[HN Gopher] What happened to the US machine tool industry?
___________________________________________________________________
What happened to the US machine tool industry?
Author : jseliger
Score : 108 points
Date : 2024-01-18 17:25 UTC (5 hours ago)
(HTM) web link (www.construction-physics.com)
(TXT) w3m dump (www.construction-physics.com)
| grow2grow wrote:
| Right, it seems the U.S. economy is trying to say, "making
| elementary machine tools is beneath us." The important bit is at
| the end: the U.S. is still a top buyer of machine tools (made
| elsewhere).
|
| Is the same thing to happen with software?
|
| When it becomes worth the time of the U.S. economy to produce
| basic machine tools again, they'll get to create new machine
| tools factories using all the latest technology: so it is
| probably good thing the "old way" is not still around hanging on
| by a thread.
|
| The market naturally is culling technical debt.
| toasterlovin wrote:
| Right. The US economy was well poised to tackle the massive
| task of computerizing humanity and, being a nascent technology
| stack with green field opportunities abounding, it was more
| profitable than continuing to produce machine tools. Meanwhile
| the Pax Americana has eliminated the risk premium to
| manufacturing overseas, so our entire economy has reconfigured
| itself around this task and opportunity of computerizing
| humanity. To our massive benefit, I think. IMO this is the main
| driver between diverging American incomes compared to the rest
| of the developed world.
| dragontamer wrote:
| As long as those manufacturing centers are part of US allies
| (Japan, Korea, Europe, Australia, Taiwan), or at least
| trustworthy neutrals (Vietnam, India), I'm happy.
|
| But some manufacturing, in fact a large amount, is Chinese.
| And I'm not convinced they've got our best interests at
| heart. Either China needs to calm down over their "Wolf
| Warrior" style, or we need to cut back on providing benefits
| to an obviously and increasingly antagonistic power.
|
| ---------
|
| The other part, with respect to Taiwan + China, is that we
| must defend Taiwan as they are a critical source of advanced-
| materials (ie: computer chips) to us. Yes, its more efficient
| to have Taiwan centralize production, but it does come at a
| cost. We need to be ready to defend Taiwan and keep it safe
| if we are to continue to build computers and phones out of
| Taiwan-only parts.
| poncho_romero wrote:
| The entire economy is configured around making quarterly
| profits for shareholders. Any good that happens to come out
| for humanity is purely incidental. The US economy is not some
| fairytale hero.
| MajimasEyepatch wrote:
| > Is the same thing to happen with software?
|
| Offshoring in software development has been around for a very
| long time. Most large US companies have a mix of onshore and
| offshore devs. The more mundane the software, and the tighter
| the financial macro-environment, the more the ratio shifts
| toward offshoring. This is the way the offshoring cycle has
| worked for a long time.
|
| However, unlike hardware, software is about information and
| communication, and cultural context is very important. I have
| seen firsthand that non-US teams building software for US
| consumers often don't quite understand the reasoning behind the
| requirements and may lack polish around basic things like
| English. (The same is true, of course, in reverse, if US teams
| build for non-US audiences.) So I think it should be a little
| bit stickier.
|
| You also cannot copy software design in the same way that you
| can copy, say, the design of a lathe. A lathe is a lathe, and
| as long as you've got the tools and materials, a lathe made in
| the US should not in theory be any different than one built in
| China. The same is not true of software.
| dukeyukey wrote:
| > I have seen firsthand that non-US teams building software
| for US consumers often don't quite understand the reasoning
| behind the requirements and may lack polish around basic
| things like English
|
| Something I'm curious about, have you seen this happen with
| countries culturally close to the US? Like teams based in
| Canada, Ireland, or the UK?
| michaelt wrote:
| _> Is the same thing to happen with software?_
|
| I have a theory that one of the major challenges facing
| manufacturing in the US is actually the opposite.
|
| A manufacturing company in the US is competing for smart,
| numerate STEM graduates with the likes of Google who offer
| graduates $180,000 with zero experience (or so I'm told)
|
| But they're _also_ competing with manufacturers in the far
| east, where $40,000 is a great salary, for someone with several
| years of experience.
|
| Difficult to win both competitions.
| poncho_romero wrote:
| I think that's right, and I think there's a third aspect at
| play, which is that culturally the US doesn't value jobs in
| manufacturing, machining, engineering, etc. as highly as it
| once did (after WW2, say) or as highly as it values finance
| and tech jobs today. I'm not sure how easily that could
| change.
| rsync wrote:
| "Right, it seems the U.S. economy is trying to say, "making
| elementary machine tools is beneath us.""
|
| Hopefully policy makers and the citizenry will resist following
| what, as you say, the US economy is trying to say.
|
| You see ...
|
| You can stop making elementary machine tools.
|
| You will never stop making (people who can only make elementary
| machine tools).
| poncho_romero wrote:
| Will "all the latest technology" be available? The expertise
| the US once had in this area is largely gone, and won't come
| back immediately. I think there's real reasons to be concerned
| that the US will fall behind countries like China in areas like
| innovation because of this self-inflicted brain drain.
| aj7 wrote:
| People who understand this industry can answer in a single word.
|
| Fanuc.
|
| And when Fanuc realized that only GE was capable of competing
| with it in the computer controls needed to run machine tools (and
| wasn't doing shit, another Welchism), it cleverly bought off GE
| by giving it the U.S. franchise for Fanuc, at least until the GE
| stink began to be undesirable.
| grow2grow wrote:
| Yes, no surprise that a standard won the battle, over several
| competing choices. That seems to happen a lot.
| droopyEyelids wrote:
| Sort of a tautology, right? The winner of the competition
| becomes the standard.
| nofunsir wrote:
| I was binge watching TechFreeze[1] on youtube just yesterday!
|
| [1] https://www.youtube.com/watch?v=jOnxOTdx_ps
| jd3 wrote:
| https://www.youtube.com/watch?v=QU6nsfoNWDI for a trip down
| memory lane (and coincidentally, an apt example of how far we've
| fallen).
