Handmade vs mass-produced

Jewelry Discussion
21 
    Pardon my ignorance, what kind of influence say a super rich
like Mr. Warren Buffet or say a company like Wal Mart or say GE or
some giant insurance corp or say the families that control the gold
or the currencies like Mr. Soros could have.Also what effect could
the people controlling media may have? or are these factors not
important or eventually lot of these holdings are eventually
concerntrated by few .

Hi Anil!

My 2 cents… These big players are fundamental in the destruction
of local economies, in the formation of large centralized services,
and are unfortunately, the natural progression of the kind of
economic system (banking) we inherited from Europe. There is no easy
answer. These economic powers are greater than the kingdoms of old,
and have a profound affect on our quality and style of life. I hope
everyone here understands the implications (and gets involved at the
grass roots level).

Jewelry makers, however, are typically very independent people,
sometimes painfully so. We exist in whatever economic climate we find
ourselves in, surfing along the waves of change with our skills and
humanity. ACN-TV may now be the worlds largest single jewelry
retailer. Their buying power is unmatched by anyone. They can, for
example, profitably sell beautiful invisibly set diamond jewelry for
less than we can purchase the materials for, yet people still come to
us for that one-of-a-kind jewelry piece in their search to define
themselves as individuals.

In short, we get by one way or another. We set our sails to the
prevailing winds, and in this case, the wind ‘gods’ are the super
rich.

As far as one basic group owning most of the media, well, think
about it…

Jeffrey Everett

22 
        Pardon my ignorance, what kind of influence say a super
rich like Mr. Warren Buffet or say a company like Wal Mart or say
GE or some giant insurance corp or say the families that control
the gold or the currencies like Mr. Soros could have.

Anil,

Here is an example of the kind of influence such people can have:

In 1992 Great Britain was suffering a recession. The British
government was under extreme pressure to try and maintain the value
of the pound. At that time, George Soros sensed the opportunity to
make a lot of money by betting that the value of the pound would
fall. He borrowed about $10 billion worth of pounds and traded them
mostly for German marks betting that the value of the pound would
fall in relation to the mark. The Bank of England tried to counter
this, as well as similar moves by other currency traders including
many large U.S. banks, and shore up the value of the pound by buying
$15 billion worth of pounds and raising interest rates substantially
(at a time when this was not wise). The Bank of England was
unsuccessful and Britain saw the value of the pound drop by about
19% and had to withdraw from the ERM (Exchange Rate Mechanism, the
precursor to the Euro). Many factors came into play and George
Soros alone did not bring this about but he played a significant
role selling almost as many pounds as the Bank of England was buying
to try and shore up the pound. Soros made about $1billion on his
bet. George Soros primary occupation these days is giving away
large sums of money primarily through foundations he has established
in eastern Europe and the United States.

Warren Buffett has not and does not make his money through currency
speculation. He does, however, control such large sums of cash that
he has to be careful how much of anything he does at any one time.
I recently heard that he has been selling dollars for the past year
and a half. It doesn’t sound like he has much confidence that the
value of the dollar is going to go up.

Best Regards,
Dale

23

Hence the question is How far can we blame the countries,thus, for
providing us with unfair"competetion"? Would I be wrong not to blame
my compatriot of getting things done overseas? Obviously this is
getting us in lots of trouble. Even as you and me, us and we
allinsist upon MADE IN AMERICA goods, to what extent are we
responsible for this situation currently we are in. Although I do not
want to shop at, say, Wal Mart but the logistics pushes me towards it
because my local store charges at least one key more than Wal Mart
does (Still local store does not make enough to survive). If
companies such as Wal Mart does not hesitate in hoisting products
from timbaktoo in my face and not the locally made goods then how do
i not get my product overseas to face comptetion from companies like
Wal Mart. Thanks for indulgence anil

24 
    Hence the question is How far can we blame the countries,
thus, for providing us with unfair"competetion"? Would I be wrong
not to blame my compatriot of getting things done overseas?
Obviously this is getting us in lots of trouble. Even as you and
me, us and we all insist upon MADE IN AMERICA goods, to what extent
are we responsible for this situation currently we are in. Although
I do not want to shop at, say, Wal Mart but the logistics pushes me
towards it because my local store charges at least one key more
than Wal Mart does (Still local store does not make enough to
survive). If companies such as Wal Mart does not hesitate in
hoisting products from Timbuktu in my face and not the locally made
goods then how do I not get my product overseas to face competition
from companies like Wal Mart.

