Can the Midwest ward off a Rust Belt slump?

[pupp1]

Saturday, June 4, 2005



Can the Midwest ward off a Rust Belt slump?



By Dee-Ann Durbin / AP Auto Writer
DETROIT -- General Motors Corp. and Ford Motor Co., the nation's two biggest automakers, ordered fresh production cutbacks this week after they again lost business and valuable market share to Asian rivals in May. Some of their key suppliers have seen orders dwindle so much they've had to declare bankruptcy.

Add to that Friday's news of fewer jobs in the U.S. manufacturing sector as a whole, and it raises a disturbing question: Could the Midwest be falling back into the Rust Belt malaise of the early 1980s, when Michigan's unemployment rate topped 16 percent and GM, the world's largest automaker, saw its market share tumble nearly 10 percentage points?

"There's definitely a headwind for the Midwest economies," said Dana Johnson, chief economist at Comerica Inc., a Detroit-based bank. "Nationally, there's not a very steep or disturbing downshift in growth, but there's a very different situation here in the Midwest because of the Michigan-based automakers and suppliers."

A generation ago, it seemed like a weekly occurrence for a Midwest steel plant or aging manufacturing plant to close and thousands of union workers to end up on the unemployment rolls as companies shifted production to lower-cost plants overseas.

While that trend hasn't stopped, one big change now is that Asian auto manufacturers increasingly are opening assembly plants and adding jobs in the United States -- although few of the facilities are in Michigan or other states surrounding the Great Lakes. Hyundai Motor Co., for example, opened its first U.S. plant two weeks ago in Montgomery, Ala. Toyota Motor Corp., meanwhile, is building another plant, this one in San Antonio, to increase production of its pickups.
Full Article Here

[SPDKLZ]

Yet another gloom and doom for the Big Three domestics article...

[plane]

What will it take to stem the bleeding? Focus. Cooperation. Execution. The flexibility to consolidate and close down unproductive plants now. Compromise and innovative solutions for health care, restrictive work rules, and improving the bottom line number of hours per vehicle. Definitely vision and a little luck in seeing, knowing, and building the best future cars on the market. A visible, unblemished commitment to continuous qualty improvement. Genuinely teaming with suppliers. Eliminating debt or at least the willingness to incur further debt. Unshackling design teams to produce must-have cars. The ability to convince North American customers that we offer without exception the best products in the World.

[New_Mexico_Sunset_on_Rt66]

I am an active Republican and this is one of my passions. I am new to the mid-west, now living in Iowa, and maintaining an active, robust, US owned, manufacturing base in the USA, is one of my passions.

Several of my colleagues in the party shares my passions. This is probably the only area that I agreed with John Kerry on.

I think one of the best ways to maintain and stimulate an active robust, US owned, manufacturing sector is through de-regulation and aggressive tax cuts. Environmental laws passed in the 1970's and 1990's are crippling the manufacturing sector.

I think many mid-west companies are missing the boat. The mid-west offers something which big cities cannot, and that is quality of life. Life just moves slower in the mid-west, and traditional values are valued here. Mid-west companies should recruit workers from the big cities; Los Angeles, Chicago, Miama, Seattle, with the opportunity of less traffic jams, a better environment to raise kids and neighboors that you talk to.

There are many mid size cities in the mid-west which offer many of the benifits of large cities, but without the problems associated with them.

Urge your Congressman to pass "manufacturing friendly" legislation aimed at helping US owned businsess' to thrive in an increasingly competitive environment.

[Havasavana]

Originally Posted by New_Mexico_Sunset_on_Rt66

I think one of the best ways to maintain and stimulate an active robust, US owned, manufacturing sector is through de-regulation and aggressive tax cuts. Environmental laws passed in the 1970's and 1990's are crippling the manufacturing sector.

Ah, the mantra again. More tax cuts == more deficits == more problems for future generations, and even this one. Environmental laws were passed for good reasons. More air/water pollution == more respiratory, etc. diseases == greater cost spread through the society. Your republican buddies are driving this thing at present, and have been for several years now. How's it working? Stay tuned for more results. Even you might learn when it gets bad enough.