|
| Can you think of a single modern US-based industry/association
| which produces educational, instructional, and/or historical
| videos like this one anymore?
| ChumpGPT wrote:
| Haas broke US sanction and was directly providing Russia with
| specialized machine tools to make weapons. The same weapons that
| they are using in Ukraine and would attack the USA with. The
| company is morally corrupt.
|
| https://www.pbs.org/newshour/show/american-company-accused-o...
| cpursley wrote:
| And what of the US made weapons currently pulverizing Gaza? Or
| maybe Iraq was moral? And please spare me the lazy whataboutism
| nonsense, we're grownups here.
| pinewurst wrote:
| Says they who offer only lazy whataboutism...
| PeterisP wrote:
| The equivalency would be if there were weapons of e.g. some
| Iranian company sold to Israel and used against Gaza.
|
| As a US company, Haas has a duty to obey US-ordered sanctions
| and ensure that their products are not being used against the
| interests of USA, but it has no duty to ensure that their
| products are not used against interests of Gaza.
| cpursley wrote:
| This I totally agree with (US companies should abide by US
| law). It's the moralizing that gets under my skin.
| serf wrote:
| >The company is morally corrupt.
|
| haas has been morally corrupt for some time.
|
| they're essentially the 'john deere' of machining, they sell
| under-performing over-priced crap that only they can sell parts
| for or maintain, which is convenient for them because they
| produce machines that have some of the highest downtime in the
| entire industry due to lack of repair
| facilities/parts/availability as well as overwhelming small
| quality control problems.
| cantrevealname wrote:
| > _Consider a company that manufactures its product on lathes.
| Assume that it has ten lathes that can just meet production
| requirements. Assume also that each lathe wears out in ten years
| and that the company has its investment plans so well organized
| that one lathe is replaced every year. Now consider what will
| happen if there is a 10 percent increase in demand for the
| product. The plant will need eleven lathes to meet production
| requirements. It will have to buy two lathes: one as a
| replacement for the worn-out lathe and a second to increase
| capacity. Thus a 10 percent increase in the demand for the
| product has produced a 100 percent increase in the demand for
| lathes._
|
| The 100% increase doesn't seem to make sense in this example.
| MajimasEyepatch wrote:
| It's a 100% increase (i.e. double) relative to what the
| ordinary demand for lathes would have been.
| Retric wrote:
| The universe isn't quite that binary.
|
| Suppose those lathes ware out 0.1% faster than expected
| lasting ~3 days less than 10 years, now eventually you
| replace 2 of them in the same year thus doubling demand in
| that year... Except the manufacture wouldn't notice a spike
| from occasionally sending out a few days earlier even if it's
| crossing a calendar year.
| bluGill wrote:
| a lathe doesn't wear out that way. It just slowly gets
| harder and harder to maintain tolerance. Eventually a new
| machine will be enough better as to make an experienced
| machinist take less time - they always have to stop and
| measure as no lathe can give you absolute accuracy, but
| when the lathe is new it is more predictable how much
| turning a handle will change things and so you measure
| before the last operation and adjust it to the right
| setting vs you measure get closer and measure again.
| serf wrote:
| I run a small machine shop, and while I agree that you're
| opinion is closer to reality it's absolutely not out of
| the ordinary for a precision metalworking lathe to fail
| entirely and be dead weight until repair; it's not all
| gracefully easing into imprecision.
|
| Older lathes, for example, love to put the AC motor under
| something that either accumulates or produces chips; you
| can see why this might be a problem over time. It's not
| out of the ordinary to require motor re-winds.
| AnimalMuppet wrote:
| Well, it's a 100% increase _from that company_ , for _one
| year_. The next year, though, they only need to buy one lathe
| again. And the next year, and the year after that. Every tenth
| year, they 'll buy two lathes.
|
| Calling that a 100% increase doesn't seem to make sense because
| it actually doesn't make sense.
| jacquesm wrote:
| Yes, and there even is such a thing as equipment lease for
| companies that are liquidity constrained to be able to move
| to match the market even if their short term reserves would
| stop them from doing so otherwise. At a price, of course.
|
| The most asked question about the CNC gear we sold was
| whether or not it could be leased and whether we could offer
| financing. Almost none of it was bought outright.
| KevinMS wrote:
| Do lathes actually wear out? Machine tools are built like tanks
| and could probably last until the end of time, you just need to
| replace the bearings and motors occasionally.
| dale_glass wrote:
| Yes, it's a machine with many moving parts. There's bearings,
| gears, ball screws, lead screw, belts, etc. There's also
| multiple precision ground surfaces that wear unevenly because
| some parts of the surface get far more use than others.
|
| The bed tends to accumulate damage over time, as try as you
| might, you'll eventually drop something heavy on it.
|
| A lot of it is very much fixable, but I suppose that
| eventually one decides it's too much to bother, especially if
| something is damaged is badly enough, or the lathe is old
| enough and it doesn't make much business sense to fix it.
|
| If you abuse a machine badly enough you can get something
| bent to the point it's not really worth fixing.
| Kon-Peki wrote:
| There's an entire refurbishment industry keeping them going.
|
| I know that this article said that you could order machine
| tools from Japan in the 1980s and get them in a few weeks.
| But that's not the case anymore.
|
| People buy some press or lathe or whatever out of a
| liquidation warehouse in Michigan for ~$50k and then pay a
| refurbisher $1,000,000 to get it to whatever specs they need.
| That's more expensive than buying a brand-new machine from
| Germany/Italy/Japan, but you get it installed in your
| facility so much faster that the extra cash is worth it.
|
| And because they last forever with proper care and
| maintenance, nobody cares if the "new" tool is 70 years old.
|
| Note that this behavior can easily distort the stats on
| demand for new machine tools ;)
| extrapickles wrote:
| The lathe ways (the guides/support for each axis) do wear
| out, but you can re-grind them to be flat again.
|
| Usually you sell the machine at this point to someone who
| doesn't need the precision and get a new machine.
