The Collapse of American Manufacturing
by The Cunctator, Thu Dec 14, 2006 at 12:38:52 PM EST
Cross-posted at DKos.
Banking is not the creator of our prosperity but the creation of it. It is not the cause of our wealth, but it is the consequence of our wealth; and if the industrial energy and development which had been going on for so many years in this country were to be hindered or relaxed, then finance and all that finance means, will follow trade to the countries which are more successful than ourselves.
--Joseph Chamberlain, speaking about the British economy, in 1904.
The financial sector has replaced manufacturing as the driver of the American economy.
Manufacturing and Financial Services: Changes in Percentage Share of US GDP, 1950-2003
In 1960, there were 17 million people in manufacturing out of a total workforce of 65 million.
In 2006 there are 9-18 million people in manufacturing (depending how broad you make the definition) out of a total workforce of 150 million.
US merchandise exports have been steadily collapsing as a share of GDP: 8 percent in 1990, 7 percent in 2000, 6 percent in 2003. By way of comparison, British merchandise exports in 1990 were 21 percent of their GDP.
This isn't just a matter of the US being unable to compete with the growing economies of Asia. Just look at this comparison of exports between the US and other first-world nations with worker protections, health care, etc.2004 Exports ($billion)population (million)Imports ($billion)Germany89382
In 1904 Joseph Chamberlain was one of the few who foresaw the collapse of the British Empire as its economy moved from manufacturing to banking.
In 2006 Kevin Phillips sounded the cry about the American economic empire in American Theocracy, from which the above statistics are grabbed.
It doesn't look good, folks.