Peace Dividend

In the time since the Soviet threat went away, there have been profound changes in some of our most technical manufacturing companies. A significant amount of our defense-related manufacturing capacity has been freed for commercial ventures.

Columns From: 12/1/1997 Modern Machine Shop, ,

Click Image to Enlarge


Chris Koepfer

In the time since the Soviet threat went away, there have been profound changes in some of our most technical manufacturing companies. A significant amount of our defense-related manufacturing capacity has been freed for commercial ventures.

That transition was painful for companies heavily dependent on military contracts to produce hardware for ourselves and our allies in the global domination game. What's become clear since the lowering of the wall is we simply don't need to have as much military response in reserve. We also have several new and potentially lucrative commercial markets.

In part because of the reduced influence of government dollars, our current manufacturing "good times" perhaps have a stronger set of legs than previous booms. Moreover, it's quite possible that this already six-year-old up-cycle is more sustainable than previous cycles because it's based in supply and demand metrics that more realistically reflect market conditions.

It might be called a peace dividend. Focusing some of the extraordinary talent and technical resources away from military weapons manufacturing toward commercial enterprises will perhaps help make our global commercial manufacturing presence as daunting as our global military presence.

It's the old guns and butter argument, which, thanks in part to changes in the balance of global political power, has put our domestic manufacturing base (making butter and much more) into a position to play large on the world stage.

It's a wonderful time for manufacturing in the United States. Our markets are up, our productivity continues to improve and most of the impetus is from segments that want, need and use what we're making. As a manufacturing nation, we are arguably better off in the long term, participating in a global market where success is measured by how well you satisfy the demands of customers with your products, quality and delivery. It is also arguable that by looking at the world as a marketplace, energies and expertise that were once directed toward fending off military threats can be used to further our national commercial success.

For fifty years, the United States invested heavily in being ready to fight the "big one." Now we investors are seeing a return in the form of a peace dividend for our manufacturing base. With what's going on in our economy, which would you pick—guns or butter?

Comments are reviewed by moderators before they appear to ensure they meet Modern Machine Shop’s submission guidelines.
blog comments powered by Disqus
MMS ONLINE
Channel Partners
  • Techspex