tv Making It CSPAN July 15, 2017 2:30pm-3:31pm EDT
pride that people are continuing to craft actual editing. >> bob weil, runs the liveright division of norton. it's 100 years old. these are the books coming out in the fall. >> thank you. [inaudible discussion] >> good evening, everybody. want to take a moment to find your seats. thank you for joining us on this incredibly beautiful, warm evening. my name is mark, the executive editor the new press. these are our offices. we are very happy to be here tonight. this is above all a celebration
of lou. he his wonderful new book "making it." i had the pleasure of working with lou over a number of years as his editor and it's been a great collaboration. i'd like to congratulate you on the publication. an exceptional response early on and this party is meant to anchor the launch to making it. [applause] >> i want to thank you, i'm not sure this into would have happened without you. >> oh, no. >> you're a good editor. >> thank you. >> so, lou, as many you know, has a distinguished pedigree and career in writing about america and economics. for 245 years he report on labor and economics for "the new york times." before that a foreign correspondent to the "associated press." his last book "the disposal
american," look into the kind of long-term aftereights of the destroyization, and this is something that -- deindustrialization, and this is something that was very much ahead of the curve. the new press prides itself on doing books that are ahead of the curve, whether it's the new jim crow or books on the current lists, but lou had -- i think we started working on this together six years ago and at that point we thought, interesting, a book on manufacturing. fascinating. we understood what lou was up to. but who could have foreseen the convergence of this topic with american politics in such an unexpected and not altogether pleasant way. but i think it does open up an opportunity to have a discussion like that's, and jeff, thank you so much for joining us tonight. and, everand lou have -- jeff
and lou have known each other for some time. >> a long time. >> a long time? you may know jeff as a frequent contributor to the new york review of books. has is senior fellow at thesen at the sentry foundation. >> an editor of -- >> i'm sorry. the editor. thank you. seven bad ideas, the subtitle of which i have not committed to memory but has to do with the damage that american -- have done inside the u.s. borders and beyond. none of those books were published by the new press but that's okay. there's still time. so we are very gratified to have these two gentlemen with us to talk about lou's book and also to talk about the subjects that unpin it, manufacturing in america and its broader meaning
for politics and society in the u.s. think we propose to have jeff and lou speak for a half our or so and then have a conversation, and at that opinion i'll open it up for questions and then we'll break and enjoy the terrace and the weather. thank you for coming. we appreciate such a wonderful turnout. >> mark, thank you. it's a pleasure for me to be here with my longtime friend, lou outcome tell uchitelle. he was written a lovely book about manufacturing. he touched to some degree about his own experiences growing up with manufacturing. his dad was involved in manufacturing. he thought of this as a manufacturing country. and that serves as backdrop for this book. only a backdrop.
he talks about manufacturing in the past, but he hopes to be talking about manufacturing in the future. it's acceptable as mark suggested to talk about manufacturing again. it hasn't been acceptable for a long time. in part that's because many mainstream economists have insisted we don't have to worry about manufacturing. many on -- or observe ifs that technology has led inevident my to more output and fewer jobs. we used to have more output and more jobs in another stage in our history. we're going to discuss all of that now, and i'm -- it's lou's book. i have some thoughts of my own on the surge of course, and -- only the subject, of course, but i'll let lou do much of the talking. i'm hard to shut up so i'll say something. lou, you have been really
discussing this in your work for "the new york times" for years. i don't know, 15-20 years, i think. my memory may be playing tricks. you're very close to the subject and donald trump won a stunning victory in large part because men who can no longer work in manufacturing are extremely disgruntled. their expectations have been dashed. they're angry and bitter and voted for trump out of bit areness, obviously everything is more complicated that are than that. they've been bittary long -- bitter for a long time. lou is prescient. why did you write this book? did i throw you curve ball? >> well, you gave me an opening to be modest.
