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Higher Oil Prices Are Starting To Bring Jobs Home

kdawson posted more than 6 years ago | from the silver-lining-with-a-vengeance dept.

The Almighty Buck 777

penguin_dance notes a report up at ABC News that high oil and gas prices in the US may be moving jobs back home in a trend that some economists are calling "reverse globalization." It's becoming more and more expensive to ship finished product from other countries, so some companies are moving the manufacturing back to the US. The article hints that this trend may spill over soon to raw materials such as steel. One economist is quoted: "It's not just about labor costs anymore. Distance costs money, and when you have to shift iron ore from Brazil to China and then ship it back to Pittsburgh, Pittsburgh is looking pretty good at 40 bucks an hour."

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777 comments

Interersing trend... (2, Interesting)

Codifex Maximus (639) | more than 6 years ago | (#23927541)

It would be nice if there was a favorable reaction to high fuel prices such as some manufacturing coming back home.

We can only hope that the trend continues.

Re:Interersing trend... (2, Insightful)

The Tyler (998004) | more than 6 years ago | (#23927585)

Hopefully the oil prices will cause people to become more concerned with the environment by wasting less (because of the price) and realize that gas won't last forever and get them interested in alternative fuel sources.

Re:Interersing trend... (4, Insightful)

cayenne8 (626475) | more than 6 years ago | (#23927725)

"Hopefully the oil prices will cause people to become more concerned with the environment by wasting less"

With the high price of fuel....and everything else going up along with it..I could safely bet that the avg. person in the US does not have the environment topmost on their heads. If they could come up with cheap energy for running cars, etc...I think many people in the US would now be comfortable strip mining the Rocky Mountains and The Applachians down to nothing without a 2nd thought. This has hit the general public in a way they never really ever imagined before, and they are shocked. I'd say they'd be prepared to do about anything if the price keeps increasing at this rate.

Re:Interersing trend... (2, Interesting)

Mordok-DestroyerOfWo (1000167) | more than 6 years ago | (#23927913)

I'm not so sure, currently Americans have the option to drill in Alaska. It is absolutely beautiful and pristine up there, but drilling would arguably have much less impact on human settlement than strip mining the Rockies or the Appalachians. Maybe I'm an optimist but I think this shows some consideration for environmental problems.

Re:Interersing trend... (4, Insightful)

sqrt(2) (786011) | more than 6 years ago | (#23928065)

I don't care so much about the environment in Alaska. Well, I do, but it's not my primary concern. I'm against drilling there for other reasons. Even the highest estimates say we'll only get about a 10 dollar reduction in the price per barrel of oil. That translates to a few cents per gallon. I think the money and time are better spent trying to figure out how to get us off fossil fuels than just postponing the inevitable decline of oil. And as a bonus, all that territory in Alaska can remain untouched by man.

Re:Interersing trend... (4, Funny)

Mithras6691 (1047130) | more than 6 years ago | (#23927915)

This has hit the general public in a way they never really ever imagined before, and they are shocked.
They've been slashdotted.

Re:Interersing trend... (1, Insightful)

Original Replica (908688) | more than 6 years ago | (#23927919)

This has hit the general public in a way they never really ever imagined before, and they are shocked.

They will be even more shocked when they come to realize that all of these price increases are simply a symptom of America's slip from "world superpowe" to " average wealthy western nation". Fuel and consumer products have cost this much in Europe for decades. The EU is doing just fine dealing with $5+ for a gallon of gas, and they aren't strip mining the Alps. But we can expect to have European sized cars and European sized houses at the european $3000 per sq ft not the US $125 per sq ft. [globalpropertyguide.com]

Re:Interersing trend... (5, Insightful)

Darkness404 (1287218) | more than 6 years ago | (#23927987)

But we can expect to have European sized cars and European sized houses at the european $3000 per sq ft not the US $125 per sq ft.


I highly, highly doubt that. With the mortgage crisis here in the US home prices are falling not increasing. And I doubt that that will stop anytime soon. Another thing is, North America has only been explored within the last 500 years, it lacks the shortage of land which is part of why Europe has such high prices for houses, mix that with the fact that home prices are falling and people with a lot of land are cashing it in to get some cashflow... You get the picture. While this may make large buildings such as new arenas and skyscrapers more pricey, for the average person home prices will only keep falling.

Re:Interersing trend... (2, Informative)

tomhudson (43916) | more than 6 years ago | (#23928159)

The price of the average house is falling because it was never worth what the bubble fanatics thought it was.

That McMansion out in the exburbs is looking to cost a lot more to heat this winter ... and next, ... and the year after. Transportation costs are going up as well. Plus, people don't want to spend an hour each way commuting. Cities are going to make a comeback, and those McMansions, stuck in the wilderness, with a declining tax base, will be the new slums. Look for a reverse donut-hole effect.

Re:Interersing trend... (1)

GuidoW (844172) | more than 6 years ago | (#23928051)

The EU is doing just fine dealing with $5+ for a gallon of gas, and they aren't strip mining the Alps.

True, but then again, distances to travel are usually much shorter in Europe, since it's much more densely populated.

