WILL "DO YOU WANT FRIES WITH THAT?" REALLY BECOME THE AMERICAN WORKERS NEW BY-LINE?

Public Education and the American worker, neither looks very "robust" today.

…Is this a caricature of our children´s future careers?

Is the United States becoming a nation of "Hamburger Flippers"…..? Will the most common phrase from a recent college grad´s mouth really be "do you want fries with that?" while they are employed at a national franchise burger joint?

Well, it might not get that bad everywhere, but there are some things going on in America that are bringing us closer to that reality.

We are all aware that the number for American college grads, when compared to China, India and other Asian countries continues to slip. US high school graduates in the math and the science areas are also getting less and less every year. Even the overall number of high school graduates in the US continues to fall and the public school drop-outs continue to increase, especially in the ethnic neighborhoods of African Americans and Hispanics.

Many of our elementary and primary schools have already dropped courses such as physical education, classes for a 2nd language, US History, World Geography, Social Studies and most of their previous art and music offerings. With less and less emphasis on the "3-R´s" in public schools versus 40-50 years ago, things don´t seem to be heading in an up direction. It does make us ask ; "Just what are these students going to be qualified for when they get out of school?" Whether a student is headed for a major university, a state or community college, a trade school or just a regular 40 hour weekly job, it´s become a serious question as to whether today´s public education is doing what´s needed for America´s long-term future.

Unfortunately, it´s not looking very good for either America´s high school and college graduates or today´s average middle-class American factory worker as well.

But, let´s look at what´s really going on with the long-term effects and results of today´s public education and for the workers at US manufacturers today. Unfortunately, the expectations for the average American worker today is much different from that of the past .

No I´m not just talking about the effect of the current recession and the loss of jobs over the past 3-5 years. For this situation, it is finally starting to appear that the president´s stimulus package with some additional focus on the country´s infrastructure of roads, highways, schools, federal buildings, hospitals and bridges will do something for increasing good paying, heavy construction jobs in the short term.

But what about real, long-term US manufacturing jobs?

Well, today that´s a real mixed bag, as it has unfortunately been for years.

If today, we only looked at US manufacturing from some of the recent past statistics from the Bush Administration, one would think that they look pretty good. But as with all statistics, it´s all in how you look at them, not just their overall numbers.

Now here are some of the statements that were being made at the end of President George W. Bush´s first term that he (of course) touted strongly to all Americans at the end of 2003.

The following was from a report written by a Mr. Bruce Bartlett. Mr. Bartlett is a political / economic historian and he was a domestic policy adviser to President Ronald Reagan and a treasury official under President George H.W. Bush.

Per Mr. Bartlett in 2003: "Looking at gross domestic product (GDP), real-goods production as a share of real (inflation-adjusted) GDP is close to its all-time high. In the first quarter of 2003 — real-goods production was 39.2 percent of real GDP. The highest annual figure ever recorded was 40 percent in 2000. By contrast, in the "good old days" of the 1940s, 1950s, and 1960s, the U.S. actually produced far fewer goods as a share of total output.

The highest figure recorded in the 1940s was 35.5 percent in 1943; the highest in the 1950s was 34.9 percent in 1953; and the highest in the 1960s was 33.6 percent in 1966.

In short, manufacturing output is very healthy. We are producing more "things" than we have in almost every year of our history for which we have data. The decline in employment is, in effect, a good thing, because it means that manufacturing productivity is very high. That is also a good thing, because it means that employers can afford to pay high wages to manufacturing workers while still competing with low-wage workers in places like Mexico and China."

OK, now let´s look at the reality of this information.

At the time this report was written, the minimum wage in the US had not been adjusted for almost 10 years, while everybody´s expenses (especially medical insurance premiums) had continued to escalate every year. The American wage earners salary had been stagnate for over 10 years and most Americans were using the equity in their homes like their personal ATM´s for covering their increased expenses. The US worker was only competing well with the workers of Mexico and China because the American workers were producing more while losing more jobs through increased automation, and all the while effectively making less per hour than they were before.

(This period was also at the height of the real estate and mortgage boom that eventually went bust, and we all know the effects of that debacle.)

There were two Middle East wars going on when this report was published and as the US is the largest weapons and military manufacturer in the world, much of what America was building was not for increasing domestic business or improving people´s lives. It was for producing products that blow up things and that wear out or disappear in the field. In other words, it was for producing mostly disposable, expense items with no redeeming use or value.

