Saturday, January 28, 2012

American Manufacturing and Globalization

Jason Reed/Reuters
Yesterday in a speech at the University of Michigan, President Obama stated that "when manufacturing does well, then the entire economy does well." He's trying to press colleges to lower their costs and make higher education more affordable, in the hope that they'll train more wealth-creating workers. Leaving the domestic politics aside, it was an interesting week to make this case, because two stories highlighted how globalization and technological change are hurting American workers.

Maddie Parlier at Greenville Standard Motor Products
Photo credit: Dean Kaufman for Atlantic Monthly
First, the current issue of the Atlantic Monthly ran an excellent story by Adam Davidson on how difficult it is for moderately educated workers to compete in an increasingly global, increasingly automated manufacturing workplace. Davidson, my favorite economics journalist at NPR, focuses on the plight of a 22-year old single mom named Maddie Parlier who has two kids and no college education. She's working an entry-level job at a plant that makes fuel injectors, making around $13 an hour, with little prospect of advancement.

In order to move up a level on the payscale to "Level 2" and boost her pay by about half, Maddie would need to learn a lot more in order to have the necessary skills to program the machines she currently mans. As Davidson puts it,
It feels cruel to point out all the Level-2 concepts Maddie doesn’t know, although Maddie is quite open about these shortcomings. She doesn’t know the computer-programming language that runs the machines she operates; in fact, she was surprised to learn they are run by a specialized computer language. She doesn’t know trigonometry or calculus, and she’s never studied the properties of cutting tools or metals. She doesn’t know how to maintain a tolerance of 0.25 microns, or what tolerance means in this context, or what a micron is.
Maddie's plight illustrates why President Obama is pushing college affordability and job-training programs.

And Davidson's piece reminds us why workers with limited skills are struggling to keep up these days. Their jobs are being replaced by machines and/or Chinese workers.

Second, speaking of China, the New York Times ran two stories this week in a series on "The iEconomy." The first one, "How the U.S. Lost Out on iPhone Work" made quite a splash, while the second one will disturb anyone who's bought an iPad.

In the first story, the most striking passage captured why China (and not the U.S.!) is getting so many jobs out of the explosion of demand for iPhones:
Apple executives say that going overseas, at this point, is their only option. One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.
A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.
“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.”
I'm afraid the executive is half right. American plants could probably match the Chinese speed and flexibility, but they would have to pay their thousands of workers a princely sum to be ready at a moment's notice. And then they would have to pay overtime to convince workers into grueling shifts. We just can't match China at a cost-effective rate.

Apple is currently the most valuable U.S.-based company and the symbol of American ingenuity, but it "employs 43,000 people in the United States and 20,000 overseas, a small fraction of the over 400,000 American workers at General Motors in the 1950s, or the hundreds of thousands at General Electric in the 1980s" (Duhigg and Bradsher).

Globalization of the manufacturing process is not creating enough American jobs to absorb workers with lower skills. How do we get out of this mess?

I'm not sure anybody's figured that out yet. And even if someone did figure out how to start fixing this deep-seated problem, can our politicians implement such policy solutions without politicizing them?

I guess we'll see in the next few years.

Thursday, January 19, 2012

The "Leap Second" and the Flatness of Modern Time

Today's New York Times reports on a contentious issue looming at a UN-related agency known as the International Telecommunication Union: should the world do away with the "leap second?"

The leap second is an additional second that the keepers of the atomic clocks have added every few years since 1972 to keep those extremely precise clocks in line with the earth's rotation "which [as the Times reports], sadly, does not  run quite like clockwork."

Who knew that such an obscure practice of timekeeping could be divisive?

It turns out that U.S. experts are worried that inserting an occasional extra second could mess up global computer networks. Even that one second could crash servers around the world, and computers don't like such randomness. Therefore, the U.S. wants to stop adding the leap second.

But their opponents--including China, the U.K., and Canada--worry that abolishing the leap second would create a divergence. By the year 2112, they contend, there would be a full minute gap between the official, atomic clock and the earth's rotational one. And eventually, after 100,000-plus years, the official atomic noon would occur at sunrise. Sounds like a crisis, eh? It's keeping me up at night!

On a more serious note, the whole debate illustrates how the world has become flattened and globalized through increasingly precise measurement, standardization, and networking. As chapter 1 of my book points out (and as the Times story reports), this movement to standardize time took off in the late nineteenth century, with the advent of railroads. The effort culminated in the global system of time zones that still governs us today. And the current system goes a step further, down to worrying about the effects over millennia of adding a second of time every few years.

I probably won't be watching on June 30 of this year when the atomic clock gains a second. But I'll continue to be amazed at how humans have taken time--a precious gift of God, a mystery of fullness--and flattened it into an object that they can precisely measure and seemingly control at will.

Despite our brilliant ability to fathom the complexities of earthly, chronological time, we need to grasp the fullness of kairos time if we are to live peaceably during our days and years on earth.