Re:Interersing trend... (5, Insightful)

Zak3056 (69287) | more than 6 years ago | (#23928163)

Umm... Most of the cost that Europeans pay for fuel is in the form of taxes, which they have voluntarily inflicted upon themselves, and not some kind of relationship to status as a world power. Oil is traded in a world market, whoever pays more gets the oil.

Also, the housing prices you linked to are in cost/square METER. Given that there are roughly ten square feet in a square meter, the costs are 2x, not 24x as you suggest.

Re:Interersing trend... (1)

billcopc (196330) | more than 6 years ago | (#23927869)

Business cares not what the people are concerned with, it only cares about what will part them with their money.

The difference between consumers and business, is the business will not suffer when we run out of fuel. It will repurpose itself to take advantage of the no-fuel situation, and we consumers will continue to be on the losing end of the equation.

If the oil prices were to drop one day, and Chinese manufacturing becomes profitable again, all these companies will close their American plants in a heartbeat. Long-term sustainability is irrelevant when shareholders are looking at the quarterly report.

Re:Interersing trend... (2, Insightful)

homer_s (799572) | more than 6 years ago | (#23927909)

Business cares not what the people are concerned with, it only cares about what will part them with their money.

Correct. And people only part with their money when they can obtain things that they value more than the money they part with.
What's the problem again?

Re:Interersing trend... (5, Insightful)

billcopc (196330) | more than 6 years ago | (#23928087)

Really ?

Most days I part with my money because I'm trapped between two evils, and I try to pick the lesser. Telecoms, overpriced food (even staples), services done to the lowest possible standards... Greed is spiraling out of control, because those who spend wisely are impossibly outnumbered by the ravenous fools of our society.

Re:Interersing trend... (1)

Darkness404 (1287218) | more than 6 years ago | (#23927901)

and realize that gas won't last forever and get them interested in alternative fuel sources.


Sure gas won't last forever... As shown in history nothing lasts forever. However we have untapped oil deposits we could use to boost the economy and lower prices now . Alternative fuel sources that we have right now are a downright joke. Ethanol can't survive without taxpayer money, and our demand outweighs the supply by far more then oil ever would. Hydrogen looks promising but right now the costs are too expensive. As for electric cars, I would rather get a cheap car now and pay $5 per gallon in gas then get an over-priced electric car and wait for it to charge. Basically, oil won't last forever, but nothing does. To say that we are running out of oil is far, far, far from reality .

Re:Interersing trend... (1)

The Tyler (998004) | more than 6 years ago | (#23928097)

I do realize that alternate fuels at this point are not viable for widespread use, but that's why we need to do more research on alt. fuel! If solar or nuclear kicks of really well and becomes super cheap and efficient, then that would be a great thing. We could use cheap, virtually unlimited (for solar, anyway) energy for so much more things and build a better future!

Maybe I'm too optimistic, or just plain delusional, but alternate energy (esp. solar) could be a really great thing given enough research.

Re:Interersing trend... (1)

mrbluze (1034940) | more than 6 years ago | (#23927589)

We can only hope that the trend continues.

It won't make products cheaper, however. People may buy locally made produce in preference due to price, but over all they will have very little money with which to buy anything.

So I wouldn't say it's a good sign as such, as much as I'm against globalisation.

Re:Interersing trend... (4, Insightful)

kcelery (410487) | more than 6 years ago | (#23927601)

If high fuel cost continues, it will only bring back the sail-boats, not the off-shore jobs.

Re:Interersing trend... (4, Interesting)

AKAImBatman (238306) | more than 6 years ago | (#23927657)

It should be bringing nuclear wessels [sandia.gov] . With the cost of oil to fire a ship being what it is, the Savannah would have been competitive back in the 70's. The only problem to solve is that high seas piracy still exists and the US government doesn't want the nebulous "bad guys" to steal a nuclear wessel and reuse its atomic fuel for something nasty.

Re:Interersing trend... (0)

Anonymous Coward | more than 6 years ago | (#23927743)

Yep, nuclear power is probably going to see an increase in shipping. The only realistic way to do it safely is to use a convoy with military protection. No pirate is going to attack a convoy when there is a destroyer or a cruiser present.

Re:Interersing trend... (1)

kazoo boy (1307731) | more than 6 years ago | (#23927911)

can we afford to give a destroyer or cruiser to every ship that sails the sea? seems like nuclear is a little too risky right now.

Re:Interersing trend... (0, Redundant)

billcopc (196330) | more than 6 years ago | (#23927945)

Wrong. More protection simply attracts bigger pirates, the kind with resources and connection who would actually pay for nuclear equipment. It also makes such ship very obvious targets. You know if there are military escorts, there's gotta be something valuable in there.

Re:Interersing trend... (3, Insightful)

indi0144 (1264518) | more than 6 years ago | (#23928043)

and the convoy uses what type of fuel? pixie dust?

Re:Interersing trend... (1)

smitty_one_each (243267) | more than 6 years ago | (#23928049)

Don't look for nuclear shipping anytime soon.
Naval Reactors works by training Navy Nukes to a fair-thee-well: they know that overpriced hot water heater like Linus knows the kernel.
However, despite ADM Hyman G. Rickover's fantasies, the manpower-intensive, paranoid approach needed for a fault-free system made it a crappy business case other than for aircraft carriers and submarines. Gas turbines were more cost-effective (before the last couple of years).
Meanwhile, relatively less-risky land-based plants have had no traction at all. There is no way the US government and the Nuclear Regulatory Commision is going to license any US yards to go building a nuclear tanker or cargo vessel; they are not crewed, maintained, or operated in any way that would have anyone sleeping comfortably. Not to badmouth the Merchant Marine, but I'm betting if any of them /., they will roger up on this. I will bet CdrTaco's next paycheck you'll not see nuclear shipping, ever.

