A free market economy operates according to the
Price-Demand Curve and requires increases in productivity to keep costs
down.
An early example of this is Henry Ford’s assembly line in
1913. Cars were too expensive for the
average person. In 1909 The Model T sold for $850 which is equal to $20,513
in todays’ money. By 1913 the Ford Model T sold for $550 or $12,067 in today's
money. By the 1920s, it sold for $290 or $3,258 in todays’ money. In this case, the free market economy worked
to the mutual advantage of the consumer and the manufacturer. This is the model that made America great in
the first place. The automobile allowed
further increases in productivity and freedom as families bought trucks and
opened their own businesses.
Farm Tractor prices went
from $625 to $395 in 1922, allowing smaller farmers the opportunity to cut
labor costs and expand planting acreage.
Computers like the IBM
System 3 were in use in the 1960s and spread to all areas of business in all
industries. NCR supported point of sale transactions, Drafters got Computed
Aided Design equipment and accurate manufacturing bills of materials allowed
businesses to manage their inventories.
The personal computer was
introduced in the 1970s. The
technologies that made this possible included the invention of the transistor
by Bell Labs in 1947 that replaced the vacuum tube, the invention of the
integrated circuit in 1958 by Texas Instruments and the development of the
microprocessor chip in 1971 by Intel. In the 1970s we could go to Radio Shack
and build our own PCs. In the 1980s, IBM
PCs were $5000, but businesses were buying them. In the 1990s, PCs went from $3000 to $1000. By 2000, PCs were $500 and internet
capable. The PC eliminated the “typing
pool” and everybody bought home PCs.
Computer Integrated
Manufacturing was proposed in the 1970s, implemented in the 1980s and when
refined in the 1990 using Lean Manufacturing process controls, resulted in the
end of production errors for all who implemented these design controls. It allowed US companies the option to send
manufacturing overseas in the 2000s. It
will also allow companies to return manufacturing to the US. Allowing foreign countries to produce our
electronics doesn’t help our loss of patent enforcement.
The sensors being put on
cars now are the result of advances in parallel processing that reduces
response times to enable automated braking in vehicles and allow vehicles to
drive themselves. Again, this may result
in lower labor cost and fewer crashes for transportation.
The recent development of
fracking will allow the US to become energy independent and export oil and
natural gas to help reduce our $47 billion US Trade Deficit. This would
increase US productivity.
Productivity increases are
needed nationally. We have too much debt
and need to pay this off. When this
happens to countries, they need to get to work.
The US needs to sell everything it makes to whoever wants it. It will certainly include energy like oil,
natural gas and coal, but will also include food and should include more
manufactured goods.
Cost-reducing productivity
increases need to be introduced in Healthcare and Education and Government. These
3 industries have high costs and poor outcomes. They need heavy doses of free
market economic reform.
Wage increases need
off-setting productivity increases in place before they should be implemented. The
US has drifted into a ‘managed economy’ tail-spin and needs to use the laws of
economics to grow. Unnecessary job-killing laws and regulations need to be
repealed, systemic political corruption needs to be rooted out, excessive
immigration needs to stop, bad trade agreements need to be stopped, tax policy
needs to be reformed and the US National Debt needs to be eliminated. Then,
wage and interest rate increases can be allowed to be set by the market.
Norb Leahy, Dunwoody GA Tea
Party Leader
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