Anonymous asked in Politics & GovernmentElections · 1 decade ago

What happened to US industry?

Please read the details closely and in their entirety before jumping to conclusions. Ten points will go not to the respondent who most closely resembles my view, but to the poster who best supports his or her argument.

No one can deny that industrial production in the US has diminished significantly over the past 40 years. Ford Motor Company, once the very model of industrial production, is now a shadow of its former self. General Motors, once one or the greatest emblem of US business power, is a chimera. What happened?

I offer two possible explanations, which may or may not be mutually exclusive. Take your pick and elaborate on your answer, or provide another theory.

1) Unions destroyed US industrial production by forcing manufacturers to outsource labor and production to cheaper, 2nd and 3rd world sites.

2) The US capitalists, not content from the diminishing profit margin involved in large scale manufacturing deliberately starved US industries in favor of financial speculations from which they derived profits more quickly and easily.

3) An alternative explanation of your own that combines the first two or introduces other factors entirely.


Incidentally, I will not be giving "thumbs up" or "thumbs down" to any answers.

Also, I will evaluate answers not according to my own beliefs, but for how well they make their claim(s).

22 Answers

  • 1 decade ago
    Best Answer

    2 is the correct answer. 1 is a ridiculous far right lie. The American Union bureaucracy was fully complicit in destroying the living standard of workers on behalf of the capitalists. If anything Unions sold the workers out.

    Since the mid-1960s, the global position of American capitalism has dramatically deteriorated. Its once dominant industries have been overtaken by rivals in Europe and Asia. In response, the American ruling class has launched a brutal offensive against the living standards and social position of the American working class in order to drive up the level of exploitation. Entire sectors of the American economy—including most manufacturing industries—have been systematically dismantled because they were not sufficiently profitable. Millions of jobs have been destroyed and entire cities devastated. At the same time, American capital has scoured the globe for cheap sources of labor and higher profits.

    The protracted decline of American manufacturing and the growth of investment banking and speculation as the major source of corporate profit have led to a concentration of power in a financial oligarchy that, for all intents and purposes, dictates political and economic policies. Basing itself on the privileged position of American markets and the US dollar, this oligarchy has been able to borrow resources from all around the world to fund its parasitic activities, which are increasingly divorced from the production of any real value. This process has generated deep structural imbalances in the world economy, including an extreme growth of indebtedness in the United States. The proliferation of speculation in stocks, derivatives and, finally, mortgage-backed securities was the means through which vast fortunes were built up. This process was inherently unstable and has come crashing down.

    Every gain of the working class has been won through struggle. From the 1870s and the fight for the eight-hour day and child labor laws; to the mass strikes of the 1930s and the right to organize industrial trade unions; to the fight for racial equality and democratic rights—everything the working class has achieved it has had to fight for. The Great Depression of the 1930s led to a wave of mass actions. These included the bonus marches of 1932, the mass strikes of 1934 in Minneapolis (Teamsters), Toledo (auto workers) and San Francisco (longshoremen), and the great sit-down strikes in Flint, Michigan in 1936-37, which spearheaded the formation of the United Auto Workers. Throughout the 1950s, ’60s, and ’70s, mass working class strikes were a common feature of American life.

    For the past 20 years, however, open class struggle has virtually disappeared in the United States. This is not due to the decline in class antagonisms or social tensions—in fact, social inequality has risen enormously during this same period. It is due above all to the bankruptcy of the old organizations that supposedly represent the working class. The bureaucratic apparatuses organized today in the AFL-CIO and the Change to Win Coalition—trade unions in name only—function as accomplices in the corporate assault on workers.

    These organizations long ago made their peace with the capitalist system. In the aftermath of the Second World War, the labor bureaucracy, with the support of the state, organized a purge of militants and socialists—the very people who had led the creation of the unions. They said that the interests of workers could be looked after within the framework of capitalism, without any radical change in the economic system or challenge to corporate control and management of factories and workplaces. As a central part of their nationalist outlook, the union bureaucracy supported American militarism, lending its services to advancing the interests of the ruling class abroad.

