Peanuts In My Pocket

I did not watch the Republican National Convention live. I have the time, but I don’t have the patience for political theater. I am interested in the messaging, which is why I downloaded Donald Trump’s acceptance speech and read it paragraph by paragraph, looking for meaning. Honestly, it was a tedious effort. I had trouble understanding the meaning behind his words—so much trouble that I kept asking myself, “Is this a real speech?”

Consider this paragraph:

The way they will sell their product in America is to build it in America, very simple. Build it in America and only in America. And this very simple formula, and congress has to go along with us and they will. This very simple formula will create massive numbers of jobs. We will take over the auto industry again and many many, hundreds of thousands of jobs, we lost so many jobs over the years. If you go back 20, 25 years they’ve stolen, going to China and Mexico, about 68 percent of our auto industry. Manufacturing jobs. We’re going to get them all back. We’re going to get them all back, every single one of them.

It is an incomprehensible simplification of a decades-long decline in our domestic auto production capability. One cannot simply wish the industry back. And who is “they”? American companies deliberately outsourced production of components and then whole cars and trucks to low-cost countries like Mexico. American companies did so to survive as they faced intense competition from companies like Toyota.

I spent some time working in a Ford wiring harness factory in Mexico back around 2001. The scale of the operation blew my mind. Five thousand people under one roof making wiring harnesses for the Ford F-150 by hand. The factory was just one of dozens in a small Mexican city named Acuna. The factories were not new in 2001; the process started in the ’80s.

The primary incentive for outsourcing was to reduce labor and production costs. Federal, state, and local governments have offered various incentives, including tax breaks, subsidies, and grants to encourage companies to outsource or relocate production. These measures were intended to make domestic companies more competitive globally.

Do you remember when Toyota was eating our lunch domestically and in global markets, or when Ford did everything it could to adopt the Toyota Production System? The 80s and 90s were dedicated to outsourcing and continuous improvment just so auto companies could stay competitive.

Policies such as NAFTA (North American Free Trade Agreement) facilitated the movement of manufacturing jobs to Mexico and Canada, where labor costs were lower. NAFTA took decades of work from both parties. Is Trump proposing undoing NAFTA?

Trump’s words are wishful thinking and fiction. My first thought was, what about all the jobs associated with the current supply chain? Do we steal jobs from the Teamsters Union to benefit the UAW? Followed by, Wait… he means non-union jobs. At this point, I grew a little frustrated and decided to ask ChatGPT to decode the message.

• Manufacturing in America:
  • While bringing manufacturing jobs back to the U.S. can create jobs, it is not always “very simple” due to factors like higher labor costs, supply chain logistics, and existing trade agreements.
• Congressional Support:
  • It’s speculative to say that Congress will automatically support such a policy. Legislative support depends on a variety of political and economic factors.
• Job Creation:
  • Requiring companies to build products in America could lead to job creation, but it’s also likely to increase the cost of goods due to higher production costs, which might reduce consumer demand and lead to other economic impacts.
• Auto Industry Jobs:
  • The U.S. auto industry has indeed seen jobs move overseas due to cheaper labor costs in countries like China and Mexico. However, the exact percentage of jobs lost (68%) may require specific data to verify. According to various sources, the loss of manufacturing jobs has been significant, but the exact number can vary based on different studies and metrics.
• Recovering Jobs:
  • It’s highly ambitious to claim that every single outsourced job can be brought back. Economic realities, such as global trade dependencies and comparative advantages, make it unlikely that all jobs can be repatriated.

This is an assessment of one just one paragraph from his lengthy speech. Lights would dim in San Francisco if I asked for an analysis of the entire speech.

I did some additional reading for each bullet point and found that I agree with ChatGPT’s assessment. What Trump simplifies to pander to his audience is simply not possible in the short term and would take decades of coordinated political and private sector work to achieve even part of his vision.

• Additional reading: Joint Economic Committee of the U.S. Congress (JEC): Decades of Manufacturing Decline and Outsourcing

There are no simple solutions to global problems. Believing so is childish. Trump thinks he can slap a tariff on cars and then boom, more jobs in the U.S.A.! If you take the time to read the full speech, it is one childish promise after another, fueled by lies and mischaracterizations, which offer us a pretty cake as a reward. We all should know the cake is a lie at this point.

I am interesting in discussing other views or thoughts on Trump’s speech. Please comment below to start the conversation.