The Problem

Before we discuss the problem, let’s first discuss the segment and the value of this segment to Americans and the rest of the world.

Engineering & High Tech Manufacturing Segment

• Known for high speed innovation, technology, technology developers, and for being leading edge.
• Segment feeds large manufacturing and distribution via acquisition, mergers and licensing.
• Segment creates jobs, lots of jobs, for: engineers, scientists, technicians, craftsmen, etc.
• Consistently delivers Message of Hope … that tomorrow will be better than today, hope for new technologies to improve products and improve our life.

In the good ole days before the recession, when the world seemed fairer, here’s an example of a capital equipment manufacturer.  In this example, Nova Co is an American high tech manufacturer, and Comp A and Comp B are competitors located in America or Europe.  Each of the companies make quality products, and their respective products differ by technology and features.

During the recession several things started to happen.  First, the American manufacturers that did not manufacture quality products failed and were the first manufacturers to go out of business.  Soon after another interesting phenomena began to surface.  Americans fell into either of two mindsets.  Either they had hope that tomorrow would be better,  or they didn’t have hope.  Our American Economy has always been based on Hope.  When we have Hope that Tomorrow will be Better than Today, We invest and grow.  For example, you may own a cell phone that works fine and you may be able to do just about anything you want with it.  If you have Hope that tomorrow will be better, you may decide to buy a new cell phone.  With Hope that tomorrow will be better, Americans will buy things.  Without Hope, Americans will fix things or do without, or buy cheap over quality.

So, during the recession, our example evolved as follows:

To offset the effects of a recession, Nova Co and Competitor A and B lowered their selling prices which means that profits were reduced to encourage customers to buy during the recession.  Competitor C (for “China) is a new supplier of a similar product.  The Chinese are not known for technology, they are known for providing low tech or products based on older technologies.  In this example, Comp C offers a cheap knock-off of an old version of equipment to compete with Nova Co, Comp A and Comp B.   Lots of American companies bought Comp C because all these same companies were without Hope that tomorrow will be better.

Why is it that American companies don’t have Hope for a Better Tomorrow?  In my opinion, the most important job of an American president, or, for that matter, any leader, is to instill hope in the people.  During the recession, America’s president had shown his inexperience as a leader, and didn’t fulfill his job of instilling hope for a better tomorrow.  As the recession deepened, President Obama began to talk of “hope” by promising Americans that each American that desires to work should have a job that pays well.  Unfortunately, it was only “lip” service, since the infrastructure to create a better tomorrow isn’t even on the “drawing board.”

So, without Hope of a Better Tomorrow, American companies preserved capital by laying off tens of thousands of jobs, and companies that needed equipment or capital equipment bought low quality products manufactured in China and Asia but not made in the United States by Americans.

The president foolishly bailed out the financial institutions without ever thinking that the money handed out to the financial institutions would stay with the financial institutions.  Which meant that there was no loans available to businesses .  Without loans, and without hope, the likelihood of more jobs is dismal.

After awhile, our president seems to have figured out that bailing out insurance and banks just resulted in greed.  Next he spent time trying to push his Obama Health Bill.  Even more of a joke … still not addressing the underlying problem.  Hopefully by the end of his term, he’ll figure out what America needs to prevail.

In any case, I’ve digressed, back to NovaEconomics.  Without assistance, is it possible for American high tech engineering and manufacturing companies to compete with China.  More specifically, without Hope, the answer is an emphatic NO.  Here’s why.  We continue with our example and show Nova Co competes with Competitor C.

As the note says, “thankfully” American manufacturers can still opt out of paying health and other benefits to employees.  If Obama Health ever became mandatory, American manufacturing is history.

By the way, the only companies that are currently purchasing Nova Co’s products are companies that have Hope for a Better Tomorrow.  And thanks to our president and our political system, leadership still hasn’t instilled HOPE and without it and other incentives, the future of American technology and manufacturing is dismal.

What does that mean?  Consider the following realizations …

Chinese government continues to subsidize Chinese manufacturing while US government does absolutely nothing to help American manufacturing.

Future of US Military.  As Americans we’ve always had confidence that our military is strong, and our equipment is the best.  Imagine if US Airforce  Fighter Planes were manufactured by China, and we deployed defective Chinese bombs … how will that compromise our confidence?

Did you know that legal accountability is limited to American companies that manufacture products in the United States.

Or what if aspirin and other daily consumed pharmaceutical products were manufactured by the Chinese.  Defective aspirin kills how many Americans …

Wake Up America!