i don't -- i've been covering dish covered economics for the "times" for many years and i found myself, whenever i could get an economics story that involved manufacturing or a manufacturer issue did that economic story. i found that to be quite fascinating. and over time, i began to realize that every place i win, every factory i went to eventually in a conversation with a ceo, there was a subsidy appeared and i don't say nat in any negative way. i finally came to the conclusion that manufacturing is a subsidized market activity, and i think until the soviet union collapsed, we were engaged in an idealal struggle that --
[cell phone ringing] >> that's one of the modern manufacturing -- that's not made in america, i don't think. >> i came to the conclusion -- i slowly realized, talking to manufacturers, that there was always a public subsidy involved, of one sort or another. you couldn't -- well, there's two -- if you talk about value -- let me just digress. if you talk about value added and manufacturing, you take a sheet of steel robert hundred and stamp it into a fender worth $120, that's $20 in value added. manufacturing in this country generates $2 trillion a year in value added. it happens to be that other sectors of the economy,
particularly finance, grow more quickly so manufacturing's share of the economic has dropped to about 12% from the nearly 30% that it was after world war -- in the early '50s. then we went through this long period of an ideological struggle with the soviet union. they were the ones subdiesing. they their the ones -- the government run economy. we were the capitalist economy. we couldn't really explore in our own country the real nature of manufacturing. after that ended, started to realize -- look, i would go to a place like revere copper in rome, new york, and i would it there with them and say, look, we use a lot of electricity in making copper rolls.
we can't afford that electricity unless we gate -- get a break so every year we go to new york state power authority and ask if we can buy the electricity at a discount remember that's my idea of a subsidy. there's also -- the word "subsidy" is not a good word. i'd rather use "public spending." $2 trillion of manufacturing value added, a huge share of it is weaponry, the defense department ordering weapons, and very often production for -- under "buy america" clauses, if you get stopped by a policeman and he gets a ticket, you mewing look at his car, probably made by a manufacturer in america. scarsdale are all fords where i live. i don't know what they are in new york.
so we have a situation where we are able now, at the end of the cold war, to examine this, to say what is the nature of manufacturing and what does -- how is it made up? well, public subsidies are everywhere. weaponry is a big part of it. that's the defense department's purchases of weapons. so you have a guy like trump, who is going to be very bell ledge rant -- belligerent and so forth and that's good for the weapons industry, and it's -- but it's not necessarily good -- let my digress -- for the factory workers. i think what dish -- factory employment and manufacturing was 19 million. the high point in 1979. it fell off a curve -- fell
almost precipitously after that, and it's now -- got down to around 10 million and now about 12 million people. if we increase factory output in this country there might be -- there would be an increase in employment but not to the extent that trump's followers are hoping, and many of trump's followers or the families aren't just unemployed. they're just earning less than they earned or the factories once paid. it was in the reporting in indiana once where i was with a man who had been a factory worker. he was working in a service sector job, his wife was working in a service sector job, and she turned to me -- we were driving, and she said, you know, my children are not going to live
as well as we lived. they can't earn enough in the service sector. salaries aren't high enough. manufacturing is potentially a high-wage thing because manufacturing value added manufacturing is usually greater than value edded in a lot of other industries. so, let me get back to trump for a second. he says i'm going to make america great again. what he really means i i'm going increase production of weaponry in this country. and perhaps -- he doesn't say how many people will be employedment won't be very much. followers of his are going to be disappointed. that's a big part of the current situation. there's something else that is very important here, and that is civil rights.
>> we should hold that for later. let me get back to the subsidy idea. i think that's an important issue. you're saying virtually all manufacturing is subsidized in america but you also say something that's very important, virtually all manufacturing is subsidized in the rest of the world. >> absolutely. that's a powerful point i think has to be -- you also said to me the other day, subsidies in america are basically chaotic. so why don't you address what you mean by that. >> the sub diz -- we do not have a national industrial poll si where we decide -- policy where we decide what manufacturers should be supported and where the effort should go. we have a world in which st. louis says to a factory owner, put your factory in my town rather than kansas city and we'll give you $100 million.