Re:Interersing trend... (4, Interesting)

0100010001010011 (652467) | more than 6 years ago | (#23927767)

"The 163 pounds of uranium she consumed is estimated to have provided the equivalent power of nearly 29 million gallons of fuel oil."

That just put everything in perspective. Holy hell. For the amount of money you saved you could hire a small army to arm your vehicle. US Government could nationalize some ships.

29 million gallons of fuel.

Damn. Just Damn.

Re:Interersing trend... (0)

Anonymous Coward | more than 6 years ago | (#23928109)

It shouldn't be that surprising. You get about 55 electron volts of energy when you combust an octane molecule, while you get 200 million electron volts per fission reaction. Octane has a molar mass of 114 g, while uranium is around 5644 g per mole of 'burned' U-235 (assuming 4.4% enrichment: 22.7 * 238 g + 235 g). This means that 4.4% enriched uranium has about 75,000 times more energy per unit mass than octane. If you used a breeder reactor (or higher enrichment) you could increase that energy per unit mass number over ten-fold.

For verification: 163 lbs * (conversion factors to octane) = 2.8 million gallons. Assuming the uranium counted is only U-235 (which has 17 million times as much energy per unit mass as octane), then 163 lbs of U-235 * (conversion factors to octane) = 49 million gallons. I think the cited numbers are wrong here, but you can check my math. Octane isn't perfect as an approximation to fuel oil, but it won't be 2 times off.

Re: piracy (4, Insightful)

icebrain (944107) | more than 6 years ago | (#23927769)

The only problem to solve is that high seas piracy still exists and the US government doesn't want the nebulous "bad guys" to steal a nuclear wessel and reuse its atomic fuel for something nasty.
We need to bring back armed merchant vessels... a couple armored .50-cal mounts and a 3-inch gun or two maybe. And give the crew rifles.

Also, a nuclear ship can sustain high speeds much longer than conventionally-powered ships. Makes you harder to capture.

I think it might be an interesting development to bring back the "Q-ship"... troll for pirates, then blow their asses out of the water by surprise.

Re: piracy (2, Funny)

pipingguy (566974) | more than 6 years ago | (#23928093)

Add minigun.

wessels? (4, Funny)

ciaohound (118419) | more than 6 years ago | (#23928001)

Thank you, Mr Checkov. Mr Sulu, lay in a course for the 1970's.

Re:Interersing trend... (1, Informative)

Anonymous Coward | more than 6 years ago | (#23928117)

The only problem to solve is that high seas piracy still exists

It's never as much fun as it looks in the movies...

Re:Interersing trend... (0)

Anonymous Coward | more than 6 years ago | (#23927679)

First-world code-monkeys rejoice as the high cost of transporting their finished products finally brings their jobs back home.

Yay, Pittsburgh (1, Insightful)

PunkOfLinux (870955) | more than 6 years ago | (#23927553)

Actually, pittsburgh sucks. But this is a good thing, regardless.

Re:Yay, Pittsburgh (1)

arbiter1 (1204146) | more than 6 years ago | (#23927619)

yea Pittsburgh sucks (go red wings), but having move jobs coming back to the US is a good thing. which will help the economy

Re:Yay, Pittsburgh (1)

FooAtWFU (699187) | more than 6 years ago | (#23927697)

Oh, it will help the local economy of Pittsburgh plenty, but the loss to the rest of the economy will more than offset that. Expensive steel hurts the construction industry, and anyone who uses things which have been constructed. Like, say, buildings. Or web sites that are hosted on computers which are located in data centers inside buildings. Or people who pay taxes to fund the latest municipal light rail project (and hey, those things get federal money, so that's... let me check... just about everyone in the country).

Re:Yay, Pittsburgh (1)

east coast (590680) | more than 6 years ago | (#23927763)

Uh, guy, the hockey season is over. If you're going to judge our town by our hockey team it's amazing that you have any voice on slashdot. Frankly, me and a bunch of other Pittsburghers wish that the Penguins would just get the fuck out of town.

Re:Yay, Pittsburgh (1)

PunkOfLinux (870955) | more than 6 years ago | (#23927981)

Wtf? You think I mean hockey? Hell no. I mean your city. Your CITY sucks. Erie ftw!

Re:Yay, Pittsburgh (1)

east coast (590680) | more than 6 years ago | (#23928011)

I wasn't replying to your post.

Re:Yay, Pittsburgh (1)

FooAtWFU (699187) | more than 6 years ago | (#23927633)

To the people who enjoyed cheaper steel (useful for all sorts of construction projects, like skyscrapers and bridges, and cars, and...) and to the Chinese steelworkers who will be unemployed (and the people who had come to rely on their employment), and to people in and about Pittsburgh who were not otherwise affected detrimentally by the current state of affairs but will be negatively affected by increased industrial emissions in the area, this is a bad thing.

