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Discussion: (30 comments)

  1. Leslie Schwartz

    A major point that you are overlooking is that most consumer semi-durables are now made in some foreign country and imported to the US.

    The impact has been that the reliability, the number of dead on arrival, or dead after some inexcusably too brief period of use, has drastically increased.

    People used to be able to buy something from Sear, it would be durable, and if it broke you could get it fixed.

    That is no longer the case typically.

    Now these items are throw-away and fill up the garbage dumps of the US.

    Look at the reviews for any semi-durables where consumers get to add their comments and experiences with the item.

    You will see that for anything you can name, TVs, laptops. pop-corn makers, microwave ovens, vacuum cleaners, etc. including the bits and pieces of plumbing and replacement parts for toilets, showers, sink faucets, now all made abroad.

    The quality is awful, the parts and pieces are not genuinely durable as they were when they were mostly made in the USA, and the average American just can not afford the items that are comparable and which are made in the US, and they are not stocked where people buy these items, Home Depot, Lowes, Sears, etc.

    Just looking at the prices does not tell the whole story or even the most important factors.

    The related point is that employment in the US is perpetually and permanently suppressed since so much is no longer made in the US.

    1. morganovich

      leslie-

      this seems like a highly misguided criticism.

      high quality products of virtually every type are readily available, many of them made in the US.

      i do not have single piece of stereo or video equipment made abroad. this is not out of patriotism but because the us makes the best stuff in the world. but, it also costs more.

      you could easily buy a us made stereo. you likely chose not to because you found an import more attractive on price/performance.

      there are innumerable high quality washing machines, dishwashers, home fixtures, etc.

      it’s not like they are hard to find or buy.

      cheaper, lower quality goods provide you with options. they do not doom you to having to buy crap.

      you can buy a cheap vizio blu ray player, or you can buy an incredibly high quality oppo player, made in the us.

      further, your notions about suppressing employment are inaccurate. trade does not suppress jobs, it creates them. us manufacturing employment is at higher level than ever.

      it has dropped as a % just as agriculture did. this same thing is happening all over the world, even in china.

      it’s a sign of wealth and productivity, not a sign that manufacturing is dying.

      1. “us manufacturing employment is at higher level than ever.”

        What?

        ’75,’78 were peak years for U.S. manufacturing jobs. We are waaaay off the high.

        As far as trade goes – it’s a moving, breathing entity – corporations will send jobs abroad wherever and whenever there are cheaper options – it is hardly dtagnant and we have not fared well on jobs (for many reasons) but .

        1. sorry, hit ‘post’ prematurely..

          ..we have not fared well on jobs for many reasons; aging population is one, but jobs having been shipped overseas is certainly another.

          1. morganovich

            sorry, i misspoke. i meant to say output.

            but if you look at manufacturing jobs as a % of all jobs, they are shrinking all over the world including the eu and china.

            this is just the inevitable effect of productivity. it’s a sign of good things happening, not bad ones. this same thing happens in every economy.

            you start out all agriculture, you move to manufacturing, then to services, then to information.

            ag was over 90% of us jobs, now it’s what, 3-5%? that shift was because one guy could make much more. so he gets paid more, we get cheaper food, and labor is freed up to do more valuable stuff like manufacturing. when that gets more productive, it drops prices for all sorts of goods, and frees people up to do work in other fields like services and knowledge.

            we have a persistent myth is the US about “good manufacturing jobs” that is based on a highly anomalous period.

            in the late 40s’, the us has the only in tact manufacturing base of any size on earth. jobs were abundant, prices were high, and demand was off the charts. that was pretty much the only time in history that manufacturing was ever that good, and, barring another massive war, we’re unlikely to ever see it again.

            mostly, manufacturing jobs have been crappy to mid level jobs, not one you could get, buy a house, 2 cars, and put your kids in private school.

            many seem to base their perceptions on the 50’s, but that period was the aberration, not a norm or a golden age we somehow lost due to sneaky foreigners and evil trade. it’s also worth looking at just how much prices have dropped in constant dollars.

            we have fewer workers and more output. this is a thing to be excited about, not lament.

            try considering the reverse.

            we could, at a stroke, probably triple or quadruple construction jobs in the us by banning the use of power tools. does this seem like a path to prosperity? heck, let’s ban tools altogether. consider how many people it would take to dig a foundation with their hands.

            the price of keeping jobs here is much higher prices for goods, less selection, and fewer advantages from comparative advantage deriving from trade.

            even if this result in more jobs, it would likely result in less prosperity as higher prices would more than offset the results in real terms.