| tejtm wrote:
| If they did not; we would not have the entire art of scraping
| [0]
|
| Yes, if meticulously maintained and lightly used some can
| last a good while. In a less pristine environment, say where
| deadlines need to get met, they wear out unevenly, for
| lathes, the ways near the headstock usually see more work
| than the tailstock end. So, the machine now cuts a taper when
| it is suppose to cut parallel.
|
| [0]
| https://duckduckgo.com/?t=lm&q=scraping+machine+tools&ia=web
| 1nd1ansumm3r wrote:
| What was considered high-end precision machining a few decades
| ago is now standard and easily reproducible in cheap labor
| markets. For example, guitars made in SKorea used to be a bad
| joke. Their machining tolerances were too big and too
| inconsistent. Much like storage and bandwidth what used to be
| exotic cost-prohibitive is now cheap.
| mauvehaus wrote:
| If you're into machining, the American Precision Museum[0] in
| Windsor, VT is highly worth a visit.
|
| I had the good fortune to tour the Starrett factory some years
| back. They were still running pre-NC screw machines to make
| parts. It really is true that old machines, well cared for, will
| last just about forever. Apparently it's something of an axiom in
| the machining industry that tools that are no longer economically
| viable for large scale production end up in job shops where the
| capability is needed but there isn't a need to pump out volume.
|
| The Springfield Armory[1] is also a neat visit. For hopefully
| obvious reasons, their machining exhibits are focused on the
| production of weapons. The American Precision Museum is actually
| housed in a historic privately-owned gun factory. It turns out a
| lot of the progress in machining is driving by the need to make
| weapons.
|
| [0] https://americanprecision.org/
|
| [1] https://www.nps.gov/spar/index.htm
| digitalsushi wrote:
| If you go in late August and have a strong affinity for amateur
| astronomy, you can have one heck of a weekend by visiting
| Stellafane 10 miles south of there in Springfield VT. Probably
| an abuse of a comment but it's so rare to find two things to do
| so close together in that area.
| MisterTea wrote:
| Visited when I was a kid it was fun seeing all the belt driven
| machinery that wasn't so different than my father's machine
| shop (job shopped manual and CNC milling and turning.) The 90s
| was when we saw the manufacturing downslide then my father got
| sick and passed. We kept it going but by the 2000's China was
| eating everyone's lunch. Though the fall of the Berlin wall
| killed a lot of aerospace work which was big business on Long
| Island. We sold the business in 2006 and somehow the guy who
| bought it is still in business though downsized and runs it
| himself now.
| drmpeg wrote:
| I worked at my fathers machine shop (which was a subsidiary of
| New Britain Machine Company) a couple of summers when I was in
| high school in the mid 70's. It was quite an experience and the
| employees were some of the crustiest characters I've ever met.
| The second summer, I worked with this guy named Ray on a huge
| machine that made the heads to ratchet wrenches (the square
| part with the little ball). He was one of these guys that was
| continuously pissed off. A man's man probably only 35, but
| looked 45 and smoked Camel unfiltered cigarettes. But the thing
| I remember most about him was that he could swear for a minute
| straight and never use the same word twice. For example, he
| called the machine "The Afterbirth". I'll never forget that
| man.
| karmasimida wrote:
| So it is the story of losing because of market competition?
| Doesn't feel that surprising of an outcome
| bluGill wrote:
| Not really. The story is management wasn't able to handle a
| downturn and so failed to come out of a recession.
| psychlops wrote:
| > A strong dollar made imports even cheaper by comparison
|
| I think that summarizes the article. It has been cheaper to
| import, so we do. The strong dollar policy supports some
| industries at the expense of others.
| bluGill wrote:
| I'd say MBAs driving for quarterly numbers were unable to
| manage the business cycle is a better summary.
| edgyquant wrote:
| That's just corporate political shade throwing. Fiscal policy
| has, for a few generations now, incentivized trade deficits
| for foreign policy reasons. Overtime this results in
| offshoring of all industry.
| missedthecue wrote:
| This is as empty as saying trade unions caused it. Does Japan
| not have MBAs? It's all about comparative advantage.
| bluGill wrote:
| Apparently Japan's MBAs can manage for longer term. At
| least in this one industry.
| badpun wrote:
| From what I've heard, Japan has very different corporate
| culture, more focused on loyalty and social stability, than
| on maximizing profit. They can even keep unprofitable
| divisions of the company, because they don't want to fire
| people who work in them.
|
| Would be nice if someone with first-hand knowledge of
| Japanese corporate world could confirm/deny it.
| maxglute wrote:
| Article says machinist industry failed to lobby the same way
| as US steel. Not that US steel is doing healthy. But at some
| point it's the govs foresight / job to reign in MBAs via
| protectionism and industrial policy for strategic sectors. As
| other's have mentioned, JP has MBAs too. Maybe lesson is JP
| Gov listened to Zaibatsu/conglomerate lobbying power.
| edgyquant wrote:
| This is the answer to all American manufacturing woes. The
| dollar as a reserve currency gives the US a ton of global
| leverage but requires a trade deficit thus it comes at the
| expense of domestic industries.
| specialist wrote:
| I'd love to understand statements like this.
|
| Lemme try:
|
| Because trade deficits induce demand for dollars? Like how
| Japan and now China hold a bajillion US dollars? So if the US
| had (prolonged) trade surplus, no one would be holding
| dollars?
|
| But wouldn't trade partners still need US dollars to buy US
| goods? Like the situation post-WWII?
|
| So then we'd "loan" partners US dollars to buy our stuff?
|
| Aiugh. My brain just broke.
|
| How does a noob like me learn about these systems. I know it
| all probably makes sense to the learned. But with my folk
| (mis)understanding, these claims sound counterintuitive.
|
| Thanks.
| maxglute wrote:
| https://en.wikipedia.org/wiki/Exorbitant_privilege
| prettychill wrote:
| I found this blog post to be quite interesting
| https://www.lynalden.com/fraying-petrodollar-system/
| depereo wrote:
| I think of it as another type of
| https://en.wikipedia.org/wiki/Resource_curse
| fuzztester wrote:
| "Aiugh. My brain just broke.