Hi Anil

As I said earlier, there is no easy answer. For 20 years I have been
observing the closing (or moving overseas) of one U.S. jewelry
manufacturer one after another because they could no longer compete
in the new world market. Chain stores have set up their own
manufacturing companies overseas and because they buy their gold and
gems at volume lowest cost, have only the labor (as low as $1 per
ring!) and cost of doing business.

The jewelry business climate has changed, that’s about all there is
to it. You’re seeing, as in many businesses, manufacturers and
wholesalers selling direct either because it’s the only way they can
stay solvent, or because they can with satellite TV, the Internet and
cable TV.

In short, we can’t blame anyone. we’re in a world market now, and we
have to adjust to it, one way or another.

On the other hand, there will in all probability always be a local
craft and handmade jewelry market. This is what I consider grass
roots survival (cottage industry) in the local economy.

Jeffrey

25 
        Hence the question is How far can we blame the countries,
thus, for providing us with unfair"competetion"? ...... If
companies such as Wal Mart does not hesitate in hoisting products
from Timbuktu in my face and not the locally made goods then how do
I not get my product overseas to face competition from companies
like Wal Mart.

Hi Anil, If anyone is to blame for the situation in the U.S., I blame
the U.S. government. They must enact trade policies which help to
compensate for drastic differences in the cost of labor (i.e.,
standard of living) in different parts of the world. These should
apply to both foreign based companies that import products into the
U.S. and to U.S. based companies that set up manufacturing
operations in foreign countries (they are now actually foreign
companies) for the purpose of importing goods into the U.S. There
needs to be a dis-incentive for U.S. companies to become foreign
companies unless they plan to sell those goods in the country in
which they operate. If you want to call this protectionism, then so
be it. I see nothing wrong with protecting the jobs and hence the
economic welfare of ones citizens. I do not mean retaliatory type
trade policies. I think this is stupid and counterproductive. I
mean reasoned and rational trade policies (if there is such a thing)
intended only to try and equalize for the gross differences in the
economic climates between vastly different countries. As these
differences become lessened, then the trade policies should be
adjusted to reflect this. Pressure from the U.S. government on
these foreign governments to take measures to elevate the standard
of living of their workers (minimum wage laws?) in exchange for more
favorable trade policies may also help.

Yes, Wal-Mart buys the vast majority of its goods from China. But
you cannot compete with Wal-Mart no matter where they buy their
goods. They buy in such large quantities and operate on a 3-5%
margin that it really wouldn’t matter where they buy their goods.
Can you operate on a 3-5% margin?

This situation is not limited to the jewelry industry by any means.
Indeed it is rampant. I know a man who owns a $5 million/ year
manufacturing operation (not jewelry related), and has for 20 years,
who is having trouble competing with overseas operators. I hope you
can see that if we all decide the answer is to move overseas that we
are in serious trouble. Those who are left will have to work at
Wal-Mart and jewelry will not have a place in their budget.

I do not blame the consumer for this situation as much as I blame
the government. We are all doing the best we can to survive and
will choose from the available options. When confronted with
comparable options, I will choose American made products. But as I
have noted before, this is increasingly difficult to do. As an
example, I do not believe that it is possible any longer to buy a
television that is made in the U.S. I believe the market for local
craft and handmade jewelry has already been impacted by such outlets
as cable TV and the Internet. I know a woman who will only buy her
jewelry via cable TV. She thinks it is finely handcrafted and of
the highest quality (OK so she’s not a jewelry connoisseur) and does
not understand why it costs so much less.

Since I do not have the desire nor the ability to set up my own
overseas manufacturing operation, the only recourse I see is to
communicate with my government representatives. For anyone who is
interested, I have prepared a two page dissertation on this topic to
send to my congressional representatives. If you would like a copy,
please email me off list and I will send you a copy.

Thanks for listening,
Dale

26

I agree with Jeff Everett. People come to the small, independent
jeweler for that unique statement in personal adornment.

Here’s how to broaden your market share. Sell your work as “the
tattoo you’re not stuck with”.

Dan Woodard

27

I am all for it. But do you think they will listen to such isolated
voice/s (unless they feel they will lose their chairs)? We are not
represented by the lobbyist. Also there has to be reason that I or
most of us do not know why have we deliberately erroded or allowed it
to be erroded our home industries base( for e.g. it is the turn of
steel mfg. units to erroded) for getting product from overseas. I
fail to understand why every country even the most lagged behind
country insist upon manfacturing or processing their own goods or
developing their own manufacturing base, but for us-USA (except
printing $$$$$$$$). But I sincerely thank you
all for your point of view and indulgence. Anil

28

Anil; I believe most of our problems began when we allowed strong
armed tactics to be used in Force Feeding trade unions down our
throat, It seems to have created a class of people that either had
the money to buy the products which had become so over priced, by
necessity for the unionized companies to remain in business or the
other class of working slob that still had the minimal wage jobs,
remember at one time, in not too far distant times the United States
Of America was the most powerful nation in the world in regard to our
industrialized sector,

Unfortunately as has been stated before “No one can compete with
things like Wal-Mart” that’s because the people that aren’t employed
courtesy of the Unionized trades can’t afford to shop many other
places, and the ones that can afford the other places usually shop at
the GIANT any way. We as Americans have collapsed our once beautiful
house of cards right down on our own thick headed selves.

