Matt Stoller is getting close to the Gosbank solution. He’s discussing Boeing, with a complete and accurate history. He concludes that the government needs to BUY Boeing and redistribute its production to benefit American workers instead of American shareholders. On the dot.
In the Soviet system the government provided the FINANCE and also made the DECISIONS, trying to provide the most useful work for the widest range of workers.
What we have now is the worst of both worlds. Government has been providing most of the FINANCE through defense contracts and QE and ZIRP and specific bailouts; but Wall Street makes all the DECISIONS solely to benefit Larry Fink. In other words all the money moves from taxpayers to Larry Fink, never reaching the workers.
= = = = =
Thinking about offshoring…. The history was different in each industry.
Electronics went first in the 50s, as the industry voluntarily abandoned all US production of consumer goods and allowed Japan to take it. Clothing followed in the 60s for different reasons. Appliances followed in the 70s.
Right now aircraft is in the early stages of the process that electronics ran through in the 50s. Boeing is so totally dependent on SECURE war contracts that it’s abandoning its RISKY civilian business to foreign competitors, and also offshoring civilian production. It hasn’t lost all civilian airliner business yet.
Automobiles followed a different path. At first VW offered small crappy cars for a low price with excellent service. This combination didn’t make major inroads, but wise leaders (a category that includes exactly and only George Romney) could see what would happen if America DIDN’T answer it. Rambler answered first with considerable success, then the big three answered Rambler in 1960. Toyota came much later and captured a big part of the market through the best form of capitalism. Toyota made GOOD cars at a time when Detroit was making CRAPPY cars. Size was not the distinction. Detroit and Kenosha were making a wide variety of sizes in 1968 when Toyota seriously entered the game.
In the 80s Detroit fought back in the best capitalist way, improving its quality to match Toyota. Now some Detroit cars are ranked better than Toyota.
Now the auto industry is NOT offshored from the viewpoint of WORKERS. We have about the same number of factories now that we did in 1960. Half of them are owned by Japan and Korea and half by Detroit. American workers have proved they can turn out Japanese quality when managed by Japanese methods. (What we call Japanese methods were originally American methods. We gave up Fordism in the 50s. Japan and Korea picked it up and used it against us.)
The other industries, electronics and clothing and appliances, are totally gone from American WORKERS. Some of the foreign plants are owned by Wall Street brands, but none of them are employing American workers.
Polistra's Mill 