I'm part of the at-large public who consumes steel (mostly indirectly via Infrastructure) and I for one am not particularly happy about its skyrocketing prices these days.

Re:Yay, Pittsburgh (4, Interesting)

xSauronx (608805) | more than 6 years ago | (#23927795)

my dad owns a drycleaning plant. steel hangers are one of his biggest supply expenses now. a few years ago a hanger might have been $0.10 or so, then 2 or 3 years ago it doubled overnight to $0.20, and a few weeks ago *that* doubled.

some of the larger hangers are 50 cents each. 50 cents for a metal coat hanger. he needs several hundred of these in a given week, nevermind the price of all the other supplies going up. it hurts, bad, and he has had to raise prices because of it (though not enough to actually cover the added cost)

Re:Yay, Pittsburgh (1)

east coast (590680) | more than 6 years ago | (#23927881)

The real question is if it's going to cost any more or less from Pittsburgh (Assuming that they're Chinese hangers). And if it is the same price is it worth it to support fellow Americans?

Re:Yay, Pittsburgh (2, Insightful)

homer_s (799572) | more than 6 years ago | (#23927943)

You can thank Uncle Sam and the protectionists for that one. Read more [marginalrevolution.com] .

Re:Yay, Pittsburgh (4, Interesting)

John_Sauter (595980) | more than 6 years ago | (#23927969)

my dad owns a drycleaning plant. steel hangers are one of his biggest supply expenses now. a few years ago a hanger might have been $0.10 or so, then 2 or 3 years ago it doubled overnight to $0.20, and a few weeks ago *that* doubled.

some of the larger hangers are 50 cents each. 50 cents for a metal coat hanger. he needs several hundred of these in a given week, nevermind the price of all the other supplies going up. it hurts, bad, and he has had to raise prices because of it (though not enough to actually cover the added cost)

Perhaps your dad could provide a discount for customers who provide their own hangers.

Re:Yay, Pittsburgh (2, Insightful)

xSauronx (608805) | more than 6 years ago | (#23928197)

several customers recycle the hangers, usually it takes work to sort through them and pick out the ones that are worth keeping (ill say ~%70 are worth keeping, of 200 or 300 that are turned in each month)

we offer discounts so that no customer has to pay the full price.punch-cards, law enforcement/military discount, state employee, senior citizen, so i dont think hed opt for offering another discount.

Recycle them (0)

Anonymous Coward | more than 6 years ago | (#23928045)

Make them a line item expense on the dry cleaning bill and if the person brings back their old hanger they don't have to pay it.

Re:Yay, Pittsburgh (1)

Ortega-Starfire (930563) | more than 6 years ago | (#23928115)

Goddam. I really wish you guys would actually put that stuff on signs or something for your consumers to read.

Now I have to scrounge up the 600 hangers I have lying around from dry cleaning over the years and drop them off at my local cleaners. BRB.

I am more concerned about the distance... (2, Interesting)

clonan (64380) | more than 6 years ago | (#23927555)

from my home to my office....when will my company start teleworking as an option!

But US jobs and stable prices despite the raising fuel costs is great news!

Telecommuting (4, Insightful)

BWJones (18351) | more than 6 years ago | (#23927559)

Now if companies would pull their heads out and either/or/both go to a 4 day work week and re-implement telecommuting...

Re:Telecommuting (1)

paroneayea (642895) | more than 6 years ago | (#23927751)

Oh yeah? And on that note, why not telecommute from India?

This helps bring blue collar jobs back home. That doesn't say anything about programming, or graphic design, or any of the jobs that most people who visit here probably have or want.

Re:Telecommuting (1)

dada21 (163177) | more than 6 years ago | (#23927757)

My employees are allowed to work on their own schedule (start late, leave late, start early, leave late). I have one full timer who only works 3 days per week, all contract work, and he's leaving his house at 5am, taking an hour for lunch, and leaving the client's around 7pm. He puts in 34-38 hours a week on average, avoids traffic, and only has 6 trips per week for work.

My competitors, on the other hand, are still forcing their employees in at 8, out at 5, and running 5 day weeks. Ridiculous.

Re:Telecommuting (1)

Shados (741919) | more than 6 years ago | (#23927837)

Nice freudian slip (start early, leave late, is what you said).

8 to 5, 40 hours days... I had to do that once. From my experience, less than 5% (and I'm being generous, though keep in mind thats for software development, millage may vary in other fields) of people can sit in front of a computer that long and be productive... When I worked for a company who did that, projects were easily 100-200% late when compared to the initial estimates (and the estimates were VERY conservative). Inefficient as all hell. 30 people working, and honestly, with 4 people on a regular, more permissive schedule could have done as much work in the same amount of days. It was totally rediculous. Now, I refuse those hours systematically.

Now I do 5 days a week, but 35 hours (so 9 to 5 with 1 hour lunch, more typical stuff), and I'm allowed to come in and leave whenever I want (as long as it totals 35 hours + lunch), and projects really purr along, in comparison. Crazy what 1 hour a day can do.

