Saturday, November 29, 2008

The trace elements of a nation

A long discussion over on Angry Bear dealt with how economic choices, rational in the short term or in the service of one economic actor, can cumulatively cripple the societies in which these choices are made. Well worth hopping over to read the full conversation, and also taking another hop to read the 1994 address of Sir James Goldstein to the US Congress.

I added to the conversation, and was pleased enough with that comment that I lifted it for here.


For some reason, this discussion is reminding me of the "dead spots" in the ocean where fertilizers poured in and encourage the growth of oxygen sucking algae.

Like so many other issues in economics, the issue of training versus skills versus cost of acquiring those skills rests on a matter of balance. How does a society support the acquisition of skills which are, when all is said and done, not going to be needed frequently enough to support a large number of artisans? I took a tour of an engineering firm a few years ago, where they make to order generators and motors. The men doing this work are all my age now, and will probably be retiring shortly. The workplace was not a factory floor as you would at ordinarily imagine it -- instead it was like a very large workshop, and the "coils" inside the motors and generators were actually bent from lengthy slabs of specially shaped copper. I know for a fact that units produced by this company were integral to parts of the space program from the 1960s.

Motors, generators and transformers have shifted over the past 30 years to a very small number of producers, most of them offshore. Although I'm not in the field anymore, at the time I retired there were really only three or four producers of large power transformers, and the lead time for a single transformer might be three years. In some cases, there would effectively be only one producer because the others were not at that time taking new contracts.

In an emergency situation, how do you quickly replace a damaged transformer? They are not kept sitting on the shelf, one of these would be large enough that it would only fit in my two-story house if I removed strategic portions of flooring and walls.

The crisis of American manufacturing is not, I think, primarily one of job loss. It is instead the loss of capacity to rebuild oneself independently in a crisis. That capacity is only partly dependent on the infrastructure -- the factory floors and steel mills. More importantly, the working knowledge of how these things are built and the working attitude of coming in every day and bending some more copper into shape, but doing it precisely right, have been punished out of the American workforce I believe.

To become skilled in one of these jobs often requires an opportunity loss of becoming skilled in other areas -- in order to train a good machinist requires enough time that the skill becomes the individual's only resource, and if that resource is no longer in demand, the entire field looks like that oceanic dead zone where there isn't enough oxygen to survive.

A balanced diet includes many things -- sugar and fat and protein in large amounts, and iron and chromium and zinc in tiny amounts. But if a person's diet includes no trace elements they end up with deficiency diseases.

I think the loss of niche professions is a deficiency disease in a nation. Identifying and supporting these fields of work may not be financially efficient -- it's much easier to eat a candy bar than it is to eat a balanced diet. But the result of always making the candy-bar choice is a particular disease that weakens its host out of all proportion to the size of the elements needed.



theojones said...


I am from the UK, where manufacturing has been decimated - with government ministers proudly proclaiming that service industries were the future...

But at it's heart, if a nation does not have specialist manufacturing industry, isn't it horribly, horribly exposed to the hostile actions of enemy?

if you don't make anything, what happens when the people who DO make things decide to charge more?

I enjoyed your article - thanks!

tor said...

The late Seymour Melman was also concerned with the deindustrialization of the U.S. I recommend his last book "After Capitalism".