Today, in regard to manufacturing as a portion of America´s GDP, Mr. Bartlett refers to "real goods production", and gives us some nice positive numbers. However, his "real goods" also include all of those military goods that eventually wear-out, blow-up or disappear. They also include products such as "soft goods". "Soft goods" are items that are only good for a one-time use or that wears out after a few months. Everything from paper towels to clothing could be referred to as Mr. Bartlett´s Americas manufacturing of "real goods".

The key to a nations real manufacturing position is that of manufacturing what´s called, "durable goods". "Durable goods" are items that last over time or during multiple-usages such as automobiles, trucks, tractors, refrigerators, televisions, buildings, bridges, dams, power plants, washing machines, etc. The real percentages of those numbers as shown in Mr. Bartlett´s comments for back in the 1940´s, 50´s, and 60´s, most of those 30% to 40% "real goods" back then were actually "durable goods", or goods that lasted.

If we look at manufacturing just real "durable goods", here are some recent numbers for the actual percentage of US GDP in "durable goods", not just "real goods" that include "soft and military goods".

Manufacturing % of US-GDP in "Durable Goods":

1987: US "Durable Goods" = 18.3%

2098: US "Durable Goods" = 9.2%

2008: US "Durable Goods" = 7.4%

The actual percentages of the past GDP which were "durable goods" of the 1940´s through 1960´s is not readily available. However, I would suppose that the "actual" real percentage of US "durable goods" of the stated 1953 "real goods" @ 34.9% of GDP, was probably around 25-28% "durable goods" as compared to today´s 7.4%.

And this same situation can be applied to the current difference in numbers between back then and the number of today´s American union workers.

At the height of US being the world´s giant of global manufacturing, the percentage of Americans that belonged to a union was over 30% of all US "blue-collar" workers. Today that number is at about 13%. And that percentage today is somewhat "skewed" as many of the union workers in the current union percentage are in a "Service Workers Union". They are not working in a factory that builds "things" or in a "durable goods" factory. They are instead in unions such as those for janitors, nurses, teachers, etc. Yes, they are very useful unions for needed US jobs, but they are not for those higher-paid, skilled workers that are "building things that last".

There´s another small example that shows the status of workers and manufacturing in America today. Remember many years ago at Wal-Mart, America´s largest retailer today, when they stated that they would only sell "American made products". They haven´t made that statement in decades, and just try finding an item today in Wal-Mart that is "Made in America". More than 90% of Wal-Mart´s products today are NOT made in the USA. In fact, most are from China, India or other Asian countries.

America today does not just need Jobs, Jobs, Jobs! America needs to have real "durable goods manufacturing": Jobs, Jobs, Jobs!

We all know that America can build anything. But as long as the America´s "market playing field" is being ruled by the Republican Party´s so called "free market" mentality, and if the flawed trade agreements such as NAFTA, CAFTA and the WTO continue to flourish, it will never be a level playing field. The Asian countries do not have "free markets". The Chinese and Asian duties on US and other of their foreign imports are as many as 20 to 50 times higher than US import duties on their products. And this is especially true for US "durable goods" export products.

The solution to this problem is very complex and it will take many years to solve.

The first area that needs work is in the mentality of the American manufacturing and business decision makers. Just because you can make something cheaper in an off-shore factory that uses cheap labor w/o any consideration for civil or human rights, then you think everything is just fine. If that approach and mentality doesn´t change, nothing will change in going forward. And yes, the US government can get involved in a positive way for helping make that change.

When foreign countries put 20% duties on US imports, the US should reciprocate with high duties on that foreign country´s products as well.

As an example, during the past "Cash for Clunkers" program, why were all foreign auto manufacturers included….? They could have included those models from foreign manufacturers if over 50% of the car was manufactured in the foreign manufacturer´s US factories.

As it was, the largest benefactors of America´s "Cash for Clunkers" program were the auto manufacturers Hyundai and Subaru. Only a few of their car models are over 50% built in a US factory. This un-even market approach has to stop.

The other area that must be dealt with is health care for the American factory workers that is competitive with foreign workers. Until the American manufacturers can remove the financial liability of their employees health care coverage, the products from the US will continue to cost more than those from foreign manufacturers that already provide their workers comprehensive health care.

As I said, it is a complex issue. It needs attention from the basics of public education; to long-range business and market / government regulations; to decisions on comprehensive health care for all Americans.

It´s all in ours, our children´s and our grand children´s hands.

Copyright: G.Ater 2009

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