this goes up to $100 million. so, that doesn't -- that's a zero sum game for the nation as a whole, but it's -- st. louis comes out better off than kansas city. the other aspect of it, i found very disturbing, is that in this bidding war to get a factory to locate in one city rather than the other, a great effort to avoid cities that have unions or that a have strong unions that are likely to negotiate contracts -- labor contracts that raise wages or take advantage of the considerable value added that manufacturing makes possible. so that's another aspect which i find quite disturbingment disturbingment -- --ing. and then toes like st. louis and new york as well, the manufacturing that took place in
urban centers, near african-american neighborhoods or other minority neighborhoods, that was quite a bit. those factories, however, have -- st. louis has a general motors plant in north st. louis, a big employer. i said we're closing. we're going to move the factory operation only 80 miles to winceville, missouri. we will give -- we offer jobs in any of our factories to anyone who is -- who loses a job in the st. louis factory because of our move, and many people took that offer and relocated to other factories. however in north st. louis today, there is a younger generation growing up and that younger generation might -- leaving high school, might have
gone to work in a factory. it can't anymore. so we have a situation where, like ferguson, emerson electric made -- had factories in st. house and -- st. louis and ferguson. part of the tension, think, is that there just weren't well-paid unionized factory jobs for people in the st. louis area to go to. what bothers me is that -- i talked to a number of -- i went to st. louis to do the urban manufacturing because my brother happens to live in st. louis. my mother grew up in st. louis. my grandfather settled there in 1900. i won't get into his business. it's honest. and i could stay with him while i did the reporting. it was there that i came into contact with african-american
civil rights leaders who said, look, these factories are leaving town, the shoe factories are all gone and there isn't the work -- there isn't work for the people they leave behind, and that is -- and yet these factories are being subsidized to move and they're leaving behind a succeeding generation of people who can't get that work, the sort of work that high school educated people once could get and could earn well. asked -- there was a guy named dr. donald, a dentist that publishes the african-american weekly newspaper. he himself says his family leveraged itself because his father had worked in a factory in the area for many years and had done well, but i said, why
aren't there movements in the streets? he said, well, we just don't have the civil rights leaders that we once had or we can't seem to associate civil rights with the migration of factories out of the city. and i think that you can apply that to new york as well. trump comes along and he says to the people -- well, he probably doesn't care about whether the factories are downtown or not. he's more worried about the white people or the caucasians that don't have the factory jobs. the african-american, on the other hand, are losing the opportunity to have manufacturing and well-paying jobs right in the city. i better stop there for a second. >> one of the things -- tell me if i got this wrong, just going back to subsidies. one of the things i think
discovered in your reporting or people were telling you, they didn't necessarily offshore to china or move factories to china and so forth. for -- in order to save the labor costs. they the moved for the subsidization there. >> i'll get to that. china is a big subsidizer of manufacturing, which is fine. general motors, for example, makes 2 million cars a year in china, which it sells within china. what should be going on when obama and now trump meet with the chinese, they should be banging their fist -- not banging therapists. they should be negotiating that a million of those cars are made here in the united states and exported to china, and that would of course -- that's a very hard negotiation, and -- but it
is a direction that we should be going. right now manufacturing, when you think about value added is only 12% of the american economy. after the -- in the 1950s it was 28% and it's been a steady decline after other individual, i.e. service industries and the financial sector in particular, grew as a share of the economy, manufacturing dropped shares. i even have a chart shot shows this. jeff told me not to show charts. this is private -- the blue line is private goods producing. the yellow line is the service sector, and the gray line, which is once way below manufacturing, has now passed it.
