. This year, iron-ore prices have increased up to 70 percent as a result. Soon, you’ll hardly be able to get anything cast or forged in America.” End quote.

Read that last sentence again. Now suppose we take out the “cast or forged” and replace it with “made”. And again suppose that since nothing is being made in the USA, they decide to quit selling to us. What kind of a fix will we be in then? Does Japan just before WWII come to mind? As much as the fighting spirit of our troops during WWII help to win the war, just as much or more important was our industrial ability to out-produce our adversaries.

After the so-called end of the cold war, our submarine force has been drastically reduced. Not as many submarines are deemed to be needed to keep the peace, so production grew almost to a close. Someone did decide that we needed to keep production of some submarines if only to keep the work force in place. Can you imagine today trying to build and successfully run a fleet steam locomotives? Look at what the lull in export coal has done to that industry. After years of layoffs due to cheap overseas coal and lesser demands on domestic export coal, now the coal industry is trying to make a comeback. Demand is up but, now the bloodlines have been broken and nobody wants to go down in the mines again.

Let me finish by quoting the last paragraph in the editorial;
“This isn’t about racism. It’s about disappointment in watching America become a servant nation whose most marketable commodity is its culture. Hot rods are a big part of that culture, yet the flag-waving hot-rodding marketplace cannot be counted on to actually pay more for products made in America. Will our hobby succumb to the world economy, or will we keep our American-made speed merchants in business? Only you can decide.” End quote.

May God bless America
Big Jim