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The Magic Cafe Forum Index » » Not very magical, still... » » A question: American-made vs foreign-made (2 Likes) Printer Friendly Version

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Magnus Eisengrim
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On Aug 30, 2015, stoneunhinged wrote:
I'm curious as to how much of stuff that is made in America is really made in America. If I buy, say, an American-made Fender guitar, is it truly 100% American-made? Every bolt, screw, wire, piece of wood, chemicals in the paint? Really? Maybe so, maybe not. But how much of a product--other than the brand--has to be American before it can be considered to be American-made?

It reminds me of the pre-war Gibson banjo I once saw for sale: the neck was not original, nor several of the nuts and bolts, nor the strings or head. Basically you would be buying a pot with an original tonering--the rest of the parts were modern replacement parts. They were asking over $100K--it being pre-war and all.

(For those of you who don't know how a banjo is made, an analogy would be to offer an original "Ferrari" consisting of an authentic chassis and engine, but with everything else being made in your local custom shop. It has the heart of a Ferrari, but the rest is a reproduction. Is it a Ferrari?)

So what does American-made even mean?


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imgic
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I did some work with medical device manufacturer not too long ago. They'd been outsourcing a lot of their parts from China. Recently they've been using more supplies in the U.S. One is quality. second is the Chinese labor force is demanding more wages as their middle class grows. They are losing their comparative advantage due to low wages.
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magicalaurie
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RogerTheShrubber
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On Aug 30, 2015, magicalaurie wrote:
Who remember this? Smile

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The show, yes. The episode, no.
Wizard of Oz
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Quote:
On Aug 30, 2015, stoneunhinged wrote:
I'm curious as to how much of stuff that is made in America is really made in America. If I buy, say, an American-made Fender guitar, is it truly 100% American-made? Every bolt, screw, wire, piece of wood, chemicals in the paint? Really? Maybe so, maybe not. But how much of a product--other than the brand--has to be American before it can be considered to be American-made?

It reminds me of the pre-war Gibson banjo I once saw for sale: the neck was not original, nor several of the nuts and bolts, nor the strings or head. Basically you would be buying a pot with an original tonering--the rest of the parts were modern replacement parts. They were asking over $100K--it being pre-war and all.

(For those of you who don't know how a banjo is made, an analogy would be to offer an original "Ferrari" consisting of an authentic chassis and engine, but with everything else being made in your local custom shop. It has the heart of a Ferrari, but the rest is a reproduction. Is it a Ferrari?)

So what does American-made even mean?


This question has been asked many times, and it's always a good question, even when it's been answered repeatedly. I've heard "Made in America" meaning everything from the majority of parts in the item being manufactured in America to simply being assembled in America. Ideally I would think, a product would include all American-made components and assembled in America. But...do we go even deeper and wonder where the steel came from?

I care ultimately about quality and value. If I can get equal quality and value on an American item vs. foreign, I'll pick American every time. But there is a caveat. I also care about how products are engineered, and how they look. As a designer, I care about that a great deal. I've seen some well-made American products that just look horrible. But I've seen some great looking, inexpensive, foreign items that I know won't last as long as their American counterparts. Quality and value ultimately win.

Lately, I've seen some awesome American clothiers becoming more popular, shoe manufacturers, recreational products, and more obscure...as I collect knives...some of the best knives in the world made in the good old USA. You can buy several Chinese knock-off assisted-opening knives for the price of one American blade, and they break proportionately as quick as the money you save.
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rockwall
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On Aug 29, 2015, balducci wrote:
FWIW, the United States has one of the most self-contained economies in the world. Only about 15% of its GDP is tied to the import of goods and services. Among developed nations, that figure is (or is about) the lowest. For many nations the corresponding figure is 40 to 80 percent.


I find this comment very interesting. Could you elaborate? Are you saying that 85% of everything spent in America is on something American made? If that's what you mean I'm astounded.
rockwall
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Mike Rowe from Dirty Jobs has a Bobblehead that is made in China. He wrote a long blog explaining why it's not made in America that is pretty fascinating. Without having to read the entire blog it basically boils down to this:

“To make the venture worthwhile,” he said, “a Bobblehead manufactured to your specifications entirely in this country would need to retail for at least $250.00. Probably more.”

http://profoundlydisconnected.com/founda......ad-mike/
balducci
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On Aug 30, 2015, rockwall wrote:
Quote:
On Aug 29, 2015, balducci wrote:
FWIW, the United States has one of the most self-contained economies in the world. Only about 15% of its GDP is tied to the import of goods and services. Among developed nations, that figure is (or is about) the lowest. For many nations the corresponding figure is 40 to 80 percent.


I find this comment very interesting. Could you elaborate? Are you saying that 85% of everything spent in America is on something American made? If that's what you mean I'm astounded.