and that's finance. that's real estate, brokerages. those lines should be reversed. the government should do it. there should -- it shouldn't be done by getting kansas city to pay a factory more to locate in kansas city rather than st. louis should be done with a national industrial policy that distributes the subsidies in some coherent way. i'm afraid -- well,'ll stop there. >> let me -- i'd love to get to that because we need to get to your proposals for restoring at least some manufacturing. let in go back to the civil rights issue. especially urban blacks, lost the possibility to get decent jobs with only a high school education. what trump's elect made very clear is that whites also lost. we have known this in the data,
been talking about. whites also lost the opportunity to get good jobs with pensions that were sustainable and permanent for the same reason, and they were -- and they're angry as heck. >> yes. >> so, i think one of the big great error -- i'm surely among the last to note this -- one of the errors of the clinton campaign was not to recognize the white component of this decline, and address the needs of the white people in the rust belt. as a important who is writing about child poverty, i write about blacks in city but talk about white loss of jobs. >> well, i didn't understand myself in the year is traveled a lot in the midwest -- i don't know why i traveled toso much in the midwest. always found excuses to go to the midwest to do whatever
economic story i was doing, but i kept running across -- i would go always to the union -- let me put it this way. every time i visited a factory, within a mile was the local union headquarters, and the factory workers at the end of the shift would come into the union headquarters to have -- to talk, there was actually beer there and a lot of conversation, and the unions played a role in representing them, but as the factories dis -- as the unions weakened and membership and as the factories disappeared, all rust also disappeared. where aim going with that? i think the union membership has plummeted. i think we need -- in order to
have resurgence in manufacturing in this country we really need a resurgence in union membership, because the two go together. in the negotiating of subsidies for manufacturing manufacturings should be involved in that. >> what do we do? what are you proposals about restoring manufacturing? i know you're talking bat national industrial policy. you have been -- you write about having actual goals to increase manufacturing share. i think getting back to your civil rights issue, i do find this fascinating, though. regret the left wing of america seems to have ignored what seemed to them the right wing whites who are suffering. in economics generally there is a -- i would call it something
of prejudice, but a skepticism that subdiesing manufacturing made sense because it's an inefficient ways to deal with the economy. better ways to deal with it. let it decline and let other individual take their place. when you have the civil rights individual, as lou brings up quite successly, you're talking bat negative externality to manufacturing. you're creating poverty which in turn in william wilson's terms, leads to an isolation, not a culture of poverty, an idea that i'm particularly -- i particularly dislike -- but a concentration of poverty that leads to social isolation, which reinforces the so-called pathologies of the inare city. so why not invest, even if it's ineffecter in manufacturing --
inefficient -- in manufacturing, to prevent that from happening because it festers. >> the investment has been so localized it's counterproductive. it doesn't increase manufacturing to spend hundred million or give a factory $100 million to come to one town rather than another. the national policy should set goals. the six -- the subsidies should come from the federal government. they should have some job goals involved. there should be unionization. the afl-cio unions should represent factory workers. there should be a public discussion of how much -- what is going to happen if we don't bring back manufacturing. i think of it this way. we can live through it in our generation and our children can probably live through it, and i'm not sure about my granddaughter, who is here.
but we are going to get to the point where, right now, we buy stuff from china, we pay china in dollars, china takes the dollars and invests them in treasuries, u.s. treasuries and securities, and we then take the dollars they invest and good back and buy stuff from china. at some point -- i'm using china -- asia -- at some point there's going to be -- the chinese are going to say, no. there's going to be a shift from the dollar as the international currency to something else as the international currency, and that of course happened between the world war i and world war ii, with the pound, the british pound, and the u.s. dollar. when that shift takes place, we -- what are we going to do?
it's higher is-- in asia, north of 30%. if i were a candidate, i would propose doing that. i would say-- i would pass a law saying no more competing one city against another. all subsidies have to be channeled through a federal agency, which decides who gets what and if the goal of increasing manufacturing as a share of the economy back up to 19 or 20%. i would leave out the jobs part of it. i would have to say that manufacturing employment got to
19 million in 1979. that was the high point in the post-world war ii period and then dropped to about 10 million and has come back up now to about 12 million and you hear the candidates talking about raising employment of manufacturing from its present level without mentioning how high it once had been. i would not try to force employment into manufacturing, but what i would do and i'm afraid trump mentioned it-- i certainly did not vote for him and i don't think he can bring it off, but the best way to raise employments is through public works, i mean, we should build high-speed railroad between new york and san francisco. about employment intensive. trump said things vaguely about that.
he certainly is a rushing to do that. he's cutting taxes for people instead of raising them. we should have a more progressive income tax and he's very vague about what he's going to do as far as public works are concerned yet he won, i think, on that score. he held out the promise particularly to non-hispanics of getting them work. one in manufacturing and also in a nonexistence public works projects that he talked about. you don't hear him talk much about those projects, so that would be a source of employment? host: let me ask you about a major concern of the people, if we subsidize more want there be retaliation by the nations, a trade war that could-- guest: if we decide we have to
gm-- we forced gm to make a million of those cars here and a ship them to china instead of making 2 million cars in china, that's the beginnings of a trade war. i think there has to be a recognition and there has to be a negotiation. the larger problem is that we have the capacity to make much more contractors around the world than the buying public, if you will, has to purchase these things and perhaps we have to subsidize purchasing. host: you talk a bit about skills. is the decline in manufacturing left us without the skills? guest: i'm skeptical about the skills business and i say so in chapter two. i think almost any skill can be taught to someone
with a high school education and there was a time when that is the way it was, i mean, my father got out of high school and he became a broker, textile broker moving fabric 11 factory to another other people, i think-- when i go to a factory and talk about a skills shortage i often get people in the factory supervisors rolling their eyes. i have yet to find a factory that shut a shift because of lack of skilled workers. they find ways to train them. people get trained on the job or they get trained in junior-college courses. there are ways to train untrained workers. >> we are particularly bad at apprenticeship programs here.
