American manufacturing has been declining for half a century. It hasn’t disappeared, of course; manufacturing is still a big part of the American economy. But it’s not what it was, and that’s a problem.
We’ve seen our nation’s population increase by over half, over the past 50 years, and in all that time, we’ve lost over 5 million manufacturing jobs, and by some counts, approximately 90,000 factories have closed.
Did we need manufacturing to jump by half in that time, as our population did? No. But if we were doing things right, manufacturing should have at least held its own. Our high taxes, crippling regulations, and other errant public policy choices have driven out a lot more manufacturing than we could afford to lose.
And it’s important to note where the new manufacturing went over those years. Did it all go to Europe, or to our neighbors Canada and Mexico, or to the third world? No, as the years went by, an ever-greater share of the world’s manufacturing went to one country: The “People’s Republic” of China.
Certainly since the breakup of the USSR, China has been the world’s most disruptive country. Their army harasses India and Nepal with border skirmishes; they send troops (sorry, “advisors,” perhaps?) to help Russia in its attack on Ukraine. China’s navy stages live fire exercises within the territorial waters of New Zealand and Australia. China’s navy and air force both delight in encroaching on the territories of Japan and the Philippines. China insanely claims the entire South China Sea as its own, and of course they threaten Taiwan almost daily in every way.
The world’s manufacturing shift to China – instead of bringing peace and stability to the dragon and its neighbors, as moderate Westerners optimistically dreamed at the beginning – has in fact brought nothing but risk and danger to the world.
So the Trump administration is trying to do everything it can to bring back American manufacturing, both for our own economic reasons and for the cause of global stability. We have a genuine need, as the leader of the free world, to reduce either China’s ability or its desire to cause trouble.
There is a problem though, and that problem is time.
An American presidential administration, in theory, has four years, but in practice, it’s really much less than that. The administration must produce results by the midterms or lose the House and Senate. Even worse, the administration must produce results by the autumn of the first year, because of the four important states that hold statewide elections in the odd year. So if an administration has things to accomplish, they have no choice; they must get them done in the first few months.
Politics aside, the path would be obvious:
Lower corporate tax rates and reduce crippling regulations now, to launch an economic boom in the years to come, enabling entrepreneurs to start up new businesses. Then once the economy is booming, use tariffs to break down foreign trade barriers and encourage domestic companies to buy local and thus reduce their imports – especially from China.
But politics cannot be set aside.
For domestic political reasons, the time schedule must be sped up. And for international political reasons – the increasing risk that China wants to start an Asian war, either by outright annexation or by constant provocation – the Trump administration felt it had to expedite this process.
If every dollar we spend in China both undermines our own economy and feeds China’s war machine, then we have to reduce our dependence on China, not slowly, but as fast as possible.
If there’s a war – whether China attacks Taiwan, the Philippines, or someone else first is almost immaterial – we will have to be on the side of the defenders, and we will have to prepare to become independent of Chinese goods overnight anyway; we can’t trade with a company with which we’re at war.
So, American manufacturers find themselves in a nearly impossible situation today.
We depend on China for too many of our components, because we have lost so many industries over the decades, and those new American factories haven’t been built yet.
The current reality is that we are putting the cart before the horse, not because we want to, but because we have to.
Almost every machine we make in the United States – the car or washing machine, the furnace or kitchen mixer the crane or CNC, the robotics or conveyor belt – is dependent upon China for at least a couple of its key components. Even if you make 90% of the components here, you still can’t complete that machine without that Chinese dial, or that Chinese motor, or that Chinese battery, or that Chinese hand pump, or that Chinese circuitry that makes it go.
At this writing, our tariffs on most Chinese goods suddenly range from 145% to 170% of their value, on top of the normal import duties that such goods would be charged if made in other countries.
Few American manufacturers can afford such a huge cost increase on critical components today. If they pass on such costs to consumers, they either contribute to inflation or they lose sales. If they take the hit and absorb it, they will likely go under; nobody can afford such a hit, long term.
And who would be the ones to participate in this American manufacturing renaissance anyway? The existing manufacturers are always the natural source of such growth, through expansion and the establishment of subsidiaries. But these tariffs are hitting American manufacturing so hard right now, they won’t have the money to invest in such things. Most are just taking it one day at a time, hoping to survive until these tariffs drop back down to an affordable level.
Building a new American factory requires time. Building tens of thousands of factories doesn’t take any more time, because they can be built simultaneously, but it doesn’t take any less time either.
Entrepreneurs and investors need to raise money, choose and buy the right location, and break ground. They need to order the necessary factory machinery – much of which is custom-built to order – they aren’t just sitting on the shelf – and arrange the assembly lines. They need to hire and train staff, design an ERP system, order materials. And then once they start up, they have to test and proof every model, getting their NSF or UL approval domestically, getting CE or SASO approvals abroad.
Maybe then the sales part will be easy, because anxious American companies will be so enthusiastic about onshoring, the orders will just appear. Perhaps. But these steps still need to happen in order. All this takes years.
And we don’t have years.
Nobody knows better than the Trump administration how quickly this all has to happen.
And nobody knows better than the typical American manufacturing company what a catch-22 we are in.
- If we don’t force independence from China quickly, we’ll be stuck without an industrial sector the day China starts its war, which appears more imminent every day.
- And if we do force independence from China quickly, before new domestic production capacity is in place to absorb it, existing American manufacturing will shut down – and the very people intended to benefit by all this will be our first casualties.
And there’s one more problem – one that only manufacturers seem to understand, and politicians never do:
There’s a huge cost to moving production of anything that’s custom-made. Once a company moves something – paying for the new tooling, testing and approving it, registering it with UL or CE or SASO – the company doesn’t ever want to move that production again.
So what’s our biggest risk right now? If we force American manufacturers to pull component purchases out of China before we have the domestic production to handle it, then they’ll have to move the production to Malaysia or Mexico or Costa Rica or the Philippines or Brazil. And once they move it there, no matter how patriotic they may be, they won’t be able to afford to move it yet again, to that new American factory that’s going to be built in a year or two.
There may be no winning. It’s entirely possible that past American politicians let it go too long, and now we’re stuck with nothing but bad choices.
We should compliment the Trump administration for tackling this problem – it had been put off, for much too long – and pray that they do manage to find some way to thread this needle that allows the good American manufacturers to survive this transformative period.
But make no mistake about it – the press and the Wall Street folks have it all wrong. They’re warning that this period is going to be rough on transportation, or rough on the consumer, or rough on the advertising community.
That’s nothing.
This period is hardest on the good, hard-working American manufacturers who’ve been suffering for so long, and who have been looking forward to a solution from Washington as a Deus ex Machina – and who may all be hurt hardest now that it’s finally happening, just because it was put off so long, there are no good options left.
Copyright 2025 John F. Di Leo
John F. Di Leo is a Chicagoland-based international transportation and trade compliance trainer and consultant. President of the Ethnic American Council in the 1980s and Chairman of the Milwaukee County Republican Party in the 1990s, his book on vote fraud (The Tales of Little Pavel), his political satires on the Biden-Harris administration (Evening Soup with Basement Joe, Volumes I, II, and III), and his first nonfiction book, “Current Events and the Issues of Our Age,” are all available in either eBook or paperback, only on Amazon.
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