Once major manufacturing companies including Auto makers found that
there were people that could be trained to do the work that was
necessary to build their product, for 1/10th the salary of an
American Worker, well DUH would you continue to pay someone 28.00 an
hour to do something that you could get someone else to do for 1.75
an hour? The actual reason we are in the shape we are in, is that we
had it too easy for too long! That and we showed by example what
could be done if industrialization and wage could meet at a
reasonable level price wise. In other words we taught the third world
how to conquer the top, Now we get to sit and whine because our
Government is allowing American Entrepreneurs to go off shore and
bring their product back into the U.S. with out taxing the living

out of them. The small town I live in had 2 large garment makers

and 10 or more places that cut and sewed for them, the total work
force of this sector was over 3,000 people, now there are 3,000 more
employed, in Mexico and Honduras and 3,000 here that will do just
about any thing they can to earn a dollar because their unemployment
ran out long ago.

I think the worst thing that has happened to America wasn’t the
attack of 9-11 it was the attack of N.A.F.T.A. Personally though I’m
not schooled in the finite strata of economics unless we are willing
to drop our economic standards to that of = Mexico, Honduras,
Guatemala and the other nations we sent our manufacturing plants to
or gave our technology to that we are in for worse times. We may
possibly become a nation that is totally based on consumption rather
than manufacturing and agriculture. Granted I would rather see most
Jewelry hand crafted, I would even like to see it if it were
manufactured in Providence RI. But that and wanting clothes made in
New Hampshire and shoes made in Massachusetts. Isn’t going to happen
any more so who do we throw rocks at for these problems? We are all
guilty, how many on this board that live in the U.S. drive cars made
by Ford, GM, or Chrysler, NOT imported by them but wholly made in
this country. I’m just glad they haven’t found a way to import houses
yet.

(Putting soap box away now)
Kenneth Ferrell

29

Ken, I read your message. A soap box is a nice thing and surely
everyone is entitled to this opinion, still, the truth is that no one
really knows how many jobs flee the U.S.A. nor any other
industrialized country for that part as a consequence of a process
which is wrongly called ‘globalization’ nowadays - I am perhaps
permitted to refer to the seminal work about this done by my good
friend Erik Swyngedouw from the University of Oxford - look it up on
the net, many of his articles can be found. Let me answer a couple of
points in short. 1. The thesis that strong unions in the USA managed
to get wages up to such a point that they became a competitive
disavantage is untrue. It is historically incorrect in the long term

