Drew Greenblatt, president of Marlin Steel, joined several panelists yesterday for a spirited discussion on the future of manufacturing on Midday with Dan Rodricks on 88.1 FM WYPR public radio in Baltimore.
Charles Fishman, author of a Atlantic magazine cover story in December about "The Insourcing Boom", said there's anecdotal evidence of U.S. companies returning manufacturing operations to the United States from China. Advantages that drove them to send production to China a decade or more ago are waning as Chinese wages have risen five times in 10 years and as the price of oil to transport goods has tripled during that period. He pointed to General Electric's recent investment of $1 billion to open appliance production facilities in Louisville and elsewhere in the U.S.
"It's not so they can put an American flag sticker on the appliance," he said. "It's because it makes business sense."
Alan Tonelson, a research fellow at the U.S. Business and Industry Council, was less sanguine although he echoed the need for a manufacturing resurgence in America. U.S. trade policy has encouraged "offshoring," he said. He also doubted the viability of the "Bring Jobs Home Act," co-sponsored by U.S. Sen. Ben Cardin of Maryland, to create incentives for U.S. companies that open plants at home and eliminate tax deductions for doing so abroad: It's hard for the U.S., in heavy debt, to get into that game against China, which spends $1.5 trillion to subsidize key industries, he said.
Drew Greenblatt contended that U.S. manufacturing is on the ascent, in part because the rich supply of natural gas are among advantages swinging the pendulum back. China is formidable, but fears in the 1980s about Japanese manufacturing dominance and in the 1990s about Mexico turned out to be exaggerated. Marlin Steel -- whose existence was once threatened by Chinese steel dumping, and now exports to 36 countries, including China -- is an example of the use of the latest robot technology and skilled engineering to carve out a successful niche in the the production of steel wire baskets for industrial materials handling.
Dan Gunderson, executive director of Baltimore County Economic Development, said it's that type of nimble, high-tech manufacturing that the county hopes to cultivate many times over to fill the 3,400 acres of vacant, prime industrial land that was once home to one of the largest steel factories in the world at Sparrows Point. The "point" was long home to Bethlehem Steel, which became a symbol of the might and the fall of U.S. manufacturing, but Drew Greenblatt urged the panelists to consider the advantages the U.S. maintains:
"The quality of USA products is top notch. [Intellectual Property] rights are embraced, while they're tarnished in China," he said. "We're selling steel baskets to plants in West Virginia, in Kentucky, in Indiana, these are the factories that are creating American jobs."