Donate Bitcoin

Donate Paypal


PeakOil is You

PeakOil is You

Manufacturing and Agriculture Developing Parallel Outcomes

Discussions about the economic and financial ramifications of PEAK OIL

Manufacturing and Agriculture Developing Parallel Outcomes

Unread postby MD » Mon 20 Nov 2006, 11:19:07

Since the 1950's, growing suburbia has displaced many square miles of farmland.

It has been repeatedly observed that in any given farming region, when a certain percentage of farmland is taken out of production, the agricultural support economy begins to degrade. Farm suppliers begin to pull out as sales drop leaving the remaining farmers with no choice but to travel further for supplies. Eventually economic pressures drive the remaining farmers out of business, and agriculture collapses in that market.

The same effect is occuring on a larger scale today. The American Mass Manufacturing asset base is slowly being sold to China. As a result, we are starting to see new gaps in the supply chains.

The progression neatly follows what has been observed in agriculture. New pressures are building against the remaining manufacturers, simply due to the loss of scale. Suppliers and supplies are dropping from the availability list. If left unchecked, the trend will end with the general demise of American Mass Manufacturing.
Last edited by MD on Tue 21 Nov 2006, 05:02:26, edited 1 time in total.
Stop filling dumpsters, as much as you possibly can, and everything will get better.

Just think it through.
It's not hard to do.
User avatar
MD
COB
COB
 
Posts: 4953
Joined: Mon 02 May 2005, 03:00:00
Location: On the ball

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby ohanian » Tue 21 Nov 2006, 00:01:35

History of manufacturing by Major Veech

https://acc.dau.mil/GetAttachment.aspx? ... e&aid=2449
User avatar
ohanian
Heavy Crude
Heavy Crude
 
Posts: 1553
Joined: Sun 17 Oct 2004, 03:00:00

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MD » Tue 21 Nov 2006, 05:00:05

$this->bbcode_second_pass_quote('ohanian', 'H')istory of manufacturing by Major Veech

https://acc.dau.mil/GetAttachment.aspx? ... e&aid=2449


That's a decent 31 page primer, worth a read for those interested in a quick study of manufacturing history and current philosophy.

Focus on the "lean" principles. Those are the engines that have driven productivity gains since 1980. These systems(under various names and forms), combined with advances in automation, are what allow short and medium production runs to remain competitive against high volume manufactured goods.

The idea is that if I can provide you with the three widgets you need, custom build them for you today, ship them overnight to you tomorrow, while maintaining the highest of quality, you will accept my higher price as worthy.

The results of this practice have been remarkable. There are thriving manufacturers all over the US that have transformed themselves into lean, state of the art, custom manufacturing operations delivering low and medium production runs to the marketplace.

The Toffler's, in their "Third Wave" book, make analogy between warfare methods and manufacturing.

Simply put, WW 2 was "mass manufactured" warfare, the Gulf War was "lean manufactured" warfare. One carpet bombs an area, the other drops a precision missile though a vent hole.

They conclude that if superior and efficient system rules in warfare, the superior and efficient manufacturing system will rule also.

Apparently many of those in positions of power in the military and government bought into this deeply flawed analogy, because it was right around the publication of that book that we began to abandon mass manufacturing to Asia.

The unforseen negative effects of this policy are starting to reveal themselves as pressures on the system.

The worst potential negative effect remains completely hidden from view, and will only reveal itself if and when the global trade system falters.

This continent is now unable to manufacture many of the basic needs of life in meaningful quantities. Should the container ships stop, we will find ourselves in very deep trouble, very fast.
Stop filling dumpsters, as much as you possibly can, and everything will get better.

Just think it through.
It's not hard to do.
User avatar
MD
COB
COB
 
Posts: 4953
Joined: Mon 02 May 2005, 03:00:00
Location: On the ball

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MrBill » Tue 21 Nov 2006, 11:46:50

Okay, fair enough, but there is no reason for the container ship or railway to fail? They are both extremely efficient at moving the most tonnes over the most miles for the lowest cost per tonne. I never met a manufacturer yet that did not want to sell their goods. Why would that change?

Secondly, even in the mountain passes of Nepal necessities like beer come through at a reasonable cost. Why? Because someone's livelihood depends on selling to the buyer including delivery. I ate five course meals at 12.000+ feet, but suffered from lack of hot showers because shrimp are easier to transport than firewood and hydro-electric was not available. Shortages depend on what you're trying to transport over what distances and with which obstacles.

Total societal collapse? Okay, maybe, but how is overland within the Continental USA any different than via container or rail? Same logistics basically. It is supply chain management and how much inventory is held on hand to meet local demand. The more uncertain the logistics the more inventory that is needed.

Lean military like lean JIT manufacturing are not the samething because winning a war is not the same as enforcing the peace. The latter requires more committed boots on the ground as well as popular support. Air strikes are obviously pretty effective if you are willing to 'live' with collateral damage. However, human shields and asymmetrical warfare have changed the rules of engagement. Especially if you're living in a country where it is not fashionable to wage wars in the first place. To compare it with manufacturing is silly.

Agriculture also does not collapse because of urban sprawl onto farmland. Urban sprawl takes productive farmland out of production, pushing agriculture onto less productive land in some cases. Rural communities disappear because commerce leaves the small town in favor or larger centers with more choice and lower prices not because agriculture in the area has disappeared. This is simply the flipside of long commutes from suburbia to work in city centers. Local farmers have abandoned local communities to drive farther to either have better selection in the city or lower prices or both. Plus shopping in the city is a form of entertainment. It has nothing to do with urban sprawl lowering the critical mass. But it is a real problem to be sure.

