Free Trade and the De-Industrialization of the United States


Manufacturing was the economic growth engine of United States. It helped to create the high paying jobs, improved living standards, national wealth, military might, and tax revenues. Unfortunately, there has been a dramatic decline in the above scenario for the United States in the 21st century.  The U.S is rapidly turning  into non-Super Power second rate country.

[McKenna Service Company]

Manufacturing is the basis for research and development and National Defense and once represented more than 28% of the jobs in the U.S.   Although the absolute number of jobs in American manufacturing was rather constant at about 17 million from 1969 to 2002, manufacturing’s share of jobs has continued to decline from about 28% in 1962 to only 8% in 2014.

New technologies may bring back some manufacturing output to the United States since labor costs will be a lower fraction of the total cost of manufactured products based on the new technologies. However, these technologies aren’t likely to offer many jobs since they are generally labor-saving, not labor-using, but the jobs will require skilled and better paid workers.

Productivity gains in manufacturing are also a major cause behind the decrease in manufacturing employment in the US.  Higher productivity lowered prices of manufactured goods relative to prices of services. Yet employment in manufacturing fell because the lower manufacturing prices did not stimulate a large enough increase in the demand for manufactured goods to offset the productivity increases of the manufacturing workforce.

A more obvious force reducing jobs in American manufacturing has been the extreme growth in China’s economy and its exports of a large variety of cheap manufactured goods (which are a great boon to American and other consumers).  Exports from other foreign countries explain the downward trend in manufacturing employment prior to that year, but Chinese exports were important in the declining trends in manufacturing during the past 20 years. Finally, the recession cut jobs in all sectors of the American economy, but especially in factories and construction.

How and why did this occur?  During the Clinton administration “Common Sense” trade policies were compromised.  FAIR and BALANCED” trade policies were replaced with “FREE & IMBALANCED” trade policies for the benefit of big business as politicians were bought off by Wall Street.

The Clinton Administration’s two flagship trade agreements (NAFTA and PNTR ) were misrepresented to the American people as bringing millions of jobs and higher prosperity to the United States.   History and reality regarding these policies now show that they debased and destroyed U.S. manufacturing and the private sector.

Americans were warned many times regarding the actions of the Clinton Administration.  Their policies set off a chain reaction that has resulted in a mass exodus of U.S. companies, jobs, products, technology, and manufacturing along with highly guarded Trade Secrets.

In fact, Bill Clinton even sold U.S. Top Secret Ballistic Missile technology to RED CHINA. (President Overrode China Launch Concerns).   This technology was developed and perfected by U.S. companies and then transferred to foreign nations who are enemies bent on destroying the United States.

The detrimental Clinton policies have resulted in the loss of more than 100,000 U.S. manufacturing companies from the United States since 2000 and more than 3 million U.S. jobs.  Click on this link to see a “damage report“.

A former Republican candidate for President, Ross Perot said it best during one 1992 Presidential debate (shown below) saying “There will be a Great Sucking Sound as American JOBS and wealth leave the country if the North American Free Trade Agreement (NAFTA) was ratified”. His statement was right on target.

A side note regarding NAFTA and the Bush Administration.  It is not a “new” agenda.  Former President George H.W. Bush has been working to remove the borders between the United States and Mexico since 1953.  The following article clearly exposes this agenda. The Bush Dynasty’s Central Project Since 1953: Integrating Mexico Into The North American Economy.

The De-Industrialization Of America
The United States is the very first “post-industrial” nation on the globe.  All great economic empires eventually become fat and lazy and then squander their great wealth. However, the pace at which America has declined is beyond comprehension. Thousands of factories have closed and left the United States.  The high paying manufacturing jobs are gone leaving the United States with over 92 million UNEMPLOYED citizens.

As more are being added daily the U.S. is fast becoming a Socialist welfare state. The United States is a nation that consumes everything in sight producing increasingly little. The biggest U.S. export today is Waste paper.  Trash is the number one thing shipped out to the rest of the world as we voraciously blow our money on whatever the rest of the world wants to sell to us. The largest debt in the history has been amassed in an effort to maintain a very high standard of living which is not sustainable.

Here are some De-industrialization Facts:

  1. The United States has lost more than 100,000 factories since 2000.  Seventy-five percent of those factories employed in excess of five hundred people when they were still in operation.
  2. Dell Inc., one of the U.S.’s largest manufacturers of computers, announced plans to dramatically expand its operations in Red China with an investment of over $100 billion over the next decade.
  3. Dell also announced the closing of its last large U.S. manufacturing facility in Winston-Salem , North Carolina in November.  Nine hundred jobs will be lost.
  4. In 2008, 1.2 billion cell phones were sold worldwide.  There are now NO cell phones produced in the U.S.
  5. The latest study conducted by the Economic Policy Institute, the U.S. trade deficit with China continues to increase at its current rate, the U.S. economy will lose over half a million jobs this year alone.
  6. As of the end of July 2010, the U.S. trade deficit with China had risen 18 percent compared to the same time period a year ago.
  7. The United States has lost a total of about 5.5 million manufacturing jobs since October 2000.
  8. According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies increased an astounding 30 percent to 10.1 million. During that exact same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million.
  9. In 1959, manufacturing represented 28 percent of U.S. economic output.  In 2008, it represented 11.5 percent.
  10. Ford Motor Company recently announced the closure of a factory that produces the Ford Ranger in St. Paul , Minnesota . Approximately 750 good paying middle class jobs are going to be lost because making  Ford Rangers in Minnesota does not fit in with Ford’s new “global” manufacturing strategy.
  11. As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time less than 12 million Americans were employed in manufacturing was in 1941.
  12. In the United States today, consumption accounts for 70 percent of GDP. Of this 70 percent, over half is spent on services.
  13. The United States has lost a whopping 32 percent of its manufacturing jobs since the year 2000.
  14. In 2001, the United States ranked fourth in the world in per capita broadband Internet use.  Today it ranks 15th.
  15. Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975.
  16. Printed circuit boards are used in tens of thousands of different products.  Asia now produces 84 percent of them worldwide.
  17. The United States spends approximately $3.90 on Chinese goods for every $1 that  the Chinese spend on goods from the United States.
  18. One prominent economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.
  19. The U.S. Census Bureau says that 53 million Americans now live in poverty and according to them that is the highest number of poor Americans in the years that records have been kept.

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  • commented 2016-04-03 09:31:27 -0400
    Technological development follows the factory floor, not the Wall Street trading floor. That is just the physics of how stuff works. A loss of physical functionality means a loss of knowledge base, no matter how much the beancounters want to financialize everything. So our $$$ military industrial complex ends up with parts under the hood “made in China”, maybe Trojan horses too – a real national security bargain -yeah right.
  • commented 2016-03-29 10:33:16 -0400
    We spent decades building the greatest wealth producing engine in the history of the world — U.S. manufacturing — then our greedy, incompetent politicians simply handed it to Communist China. China did nothing to earn this, and they are not using it to improve the standard of living of their poorest people, but to build up the biggest military in the world. Why?!
  • commented 2016-03-29 10:15:52 -0400
    I like the thrust of your article, but Ross Perot was not a Republican candidate for President. He was an independent candidate. Additionally, the United States is not a Socialist Welfare state. If it were a socialist welfare state like Canada, Sweden or Denmark, everyone would have access to healthcare: we would not have millions of homeless people, many of whom are homeless because of lack of access to mental health care; and many of the working poor wouldn’t be working two or three minimum wage jobs without access to healthcare for their families or any hope of retiring with dignity. And we wouldn’t be privatizing schools, prisons and the military to the benefit of global corporations.