US Manufacturing Needs Pro-Growth Policy and Time
Four foundational reforms are essential to reshoring industry. U.S. automotive manufacturers were caught by surprise when fuel prices skyrocketed in the 1970s.
In the wake of those higher costs, many Americans replaced their gas-guzzling vehicles with smaller and more fuel-efficient vehicles produced by Japanese automakers. Japanese manufacturers introduced the era of lean manufacturing, transforming the supply chain with "just-in-time" production.
Japanese manufacturers ushered in the era of lean manufacturing, too. This new approach to large-scale manufacturing of vehicles transformed the supply chain with “just-in-time” production, which freed up working capital to be efficiently redeployed.
It took time for the U.S. manufacturing sector to respond, but they learned from this changing landscape, evolved and came back even stronger. Years later, globalization again reshaped supply chains, but with a more profound effect.
Author's summary: US manufacturing needs reforms.