If suppliers are disappearing it is because comparable goods priced for less are available somewhere else. Same for manufacturing, same for agriculture. Obviously, large firms will try to pressure their suppliers for greater and greater concessions until one by one they drop off unable to compete for one reason or another. Then the large firm will be forced to source farther and farther away, until their own competitive position is also eroded. By Chinese parts suppliers for example that move from supplier to manufacturer. Also a real problem to be sure.

For the record, I am against urban sprawl and taking productive land out of production. I just took exception to the notion that this was causing small rural towns and their agricultural suppliers to fold due to lack of demand. Mostly the demand left before the supplier folded. Blame that on the the farmer though.
The organized state is a wonderful invention whereby everyone can live at someone else's expense.
User avatar
MrBill
Expert
Expert
 
Posts: 5630
Joined: Thu 15 Sep 2005, 03:00:00
Location: Eurasia

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MrBill » Tue 21 Nov 2006, 11:48:23

$this->bbcode_second_pass_quote('', 'T')his continent is now unable to manufacture many of the basic needs of life in meaningful quantities. Should the container ships stop, we will find ourselves in very deep trouble, very fast.

Plus much of what is imported, like cheap electronics, can hardly be described as basic needs of life?
The organized state is a wonderful invention whereby everyone can live at someone else's expense.
User avatar
MrBill
Expert
Expert
 
Posts: 5630
Joined: Thu 15 Sep 2005, 03:00:00
Location: Eurasia

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby Doly » Tue 21 Nov 2006, 11:52:19

$this->bbcode_second_pass_quote('MrBill', 'P')lus much of what is imported, like cheap electronics, can hardly be described as basic needs of life?


Depends on what kind of cheap electronics you are talking about. I consider cheap watches pretty much a basic necessity nowadays.
User avatar
Doly
Expert
Expert
 
Posts: 4370
Joined: Fri 03 Dec 2004, 04:00:00

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MrBill » Tue 21 Nov 2006, 12:01:01

$this->bbcode_second_pass_quote('Doly', '')$this->bbcode_second_pass_quote('MrBill', 'P')lus much of what is imported, like cheap electronics, can hardly be described as basic needs of life?


Depends on what kind of cheap electronics you are talking about. I consider cheap watches pretty much a basic necessity nowadays.


And you would find yourself in very deep trouble, very fast, if the container ships stopped?

I doubt it? More likely you would either make do with what you have? Find alternatives? Or the market would make sure you had a replacement at a price you could afford?

Twenty plus years ago my mother as a teacher spent $100+ on a LED calcuator the size of a brick. Now they are given away for next to free, are more complicated, powerful, and are simply imbedded in other applications like spreadsheets and mobile phones.

Watches are no different. Fashion aside a reliable watch can be had for $1 in some cases. Hardly life and death. Plus again, why would the supplier stop selling? Why would the transport company stop shipping?

I would be more worried about your vegetables arriving from Spain than cheap electronics from Asia.
Last edited by MrBill on Tue 21 Nov 2006, 12:03:00, edited 1 time in total.
The organized state is a wonderful invention whereby everyone can live at someone else's expense.
User avatar
MrBill
Expert
Expert
 
Posts: 5630
Joined: Thu 15 Sep 2005, 03:00:00
Location: Eurasia
Top

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MD » Tue 21 Nov 2006, 12:02:30

$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('', 'T')his continent is now unable to manufacture many of the basic needs of life in meaningful quantities. Should the container ships stop, we will find ourselves in very deep trouble, very fast.

Plus much of what is imported, like cheap electronics, can hardly be described as basic needs of life?




Do you really think I was refering to cheap electronics as a basic need of life?
Stop filling dumpsters, as much as you possibly can, and everything will get better.

Just think it through.
It's not hard to do.
User avatar
MD
COB
COB
 
Posts: 4953
Joined: Mon 02 May 2005, 03:00:00
Location: On the ball
Top

Re: Manufacturing and Agriculture Developing Parallel Outco

Unread postby MrBill » Tue 21 Nov 2006, 12:10:56

$this->bbcode_second_pass_quote('MD', '')$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('', 'T')his continent is now unable to manufacture many of the basic needs of life in meaningful quantities. Should the container ships stop, we will find ourselves in very deep trouble, very fast.

Plus much of what is imported, like cheap electronics, can hardly be described as basic needs of life?




Do you really think I was refering to cheap electronics as a basic need of life?


Sorry, I am just back from the developing world and am re-energized like a Missionary!

Okay, what basic needs of life are you referring to then?

Food, water and shelter? If you're American, none of those need be imported except for the sake of variety as the US is a net exporter of food. Water? Well, you can always invade Canada and divert their fresh water to re-fill your depleted aquifiers. Shelter? Pretty much a locally assemble product. Plus all those McMansions could be sub-divided a la Victorian England into multi-family homes.

Clothing? Most of us possess twenty year's supply in our closets at home in any case. Fashion be damned. Does it really matter if it comes from China, Bangledesh, Vietnam or any other developing country with a surplus of labor to produce it cheap? I can buy North Fakes outwear in Asia for the cost of the sales tax at North Face's outlet on Michigan Avenue. Cost of production bears no resemblance to final price when it comes to fashion and brand names.
The organized state is a wonderful invention whereby everyone can live at someone else's expense.
User avatar
MrBill
Expert
Expert
 
Posts: 5630
Joined: Thu 15 Sep 2005, 03:00:00
Location: Eurasia
Top


Return to Economics & Finance

Who is online

Users browsing this forum: No registered users and 1 guest

cron