|
| How does a noob like me learn about these systems. I know
| it all probably makes sense to the learned. But with my
| folk (mis)understanding, these claims sound
| counterintuitive.
|
| Thanks. "
|
| don't worry, your intuition is right. you are on the right
| track when you say that your brain broke. you are more
| learned, or rather, more wise than those guys.
|
| because a lot of economics is BS, a hotchpotch of some art,
| craft, heuristics, observations and formulae, pretending to
| be a science.
|
| this is exactly why economics is known as "the dismal
| _science_ ", and why there is a saying that if you get 20
| economists in a room and ask them the same question, you
| will get 20 different answers.
|
| (italics mine)
|
| I studied economics in high school for a whole year (11th
| grade). the course covered both microeconomics and
| macroeconomics. the Samuelson (MIT prof., IIRC) book was
| one of our text books.
|
| I did well in class, was among the top few students.
|
| I made some penetrating comments to which my teacher had no
| satisfactory answer. it was on a situation / question
| regarding OPEC (the oil cartel).
|
| from that time on, and also from subsequently reading
| economics articles and news now and then, I could intuit
| and piece together the opinions that I stated above. :)
|
| so, not to worry :)
| edgyquant wrote:
| Not sure how you can pretend I'm wrong when what I stated
| is an observation of the world and not an opinion. The US
| moved its industry overseas and switched to exporting
| dollars in an effort to buy sway inside of other
| countries. It did this to isolate Russia and win the Cold
| War.
| mywittyname wrote:
| > So then we'd "loan" partners US dollars to buy our stuff?
|
| Other way around, they buy T-bonds -- i.e., "loan" dollars
| to the US Government. But the country is still owed that
| money back - it's like a trillion dollar bank account. One
| could say China "lends" dollars to the Treasury, but it's
| also just as accurate to say they "deposit" dollars into
| the Treasury. It's all just words to describe the action of
| giving money to another party to hold onto temporarily.
|
| "Strong" currency means there's more demand for it. Demand
| is usually a function of what you can buy with the
| currency.
|
| When countries reinvest their dollars into T-Bonds, they
| are double dipping on establishing demand for dollars. On
| one hand, they are owed back the dollars handed over to the
| Treasury (thus, creating future demand for USD), and on the
| other, accepting USD for the sales of their goods/services
| induces demand for USD, since it is yet another good that
| can be purchased with USD.
|
| "Weak" currency means that there's less demand for it. Weak
| currencies tend to be those from countries that produce
| little in the way of goods and services, or they only
| produce commodities (like oil) that are generally traded in
| other currencies.
|
| A weak currency can be a benefit. Hence why so many
| countries seek to artificially weaken their currency (aka
| currency manipulation). They often do this by strengthening
| the the USD. Sell to the USA, accept USD from foreign trade
| partners, buy T-Bonds with excess currency. The market for
| USD is so damn big that this is often trivial to do
| unnoticed, like using ocean to fill a swimming pool. But
| economies like Japan and China eventually grew to the point
| where their currency manipulation had a meaningful impact
| on the USD and American economy, rising the ire of American
| politicians. You can read about the Japanese "lost decade"
| which was suspected to be the result of American
| politicians intentionally targeting the Japanese economy
| due to currency manipulation and a general fear that the
| Japanese would "take over the world." (you can see these
| fears highlighted in 80s movies)
|
| > How does a noob like me learn about these systems.
|
| Take an economics class. Eco 101 is kind of trash for
| understanding anything truly useful. But at higher levels,
| you get into mathematical models for the underlying systems
| that govern trade. Granted, it's a little more hand-wavy,
| since economists can't conduct experiments at the scale
| that physicists can. But there is generally some
| experimental data supporting the models (it just might be
| data collected on college students trading candy bars).
|
| You can read about what happened to the Swiss economy
| during the pandemic. They are a smaller economy that's been
| plagued by an absurdly strong currency. There's been a lot
| of reporting and research into the many factors
| contributing to the currency's strength as well as the
| impacts it has had on such a small country.
| edgyquant wrote:
| Honestly I learned the basics in Econ classes during
| college and have an interest in international
| relations/geopolitics so I'm not sure a good single source
| for learning about it all. But yeah there is some
| macroeconomic wizardry involved here. I'll add it is a
| political thing and not a right v wrong policy. Choosing
| manufacturing power or global influence is a trade off with
| pros and cons.
| ren_engineer wrote:
| cheaper when not including externalities(losing critical
| manufacturing capabilities), which is why a proper government
| would take action. But the problem is our government is heavily
| lobbied to not protect critical industries in the name of short
| term corporate profits. And in many cases our government is
| outright hostile to manufacturing by holding domestic producers
| to pollution/labor regulations but allowing imports from
| countries with no regulations
| plagiarist wrote:
| Trade agreements have allowed importing from countries where
| human rights are (more of) an economic externality. Domestic
| manufacturers can really only compete on the ability to do
| small batches, higher tolerances, and quick turnaround; like
| for R&D projects or medical devices.
| loglog wrote:
| The article specifically mentions that Japanese manufacturers
| could deliver tools much faster than US ones.
| advisedwang wrote:
| Also that right after a drop in domestic machine tools demand
| due to recession American industry collapsed overall.
|
| It should be no surprise few machine tools are made when
| there's less domestic industry overall.
| Joel_Mckay wrote:
| 1. lack of stable production lines due to real-estate
| securitization and zoning. i.e. it is a huge liability to install
| something expensive likely to break if moved, and burning capital
| in a sucker lease.
|
| 2. lack of cheap 3-phase power in said zoning, and aging power
| infrastructure. EVs will likely make the problem worse.
|
| 3. lack of skilled labor due to career churn from outsourcing.
| i.e. it became a demand-deficient labor-force now reassigned to
| other careers.
|
| 4. Manufacturing domestically is strictly a niche industry, as
| consumers are cost sensitive, and value blind
|
| If you go to foundry districts in India, one will see many US
| machines that were sold for scrap still powering emerging
| economies. The mechanical equity of 60 year old machines are
| still supporting entire communities.