germany is particularly good at it and they are manufacturing dynamo, though i think they use their own federal policies to suppress wages, but don't you think apprenticeships would help in america. >> apprenticeships would be wonderful and over the year there were more of those programs 20 years ago they had there are today. there are now attempts at apprenticeship programs. in fort wayne indiana, for example they took all the vocational high schools, which were in a sense apprenticeship programs have closed across the country, but in some cities, cincinnati for example, the indianapolis area, they have sort of combined high schools, especially vocational training with enough
work so that when you finish the high school if you want to order college you can do so, but-- and these particular vocational high schools are sort of central schools. people are bused in. they are supported by six or seven school districts and children are bused in from these different districts that are to the ones that will go get this vocational training, some of those people who get the vocational training also gone to college, but the majority don't and these are very well-equipped schools. this one has an airplane in it that you dismantle and put back together and cars and all sorts of equipment that is rather expensive. when i went to high school, we had shop class and women had homer-- home economics. i learned to print, i mean, i would had to print the declaration of independence because it
didn't seem to recognize line types, but you got the idea working with your hands. .-dot sort of thing has disappeared from high schools all over the country. >> manufacturing jobs have come back in the last couple of years to some degree. >> very slightly. they are back a little bit, i mean, politicians talk about manufacturing jobs. there up, 500,000. obama promised to raise them i think 500,000 or maybe a million. i have forgotten, but they are coming back from a very low level. that 19 million-- and it's a low level for something that could-- that has the value added , the ability to generate a lot of income. >> what do you see as the future, then, for this nation this economy? do you think there's any chance the government would do what you would like it to do, have a
vigorous manufacturing subsidization policy or is this futile? >> well, i think trump is too crazy or too dangerous. he's a star, a bad start the next president should say we do need more factory jobs. it is true and mean if you look at some of the numbers, african-americans are not paid as well as caucasians are, if you will. but, the rate of increase in wages for african americans has been than it has been for vocations, white people, working people. i think we have to have a policy that slowly trains people. i think we have to use national industrial policy to raise factory
production to 18 or 19% from the present 12%. we should go back to shipbuilding, for example. we make on of the container ships. we once did. we make warships, but we don't make civilian cargo ships of any nature in this country. the last one closed in new orleans. i think we have to slowly through apprenticeship programs and through the next presidential candidate has to say my goal will be to raise manufacturing measured in value added to my 50% of gdp from the present 12 or 18% of gdp from the present 12 and that's where it is in most countries. we will object to the wasting of a public money and getting a factory to locate-- relocate from one city
to the other in this the bidding process. we were forced-- we will channel money into raising national output. trump didn't have the sense to do it. i don't-- bernie sanders, i think, might have, but he didn't. personally would have voted for sanders. i voted reluctantly for hillary clinton. i think she more or less has some of this in mind, but did not get far with it. i would like to say chump like person from the left get up and say here's my goal and here's how i will use public money to do this and i want to just do it with weaponry, which we do make plenty of in our factories, i mean, he almost is under pressure to start a war to make use of the weapons he's making. doesn't make sense-- i don't see mark kirk oh,
here he is. looking for a time-- i think one of the things you are saying is there are subsidy wars as opposed to-- and they are warm of trade wars. >> and we should recognize those. >> and we should fight to them better, so that to me would be a provocative proposal that i draw from your book. clipping lead that. >> we should be making, again? >> to gm. it's a company we bailed out and it should be making a million of those 2 million cars that it makes in china should be made here and chipped to china and how to do that? well, barack obama, trump, trump's successor, has to sit down at and negotiate that deal and there will be compromises.