    The response of the union bureaucracy to the corporate-financial onslaught on the working class that was launched three decades ago was to integrate itself ever more fully into the management structure. Beginning in the 1980s, the union leadership worked consciously to isolate and betray every major strike. Since then, the number of strikes has declined dramatically, even as the assault on the working class has intensified. Every contract agreed by the unions has included more concessions in wages, benefits and jobs. No longer can these organizations be called “unions.” They function as a branch of corporate management, policing the working class, containing social unrest, and enforcing concessions. As part of the current assault on auto workers, the UAW will become a principal owner of both Chrysler and GM, with a direct interest in the exploitation of the workers it supposedly represents.

    At the same time, these organizations have worked to subordinate the working class to the capitalist system and its political representatives, especially the Democratic Party.

  • 1 decade ago

    I grew up in a union household so naturally after leaving the military, I got a union job. This was in '66. The job was fine, I got good pay until the contract ran out and the union went on strike. As a young father with a child, that child came first. I took a non-union job to pay bills and feed the kid. I made better money as non-union but didn't have the benefits. Thar union package is great if one can stay working.

    The major companies that are or were union have always had the problem of the union wanting more. To get more they close the plants on strike and with each strike or contract agreement the cost to build the product rises and to compensate, the cost to the consumer rises. If the cost to produce rises 5% the cost to sell rises 7% and the consumer pays. Eventually to reduce overhead costs some of the companies started using foreign made materials, which later lead to them building plants in the countries where the materials were made. They sold at the inflated price and made more profits and then the migration of industry began.

    It is a combination of supply and demand. People will buy something of lesser quality to save a little money, and if the American made product is more expensive than it's Chinese counterpart, guess which one they will buy.

    Sam Walton, founder of WalMart once said, "If I can find it made in America for a cheap enough price I'll sell it cheap!" Try to find an American made product at Wally World today!

  • Anonymous
    1 decade ago

    While most union workers - of which I am happy to say I am not - believe that only union jobs pay better and have better benefits, they are mistaken. Granted, many non union jobs do not pay well, but these are low skill jobs that any 6th grader could perform. So, yes to #1 because the union elite (honchos) benefit enormously and do not even do the work the workers do. Businesses do not owe employees anything except the wages they agreed to when they were hired. Performance and job skill will lead to advancement. Despite what one of the Trotskyites bloviated here earlier, business owners need intelligent, success driven employees who will be fairly compensated based on their performance instead of an arm-twisting union goon who has never had to make a payroll in his life.

    #2 is valid too. There is no question that greed is a vice that drives many corporate board members to forget that it is their employees who make the company it's money based on their bsiness decisions. An idea or product is only as valuable or profitable as the laborer who takes it to production. That said, the corporate tax is a drain on revenues, which has lead to the proliferation of outsourcing. Increasing the tax will not create job growth. It will create more outsourcing. However, what is the solution? Government interference in the private sector is not the answer. FDR used this ploy and caused the Great Depression to continue another 4 years and it took WWII to slow it down. War is good for the economy in some respects.

    I use my own life experiences as my source. I'm 71 years old/young? and I am a Marine veteran having served in 2 wars. I have worked union and non union jobs. I have laid off 4 times in my working life and I never drew one unemployment check or welfare check. My wife - of 50 years - has never been unemployed either despite a few job losses. We raised 4 children who have never been unemployed either despite a couple or so job losses. Our children paid for their own college education by working. Our grandchildren are learning the facts of life the same way. Too many Americans have been spoiled by almost 45 years of entitlment mentality.

    I don't really care about thumbs up or thumbs down since my opinion is just that. I will defend to the death, though, each American's Constitutional right to express his/her own, as well.

    Thank you

  • Anonymous
    1 decade ago

    2. Our Capitalism theory is a flawed theory. Most Americans will only work for a reasonable pay. Which ISN'T bad is it? I mean heck, we got to get by. So these companies and big cooperation follow the lowest price tag, and biggest profit. Our jobs go all over South America, China, India, and many other places.

    May not sound like it DOES much. But after years, and years, and years. Literally, decades of out sourcing America loses a lot of money -- because so many foreign workers are getting our domestic made money. So these people in foreign countries get our money, and consume in their country building their economic infrastructure, while ours just continue to slowly lose money.

    As we can see right now, it has came home to roost. And what makes things worse is not only is our economy suffering, but our medicare, and energy systems are costing more than they are worth. And another thing to top that off is that we literally HAVE no money.