| barelyauser wrote:
| Value blindness is the bane of my existence. Thin walled
| plastic everywhere. Things are difficult to clean because they
| are filled with grooves, because you need grooves and bends to
| make thin walled plastic stiffer. A very good criteria for
| quality and value is: how easy is it to clean? If it is hard
| then you probably are dealing with a low value disposable
| product. Consider porcelain, lasts forever, cleans beautifully
| and does not stain. Or spoons made with solid stainless steel.
| Spoons made with thin sheet steel often have bends and corners
| as to make the thin sheet stiffer. But then dirt accumulates on
| these corners.
| Joel_Mckay wrote:
| The cost of porcelain is similarly constrained by labor,
| energy cost, and space.
|
| I learned a lot from a domestic slip-casting company as a
| kid. It taught me big heavy things are not economical to
| ship, and thus remain locally competitive in a global market
| even when competitors are 100% subsidized. Amazon shifted
| this calculus a bit, but is still constrained by energy/fuel
| costs.
|
| The power of plastic is automated cycle times under 45
| seconds, minimum infrastructure needs, and shipping weight.
| In a way, Tesla Giga Press technology leverages similar
| strategies for Aluminum parts.
| sct202 wrote:
| That press you mentioned in an interesting example of the
| globalization of machine tools. Commissioned by an American
| company and made in Italy by a Hong Kong Chinese owned
| company, which now makes them in China.
| georgeplusplus wrote:
| We gave up the low intelligence blue collar manufacturing jobs so
| city dwellers can obtain highly specialized and skilled expensive
| college degrees to do important work on global problems in matter
| like, making and editing excel spreadsheets, writing emails, and
| sitting in on web meetings.
|
| I am writing this while drinking an 8$ caramel latte from
| Starbucks with a slice of avocado toast for 17.99$.
| jillesvangurp wrote:
| > Constant pressure to hit quarterly performance targets meant
| that machine quality often suffered. In some cases, machines
| would be shipped out the door unfinished so the delivery could be
| booked, and assembly would be completed by service technicians at
| the customer's location. In his history of the American machine
| tool industry, Albert Albrecht states that "the actions of these
| larger corporations and conglomerates, under the leadership of
| financial MBA's, perhaps more than any other factor, contributed
| to the restructuring and decline of the US machine tool industry
| at the end of the 20th century."
|
| In short, the MBAs happened. Clueless management was brought in
| who then decimated anything they did not understand. I.e.
| everything. Aided by Reagan policy to aggressively outsource
| manufacturing from the nineteen eighties US manufacturing just
| imploded.
|
| Just speculating here, but by the time the Japanese and the
| Germans caught up and got really good at machine tools, the
| metric system would have become an obstacle as well. Because the
| US insisting to do everything in inches, foot pounds, and what
| not doesn't translate very well internationally when you start
| outsourcing all your manufacturing. Outsourcing meant
| manufacturing standardized on the metric system using equipment
| and parts not made in the US.
|
| Just speculating here, but I imagine that all that combined lead
| to a natural preference for non US based manufacturing companies
| that took over from US companies to not use any US made equipment
| or parts. So, manufacturing became predominantly metric based and
| that would have affected standard components, screws, bolts,
| parts, etc. All made by non US companies standardizing on all of
| that.
| cpursley wrote:
| MBA thinking ruins everything it touches. Boeing is another
| example. It's all about short-term profits over long term
| sustainability.
| lasermike026 wrote:
| Fire all the MBAs.
| mobilio wrote:
| also HP...
| baron816 wrote:
| > Constant pressure to hit quarterly performance targets meant
| that machine quality often suffered.
|
| It's not necessarily the case that greedy, ignorant MBAs came
| in and ruined everything. Like, if their practices were so
| inferior, then any domestic firm that didn't get taken over by
| them should've had a leg up and could've dominated the domestic
| market.
|
| Don't you think the more likely source of "pressure" was the
| international suppliers who had lower costs?
|
| > Aided by Reagan policy to aggressively outsource
| manufacturing from the nineteen eighties US manufacturing just
| imploded.
|
| Was the policy to outsource everything, or liberalize markets
| and let firms and consumers more freely choose where to buy
| things from? Globalization has done quite a lot to lift people
| out of poverty and keep prices low.
| lesuorac wrote:
| > Like, if their practices were so inferior, then any
| domestic firm that didn't get taken over by them should've
| had a leg up and could've dominated the domestic market.
|
| There aren't infinite firms. Plus in the article, the
| previous paragraph goes into how the tooling industry was
| being bought up by conglomerates so the finite firms became
| even easier to count.
|
| A company fitting your argument is Telsa. The existing firms
| weren't willing to canabalize their existing product lines so
| they didn't invest into EVs and now a domestic firm is eating
| at their market share. However, "Who killed the electric
| car?" is from 2006, there has been a lot of pent up demand
| for EVs that no domestic firm was selling to.
|
| However, something also fitting your argument is Moneyball
| [1][2]. It's not until the 2002 season that teams start to
| use statistics to determine who to staff their roasters? The
| League is from 1876; it took 126 years of baseball before a
| team figured out how to use math!
|
| > Don't you think the more likely source of "pressure" was
| the international suppliers who had lower costs?
|
| Well, the article agrees in that it says "By now, tools from
| Japan and other countries were as good as or better than US
| tools, not to mention cheaper and more reliable.".
|
| However, R&D was also being cut prior to this so if you don't
| do any R&D and your products become uncompetitive it's
| probably because R&D was cut.
|
| > Was the policy to outsource everything, or liberalize
| markets and let firms and consumers more freely choose where
| to buy things from?
|
| Well, don't forget there are winners and losers when trading.
|
| In this case the losers are the American Tooling Industry;
| the winners were everybody that bought from them lol.
|
| --
|
| I do think this growth every quarter is a big problem though.
| The early observers of business cycle all noticed that it has
| its ups and downs. Pretending that there won't be a down and
| fudging the numbers so that you don't have any downs is going
| to cause future problems. Delivering not-finished lathes
| counts to me as fudging the numbers.