Well, I was reading some article in the financial press this past week and it mentioned the bit about the U.S. having one of the most self-contained economies in the world. Particularly when measured in terms of its percent of imports of goods and services as a portion of overall GDP.

The data is not hard to find. Here are a couple of links.

http://data.worldbank.org/indicator/NE.IMP.GNFS.ZS

https://www.quandl.com/collections/econo......-country

Obviously the precise percentage will vary by year.

Among G-20 nations, the U.S. has just about the lowest percentage.

And outside of G-20 nations, the percentage is often several times what it is in the U.S.

Having said this, it is also true that the U.S. is one of (and perhaps THE) largest importer if you look at absolute dollars instead of percentages.
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rockwall
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Fascinating. Although I have to wonder if the numbers are somewhat deceptive. For example, a lot of foreign cars are built here in the US. So, if I buy a Toyota, am I buying a foreign car or a US made car? It's not an import so I'm assuming that it doesn't show up as an imported good. I don't know if that example applies to anything other than cars but there may be other things that make the numbers look better than they really are.
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If I have x amount of dollars in my pocket, would I pay more for a product made in the USA than made elsewhere (if it were indeed the same product)? No! Phrased another way, would you pay more to help an American worker than someone in a 3rd world country who may be more desparate? Well, that assumes a lot of things... do you really have the choice as a consumer to dictate how workers will be treated whether in the US or China? No, again! Our consumption figures into wages, but does not determine them! In spite of certain US businesses folding, others are thriving (eg tech industries, yes even American companies which make a great deal of wealth from foreign labor). Capitalism is all about competition. Where is the compulsion to buy a less competitive product? My Japanese made car just hit 215,000 mi. I also had a Honda that I sold with over 300,000! My American cars, as nostalgic as I might be for my old '49 Ford, never came close. Lynn
S2000magician
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On Aug 30, 2015, imgic wrote:
I did some work with medical device manufacturer not too long ago. They'd been outsourcing a lot of their parts from China. Recently they've been using more supplies in the U.S. One is quality. second is the Chinese labor force is demanding more wages as their middle class grows. They are losing their comparative advantage due to low wages.

They're probably losing their absolute advantage; whether they're losing their comparative advantage is a lot harder to demonstrate.
Gregor Von G.
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I'm not living in USA but in Italy but I hink that the core of the argoument remains the same.
When I can I buy made in Italy products (only if well crafted, of course)and food but I think it's impossible to have the total control on what you buy.
It depends on the products, of course, you can actually be sure of the provenance of a tomato or a pair of leather shoes but it's more difficult with more complex products like electronics etc (Stoneunhinged's Fender example fits well)

Here in Italy a lot of companies, good craftmens and local small food stores closed because of a sort of invasion of shops runs by Chinese folks where they sell all kind of stuff at the half of the price.
Obviously people preferred to pay the half of the price for what they thought it was the same products.
And luckily for us in the last years people realized how low the quality was and now it seems that a vast number of people start to buy Italian again. And small business start to do well again
Same thing for the industrial suppliers. Some years ago there was a huge clamor about this low priced steel from China so lots and lots of factories bought it. But at the end they realized that it was a dangerously low quality product.
So they started to buy European or American steel again.
I am a designer (manuals, brochures, publicity, marketing etc...) for a large group who produces oil and gas and water drilling rigs
We were fortunate because the company for which I work never made this mistake. If a drilling rig is made of poor quality components, may cause serious incidents, can also cause deathly incidents....
imgic
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The medical device company I worked for had a plant in Italy. They wanted to close it as the product line they produced was being undercut from plants in Asia. They couldn't cut costs any further, so began to loss on every item produced. The issue was the Italian government had mandates in place that governed plant closing...severance pay equal to annual salary times years employed. Needless to say is was cost prohibitive to shut the plant down...so they continue operating at a loss...
"Imagination is more important than knowledge."
Gregor Von G.
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If I understand well, you are talking about the "TFR",
In Italy when a employee stop working with a company, he have the right to receive what is called "Trattamento di fine rapporto" - severance indemnities - that is equal to a monthly salary a year. Example, I worked ten year for 1.000 eur monthly, at the end I'll receive 10.000 eur.
But it's not on company's shoulder.
Every month the company collect the part of your severance indemnities from your salary, as a tax.
There are many cases where a company, instead of collecting and keeping safe your money, they spend it, so, when it's time to close they haven't money enough to pay the "TFR" to the employee.

There are particular cases in which you can ask it before the end of the employment relationship but only after eight years you worked for the company. The cases are if you have large medical expenses or if you have to buy or built your first house.

Substantially, It's your money, taken from your salary and given back to you at the end of the employment relationship.
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