maybe it will be 500,000 and cars that gm will be required to ship from here. that's the way we would go. slowly build up-- we should use the numbers. slowly build up manufacturing to 17 or 18% of gdp using those numbers, nevermind that 31% or 30% or more in places like china and south korea. >> wto is supposed to end the subsidy war. i don't think they have. some people think it's actually operated mostly in favor of america, but i think and i borrow from people like danny here, an economist who writes interestingly about this stuff. we need a looser arrangement to allow subsidies in the nations to promote certain kinds of manufacturing that
they couldn't otherwise do and we had a looser arrangement, ironically, under britain-- >> the wto in some magic way says we don't recognize-- we don't recognize subsidies, that they are outlawed in free trade. well, they are not outlawed. and they are all over the place and somehow the world trade organization doesn't see them, so it would be helpful if the world trade organization said manufacturing runs on subsidies and public money i.e. defense spending and let's recognize that and let's start giving who gives what and it will be-- you might get a war out of that, i mean, i don't know quite how we solve
this problem, but we don't even face it right now. >> let me sum up by thanking you for writing what i think is a lovely discourse that i'm glad will make it into the public conversation. it's from the heart. one of those things people don't do very often anymore. he actually talks to factory workers and factory managers and factory owners and it gives us a perspective we rarely get nothing generally i hope this will influence the nation in the right direction, so thank you. congratulations. [applause]. >> thank you. >> we have time for a couple of questions. >> under any national concern with the loss of manufacturing--
[inaudible question] >> we somehow managed to continue to make weapons that becomes a bigger and bigger share of what we manufacture, so so far that has not been problem. it's a problem in the sense that trump-- i'm making this up and says look at these factories making weapons. i had to do something with them and he does. >> there could be supply chain problems and may not be able to get the parts we need for weapons, so i think that becomes a serious-- could become a serious national security risk. >> that's a very big thing is we are importing-- we think we make a ford, but in fact it has 20% imported parts and that's a big deal.
that just didn't exist in world war ii, so maybe it makes it complicated to fight a war because we can't make the weapons without importing the parts and the other guys can't make their weapons without importing parts from us, so we are all stymied. [inaudible question] [inaudible question] >> what are the politics this program you-- the national association of manufacturers, willie likely be open to it? could it be pro-business? obviously if you have
labor standards added to it that's harder, but anyways those are two separate questions. >> i hope i-- in one chapter with the description of a convention which they talk about what great people they are and how they think things up and then at the end of the speech this convention is taking place in washington and they all get on buses and go up to visit the congressman on capitol hill and the buses make two or three or four trips, so-- repeat your question. i'm going off on a tangent. [inaudible question] >> do you think in that and they would likely be supportive of it? >> well, there's another problem. they solved a lot of its problems by creating
multinationals. when i started covering the meetings i used to go to the board meetings and they had most of the production here. and then the multinationals became the dominant force in their and became harder for journalists to go to the meetings and they started putting more and more factories overseas rather than producing hair, so you have a situation where two thirds of this factory output in this country comes out of multinationals-- factories owned by multinationals and yet they are the ones that are also operating overseas, so you really have to, i mean, i will take another example. along the mexican border within a morning strive there is like eight auto assembly plants in mexico.
they are not there for the cheaper labor. although, that helps. what are the reasons they are there is that mexico has free trade agreements enabling them to ship stuff without tariffs to 50 countries. we can only ship them to 20. well, nafta-- they also ship cars north from those factories to this country, so trump is not wrong to want to get rid of nafta. hillary clinton wanted to get rid of nafta and then she didn't and bernie sanders was not really strong enough. i think we have to get rid of nafta and get rid of the free trade agreements. we have to say to those multinationals, you have to make more stuff here. dow chemical over the years got to know andrew who was-- when obama was in office he was on
obama's manufacturing counsel. now i see he is on trump's manufacturing and with good reason. he said to me, look we make in america what we sell america and he said this when i visited him in michigan and they were building a chemical plant with government money and we make in china what we sell in china and we are just not going to export it must have to. well, he shouldn't be allowed to do that. he should make in america more of what he sells in china. he shouldn't have in china 13 factories, which is what dow chemical has research center. does that answer your question? so, they are stuck in the middle of these guys and its dominance of members are dow chemical and ge and all of these others and it's shifted with them.
