Trouble is, that figure was wrong.
In 2007, the average hourly wage in a unionized Detroit auto plant was $29. The average hourly wage in a non-unionized Toyota plant in Kentucky? $30. In Japan, Toyota paid assembly- line workers about $22 an hour. True, that’s less expensive.
Ideology, for one. A national industrial policy is anathema to many conservatives. When solar-panel maker Solyndra LLC went bankrupt after receiving $535 million in federal loan guarantees, opponents of industrial policy eagerly cooked the failure into a “scandal.” The attack was not only a partisan shot against the Obama administration, which had signed off on the loans. It was intended to preempt and disqualify federal support for manufacturing in the future.
There are at least two reasons. First, for the Tea Party and its financial backers, like the Koch brothers, weakening the federal government is ideologically more important than strengthening the national economy; if a unified, competitive national economy requires a strong, powerful federal government, the trade-off is not worth it to them. Second, the political leaders who shape federal economic policy are responsive to the sectors that have mastered lobbying -- oil, agribusiness, finance and drug companies. Manufacturing for decades has been left to take care of itself.
Commodity production no longer generates enough employment -- automation in agriculture and mining has gone too far. Wyoming produces 40 percent of the U.S.’s coal with about 7,000 miners. “Knowledge work” pays well, but draws on a narrow population: How many lawyers and bankers do we need? Facebook Inc. is a remarkable innovator, but it employs only about 3,000 people to serve a customer base of more than 800 million. Personal services, such as restaurants and retail, pay poorly and rely on income streams from other sectors to pay at all.
Henry Ford paid his workers $5 a day so they could afford to buy his cars. But they also patronized the grocers and carpenters of Detroit. We spent the last two decades paying our grocers and carpenters with cheap second mortgages -- a strategy bound to collapse.