Friday, 21 April 2017

Buy American and Hire American

When this blogger started blogging in 2009, his very first post was titled "What is American goods, anyway ? " Eight years later, when returning back from a two year hiatus in blogging,  the same theme resurfaces as the second innings of blogging is started.

The trigger for this post is of course Trump's executive order titled the same as this post, which he signed with much fanfare three days ago.  The order , of course, is pure bombast and is only meant to show that the President is doing "something". It simply orders the Secretary of Commerce to tell the world what the hell this means in 60 days and orders sundry other Ramamrithams to specify how it will be implemented  in 150 days. I was not aware that you need an Executive Order to tell people to do their jobs, but apparently in the world of alternative reality, that is required.

Precious little, other than nuisance value, will come of it. For you see, in today's globalised world of supply chains it is almost impossible to determine what is "American" as my first ever post argued.  If "value added" is the yardstick for measuring national origin, then your iPhones are as American as mom and apple pie even though they are entirely manufactured outside the US. If the physical act of manufacturing (read final assembly)  is the yardstick, then the iPhone is Chinese while BMW is American.  If the entire supply chain has to be in the US, most products will simply disappear off the shelves as some of the raw materials and components are simply not available in the US and have to be imported.

The Executive Order gives some clues to the warped thinking - apparently they would like  that "for iron and steel products,  all manufacturing processes, from the initial melting stage through the application of coatings, occurred in the United States ."  US iron and steel has been on decline for decades. Only an idiot will set up steel capacity in the US - after all the next President can sign another Executive Order to the opposite. Not a single new job will be created. What will only happen if this pig headed policy is even half tried is that the existing US steel plants will jack up their prices. The American consumer shall pay.

The problem of disappearing jobs is a real and serious one, but there are no easy fixes. It cannot be tackled by trumpeting economic nationalism. It certainly cannot be solved by sitting on the toilet seat and tweeting whatever comes to your mind.

By the way, the GOP was meant to stand for free markets and trade. It would have been appropriate if a President Sanders were to try something like this. But a Republican President ?

PS : Its nice to be back. Sorry for going away for two years - I was dabbling in a social enterprise in the interim, but am now back in retirement, and therefore back to blogging.

13 comments:

  1. Anne in Salem21/4/17

    Welcome back!!!!

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  2. Haha! So I did visit this page yesterday to make sure I didn't miss any notifications. Glad you are back. I was wondering if you could manage a post without mentioning the President, but the man is indomitable.

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    Replies
    1. Honoured that you chose to check out if I have come back to life again.

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  3. Yep, only an idiot will sign such an executive order. I can't believe people--63 million--voted for such a freaking reality show character!

    yes, I have made fun of this guy and Bernie in my blog. About time you started doing the same. Welcome back to blogging!

    BTW, here is the latest from Reason:
    http://reason.com/archives/2017/04/21/trumps-buy-american-hire-american-policy
    Choice excerpt:
    "The underlying message is that there is a cultural problem, not merely an economic one. "When two-thirds or three-quarters of the CEOs in Silicon Valley are from South Asia or from Asia, I think..." White House chief strategist Steve Bannon said not long ago in a jumbled explanation of economic nationalism, "a country is more than an economy. We're a civic society."

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    1. Thank you for the welcome. I can't match your pace, but at least I'll try to keep running.

      Won't be railing against anybody politically or socially, although I obviously have political views. Will keep this blog largely economic. Will write in support or yell at economic policies though.

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  4. This executive order, is one of many that provide immense nuisance value and I agree that he's just trying to show that he is "doing something". It is going to be 4 VERY long years. I am surprised he hasn't said a thing about budgets for retraining those that have lost jobs. It doesn't take a rocket scientist to come up with that - and yet he steers clear of initiatives such as that.

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    1. Well, I won't comment on the politics of it, but can you imagine the plethora of rules and procedures that would have to be drawn up to decide what is American or not ? And these are the same guys who complain about government overreach and stifling legislation.

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  5. Welcome back Ramesh - Priya Ganesh

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    1. Hey Priya. Thanks so much. Lovely to see you here. Hope you are doing well. Ping me on email

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  6. Welcome Back Ramesh..

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    Replies
    1. Hey thanks so much but its a pity I have to thank the Unknown !!

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    2. Hey Ramesh.. Kalpana here .. That's the effect of you not writing blogs for a long time..

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