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Buying American Ford Car

How Buying American Can Save the Economy: The American Automotive Industry

The US economy has been struggling and is stagnant at best.

Pundits and politicians try to paint another picture and distract from the severity of the issue. According to the Survey of Income and Program Participation (U.S. Census), well over 100 million Americans, or 31% of the US population, are enrolled in at least one welfare program run by the federal government.

While the causes and factors are many, there is one cause that cannot be ignored – the decline of American manufacturing.

Economists traditionally categorize the economy into three sectors – agriculture, manufacturing and services. For decades, America has been a global powerhouse and mainstay on the manufacturing stage.

But, not any longer. America has slowly but surely seen a devastating decline across the board. Between 2002 and 2012, the US saw the loss of fifteen manufacturing facilities per day.

The Automotive Industry & The Economy

Front and center is the automotive industry – and any significant movement in the automotive industry dramatically influences the economy in general. After all, the automotive industry helped drive the last one hundred years of American life. The Big Three – Ford, General Motors and Chrysler, were very much the backbone of the US economy and still are today. In fact, two of the four largest manufacturers in the world are Ford and GM. As a result, the decision to move much of the manufacturing overseas has been a crushing blow to the US economy.

Hit the hardest was possibly Detroit. The city was once the center of the US and global automotive industry and was a bustling place to work and live. Today, Detroit is the poorest city in America, by any measure. Worse, it has more crime than any other city in America. The closing of plants started an economic domino effect with enormous consequences.

For 77 years, Detroit-based General Motors led the world in global vehicle sales, all made in the USA. Today, GM is operating plants in 37 countries. Ford is following suit with 70 plants in 18 countries.

Interestingly, some foreign automakers are actually building in the US. Toyota, KIA, Nissan and Honda are playing a positive role in the economy. Honda has spent more than $15 billion building and outfitting nine US facilities. Additionally, Honda is outsourcing orders to more than 530 US suppliers in 34 states. The Nissan plant in Canton, Mississippi has put more than $2.5 billion into that local economy, too. Economic impact, indeed.

Why Buy American?

So, made in the USA means jobs, jobs, and more jobs. And not just on the assembly line. It means suppliers – the “little guys.” Automakers have fueled small businesses all over the country, including research institutes, design studios and safety labs. And the collective data that has been generated has improved the quality of life around the world. Unfortunately, these jobs have gone overseas, too, causing many small businesses to go bankrupt, with more on the way.

Experts are predicting the negative trend to continue. Alan Blinder, a professor at Princeton University, believes a net loss another forty million US jobs is coming over the next two decades.

Still many consider the key to economic recovery to be found in manufacturing, as a recent New York Times column suggested: “It is not only possible for manufacturing to lead the recovery of the U.S. with growth and hiring, it is a necessity. To help achieve a sustained economic recovery, our country needs a consumer-led commitment to buying American-made products, which supports American manufacturing jobs and employment.”

More significantly, the article goes on to say that the foundation for all manufacturing is that of automotive. The author cites the Center for Automotive Research estimates that show that “every new job in auto manufacturing supports nine other jobs, from restaurant workers to parts makers.”

In terms of economic impact, the columnist also concluded that a resurgence in American auto manufacturing will accomplish two specific goals. First, there will be a significant reduction in the unemployment rate. Like no other industry can, the automotive industry can create jobs. And second, growth in the automaker world will increase the tax base which will help pay for essential things like Medicare and Social Security.


The state of the economy is clearly impacted by manufacturing, and especially by the automotive industry.

Global outsourcing is killing the US. What if those 117 plants that GM and Ford sent overseas were, instead, back on US soil?