Thursday, August 2, 2012

The Rebirth of America

Forbes has a fantastic article about  the rebirth of American industry.

To summarize:

China has cheap labor.
America has robots.
Robots are cheaper than the cheapest labor.

We are talking about 3D printing, laser cutting, CNC machines (computerized numerical controls), etc.  You program the machine and it builds what you want.

The article doesn't go into China's other advantage:  A willingness to accept a CRAPLOAD of pollution.   For example, they put in limits on fire retardants only in 2009.   Formaldehyde is almost everywhere - as it used for construction and the fabrication of furniture.  Note, they are getting better, but I think they will always accept more pollution than we do.  They value their economy more than their workers.

But I don't think any American is going to be upset about giving the high pollution jobs to China.  I just wish we could export our coal burning.

So, what is America going to look like in 20 years?  Well, I expect we will have some more manufacturing, but the jobs will still be service jobs - installing robots, maintaining them, fixing them, programming them and running them..

Unfortunately, this is not the entire story.  China has been expanding it's trade with other countries, and creating solid relationships and investments outside of China.  This may turn China into a financial powerhouse, capable of competing with the US.  It can't right now.  Yeah, people are scared of China, but the US still beats China on industrial output, as of 2010, even though it had 1/3 the population.  Throw in the Service industry - which includes installing, maintaining, servicing, and programming robots - and we handily beat them.

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