    Only way to solve our solutions is with money. So they had to print more which will probably hurt us if we don't recover, because some of this **** has to get paid for now or we will collapse.

    Last buy not least, greed killed the system. I needn't explain that, just look at AIG those scumbags we bailed out -- giving their million dollar bonuses away even when they are billions of debt and are giving our tax dollars away.

    Source(s): GM went under because of overproduction and under consumption. In the Great Depression the car industry suffered the same fate.
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  • Anonymous
    1 decade ago

    Union workers get paid 40% more then import U.S. workers. That would hardly brake the bank. The Union worker only makes what the non-union worker designs. GM, Chrysler, and Ford built a reputation of poor quality the same time imports were learning from the U.S.`s mistakes.

    But it all started with Reagan lifting tariffs back when Wal-Mart had their made in the USA slogan.

    Profit competition was the motive now that companies could search the globe for cheap labor. Remember the morals of a company are that of profit and shareholders and if the rules change (lowering tariffs) then the companies will do what the rules let them because companies don`t have feelings. Clinton also fell for the rules changes (trade agreements) like NAFTA which did not pay out what it said it would. Clinton should of known, NAFTA was written by Republicans.

    Now we are left with low paying services jobs which causes a large working poor, just like Mexico.

  • Anonymous
    1 decade ago

    While your hypotheses were very intriguing and probably reasons for the American industrial depression, I will disagree and say the government is the reason.

    The Federal Reserve, at the end of the 1960's, began giving out massive loans to business. The influx of money produced many economic "bubble" periods which we still see today. What this massive giveaway achieved was decreased business efficiency. You see this in both GM and Chrysler, business which took loans in the early 1970's for what they called "expansion". They did, creating and buying so many brands and branches of redundant cars that no corporation on earth could manage efficiently.

    It's easy to manage third world people and businesses because at one time there was none. It's easy to manage something that is that uncomplicated.

    No, I'm not some government hating Republican. I just don't believe in the Federal Reserve being able to give out loans to private businesses.

  • 1 decade ago

    I think what dropped the car industry was two things Gov regulation on size and mpg cars.

    also major part of car industry losing money was UNIONS GM & Chrysler,Ford have to deal with UNION demands where Toyota puts out products and is not burdened with UNIONS demands.

    And other import cars are not burdened financially by UNION demands that GM,Chrysler & Ford have to contend with.

    It will get harder with more Gov over site and regulation with the Obama admin no one wants cars like the Prius yeah there are some but the biggest market of vehicles are SUV`s and mid size cars .

    Look at the Russian Lada sold some but not many this will happen with Gov regulated and built cars.

    I think one will succeed if he does buy it that is Saturn if bought by Penske that guy knows his cars and is good business man.

  • Anonymous
    1 decade ago

    Greedy CEO, and their greedy investors, making 4 to 5 hundred times more than the people who sweat their balls off to make a half way decent living. Then when the profits start to dwindle, they want the workers to take pay, and benefit cuts. Then when the CEO's get canned, they get them golden parachutes, worth ten, to twenty times the base salary, just for screwing up. If a common worker takes more than whats allowed for a lunch break they want to can him on the spot with nothing. This may sound like a rant, but you all know it's the truth. You sound just like one of those CEOs, I will not evaluate to my own beliefs, just how well they make their claims. WHO ARE YOU TRYING TO BULLSHIT.

  • Anonymous
    1 decade ago


    Bad free trade agreements. It has nothing to do with unions China is a communist country even their Wal*Marts are unionized. All of the Chinese factories are unionized.

    This is about people being exploited through open free trade agreements little more the sweat shops in south America.

    Some have a problem with illegal immigration yet reforming trade agreements forcing South American countries to have better labor laws protecting their citizens will not only stem the flow of illegal immigration here but put us on a level playing field with their industrial complex.

  • 1 decade ago

    Do what I did - I stopped complaining, and started buying only Asian autos (Subaru, Kia, etc.) and I buy generic brands on spite. I do not support any big business, and Walmart is also going on my Schit List - I don't care for the way they treat their employees.

    I do not support the war in Iraq, and NOBODY, AND THAT MEANS NOBODY, should buy a New car until gas goes down to $1.75 / gallon.

    Stop helping CEO's get those big $20 million retirement pensions.

    Phuck 'em all.

    God bless America

    Yohan Bundy

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