      2. Citizen Buddy

        “us manufacturing employment is at higher level than ever.”

        Morgan, can you elaborate on this statement?

        1. morganovich

          i misspoke.

          i meant to say output, not employment.

      3. us manufacturing employment is at higher level than ever.

        US manufacturing employment has declined 19.2 million workers in January 1980 to 11.9 in April 2013, an employment decline of 38%.

        I think what you mean is that manufacturing output is at an all time high, doubling in absolute terms (from about $1.3 trillion to about $2.8 trillion) and tripling per manufacturing worker since 1980 (from about $80K per worker per year to about $240K per worker per year).

      4. Bravo, Morganovich!

        Most of my audio equipment is US-made as well, and for the same reason.

    2. PeakTrader

      Leslie Schwartz says: “…TVs, laptops. pop-corn makers, microwave ovens, vacuum cleaners, etc…The quality is awful…employment in the US is perpetually and permanently suppressed since so much is no longer made in the US.”

      Quality is higher, through technological advances, and prices are lower. The U.S. offshored low-end manufactured goods, imported those goods at lower prices and higher profits, and shifted (limited) resources into high-end manufacturing and emerging industries. If employment is supressed, it’s not because of offshoring.

      Recently, I bought a thin and light TV at Best Buy for $159. The screen looks great. Also, I bought a much lighter microwave oven at Walmart for $59 over a year ago. It still works great. Moreover, I upgraded my cell phone, to a much better one, for around $50 with the rebate. Furthermore, I paid less than $500 at Walmart in 2006 for the computer I’m using now. I’ve had no repair costs on it.

    3. Without resorting to highly subjective personal experiences, do you have any data that suggests imported durable products are unreliable? Furthermore, how exactly did you attribute the unreliability of a product solely based on its country of manufacture?

    4. The impact has been that the reliability, the number of dead on arrival, or dead after some inexcusably too brief period of use, has drastically increased.

      This is wrong. Quality has improved dramatically in the last four decades, even for goods imported from abroad. The quality of everything you noted (TVs, laptops. pop-corn makers, microwave ovens, vacuum cleaners) have improved as dramatically as prices have dropped. The only reason I buy new laptops isn’t because of a drop in quality, but due to the blazing speed with which these tools advance. I buy computers about every other year, not because my old one isn’t working or has slowed in any way, but because the new ones are so bad ass it makes the purchase worthwhile.

      People used to be able to buy something from Sear, it would be durable, and if it broke you could get it fixed.

      That is no longer the case typically.

      Wrong again. This is exactly the typical case.

      1. morganovich

        ken-

        i actually think it’s a bit of a mixed bag. people get confused because they want to compare very low end appliance that had no analogue in the past with stuff their mom had.

        there are lots of crappy blenders for sale that will only last a couple years while my grandmother blender looked like it was made by studebaker and will happily be crushing gravel long after i am dead.

        but you can still buy a blender like that, and i suspect that it’s still cheaper in constant dollars than hers was.

        i think a lot of this “products are crappy now” perception comes from demanding top quality goods priced like low end goods and confusion because their never used to even be such a thing as a bargain dishwasher.

        and many better product lines have far better warranties and customer service than ever existed in the past, contrary to leslie’s narrative.

        my new washing machine has a 10 year warantee on every part of it. when my blu ray player broke, they sent me a new one at no cost with a prepaid fedex box to send back the old one. car warantees are off the charts as is reliability.

        no question, there are a lot more low quality goods around than there used to be. it’s created a vast new market segment.

        but anyone who claims that the good ones are not out there simply does not know how to shop.

        1. It’s difficult to do a proper comparison I agree. The important thing to remember is that crappy things existed, at lower prices, in 1980, too. As the cost for manufacturing decreased, it wouldn’t surprise me in the least if the median and/or average appliance of whatever type you’ve in mind has declined, as the number and variety would have increased, particularly at the bottom. Marginal utility exists at low prices, even for low quality. I also wouldn’t be surprised if the low quality items today are of higher quality than the low quality items of 1980.

          Another would be to compare the most expensive product. In this area, I would expect today’s model to be head and shoulders above the 1980 model and still be less expensive in hours worked to purchase. I’d be surprised if in 1980 anyone had access to blenders as high a quality as the Vitmaix 5200 or the Blendtec.

          because their never used to even be such a thing as a bargain dishwasher.

