Into the 1970s, “Made in Japan” meant cheap and questionable quality. The Japanese transistor radio was the meme for what it meant to buy Japanese products. Japanese televisions were horrible and the entire concept of a Japanese automobile was laughable. If you wanted something good, you looked for Made in the USA on the label.
Today, “Made in Japan” means quality usually at a low price particularly compared to “Made in the USA.” Japan no longer produces trash and trinkets either; they have gone upmarket into robotics, high end automobiles, trucks, electronics and computers, and medical to name a few.
It’s hard to believe that China was a closed society in 1972 when Richard Nixon first visited. Today, of course, China is a manufacturing behemoth with an incredible trade imbalance with the United States. China is today’s Japan on steroids!
During the 1970s, Americans grappled with whether it was unpatriotic to buy from Japan. If you lived in the Midwest and drove a Japanese car, it wasn’t uncommon to receive insults. I had a Toyota Celica at the time. One thing for sure was that you better not be driving a Japanese car near Detroit!
China’s must graphic inroads into international business is, of course, steel.
The United States steel industry was just chugging along and then China cratered the industry in the 1980s. Why? Because as the Featured Image shows, worldwide demand took off and the United States couldn’t compete. There are a whole lot of secondary reasons but China beat us at our own game.
Today, China’s two largest exports are
- Electrical machinery, equipment: US$557.1 billion (26.3% of total exports)
- Machinery including computers: $344.8 billion (16.3%)
“Made in China” is now even more ubiquitous than “Made in Japan” was in the 1960s and 1970s.
Let’s ask the question then: What will it take for you to buy American again?
WalMart was just beginning it’s “Buy USA” campaign some years ago and my father’s company saw this a tremendous opportunity since everything was produced just outside of Memphis. He and bunch of executives drove to Arkansas to meet with Walmart. After the requisite slides were presented, Sam Walton entered the room and asked one simple question: “Can you meet the price I’m currently paying for these products?” When they had to admit they couldn’t, Mr. Walton said “when you can figure out how you can, come back and see me” and he left the room. And that was that.
I always have remembered that story because that’s how capitalists behave. Our first instinct is to buy the lowest priced product that has sufficient quality and capability to meet our needs.
We’re also looking for the best “value” as well and we may well spend more for a product based on the additional value it brings (sometimes called ‘delighters’) or soft capabilities such as ease of repair and customer service.
As a proud capitalist, that’s what it will take for me to buy American — and not a label.