|
| [1]: https://en.wikipedia.org/wiki/Moneyball_(film) [2]:
| https://en.wikipedia.org/wiki/Sabermetrics
| AnthonyMouse wrote:
| The main way for countries with higher wages to compete is
| through automation. You can't supply 1000 laborers at
| $2/hour, but you can supply five skilled mechanics at
| $50/hour.
|
| The problem with this is that the 1000 people who had been
| doing the labor in the US for $25/hour don't want that to
| happen any more than they want it to move offshore, and
| they're the people with the skills to ensure the automation
| goes smoothly. So they resist and then lose to offshore
| manufacturing rather than domestic automation.
|
| Which in turn causes the US to lose even more manufacturing
| jobs, because now that factory is in Asia and it's more
| economical for its inputs and outputs to be other factories
| in Asia.
|
| The way out of this is to make sure domestic barriers to
| entry are low, so that you get more new domestic companies
| like Tesla that aren't stuck in this trap. Right now that
| _isn 't_ the case and Tesla is an exception that got there
| on hype and eccentric leadership, whereas what you really
| want is for domestic small businesses to be able to eat the
| lazy incumbent's lunch long before China does, and indeed
| to be able to eat the Chinese company's lunch by replacing
| a thousand low-wage workers with a handful of high-paid
| specialists.
| bsder wrote:
| > It's not necessarily the case that greedy, ignorant MBAs
| came in and ruined everything. Like, if their practices were
| so inferior, then any domestic firm that didn't get taken
| over by them should've had a leg up and could've dominated
| the domestic market.
|
| In this instance, it was people like Icahn.
|
| Machine tools were a _very_ cyclical market. Consequently,
| they did well as part of a vertically integrated conglomerate
| where the profits could be booked over time and the R &D
| could be shared with the manufacturing parent. When forced to
| spin out and stand alone by corporate raiders, those
| companies were effectively doomed as you just ripped out
| their ability to do R&D.
|
| In addition, people forget that the Japanese companies were
| very much _not playing fair_. MITI (Ministry of International
| Trade and Industry) and the keiretsu /zaibatsu companies were
| actively attacking the US companies--this was effectively
| governmental and monopoly collusion. This attack was to the
| point that they almost wiped out the semiconductor industry
| (which prompted the DARPA VHSIC project and later Sematech in
| response) for example. They did similar actions in the
| manufacturing industries but the government never responded
| with the same vigor.
|
| > Was the policy to outsource everything, or liberalize
| markets and let firms and consumers more freely choose where
| to buy things from?
|
| The policy was to fund the hell out of West Coast (high tech
| and mostly no unions) and to leave the Rust Belt
| (manufacturing and lots of unions) to rot.
|
| I will be one of the first to line up to piss on Reagan's
| grave for the complete shit that he was. However, to be fair,
| _NOBODY_ had any answer to the fact that manufacturing
| automated and could get by on two orders of magnitude fewer
| employees. Every country dependent upon manufacturing went
| through a horrible time (see: England and Thatcher for
| similar vitriol). In fact, nobody _still_ has any answer 4
| decades+ later. It 's one of the reasons there are so many
| old, very angry MAGAs.
|
| > Globalization has done quite a lot to lift people out of
| poverty and keep prices low.
|
| At what _local_ cost? Nobody in Cleveland gives a shit about
| whether someone in Africa is doing better when they can 't
| make their house payment.
| CPLX wrote:
| There's no such thing as playing fair it's just national
| industrial policy.
|
| Every country has one.
|
| The change was that ours went from "try to have industry in
| this country" to "my friends make money offshoring stuff"
| instead.
| glompers wrote:
| Great points.
|
| Riffing on your last remark, the federal labor statistics
| list of Ohio occupations with the highest location
| quotients (prevalence in that area divided by prevalence of
| the same occupation nationwide) still shows machine tools
| related professions near the top. Surely that cluster of
| expertise would be in even greater demand if the national
| economy were to grow in that direction.
|
| May 2022
|
| Engine and Other Machine Assemblers 4.21
|
| Multiple Machine Tool Setters, Operators, and Tenders,
| Metal and Plastic 3.79
|
| Patternmakers, Metal and Plastic 3.23
|
| Forging Machine Setters, Operators, and Tenders, Metal and
| Plastic 2.99
|
| Heat Treating Equipment Setters, Operators, and Tenders,
| Metal and Plastic 2.91
|
| Tool and Die Makers 2.81
|
| Grinding, Lapping, Polishing, and Buffing Machine Tool
| Setters, Operators, and Tenders, Metal and Plastic 2.75
|
| Sewers, Hand 2.71
|
| Cutting, Punching, and Press Machine Setters, Operators,
| and Tenders, Metal and Plastic 2.70
|
| Model Makers, Metal and Plastic 2.64
| AnthonyMouse wrote:
| > When forced to spin out and stand alone by corporate
| raiders, those companies were effectively doomed as you
| just ripped out their ability to do R&D.
|
| It would be just as fair to blame the original culture of
| having vertically integrated conglomerates to begin with.
|
| If there is anyone who should be able to figure out how to
| automate manufacturing with a small number of workers, it
| should be a bunch of machinists. But you put them in a
| lumbering conglomerate and teach them that automation is
| the enemy because it will take their jobs. Then they take
| that same attitude into a smaller company that has to be
| leaner in order to survive and you've set them up for
| failure.
|
| Whereas if you embrace it, instead of domestic buyers
| getting their goods from cheap labor in China, domestic
| _and_ international buyers get their goods from automated
| domestic factories that employ fewer people per unit but
| make more units than ever before because they have globally
| competitive prices and the global demand when you can
| supply at a low price is enormous.
|
| > Nobody in Cleveland gives a shit about whether someone in
| Africa is doing better when they can't make their house
| payment.
|
| But the reason they can't make their house payment is the
| same kind of regulatory capture that they supported and
| caused them to lose their job, which in turn makes housing
| unaffordable because you can't outsource plumbers and
| electricians.