Re:Telecommuting (3, Insightful)

Shados (741919) | more than 6 years ago | (#23927801)

Telecommuting is great, IF most of your employee base has a high level of experience and is responsible. In this day and age, thats the minority though... I've worked for a small-ish company who did it, but they lucked out big time on the quality of their employees. As for 4 day weekends...considering fridays don't even count as it is for a lot of people because its the "last day of the week", when you cut it to four, its even worse. Again, worked for a company who did that...nothing was getting done. It can work, but you need one hell of a nice corporate culture and good employees to do it. Not for everyone, definately.

And for doing 4 days but more hours each days to compensate...again, very, very few people can be efficient at their job for more than like 6 hours, nevermind 9-10.

These are things that work well in a small company of "special" people who can take it...but people who can take it are quite rare...even though many would pretend otherwise and lie to themselves about their own limits.

Re:Telecommuting (0)

Anonymous Coward | more than 6 years ago | (#23927863)

I know I am in the minority, but I've been telecommuting for the past 5+ years full time and I actually work for a Fortune 10 company. Yes, Fortune Ten, not 100 or 500.

I definitely get tons more work done this way than I ever did from an office. Plus the flexibility to run errands when ever I want, or catch a movie over lunch.

I could get higher pay elsewhere, but this is one heck of a perk I'd hate to lose.

BTW, I am a technical lead who has managed up to 13 people at one time -- all of us remote.

Not all jobs are telecommutable. (0)

Anonymous Coward | more than 6 years ago | (#23927907)

How do you telecommute in a factory, are a cop, a teacher, an orchestra conductor, a prostitute, flip burgers, etc. Only those jobs that involve sitting in front of a computer all day are viable for such an option.

Pull your head out and realize 96% of all jobs involve real hands on work.

Re:Telecommuting (1)

schnikies79 (788746) | more than 6 years ago | (#23928071)

Not all of us have desk jobs. Thanks.

Whacked upside the head ... (4, Funny)

Ungrounded Lightning (62228) | more than 6 years ago | (#23927617)

... by The Invisible Hand.

Adam Smith strikes.

Re:Whacked upside the head ... (0, Troll)

gregbot9000 (1293772) | more than 6 years ago | (#23928183)

Damn you free market democracy!!
High fuel prices driven by a world who wants what America has forcing capitalist bourgeoisie American's to actually reduce overconsumption AND force them to do their own work is great. But without having huge government programs, protectionist tariffs, and excessive regulation, how ever will they make sure they muddle up their economy completely... I mean help the people?

Lets just pray the monstrous free market disaster doesn't figure out a cure global warming and a way to provide health care, or end poverty. Then I'll never get to help the people with socialism!

Macroeconomics (5, Funny)

Citizen of Earth (569446) | more than 6 years ago | (#23927623)

It's almost like there was some kind of invisible hand at work.

Where has Steve Jobs been? (0)

Anonymous Coward | more than 6 years ago | (#23927639)

The headline mentions "Jobs" (capitalized) so I'm assuming you mean "Steve Jobs"
Apple computer with Steve at the helm has always been using oil in the form of plastics for their computers, lubrication for moving parts, and the water-repellant factor in all sorts of products. Jobs has *ALWAYS* been at the forefront of oil consumption so it is not surprising that Steve has decided to come home to supervise his company during this high cost crisis brought on by Alberta Sheiks driving their hummers across their cattle ranches.

Except for huge things this is BS (1)

EmbeddedJanitor (597831) | more than 6 years ago | (#23927651)

Sure that's true for very large things and has always been so. People are generally not importing swimming pools from China.

But with smaller things (refrigerator or smaller) distance transport from foreign lands is pretty low. The cost of shipping a refrigerator across the sea is way smaller than the cost of trucking it across a state. Sure, that shipping cost has gone up, but so has the cost of trucking etc. Sure, those shipping costs have gone up, but by a very small amount relative to the whole product cost.

Re:Except for huge things this is BS (1)

AndOne (815855) | more than 6 years ago | (#23927691)

Except... you still have to truck whatever you ship most of the time. So if the price of shipping beats the savings in labor .... trucking doesn't really matter.

There are many variables (2, Insightful)

EmbeddedJanitor (597831) | more than 6 years ago | (#23927819)

Sure, the transport costs have gone up, but Chinese labor costs have gone up too and USA labor costs have come down (relatively anyway).

The equation is tipping back towards domestic manufacture.

Shipping costs are only one of the variables and it is inaccurate to attribute the whole shift to that.

Re:Dollar Price is Low (3, Insightful)

monxrtr (1105563) | more than 6 years ago | (#23927777)

It's more that the price of dollars is low than that the price of oil is high. Turning every one dollar bill into a one million dollar bill won't cure world poverty either.

Size of product isn't the issue, cost is the issue (3, Informative)

thpr (786837) | more than 6 years ago | (#23928025)

"with smaller things (refrigerator or smaller) distance transport from foreign lands is pretty low."

Are you kidding? You think that the product size actually matters? There is very little difference in shipping a container of refrigerators vs. a container of pens. It's a tiny fraction of fuel economy (a few percent) due to weight differences. The cost & distribution challenges come in breaking up the product at distribution centers, but that happens regardless of where the product is manufactured.

What will matter is raw ores (iron ore) and other relatively dense materials (steel, lumber), which greatly increase transportation costs and are easily replaceable commodities. This will be the first place the effects are seen, but it will spread to other products.

