Politicians Have A Hard Time Understanding Economics
Americans are fairly an illiterate lot when it comes to how our economy works.
Last week, George Will wrote an interesting column demonstrating how idiotic is the current Washington fuss over Nippon Steel purchasing U.S. Steel. In his opinion, which I also share, it is xenophobic as well as an immaterial economic concern. The company is the fourth largest steel producer in the U.S. and the 573rd ranked corporation. As Will points out, it has fewer employees than the restaurant chain Dave & Buster’s.
Like coal, steel is a 20th century industry that people long to remember fondly. Both were instrumental in American economic development. While coal has receded as a source of fuel (in West Virginia the solar panel industry employs more people than the mines), steel is still in many of the products we use. It just isn’t produced by using thousands of employees the way it was in 1901 when U.S. Steel was the first billion-dollar corporation.
The industry, like coal, was a user of men. My grandfather and grandmother’s brothers toiled in the Pennsylvania coal mines when they immigrated from Italy. They all ended up with “Black Lung” government benefits because of the working conditions in the mines. None of them became rich, only the mine and steel companies’ owners, such as Andrew Carnegie, an immigrant from Scotland became wealthy.
That is when the two industries employed hundreds of thousands of men like my grandfather. Today both are after thoughts in the American economy. But what has gripped the psyche of so many Americans is a longing for a time that never was. If you were to ask my grandfather and uncles how much they longed for the days when they worked underground, they would have laughed.
Once the mines closed and they migrated to New York City, they became bakers or butchers, laborers and my grandfather, a welder. None of them ever looked at their earlier lives wistfully. They worked in industries that were needed but not loved.
Senators Rubio, Fetterman, and Hawley (none of whom ever did a day of physical labor) want to tell you how the sale of U.S. Steel to a foreign owner will harm America. An owner that has made steel in America for 50 years.
They are playing politics with your emotions. They are bringing back the “big scare” of the Japanese buying up our assets. The same thing happened in the 1980s. And guess what, all those assets including Rockefeller Center are still here.
Economics revolves around numbers. The 573rd largest corporation employing fewer people than a medium sized restaurant chain is not going to alter or cause the American economy to falter. The jobs report for January had 1 ½ times more new employees finding jobs than are employed by U.S. Steel. Common sense should tell us that this is nothing but Washington silliness.
