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Re: [OM] Kodak's long fade to black - latimes.com

Subject: Re: [OM] Kodak's long fade to black - latimes.com
From: Ken Norton <ken@xxxxxxxxxxx>
Date: Mon, 5 Dec 2011 09:49:09 -0600
It is possible to have an economic "island" with minimal manufacturing. In
the olden days, there was the blacksmiths, woodworkers and masons that
manufactured things. There were the farmers that grew the food. Pretty much
everybody else was service-industry.

Manufacturing (or growing food) for export BEYOND your economic island is
only necessary to grow the wealth. But, this is highly dependent upon
having the resources to do it. Mining coal, for example, won't work in
Florida and oil isn't much of an export from Rhode Island. Iowa grows
plenty of food to be shipped around the world, but we don't build any ships.

It is possible to manufacture beyond your natural resources. Japan and
China both import most of the materials used to build stuff for export.
Those shipping containers going from Europe/USA back to China are filled
with recycled and raw materials. However, the natural resource they do have
is a massive population of people who have a solid work-ethic and are
highly competitive.

The reality is, manufacturing is JUST a "value add" function. You take raw
materials (they have the be mined, pumped, grown or recycled), reshape them
with some level of mechanization and people resource and then resell them.
Can a society exist without this value-add process? Yes, as long as there
is some means of feeding the machine somehow. We ALL can't be just
consumers because we'll eventually run out of money.

It has been said that manufacturing is a false economy. Wealth is NOT
created in manufacturing. It just changes hands. In the end, it all comes
down to two things: RAW materials and consumption. Ultimately, it comes
back down to raw materials. He who mines/grows/drills/pumps/etc the raw
materials is the only one actually creating new monetary input into the
system. The manufacturing process is the "value-add" where you take raw
materials, add manpower (which is another form of resource--if you have no
people, you have no manufacturing) and produce a product which is
eventually consumed to destruction. The problem is that for the value-add
to take place, the human resource has to be contributory.

To make the engine of any direct front-line task to be done, it takes
10-100x the number of services to support it. My ENTIRE job is
communicating to other people. I make nothing. I do nothing that anybody
can see, touch, smell, taste. Just like the millions of other people
working in skyscrapers around the world, I do nothing but talk on the phone
and type emails and produce documents which other people might use to do
their job which is to communicate with other people. Eventually, something
is actually done to benefit a customer, but then again, I work in a service
sector which doesn't actually produce anything either.

Throughout the history of the world, Plants, animals, fish and humans have
all gone to where the "food" is. Food being the raw resource. When the food
dries up, that location has to either adapt to a value-add or will
eventually die. Sometimes, a location is built-up as a value-add in the
first place. Detroit, for example, grew thanks to manufacturing of
automobiles. As that industry dies, the city must have a new form of
value-add otherwise it falls entirely into the consumption side and
evenually it dies out. Like I said, the entire old Maytag headquarters,
which is a $16,000,000 facility can be yours for $1. The "food"
(manufacturing value-add) moved elsewhere. A town of 20,000 people was
built on making washing machines. Now what? People moved here FOR the jobs,
it's only logical that they move FROM here because of jobs. The ghosttowns
of the west exist for that very reason. No harm, no foul.

AG
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