"The cost of shipping a refrigerator across the sea is way smaller than the cost of trucking it across a state."

Perhaps if you ship them one at a time. But that's not how trucks or ships work.

The statement in the article notes an increased container shipping cost of $3,000 to $8,000 shipping from China to NY. That $5,000 difference is about 1,000 gallons of diesel, which is enough to drive more than 4,000 miles carrying the 29+- tons of a fully loaded standard shipping container.

validation at last (1)

AndOne (815855) | more than 6 years ago | (#23927661)

and people thought I was crazy when I said that higher energy costs would be a good thing in the long term.

Re:validation at last (1)

natenovs (1055338) | more than 6 years ago | (#23927775)

except globalization is the sole reason for our comfortable living status and swelled middle class. be careful what you wish for.

For strange values of globalization (1)

sethstorm (512897) | more than 6 years ago | (#23928015)

Not the kind that's been used in the last 30 years.

The type that has existed (mainly) past 1980 has antagonized the domestic worker. The other type permitted domestic work along with international dominance.

This is our nation, and we should not be allowing other countries to influence ours by proxy. If they want a vote, they can go through the process in becoming a citizen.

Re:validation at last (2, Insightful)

ScrewMaster (602015) | more than 6 years ago | (#23928149)

except globalization is the sole reason for our comfortable living status and swelled middle class. be careful what you wish for.

No, not at all. Economic dominance and a thriving manufacturing sector maintained our standard of living. The global economy did little to help that, and in fact has been much of why that vaunted standard of living has been dropping in the past few decades.

The number of people who qualify as "middle class" is also not so swelled anymore.

Yep. (4, Funny)

UPZ (947916) | more than 6 years ago | (#23927701)

Things sure have turned around 360 degrees in the good ol' USA.

360? (0)

kf6auf (719514) | more than 6 years ago | (#23927789)

360 degrees...something doesn't feel quite right...let's visualize that for a second... don't you mean 180 degrees?

Re:360? (1)

oedneil (871555) | more than 6 years ago | (#23927947)

No, probably not. I'll let you think about it.

Re:360? (0)

Anonymous Coward | more than 6 years ago | (#23927973)

Probably not. It seems every time we take a turn in this country, we end up back where we started.

I was hopeful this would be a trend (3, Interesting)

Anonymous Coward | more than 6 years ago | (#23927755)

Recently I saw a show that visited Asbury Park in NJ, and it was stated that the slow decline of the park started with cheap airfares. It immediately struck me that this trend should now start to reverse itself, as travel costs are rising while consumer confidence is dropping.

High gas prices are going to have some bad side effects, but also quite a few good ones. Hopefully, reduced travel will be effected on almost every scale: suburbs will wilt and cities will grow stronger, local foods will become more popular, inefficient business travel will be replaced by online meetings, etcetera. I think most people who have wanderlust aren't going to let higher airline prices stop them, but perhaps they'll take fewer and longer trips in order to reduce expenses - e.g., instead of going to France and Spain on one trip, and the U.K. on another, they'll wait and take a longer trip to visit all three.

It less oil to use rail over ships to move iron... (2, Interesting)

Joe The Dragon (967727) | more than 6 years ago | (#23927773)

It less oil to use rail over ships to move iron ore and other big stuff.

higher oil prices = higher prices = higher wages (1)

chifut (998159) | more than 6 years ago | (#23927785)

Bringing jobs back to USA is great, but this means the product becomes more expensive, which means the salary you get producing those may not be enough... So in other words, we get back jobs and lower salaries to levels before we shipped the jobs overseas..

Re:higher oil prices = higher prices = higher wage (1)

p0tat03 (985078) | more than 6 years ago | (#23927903)

It beats being unemployed? I know it's not much of a consolation, but it's clearly still the lesser of two evils, and is probably still worth celebration.

Re:something normal is better than nothing (1)

sethstorm (512897) | more than 6 years ago | (#23927937)

The upside is that it gives something to the domestic worker. For once in about 30 years, something favorable comes to the domestic audience.

Now just give fully domestic products a huge tax cut (if not an outright exemption from any tax). The only thing left to do is to repeal Taft-Hartley, RTW, and call it a day.

Re:higher oil prices = higher prices = higher wage (1)

downix (84795) | more than 6 years ago | (#23927953)

Actually, the point here is that the price of the product will be more expensive, period, but by bringing the jobs back to the US, more people will be able to afford said product as gross domestic will be grown along with the product price increase.

So, you're looking at an increase of $20 per 100 tonnes due to fuel cost, or $20 per 100 tonnes for salary increase *and* you expand your customer base simultaneously. Seems like a win-win to me.

Re:higher oil prices = higher prices = higher wage (3, Informative)

monxrtr (1105563) | more than 6 years ago | (#23928055)

No, it's a lose-lose broken window fallacy.

http://en.wikipedia.org/wiki/Parable_of_the_broken_window [wikipedia.org]

Paying for breathing air might increase the GDP, but it would only be making the world net poorer. By definition of the consumer price index (CPI) being fraudulent data, so too is the GDP fraudulent data. Double the supply of money, ceteris paribus, the GDP doubles. Twice as much money trades for the exact same things. But in the real world inflation works it way through the economy discretely and unevenly, not universally evenly. People who get the new money and new credit first, spend more on specific things first. In the late 90s it was internet stocks, from 2000-2007 it was houses, and now it's commodities like oil. The poorest (last to receive the new credit and dollars) will suffer the worst for the longest time.

forgot something? (1)

Quadraginta (902985) | more than 6 years ago | (#23928113)

You imply that the jobs that are "coming back" to the US are going to go to people who are presently unemployed.

