Archive for July 4th, 2012
In today’s global economy, what makes a product American, Japanese, or German? Blind nationalism is certainly not in any country’s best interests! Are US-based multinationals US companies? What about their products produced in Europe, Asia, or Japan? As the escalating cost of new wafer fabs forces AMD, Intel, Philips, Motorola, or Toshiba into partnerships with companies from outside their borders, what nationalities do they represent?
In sorting through what is key to any country and its economic viability, four considerations are primary:
* Employment — Do wages circulating in the local economy create more jobs?
* Taxes (local and federal) — Do you qualify for “local” status if you pay taxes?
* Value-added content — Do local materials, parts and/or labor contribute 60 to 80 percent of the product’s value?
* Social conscience — Does the company participate in local philanthropy and address safety, welfare, and environmental issues?
“Buying American” means selecting products that not only meet our standards for the classic criteria but also employ Americans, support our government, include value-added content (an investment of technology and locally produced goods and services, not just final assembly), and ensure the social welfare of our people.
Many in the United States support the buying of American-made products. We buy cereal from Pillsbury, gas from Shell Oil, and silicon from MEMC without realizing that all three of these companies have foreign parent companies. But the cereal, gas, and silicon we buy are made in the United States, using mostly American raw materials and employing a mostly American staff. The benefits these “American” companies provide to industry include continued product development, capital investment, and, as the companies grow, new jobs.
Consider Hoya Micro Mask, an American company that sells products in the United States. Hoya has local management and workers, over 80 percent US value-added content, and pays corporate, real estate, and social taxes to local and federal governments. However, our parent company is multinational. The benefits of this relationship include technological transfer from Japan to the United States to improve our mask-making technology. Hoya provides us with capital to enhance our processing and manufacturing equipment. It lets us create an environment of staff, equipment, and technology to meet our customers’ product needs and provide better service. Having Hoya as our parent company allows us to explore directions that might have been financially impossible before.
One goal of the Hoya USA companies is to benefit the US economy through local employment, taxes, capital investment, and technology development. Together, we and our customers become globally competitive with products and services that are superior worldwide. What the United States does not need now is for the new federal administration to unleash protectionism again. It is indeed time for an enlightened nationalism in our global community, where “local” reflects reality.