it's free trade agreement. it never raises the issue of how much manufacturing should be done america. it used to, but it never does a more. >> they are also not favorable to unions. >> that also, yeah. >> i want to point out that the polling for the election was pulling the wrong people up until the last minute hillary clinton was winning. they didn't pull the tens of millions of working people who were worse off than they were 10 years ago, 20 years ago or that their parents were. that was the people they should have pulled because those are the people that voted for tromp. you want to increase the percentage of manufacturing or amount
in the us. what will that accomplish? there's a manufacturing of more and more production with fewer and fewer workers. you can't reverse that. back in 1931, in the middle of the depression came in article-- i know you know. [laughter] >> saying-- [inaudible] >> 15 hour workweek unit in the middle of the depression he saw that, but aristocratic preferences and he wondered what the working class would do
with the rest of their time, not realizing they could be educated and appreciate all of the cultural and wonderful sports and so forth in life. is your point of view at all reflect what he thought in the middle of the depression, 1931, the prospect of how much employment manufacturing can result in and if it doesn't become more and more automated than it won't result in a lot more and there's also fair trade, specialization in one area of the world and specialization in something else. isn't that part of the international picture? >> yes, look,
manufacturing is just not going to solve the jobs problem. if less and less need for people in manufacturing. i don't want to over emphasize this, but the jobs solution has to be another part of the new deal, which is construction of public works, which is much more employment intensive than manufacturing. if we are trying to justify more manufacturing in america on the grounds of more employment we should drop that and think in terms of a much longer time which is the study -- the trade deficit which is chipping away steadily over a generation or two at the value of the dollar and will cost us the ability to be able to import as much as we do. >> during the depression in there after until maybe the late 1970s
the government policy was very favorable to unionization and unions ran around 32% and they gained. union members by-- what should i say, other areas of the economy in order to keep the unions out to raise wages all over the country. that came to an end about 1967 and decisively at the end when ronald reagan, when the air flights-- >> air-traffic controllers. >> went on strike, he fired them. that gave clear tolerance to firing-- >> let me flesh out a couple quick things.
one, manufacturing probably has a bigger multiplier than other kinds of industries that affects more industries and creates more demand for business services. it's been documented, it can be disputed, but it's been documented here that's number one. number two it's hard for me-- there is a chicken and egg question. the unions start to lose their power because manufacturing and big companies because of the competition from japan and so forth began to lose their dominance. so, i think that was part of it. i think the legal battles by ronald reagan was part of it, but i think there is still a case to be made that manufacturing has been too little-- too much and gored by the government. i think training has been too much ignored by the government, so just
wanted to add that. i would add it's been too much ignored by the unions. unions are very heavily service oriented or teacher unions. those are the ones that have survived and we haven't done anything about that. [inaudible question] >> a lot of communities will one those jobs, so how will we decide how we told them out. are there any prospects of raising wages in the service sector? >> well, if we have a national industrial policy that would be an endless political discussion of who gets factories, where they go and then there will be that question of the service sector. they should be represented also, but for a different reason,
but the national industrial policy first has to be-- that has to be set first. that has to be the first order of business, i think. that should be the pacesetter in salaries even for the service sector, i mean, that's just sort of a simple answer to it. maybe you want to add something. [inaudible question] >> places where trump one, not in the cities, but the places he won, smaller towns, one in for private sector jobs right now is a manufacturing job, so preserving manufacturing is still much about jobs in parts of the country that we don't always spend a lot of time in. one more question. the idea of manufacturing role in innovation. i think our problem is
not that it's productive, but that productivity has lagged the nation because companies are not vesting and manufacturers tend to best more new technology >> it used to be a rule that you put a factory near the research center and you invented continued across the street to the factory and tried it out and then he went back to the research center. that still exist to some extent, but it's a dying idea. >> i want to thank you. most importantly, we have books there if you like to take a copy and thanks to you all. [applause].
>> book tv is on twitter and facebook and we want to hear from you. tweet us, twitter.com. /book tv or post a comment on her facebook page, facebook.com. /book tv. >> good afternoon and welcome to princeton university. i have the honor to be the director of the james madison program in american ideals and institutions are present , the sponsor of this afternoon's event. i'm delighted to welcome you to princeton. we have not only students and members of our faculty here, but gas from the community and as far away as new