Nope. They're going to go to people who are presently working in higher paying jobs that used to similarly benefit from cheap shipping costs to other countries. Those nice jobs are going to go away, with the price of international transporation skyrocketing, and be replaced by the less-nice, lower-paying jobs that are "coming back." The net result will be little change in employment -- just a replacement of certain jobs with other, lower-paying jobs.

Does that change your calculus?

Really? (1, Funny)

Trogre (513942) | more than 6 years ago | (#23927823)

I didn't know he'd gone anywhere.

This can (1)

areusche (1297613) | more than 6 years ago | (#23927879)

Cheap energy has driven our world from locally produced goods to an international market place. When country B has the ability to make a good more cheaply it allows country A to become more efficient. It's been a couple of months since I have taken macroeconomics but I believe this is called a comparative advantage. Higher fuel and energy prices won't help us as a people. They will only bring us back to an economic situation that was seen in the early 20th century. What we need as a race are alternatives and a mass conservation effort. Heck the biggest reason for the increase in oil has been because of decline of the dollar abroad. If the fed jacked up interest rates it would remedy much of the problems we are seeing right now. But you know god forbid Bernanke and Company make G.W Bushy look bad in the economic front. I mean he screwed up a lot of stuff already let's just take on more. ----On a side note ----- Personally I think the Federal Reserve's biggest concern should be inflation. This period of stagflation is killing us. Inflation should always be the fed's number one priority. I mean seriously what good is an unemployment check when nearly all of it is going towards trying to pay for a freaking box of cereal. Also people should also not be so self righteous about working a minimal wage job while on unemployment. I know it's embarrassing to be flipping hamburgers or stocking selves, but it's money. Money that can be used to supplement a transition between jobs.

Misleading about Steel! Already restricted (2, Interesting)

dbIII (701233) | more than 6 years ago | (#23927893)

There are already trade restrictions on the importation of steel which over rule "free trade" agreements. Expensive domestic steel may actually be one of the forces driving outsourcing of manufacturing to places where the raw materials are cheaper.

You won't get any more local steel production unless there are local manufacturers that want it or if it can be produced at internationally competative prices. Steelmaking is one of those things that is not labour intensive so nobody can honestly blame unions or cheap labour countries on the price of the stuff - it comes down to effective or ineffective management.

Re:Misleading about Steel! Already restricted (1)

icegreentea (974342) | more than 6 years ago | (#23928003)

I thought US Steel had more expensive steel because it only sells very high quality/specialty steel. Please correct me if I'm wrong.

Re:Misleading about Steel! Already restricted (1)

SaintOfAllChucks (1200371) | more than 6 years ago | (#23928147)

US Steel makes all kinds. Specialty steel and the coke is their biggest business in the Pittsburgh region. However, they do own a large portion of the steel mills in Eastern Europe. Something like the same amount of production in Europe they used to have in the U.S.

OMG (1, Troll)

Idiomatick (976696) | more than 6 years ago | (#23927895)

BROKEN WINDOW FALLACY

http://freedomkeys.com/window.htm [freedomkeys.com]

I've never seen such a beautiful example of the broken window fallacy. Good job /. for not realizing it.

Re:OMG (2, Insightful)

the eric conspiracy (20178) | more than 6 years ago | (#23928005)

The concept of the broken window fallacy works if there aren't any external diseconomies in play. I'd contest that in this case.

 

Re:OMG (2, Insightful)

thegameiam (671961) | more than 6 years ago | (#23928007)

This isn't a broken window fallacy: it's simply a change in the cost of doing certain types of business. There isn't an incentive to bring, for instance, tech support from Bangalore to Pittsburgh.

Not so fast... (1)

sethstorm (512897) | more than 6 years ago | (#23928039)

That can be changed as well.

Fuel is still CHEAP in the USA ! (0, Flamebait)

shimmyshimpson (1305497) | more than 6 years ago | (#23927931)

Fuel is crazy cheap in the US, so what are you whining about ? Do you think it's your God Given Right (tm) to drive 8mpg gas guzzlers filled up with 40c/litre fuel forever????? Who are you kidding?
Most other countries (exclude major producers like Suadi, Venezuala) have heavy taxes on fuel and drive more fuel efficient cars. Stop whining America, you've shoved cheap oil into your veins like it was going out of fashion for the last 50 years, those days are now over. A billion and a half Indians and Chinese now want their time in the sun and they're starting to guzzle too.
If the USA wasn't run by Big Oil you'd be a lot better off. So instead of whining about how *shock horror* you can't just pee oil up against the wall anymore maybe you could DO something about it.
Start by asking why you can't start to wean yourselves off it, so you don't NEED to foul your own backyards to extract every last drop of the black stuff. And vote to INCREASE taxes on fuel (I know, pipe dream but hey...gotta try..) so reduce demand.

