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Friday, May 12, 2006

Buy American, Save Jobs

Here is an interesting graphic from the Detroit News:

It shows an estimate of how many jobs are supported by the major automakers, calculated by multiplying direct employment numbers by an impact factor.

The full piece is here.


John B said...

After finally buying two North American cars (both Fords), I fully agree on those numbers. The only problem is, from my experience, a large number of those jobs are for mechanics who were constantly repairing the autos. I have the repair bills to prove it.

I have given Ford two chances and they've blown it both times.

Kevin said...

This chart from the, uh, "Level Field Institute" (yeah they don't have an agenda) is not accurate and the simpleton methodology behind it is not meaningful, because it ignores the basic economics of international trade.

Here's a shocker: imports aren't free. I wish they were, that would be nice, but in the real world you have to work to obtain stuff in trade. We buy cars from Japan; in return they buy soybeans, software, Microprocessors, and business services.

That means they make cars for us, we make Dual-core Pentiums for them. That's why it's called "trade". And if the trade doesn't balance and we run a deficit, the other country invests the surplus capital here, which creates jobs just the same.

Foreign companies that export to here absolutely support American jobs, just as much as American companies they have actual payroll here. This lousy excuse for a chart does not even acknowledge that inescapable economic reality.

You can scrap this chart and quickly make a far more accurate one simply by charting the level of U.S. sales each company has. With a bit of variation based on productivity, that will accurately portray how many total jobs each company supports ...

Which will mostly be based on U.S. sales. Of COURSE GM supports more jobs than Hyundai, they're a much larger business. But if Hyundai grew its sales to equal GM's, they'd be about even in job-support, and Hyundai would have to create tons of jobs here directly, as well as indirectly. It wouldn't be possible economically or logistically NOT to.

Anonymous said...

FORD " fix or repair daily"
"found on road dead"
Fucked over rebuilt dodge"

and now shares at 7 bucks, get the picture Johnb?

The Angry Engineer said...

Given the mix of business that my employer - and the Tier 1s that my friends work for - do with the various OEMs, I wonder how long this chart will remain accurate (assuming, of course, that it's currently rooted in reality).

sh said...

While kevin likes to tout his level playing field and spout microprocessors and soybeans, he fails to account for the unlevel tariffs Japan levies on U.S. goods.
That same sense of "hook" goes for their economic aid - it always benefits Japanese corporations.
Wikipedia says:
The continued growth of Japan's foreign aid appears to be motivated by two fundamental factors. First, Japanese policy is aimed at assuming international responsibilities commensurate with its position as a global economic power. Second, many believed, the growing Japanese foreign aid program comes largely in response to pressure from the United States and other allies for Japan to take on a greater share of the financial burdens in support of shared security, political, and economic interests.

Such assistance consisted of grants and loans and of support for multilateral aid organizations. In 1990 Japan allocated US$6.9 billion of its aid budget to bilateral assistance and US$2.3 billion to multilateral agencies. Of the bilateral assistance, US$3.0 billion went for grants and US$3.9 billion for concessional loans.

Japan's foreign aid program has been criticized for better serving the interests of Japanese corporations than those of developing countries. In the past, tied aid (grants or loans tied to the purchase of merchandise from Japan) was high, but untied aid expanded rapidly in the 1980s, reaching 71 % of all aid by 1986. This share compared favorably with other Development Assistance Committee countries and with the United States corresponding figure of 54 %. Nevertheless, complaints continued that even Japan's untied aid tended to be directed toward purchases from Japan. Aid in the form of grants (the share of aid disbursed as grants rather than as loans) was low relative to other Development Assistance Committee countries and remained so late in the 1980s.

He fails to note that we provide the brass balls for their military which gives them their unhindered economic stability. We work for ours and pay for our own.