  • and besides the unions have been on the defensive since Reagan, if
    not earlier. But even if trade unions would have succeeded in getting
    the wages up - as indeed happened in most countries of Western Europe
  • then the relationship you take as a fact is still wrong, because
    another relationship interferes, namely the one between the
    percentage of unionized workers in a country - or sector - and the
    productivity in that sector, and it has been proven over and over
    again that this relationship is positive. This is for example the
    case in Belgium - but also in Germany, in France, in Holland, in
    Italy … In each of these countries the percentage of unionized
    workers is far higher than in the USA. The welfare state is far more
    developed as is the health insurance, which is universal. While all
    of this costs indeed a lot of money, the balance of it is positive
    for the country as a whole - I know from experience that this is
    extremely difficult for some Americans to understand, because it
    sounds completely counterintuitive at first sight and goes against
    what you hear all day, everyday - believe me, I know, I have been
    living in the USA for 2 years. Why is it positive? Because the
    benign effects of social mobility translate themselves in a very high
    productivity and in an educated and innovative oriented labor force.
    Only one example, but an important one: university education in
    Belgium is almost free, in other words, the tax payers pay for
    education. As a result, many people can study and as a result of this
    they can get a job which pays well, generating in turn higher taxes
    than if they would not have been able to get an education. Yes, taxes
    are high - so high that if you were right, the disavantage to our
    economies would be obvious - still the macroeconomic effects are not
    negative but positive.There is one other little detail: reckoning in
    real terms, real incomes have not gone up in the USA at all, they
    have gone down for almost two decades by now for the lower as well
    as for the lower middle classes - the statistics from the Dept. of
    Labor will teach you this - they are easy to find on the net as well.
    I think that this proves the wrongness of your point sufficiently. So
    is the USA losing jobs as a result of NAFTA? Yes. Some Americans,
    and we don’t know how many, lost - and lose - their job because of
    this agreement. The most basic thing to understand about all of this
    is that this agreement - and many others, NAFTA only basically being
    a symptom - would never been have negotiated if some Americans - we
    are talking about the USA here - did not get much better of it. The
    clearest indicator for all of this is the old parameter of Theil.
    This parameter construes a relationship between the evolution of the
    wages in a country. If the parameter is low then the wages evolve in
    such a way that rises in wages are comparable to each other. If the
    parameter is high then there is a discrepancy between the rises in
    wages of the lower classes, the middle classes, the higher classes
    and the top of the wage pyramid. Well now, the parameter of Theil
    proves that there is a tremendous discrepancy between the evolution
    of the wages in the USA. Some people lose their job, while others
    work and see their real income decrease, while other ones get rich
    like never before - you can find this on the website of
    the Dept. of Labor also - besides, I can send them to you when I get
    back home. Now, you tell me, suppose I want to buy a car, why would I
    buy a Ford or a Chrysler or a Chevy? And, indeed, why would you? You
    won’t keep jobs in the USA by doing so, because the economic pull is
    not lead by price - consumption - at all, but almost solely by the
    cost of labor. This problem, in fact, and this the most basic thing
    to say about it, cannot be solved by any economic rationality or
    economic behavior, it is a political problem and, as such, has be
    addressed politically and globally. Weird as it may sound, the
    very best the American worker - and the honest American citizen - can
    do is to make common cause with the worker in India and in Mexico in
    Eastern Europe and so on. If there are no adequate institutions for
    doing so, let’s make such instutions or let’s transform existing
    ones. I am completely and absolutely sure that nothing else will work
  • protectionism will not work - who do you think you will ‘protect’
    ? - curtailing the unions will not work, organizing trade wars will
    not work, making the rich richer will obviously not work either, but
    decreasing the incentive to delocalize by all sorts of ways will
    work. History - if there still will be one - will prove this point.
    Best, Will
30

This is a wonderfull letter, thank you for writting in. In the best
sense this is true Orchid. Keep writting the citizenry of the US is
historically xenophobic and the history of the world already has many
examples of what happens when this becomes acute. I think the main
problem with most US citizens is lack of travel and education to
understand where in the world we fit and that we don’t own the
planet.

Living on the US Mexico border is interesting. It is in many ways a
militarized border already. I don’t understand how the US govenment
keeps the idea that we can block South American labor from entering
and still maintain the economy we enjoy. I feel it is the law
enforcement business that keeps it going, there is just too much
money being spent for that business to want it to stop. The war on
drugs is a sad, constant reminder of this.

The prices for illegal drugs has plummeted since the war began
meaning that the supplies are even more plentiful. Feelings aside,
your use of US government statistics is wonderfull and telling.

Sam Patania, Tucson

31

I have to agree with Will Denayer that unions are not the problem.
Only perhaps 15% of the jobs in this country are union, and they do
not exert a noticeable upward pressure on wages for the balance of
the work force. Moreover, the jobs aren’t leaving to go just
anywhere, as they would if the problem were one of artificially high
wages in the US-- the jobs are going in most cases to some of the
most desperate, oppressed and impoverished areas on the planet. It
is no coincidence that many of the places to which our jobs are
moving have considerable issues with human rights.

What we are looking at here is simply the fact that our captains of
industry have figured out that they can make a greater short term
profit by exploiting the plight of workers in third world countries.
Their best case scenario is that they can do so while simultaneously
stealing the natural resources out from under the feet of those
people, as is being done with water rights in India. This has the
added bonus of putting workers in this country on the defensive, so
even those US workers who keep their jobs are scared into accepting
stagnant wages, benefit cuts and union busting.

This is called globalization, or neo-liberalization. It is aided
and abetted by organizations such as the WTO and IMF, and by
regulations such as NAFTA and the FTAA. It is bad not just for
workers in the US, but for everybody, save a few fat cats. With
roughly 8 million people unemployed in this country, 2.7 million
jobs gone overseas under the present administration, and the stock
market stagnant, the forty richest people in the US got 10% richer
last year.

For a good basic primer of globalization or neo-liberalization and
it’s ills, I reccommend Greg Palast’s book, “The Best Democracy
Money Can Buy.”

Lee Einer
Dos Manos Jewelry
http://www.dosmanosjewelry.com