| maxglute wrote:
| > you can't outsource plumbers and electricians
|
| Not yet. Wonder where west would be if politics threw
| trades to the wolves and kept machinists. Maintain
| manufacturing prowess and build cheap factories.
| sokoloff wrote:
| > you can't outsource plumbers and electricians
|
| You can _outsource_ trades (that 's literally what almost
| every general contractor builder does->outsource
| specialist trades to subcontractors).
|
| You can't _off-shore_ them (or at least not nearly so
| easily and completely).
| KRAKRISMOTT wrote:
| Mexico is a large country with a very liquid labor supply
| michaelbrave wrote:
| Brand names carry weight for several years before the damage
| becomes apparent.
|
| Often their cost cutting measures seem positive at first as
| it creates a profit uptick, but it's usually at the cost of
| the brand, so 3-5 years later things take a turn (once the
| consumer has figured out the brand can't be trusted anymore).
| By that point it's hard to put the blame on the appropriate
| person or identify the appropriate reason for a less
| profitable year.
| neuralRiot wrote:
| I said it thousand times in different but related at root
| topics, quality and reliability are possible but why would
| somebody build something that would last forever? It's more
| profitable to churn cheap garbage over and over specially
| when customers wouldn't pay for quality products or when a
| new, more flashy and feature-rich one is launched everyday.
| It's the same for electronics, fashion, cars, machines and
| anything. Manufacturers just push consumers to "desire" the
| brand new product but the grinder is spinning faster and
| faster and the landfills getting higher and higher.
| hasty_pudding wrote:
| > In short, the MBAs happened
|
| This describes many many things in the USA.
| depereo wrote:
| MBAs are fine, honestly. I have a manager who came up in the
| industry he works in. He worked at the 'coal-face',
| understands the issues and has real perspective. He got an
| MBA later in his career and uses what he learned from that to
| more effectively communicate up the chain and has some new
| ideas that he filters through his industry experience to make
| his team more effective.
|
| Children who get an MBA before getting a job and think they
| have some magic sauce that solves problems for an industry
| without respecting the work that's been done and knowing why
| those problems exist to begin with (maybe they're trade-offs?
| For a real reason?) are a problem, as are the clueless twats
| who listen to their breathless assertions as though they
| carry any weight.
| hasty_pudding wrote:
| The MBA philosophy vs the craftsman philosophy differ
| vastly.
| mywittyname wrote:
| MBAs are taught techniques for optimizing for quality and
| cost. It's not always an either/or decision.
|
| Even when it is an either/or situation, sometimes it's
| better to build a product that is half the price for a
| quarter of the lifespan. A buyer who will use a tool for
| 30 hours doesn't really care if the service life of a
| tool has been reduced from 1000 hours to 250 if the price
| is halved.
| hasty_pudding wrote:
| > techniques for optimizing for quality and cost
|
| Some of those techniques:
|
| 1. hiring each other and bloating bureaucracy in
| healthcare and education and other industries jacking up
| prices that werent expensive before
|
| 2. come up with ideas like 'shrinkflation' and 'planned
| obsolescence
|
| 3. reducing quality and making products unrepairable so
| we have massive waste in landfills and things like a
| giant pacific garbage patch
|
| 4. purchasing quality brands , parasiting the brand name,
| and making the actual product shitty
|
| 5. hollowing out every industry in quality and
| jobs...making private equity monopolies so theres no
| competition and then hiring more MBAs.
|
| What you call 'optimizing quality and cost' I call
| 'trying the fuck the consumer to the maximum amount
| without them noticing'. But, to be fair, those are the
| same thing.
|
| Just my observations. Capitalism is becoming a zombie and
| MBAs are the cordyceps.
| lazide wrote:
| The issue isn't MBAs. They are just a symptom.
|
| What the issue is, is that we're essentially in the third
| 'wave' of US economic change post WW2 manufacturing boom.
|
| Post WW2, the United States was the only manufacturing
| economy that hadn't been bombed to smithereens, has not
| only little to no real debt, but a lot of debtors that
| would repay them, and had massive amounts of undeveloped
| land ripe for development, and a major new manufacturing
| base looking for things to do.
|
| This allowed the US to become the world's reserve
| currency (along with gold) in the Bretton Woods agreement
| in '44. That lasted until '71.
|
| [https://en.m.wikipedia.org/wiki/Bretton_Woods_system]
| when the dollar stopped being backed by gold, allowing
| periods of increased inflation.
|
| At around the same time, the economies of Western Europe
| and Asia had mostly recovered, and they were starting to
| catch up on manufacturing to compete with the US.
|
| This led to increasing competitive pressures with US
| manufacturing, and increasing incentives to go towards
| Globalization and outsourcing to chase the cheap labor
| and more willing to compete manufacturers in these
| locations. Switching the US to a 'knowledge economy' was
| the natural progression.
|
| That easy money is mostly gone now, and the US is also no
| longer far ahead in many areas on knowledge.
|
| China in particular is starting to come close on almost
| all metrics. If Europe has a recession, their primary
| disadvantage (cost) may turn into an advantage.
|
| So then the US is much more on par with everyone else -
| for the first time in several generations.
|
| And that causes quite a rude awakening economically, as
| now the US potentially has real and actual competitors it
| isn't 5 steps ahead of already.
|
| MBA'ism is because long ago the economy switched from
| 'actually leaps and bounds ahead of competitors' to
| optimization. As most of the actual structural
| differences have now equalized, and we're down to who can
| make it cheaper/simpler. No one wants a 5 lb drill that
| costs $100 if they can have a 2lb drill that costs $50
| and does the jobs they want well.