          I think this is a profound statement that is completely ignored by people like Leslie Schwartz. The percentage of houses having dishwasher, washers and dryers, etc. has increased dramatically. And the low end appliances being bought by the lower incomes are still better than the typical appliances bought my nearly everyone in 1980.

          On top of that, in 1980, there were litarally thousands of little things that simply didn’t exist that do today.
          but anyone who claims that the good ones are not out there simply does not know how to shop.

          I think more likely they don’t know what they’re talking about, though you may be correct, which would be weird. Nearly everyone has access to google. There’s pretty much no excuse to not know “how to shop”. googling for “how to shop” brought up 3,090,000,000 hits in 0.35 seconds.

          1. morganovich

            ken-

            by not know how to shop, i did not mean did not know how to google.

            i meant that the people who did would then pick a low priced good and complain that it wasn’t it top of the line with or that they would buy a sweater at walmart and expect it to be the quality they used to get from ll bean. if you want the great prices that come from razor thin margins, you’re going to get worse customer service too.

            the massive plurality of purchasing options that faces shoppers today seems to baffle many.

            it seems to stop at “i went to the store and bought a blender and it was not as good as my old one”.

            given the truly massive amount of information, reviews, and selection available to pretty much everyone today, all i can conclude from those who claim there are no good products is that they have no idea how to shop.

            i am certainly having no trouble finding them.

          2. I knew what you meant. What I was getting at was that it’s easy to find information, to shop. google will even do it for you. Not knowing how to shop is equvalent to not knowing how to google. You can even google “how to google” and “how to shop” to get better at finding the info you want.

          3. morganovich

            ken-

            but first you have to know that you do not know, and that seems like the key problem.

            it seems to me that the key question for this “imported goods are low quality” crowd is very simple:

            “then why do you keep buying them?” for that matter, why does anyone?

            it seems to me that to assume that we keep falling for the same dumb trick of inadvertently buying crummy stuff over and over is pretty outlandish.

    5. PeakTrader

      There are great bargains in the low-end goods market, because it induced demand.

      1. Once More Around The Block

        Remember the old saw “Price, Quality, Speed…pick two out of three”?

        Still applies but the modern manufacturing has certainly reduced the impact of each.

  2. Citizen Buddy

    “The significant reduction in the cost of purchasing and operating common household appliances like room air conditioners help us understand that the “good old days” are now!”

    Cool.

  3. Jon Murphy

    As one who just moved in 100 degree weather, I greatly appreciate the cheapness of the air conditioner.

    1. oof! hope the new place is worth it Jon :)

      1. Jon Murphy

        So far, yeah. Much bigger than my old place (200 sq ft bigger), heat is included, brand new appliances (as in “I took the wrapper off” brand new) and right in the heart of downtown.

        1. morganovich

          wait, it’s 100 degrees in new hampshire or did you move to texas or something?

          1. Jon Murphy

            100 degrees in NH. We had a freak heat wave on the day I decided to move. Do I know how to pick ‘em, or what?

          2. morganovich

            well, it could have been worse.

            my uncle in lake placid had a dinner boat rented for memorial day to do a party on the lake.

            they got 36″ of snow.

          3. Jon Murphy

            Yeah, we got snow that weekend, too. Just a dusting, but still.

            Weird weather here in the NorthEast. We had all 4 seasons in the span of 5 days

  4. Despite the point of view of folks here government regulations have greatly increased the efficiency of refrigeraion and a/c units. For Central air it went from around an seer of 8 in 1978 to 13-15 today for base units. It went from 10 to 13 due to the epa regulation. Refrigerators got more efficient because Ca said they have to be this efficient to be sold in Ca. This then set the engineers loose of the restraint of short term thinking management. Once the engineers set to work, management discovered that efficiency did not increase the cost of the units much, and in many cases actually cut it.

  5. Benjamin Cole

    “though the overall CPI has increased 5.2 times since 1973, and the average hourly wage has increased 4.8 times”–Perry.

    Well, this sort of undercuts the whole post.

    In other words, wages have not kept up with inflation, meaning lower living standards. Add on, higher Social Security taxes.

    Really, this is rather basic.

  6. That’s what I like to hear. I like to hear that better products can be sold at better price and this means that even more people can have them in their home. This is some great news.

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