I am sure there are all sorts of additional factors and plenty of “experts” will suggest I’m a simpleton, but I see a very basic link between the shopping habits of American consumers and the dearth of manufacturing jobs in this country.

Here is the story I’ve heard over and over; the amounts are not from any specific example, but reflect the shared traits.

An individual or a company comes up with a great new (or improved) widget. It will be made here in the USA. The company can sell it to BigCo for $4.00 which then sells it for $9.99 – no more than what similar items sell for. The company is sure that BigCo could sell thousands each year.

BigCo agrees that the item could be hot. But they would need to promote it; offer discounts & samples and advertise it. Then maybe it could sell for $6.99 as a regular price- if they can pay only $2.00 for each one. Well, $3.50 for each one less rebates and allowances etc. But at that price they could sell MILLIONS!

Of course the product can’t be made in the USA at that price; but BigCo has ‘connections’ with all sorts of manufacturers over in Asia. Since BigCo buys so much (they get container-loads every day) there would be almost no shipping costs to add this little item. What’s a struggling company to do? They could turn down BigCo’s offer, produce it locally and sell through ’specialty retailers’ and perhaps sell a few thousand. Oh, and pay for their own marketing and advertising.

And what’s the likelihood that BigCo will just happen to launch their own brand of new Improved Widget produced off-shore? Even if the designer had the forethought (and funds) to patent their Widget, do they have the money for a long, drawn-out lawsuit against BigCo? Probably not.

So the great new widget will be produced overseas. When you buy it at BigCo on sale for only $4.99:
$2.99 to BigCo for overhead, marketing, minimum-wage staff;
$1.50 to the over-seas manufacturer
$0.50 to the designer/creator
So about $3.49 (less BigCo profits sent to overseas shareholders) stays in the USA.

If, instead, it’s made in the USA and sold through an independent shop for $9.99:
$4.00 to local shop (they don’t get the volume discount)
$2.99 to the local manufacturer
$3.00 to the designer/creator- including marketing
So about $9.99 (less any parts purchased from overseas) stays in the USA.

Please don’t bother posting that you think my examples are not ‘dead on’ unless you can reveal actual numbers from a case study. It seems to me that even if I’m ‘way off’ in relative percentages, the end result is correct; shopping at BigCo prevents the resurgence (resurrection?) of US manufacturing. So enjoy those short-term savings, but stop b!tching about the lack of manufacturing jobs, “I mean it. Really.“

(Also- “Obama, The Banks and the Consumer Confidence Game“)

Obama stands up to the banks; the Stock Markets fall – should we care? In an effort to turn our attention away from the Administration and Democratic Party’s multiple failures (most notably turning healthcare reform into mandatory health insurance) the President has decided to turn his back on the large banks that gave him his Economics Team.

Ignoring for the moment the likelihood this is merely theatrics from all players, should we care that stock prices dipped? I think not.

Sure my 401(k) will take a hit; just as it’s about to reach its former high value (from back in May of 2008). Yes companies will use this as another reason not to hire people. And MSM (the ‘mainstream media‘) and FauxNews will yell this is the end of the world as we know it. If only that last part was truly accurate; the end of the lies, fraud and shameless ‘financial instruments’ that reveal just how low humans can go.

As just one very small illustration; I currently use a regional bank for my personal accounts, business account and single credit card. The credit card payment was due on Monday the 18th. Martin Luther King Jnr day. A day the bank is closed. So my payment (a transfer from one account to another on Sunday) was ‘deemed to have arrived’ on Tuesday. They slapped a $39 ‘late fee’ and about $6 in interest on my account. That the Bank set as a due date a day that the Post Office and their offices mark as a holiday doesn’t feel right, even if not illegal. After I pointed out how long I’ve been a customer, they waived the fee but not the interest. Obviously this regional bank wants to play with the Big Boys…. so perhaps it’s time to Move My Money to a smaller bank or a credit union (such as I had before I moved down here).

On the bright side; Economists and MSM are always saying that Consumer Spending represents anywhere from 60 to 75% of the US’ GDP. And that falling Consumer Confidence leads to reduced Consumer Spending which somehow is unpatriotic, a threat to the American Way of Life, and just plain selfish. If that be true, then tackling outrageous bank fees, heavy-handed policies, and an unfounded arrogance of an industry that creates nothing (well, except false wealth and real poverty) will raise Consumer Confidence; and must inevitably lead to increased Consumer Spending and save the world.

So it’s time to support the President in his effort to do the morally (and fiscally ) proper thing. It may well be naive to believe he’s doing it out of moral outrage, it’s not the same thing as getting me full-time employment, and it does nothing (directly) for my mortgage. But after a year it’s one step in the right direction.

The people of Massachusetts are so upset at the lack of progress from the “progressive” party they’ve elected a teabagger to the US Senate.

Obama has three choices:
1. withdraw into a ‘lame duck’ victim mentality;
2. strike out at ‘the left wing fringe’ that warned;
3. analyze what went wrong and fix it.

To those who say they don’t want to ‘waste time’ with incriminations; I agree that finding a ’sacrificial goat’ would be wrong. But not taking the time to learn a few lessons from this will lead to a bigger disaster in 2 years. That whole ‘those who fail to learn from history are doomed’ thing.

The entrenched interests ‘inside the beltway’ are, of course, saying this means the Democratic Party and the Obama Administration need to be ‘more centrist’. Pharma, the insurance industry, the financial industry, the war machine… they might make token noise but not a one of them has not benefited (and in shameless excess) from the current Administration. If you view the past year as this Administration pandering to the Repugnent Party, Big Banks and Pharma then, I guess, moving towards the centre would mean progress.

But why stop there? If the Dems and this Administration are going to ‘man up’ and reclaim the mantle of Hope and Change, they should ‘bet it all’. I mean really- what’s the likelihood that a centrist position will satisfy the Repugs or make a dent in the serious problems this Administration inherited?

So go ahead- pass serious healthcare reform, remove the Insurance Industry’s collusion exemption, stop the insurance and financial industries’ assaults on the citizenry. Step up, double down, bet it all.

You might lose, but if you don’t ‘go for it’ you will lose and be a disgrace.