Tuesday, May 11, 2010

Made In America ...

...or Why I Hate Wall Street Banksters.

This past weekend, the Los Angeles Times gave us the perfect example of why employment numbers are still down which is why economic recovery for most of us is still so far down the road as to be invisible.

...what makes [Yet-Ming] Chiang's ordinary-looking beige Toyota Prius even more special is that it's powered by a breakthrough battery that he invented and is working to turn into the kind of high-tech, green, "Made in America" product that many see as the key to the nation's economic future.

Safer and longer-lasting than conventional lithium-ion car batteries, the 52-year old MIT professor's invention packs 600 cells into a case the size of an airplane carry-on bag. His technology has transformed the batteries used in many cordless power tools.

So impressive was Mr. Chiang's invention that he received funding from the government to go into production here. Unfortunately, that seed money wasn't enough. Conventional investors on Wall Street weren't interested in building US plants to manufacture the new batteries to be used in cars as a replacement for gasoline.

The obstacles here are rooted in the sad history of manufacturing's decline in the United States: Despite the promise of Chiang's batteries, many on Wall Street and in Silicon Valley were incredulous when he and other leaders at A123 asked for capital to build factories in America — Asia, yes, but Michigan, why would you want to?

Even more daunting, nearly all of the world's battery manufacturing industry is in Asia, where plants can be built faster and supplies and equipment are much easier to get than in the United States. These days, it's hard to find Americans who even know how to build a battery factory.

That's why A123 had to give in and build its first plants in China, where the company could move into production quickly to show auto industry customers that it could deliver on future contracts.

The brilliant thinking of our owners was that it cost too much to build such a plant to manufacture the product here, where it would be used. Labor is much cheaper in China where wages are kept low to keep workers at poverty levels where they would be much less likely to be brazen enough to insist on safe working conditions. China also doesn't have those pesky regulations regarding hazardous waste disposal and other environmental protection requirements.

So Mr. Chiang had to build his first factory in China, where his ground breaking invention was quickly copied and produced by competitors, because China doesn't enforce intellectual property rights, especially those from other nations.

Mr. Chiang, a Chinese immigrant and naturalized citizen, however, refuses to be stopped. He's building his US plant and placing it in Michigan where there are plenty of people familiar with manufacturing in the auto industry, most of whom are currently unemployed. He's doing it for several reasons, some of which Wall Street couldn't possibly understand. He feels it's the right thing to do for his country and his fellow citizens. He can justify it to the money men by pointing out that shipping costs for his new batteries to the place where it will be used demand such a plant.

"Without question, we would rather have done it all in the U.S.," said Chiang, who left Taiwan as a 6-year-old with his family, earned degrees at MIT and has been a materials science professor there since the mid-1980s. "I'm an American citizen. We're an American company. It's an American-born technology."

Good on you, Mr. Chiang, and welcome to America. We need some in-sourcing.

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Anonymous xan said...

In-sourcing got me the job I'm halfway through training for, which quite literally saved my life after a year of unemployment and increasing desperation. Turns out enough people didn't like talking to "Susan" and "Bobby" who spoke with Bangalore accents about their cellphone service that companies have started to bring the work back here.

Of course they use work-at-home people, who don't have to be paid much more than minimum wage, and never see each other so are a bit hard for union organizers to find. But we are all Chinese peasants these days and take what we can get and say "thank you master".

5:57 AM  
Anonymous Jamie said...

Hangings too good for them.

8:40 PM  
Anonymous Anonymous said...

"So Mr. Chiang had to build his first factory in China, where his ground breaking invention was quickly copied and produced by competitors, because China doesn't enforce intellectual property rights, especially those from other nations."

It's interesting that profit is more important to you than saving the earth. I think it's great that others in China were able to copy his invention, and get it out to the people. Being unable to do this kind of thing is exactly what has destroyed American manufacturing and is destroying the planet. If there was some evidence that copyright and patent laws helped promote the development of new technology that would be different. But the reality is that they do the opposite: they allow those who control old technology, such as fossil fuel burning vehicles, to use the law to prevent progress. We must fight this kind of obsolete thinking, and stop letting the lawyers destroy the planet.

12:21 PM  
Anonymous Anonymous said...

Are you on crack? China didn't copy new tech for the people; one branch of the Chi-Com Army stole one more thing to make profit to lowball business their way, one more time.

Earth-saving tech means squat to a country that doesn't care about saving its own workers' health -- they'd poison them and starve them and cheat them out of wages before they even give them enough of a paycheck to even afford a car using better tech.

Trial and regulatory lawyers helped America turn back from the brink ecologically, back when the water and air were a deep brown. Now the lack of them are turning China and India into sewers.

Don't green-top your way into this conversation just to back the corporations -- and if you want to know who broke IP law in the first place, ask those corporations you love so much -- they love free things to steal, and expensive lawsuits, to keep those stolen ideas in their clutches. Sheesh.

1:35 PM  

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