NEWSFLASH ---- You've had it too good for too long, now comes the pain, and this is only the beginning.

Re:Fuel is still CHEAP in the USA ! (1)

New_Age_Reform_Act (1256010) | more than 6 years ago | (#23928061)

Because, by driving an SUV, you are essentially "safer". (through statistics shown otherwise).

Here in Chicago, I see 80% of commuters who drive SUVs into the city in the morning from suburbs, are only one person, no other occupants. They could have use the train instead. Go figure.

$10 per gallon gas wouldn't hurt me much, because I drive an average of 100 miles a WEEK and my car run 30 mpg in city. (no, it is not a hybrid)

Americans love SUVs because they know whoever they hit, the other side is going to die first. That's why most SUVs drive 80+ miles per hour on expressways. They love this "superiority" feeling, you know.

double dick? (-1, Troll)

Anonymous Coward | more than 6 years ago | (#23927963)

My gf will do a threesome with one of her friends, if she can have a double cock session at some point later.

Yes, no, anyone done it?

wonderful trend but (1)

museumpeace (735109) | more than 6 years ago | (#23927983)

we are not moving any coffee plantations "back" are we?

thank god business has not yet stolen (1)

atarione (601740) | more than 6 years ago | (#23928037)

my brilliant idea for shipping goods on ships powered by the wind.

you have to wonder (1)

suck_burners_rice (1258684) | more than 6 years ago | (#23928077)

I will RTFA, and I find this to be a very interesting side effect of the higher gas prices. It may be the only good thing coming out of the situation. If a hydrogen-based car that runs on water comes out, that would be another good thing. But you have to wonder, why are oil prices so high to begin with? It has to do with several things, which I'll touch on, but I'd like to concentrate on this thing called oil futures and another thing called deregulation. Turns out that just prior to Cliton leaving office (there is only one "n" in Cliton), a bill was passed in which was buried this deregulation of oil futures. As a result, the price is higher than $4.50 a gallon due to speculators on Wall Street gambling on the price going up. Gas should really cost about $3.00 a gallon at this point, and it's that high due to heavily increased demand from China and India. But the additional $1.50 per gallon is a direct result of the craziness on Wall Street. Unless people begin to research this for themselves and do something about it, the prices WILL continue to increase and you'll soon see gas at $5.50 a gallon, $6.50 a gallon, and even $99.50 per gallon. What can you do about it? One example is to start a barrage of letters to your representatives. Another is for some enterprising smart people to get together and solve the problem of releasing hydrogen from water in an efficient way. If the situation gets desperate, it may even call for a massive nationwide gas strike in which not only will millions of people refuse to buy gas for a week, but they'll also stay home from work and school during that time. No matter what, something must happen, and sooner is better than later. Because everything depends on gasoline, so the continuously increasing price is causing everything else to become more expensive.

Trade imbalance and exchange rates (1, Informative)

Anonymous Coward | more than 6 years ago | (#23928095)

Nobody has ever really addressed the fact that the yuan is undervalued by upwards to 50% against the dollar and how this has made China more attractive as a labor market than it actually should be should its currency be allowed to float. Finally some academic economists are addressing the issue, but we refuse to move on the issue in a trade forum because if they dump their holdings of U.S. treasuries, our currency will sink against partners with assets that we actually function without (like oil.) Anyhow, if we trade with countries that won't fully take part in the free economy (which mandates a free currency exchange) then we are bound to get screwed. Even Mexico has been screwed by the undervalued yuan.

Re:Trade imbalance and exchange rates (0)

Anonymous Coward | more than 6 years ago | (#23928181)

assets that we actually function without (like oil.)
Here I meant "assets that we cannot actually function without"

Too bad (3, Interesting)

SaintOfAllChucks (1200371) | more than 6 years ago | (#23928121)

they don't make steel in Pittsburgh any more. US Steel may be based here but most of the steel plants are no longer in the region. They make steel in Pittsburgh the same way they make cars in Detroit. Pittsburgh is mostly medical science and hospitals now. When industry comes back to the U.S. it will be in places that are less union friendly. (for the record, I do live in Pittsburgh)

High oil prices will do way more than Kyoto (5, Insightful)

RobinH (124750) | more than 6 years ago | (#23928123)

The fact is, for all the environmentalists out there screaming to put regulations on carbon emissions, etc., the price of energy is the only thing that's going to have a substantial impact on the amount of fuel we use. People are actually considering more fuel efficient vehicles, and at my place of work people are taking advantage of opportunities to work from home once in a while. Especially when their commute is over one hour. If we keep it up, people might move closer to work.

China is the last (3, Interesting)

thorpie (656838) | more than 6 years ago | (#23928125)

In the 50's it was Japan,
In the 60's it was Hong Kong
In the 70's it was Taiwan
In the 80's and early 90's it was South East Asia
In the late 90's to now it has been China
To be worthwhile producing elsewhere you have to be able to produce for less than 30% of your home costs.
There is nowhere left to go
We have to manufacture our own again
So maybe we will get decent working conditions at last!

The steel thing is already happening (5, Informative)

street struttin' (1249972) | more than 6 years ago | (#23928135)

My dad has worked in steel for the past 38 years and he says they are busy as hell because the fuel cost and weak dollar has been making US steel cheaper for a while now.
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