[nailhead425]

Originally Posted by Havasavana

Ah, the mantra again. More tax cuts == more deficits == more problems for future generations, and even this one. Environmental laws were passed for good reasons. More air/water pollution == more respiratory, etc. diseases == greater cost spread through the society. Your republican buddies are driving this thing at present, and have been for several years now. How's it working? Stay tuned for more results. Even you might learn when it gets bad enough.

Talking points with zero facts. The world is not a zero-sum game. Once you can understand this, you'll realize that taxes can be cut without sending our kids into the poor-house. Spend a little time in Iowa, then tell him he's wrong. Better yet, never, ever go to Iowa. Please.

[TiburonJT]

Originally Posted by Havasavana

Ah, the mantra again. More tax cuts == more deficits == more problems for future generations, and even this one. Environmental laws were passed for good reasons. More air/water pollution == more respiratory, etc. diseases == greater cost spread through the society. Your republican buddies are driving this thing at present, and have been for several years now. How's it working? Stay tuned for more results. Even you might learn when it gets bad enough.

Targeted tax cuts are helpful. The problem is that there are often loopholes or blanket tax cuts that are not the best idea in a time when budgets are tight and so many in politics have chosen to wildly spend our money. There are bad regulations, but it seems like more often than not good regulations are eliminated. Maybe that is only my perception, but that seems to be what I read about most. This is a doom and gloom article, but Michigan's economy has been hit hard.

[Havasavana]

Originally Posted by nailhead425

Talking points with zero facts. The world is not a zero-sum game. Once you can understand this, you'll realize that taxes can be cut without sending our kids into the poor-house. Spend a little time in Iowa, then tell him he's wrong. Better yet, never, ever go to Iowa. Please.

Well, I grew up in Indiana; is that close enough? And I've been through Iowa many times. Nice corn. I've also paid attention to how the tax system works, or rather the legislative process that creates the tax system. It's mostly about bribes. Changes to tax laws are considered constantly; repeat, constantly. Why? Because those with major interests in the outcome are eager to influence that outcome, and are therefore eager to funnel money to legislators in the form of campaign contributions, or more significantly, in the form of investment opportunities that will greatly enrich the legislators with minimal/no risk. Yes, targeted tax actions have potential for benefit, but it isn't potential that counts. It's what really happens. And what has happened is record deficits for all of us to the benefit of the most wealthy. They hit the target though.

[SSrevolution]

Originally Posted by TiburonJT

Targeted tax cuts are helpful. The problem is that there are often loopholes or blanket tax cuts that are not the best idea in a time when budgets are tight and so many in politics have chosen to wildly spend our money. There are bad regulations, but it seems like more often than not good regulations are eliminated. Maybe that is only my perception, but that seems to be what I read about most. This is a doom and gloom article, but Michigan's economy has been hit hard.

Tax cuts do work, and yes there are problems like loopholes, but, (I'm not directing this at tibJT) it always is like were having a conversation on something related to the economy, an dthen the liberals start spewing *****. I'm tired of having this forum turning into a political crossfire, but I will defend what I believe.

[nailhead425]

Originally Posted by Havasavana

Well, I grew up in Indiana; is that close enough?

Not really.

Originally Posted by Havasavana

I've also paid attention to how the tax system works,...And what has happened is record deficits for all of us to the benefit of the most wealthy.

Cut taxes, cut wasteful spending. Clinton didn't balance the budget, he used projections based on the huge amounts of capital gains and other taxes as a result of the tech-stock driven market run up, which also fueled the Social Security surplus, to justify a deficit free budget. They didn't cut spending, they just took a windfall and spread it around. When the market tanked, so did all the capital gains. As a result, tax payments decrease. By cutting taxes more money is available on a daily basis for buying cars, homes, and helping to fuel the economy. We had one of the fastest turn-arounds in market history, as a result of a tax cut. Don't like it fine, but it is simply economics and it works every time.

Back on track though, right-to-work states in the Midwest have the potential to be the new South. The lure of low cost of living cities and tax incentives from states with few manufacturing jobs left, will bring in the dollars. The infrastructure is great, there is ample affordable land, the labor pool is good, and when pay and quality of life issues are better, people will migrate. As the price of property, homes, and business costs increase in the west, opportunities to cut overhead will be favorable, and they will once again be favorable in the Midwest.