Saturday, November 6, 2010

Amos & Andy.

This is coolbert:

From a comment to the blog by Steiner:

"Steiner said...
You mean, it is cheaper for the United States to pay to have these vehicles manufactured in the U.S. for delivery to Israel. The government of the Jewish state won't pay a penny for these things."

Well, what Steiner says regarding the manufacture of the Nemer infantry fighting vehicle in the U.S. is very true!

The proper understanding of the entire scenario is:

1. The U.S. borrows money from China.

2. The U.S. loans [gives?] the money to Israel in the form of military foreign aid.

3. The Israeli pays the U.S. firm [General Dynamics} to build the Nemer.

4. General Dynamics pays the workers of the firm.

5. Those workers pay taxes to the U.S. government, a portion of those taxes used to pay off the debt owed to China. That original money borrowed from China in the first place.

Sort of sounds like an Amos & Andy comedy routine - - doesn't it? But is NOT merely a shell game! Goods and services are being exchanged.

In addition AND perhaps even more important it is true that in recent times manufacturing costs in the U.S. HAVE become lower AND that it is eminently important that the U.S. continue to have an expertise in the manufacture of heavy military weaponry.

[Adam Smith said that free trade should ordinarily be absolute, with two exceptions, one being that a nation must maintain an ability to manufacture weaponry necessary for defense!]

Skills, abilities, expertise that can only be had by DOING [making the thing!].

Items such as:

* Submarines.
* Armor plate.
* Nemer IFV.

Normally, the proud and self-reliant Israeli would ONLY want to do this work on their own. But NOW the situation is such than the costs of doing the work in the U.S. are just plain CHEAPER!


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