| adolph wrote:
| Agreed and to clarify:
|
| > everything in inches, foot pounds, and what not doesn't
| translate very well internationally when you start outsourcing
|
| It translates pretty well for the last 90 years:
|
| _In 1930, the British Standards Institution adopted an inch of
| exactly 25.4 mm. The American Standards Association followed
| suit in 1933. By 1935, industry in 16 countries had adopted the
| "industrial inch" as it came to be known, effectively endorsing
| Johansson's pragmatic choice of conversion ratio._
|
| https://en.wikipedia.org/wiki/Inch
|
| See also the paragraph above referencing the precision tools
| enabled by Swede Carl Johansson's "Jo Blocks." For a nice
| video/contextual storytelling, see Machine Learning channel's
| Origins of Precision:
| https://www.youtube.com/watch?v=gNRnrn5DE58
| cityofdelusion wrote:
| The metric system wasn't a factor, it was all economics as laid
| out in the article. Tooling both foreign and domestic was/is a
| mixture of imperial and metric to meet certain markets. The
| major force behind machining, automotive, did their conversions
| to metric back in the 1970s. The U.S. was seriously lacking in
| computerized machining and had plenty of time to shift to
| metric based machines, but the MBAs had already determined long
| before that they preferred overseas manufacturing at a fraction
| of the cost.
|
| Machining today is heavy metric, even in the U.S. and there is
| still no economic way to make it all work, much like with steel
| production and other manufacturing concerns.
| mywittyname wrote:
| > Machining today is heavy metric, even in the U.S.
|
| Likely due to the dominance of metric tooling from abroad.
|
| Old ass machine equipment is imperial and is still in use.
| Imperial measuring devices are still widely available as
| well.
|
| I think the OP is probably onto something.
| rvba wrote:
| The MBAs probably did not want to invest into anything. I see
| it all the time, it feels like they never thing more than one
| year ahead.
| bawana wrote:
| Wait till you see what the MBAs have cooked up for health care.
| You'll die in the Emergency Room waiting room. Even concierge
| medicine wont save you.
| citizenpaul wrote:
| I've long been sounding the alarm on MBA'ification destroying
| everything. To me its the most under discussed problem with
| society in better quality of life areas.
|
| In the beginning they cleaned up messy, inefficient, wasteful
| processes. However for the most part MBA's ran out of real
| stuff to do 10-20 years ago. Ever since then it has just been
| about how much more can they shave off of 0.1% of 0.1% of just
| one more thing that doesnt need it but hey they have a quartly
| bonus attached.
|
| Or like a comedian I recently saw said, every new business
| these days are basically something like:
|
| Hey you know how a taxi driver can afford to feed his family?
|
| What if he couldn't anymore?
| 11thEarlOfMar wrote:
| At some point, the technical advancement rate of markets tops out
| and other nations then can catch up. Ford ultimately gave way to
| Toyota. Westinghouse to Panasonic.
|
| The counter example is the semiconductor tool industry where the
| advancement of technical capability remains ahead of the rate
| other countries can catch up with them. Internal to the industry,
| the 'low-tech' machines are made by Japanese manufacturers: Track
| (TEL), Wet (Screen).
|
| US/Europe (AMAT, LRCX, KLAC, ASML, ASMI) remain dominant in that
| capital equipment market.
| FrustratedMonky wrote:
| Read a great book on this in college in formative years. Made me
| pretty depressed about how management/markets can target false
| equilibrium points.
|
| Markets do not drive efficiency. At least not if chasing
| quarterly profits drives bad decisions.
|
| "When the machine stopped: A cautionary tale from industrial
| America"
|
| https://www.amazon.com/When-machine-stopped-cautionary-indus...
|
| Note: referenced in the OPs original article
| pinewurst wrote:
| This is a great book - I still own my copy and occasionally
| reread it.
| lkramer wrote:
| Why do I feel there is a parallel here to Boeing? (Maybe that was
| the motivation for the submission)
| ThaDood wrote:
| So from what I can tell, a lot of boils down to the same reasons
| most of America/US manufacturing declined. Globilzation, greed
| and other factors.
|
| This article really hits home for me. I grew up in Cincinnati and
| it was a tool making powerhouse back in the day. Cincinnati Tool,
| now Milacron and many others were made here in town. We still
| have a few nice tool makers in Ohio - Kett and Wright but its sad
| to read about how much this industry powered the nation and a lot
| of its innovation.
|
| Going to our museum center, hell even our Airport has a bunch of
| exhibits that take about all of the tool making and industry we
| used to have. Makes me sad really.
| eunos wrote:
| Also US more or less export controlled CNC to China, boosting
| German, Japanese and even Taiwanese machine tool industry
| massively since China bought many from them.
| bane wrote:
| I grew up in a family printing business. Printing is a
| manufacturing industry just like anything else, with equipment of
| various sorts at every step of the production chain. Even in the
| 80s, when the business was going strong, _most_ of the equipment
| we used was from Germany or Japan.
|
| Sure there were a few odds and ends made in America, things like
| X-Acto knives, or wax melting machines or something. Paper, ink,
| and a few other chemicals used for various parts of the
| production processed were usually sourced from the U.S. or Canada
| IIR.
|
| But the presses, big cutting and binding machines? Every single
| one was from overseas: Heidelberg, Hamada, Ryobi, others. It was
| simply impossible to get machines of the quality and precision
| from the U.S. This often meant multi-week downtimes for aging
| machines that needed parts replaced or repaired, waiting for a
| single roller or a latch or something while it was shipped from
| the home country.
|
| As things moved more and more digital, the front-end equipment
| likewise became more and more foreign made.
|
| In my lifetime, the U.S. never owned the entire vertical supply
| and manufacturing chain in that industry. I'm not sure if it ever
| did.
| toss1 wrote:
| First thought, being in the aerospace advanced composites field
| and using machine tools: "MBAs"
|
| Aaaand, the money quote:
|
| " In his history of the American machine tool industry, Albert
| Albrecht states that "the actions of these larger corporations
| and conglomerates, under the leadership of financial MBA's,
| perhaps more than any other factor, contributed to the
| restructuring and decline of the US machine tool industry at the
| end of the 20th century." "
|
| MBAs & financial "leadership" have basically optimized American
| excellence, leadership, and its middle class out of existence,
| and putting the world's democracies in jeopardy.
|
| They benefitted greatly by privatizing and optimizing profits
| into their pockets, but at the cost of nearly breaking the
| society onto whom they externalized the costs.
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