Since the mid-1970s, the United States has run enormous trade deficits, not only with developing countries, but also with wealthy, advanced economies like Germany and Japan. Last year, the U.S. ran a trade deficit of $539 billion, a deficit approximately equal in size to the entire economy of Sweden. If not for a modest surplus in services, the trade deficit would have been far worse. Astonishingly, in 2015 the U.S. imported $759 billion more goods than it exported, a deficit of $2,400 for every man, woman, and child in the country. In the long run, these deficits are only “balanced” by the U.S. selling real assets — land, factories, intellectual property, treasury bonds — to other nations.
It wasn’t always this way. For most of the 20th century, the U.S. ran a modest surplus in both goods and services. The U.S. manufacturing sector was also a much bigger part of our economy than it is today. In 1960, about 25% of all American employees worked in manufacturing; today the share is under 10%. Manufacturing as a percentage of the total U.S. economy has also sharply declined in importance over the same time period.
Throughout the 19th and into the 20th century, the political consensus was to protect and nurture American manufacturing. It’s a little known fact that in the 19th century, tariffs on imported goods were one of the federal government’s largest sources of revenue. While academic economists today disparage “protectionism,” the truth is that the U.S. in the late 19th century became the world’s largest economy, the world’s largest manufacturer, and had the highest average wages of any country in the world. America achieved this incredible success despite taking actions which directly contradict the trade theories taught today by many academic economists.
The problem is not just academic trade theory. Today, manufacturing suffers from a perception problem, especially among the most well-educated Americans. Factory jobs are often seen as dirty, relatively low paid work, an artifact of the past. I saw this first hand at the elite universities I attended. The default career paths are law, medicine, banking, tech and academia. Manufacturing is nowhere on the agenda, save perhaps for a limited segment of students in engineering fields.
In fact, the poor perception of manufacturing has little basis in reality. In the Chicago area, still one of the nation’s great manufacturing centers, the average earnings for manufacturing jobs is over $67,000 a year — 16% higher than the average job in the region. The same is true nationwide. Manufacturing jobs pay more because, in many cases, it takes years of training and expertise to really do the job well. You can’t afford to lose an employee who is critical to the process.
Mondelez recently announced it was closing its Oreo cookie plant on Chicago’s economically depressed South Side and moving the jobs to Mexico. At the plant, many factory employees made $25 an hour with good benefits. These are employees who, for the most part, do not have a post-secondary education. Many of them will be lucky to find a job which pays half as much.
So-called “free trade” deals shoulder substantial the blame for the decline in U.S. manufacturing. For example, research shows that trade with China has cost the U.S. three million manufacturing jobs — more than the entire population of Chicago. NAFTA has also cost the U.S. over 600,000 manufacturing jobs. Those were, by and large, good jobs which supported families. The result is plain to see: many American cities, small and large, which look like bombed out war zones, with empty factories, vacant homes, and crumbling infrastructure. Detroit is classic example — going from one of the highest-income regions of the U.S. in the 1950s, to a shadow of its former self, having lost over half its population. It’s very difficult to conclude this is an acceptable outcome of “free” trade.
As a graduate student at the London School of Economics in the late 1990s, I was thoroughly exposed to the “consensus” Anglo-American view on free trade. For the most part, the view is that trade is good even if one side manipulates its currency or otherwise tries to put a thumb on the scale. This is the American consensus on trade, but it’s hard to believe that elites in Germany, China, Japan, South Korea — countries with strong manufacturing sectors and big trade surpluses — share this “consensus” view. Their actions suggest they don't put much stock in our current academic trade theories. And perhaps they are right. There’s an old saying: “if you’re at a poker game and you don’t know who the sucker is, the sucker is you.”
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Copycats vs. The Real Thing (10/24/2014)
There are a lot of copycat, fake, and knockoff products out there. It might seem like a bargain -- the idea that you're getting the same product for a lower price. Unfortunately, it's not true. While the copycat may look the same, it's often a very different and inferior product underneath. And sometimes, the fake can be dangerous to your health. (That's true even for products, like combs, which are not eaten or ingested).
One difference is material. Chicago Combs are made of very high quality stainless steel which is manufactured in Kentucky, USA. But when you buy a copycat, you don't know what you're really getting. They may call it stainless steel, or even titanium, but you have no idea what it's really made of. There are many grades of stainless steel -- and some have such a low chromium and nickel content that they can actually rust or corrode. Or the cheap metal they use can leach dangerous chemicals or other metals onto your hair or skin.
Another difference is quality. With a fake, you're getting something which is not finished with anywhere near the level of care as a Chicago Comb. Metal polishing is an art form, and it takes years of expertise to know how to properly polish each comb so that it's comfortable, smooth, and gentle on the scalp. The knockoff combs are made as quickly and cheaply as possible, without regard for whether the comb actually works as it should.
Unfortunately, even if you buy a fake comb that doesn't rust - or injure your scalp - you're still not out of the woods. Believe it or not, there's a major issue in certain countries with radioactive metals being recycled and sold on to consumers. The Seattle Times reported on a recent incident involving radioactive metal tissue boxes which ended up on the shelves of a major retailer, Bed Bath and Beyond. Undoubtedly there are many other such cases which haven't made the news.
Obviously not all products from overseas carry the same risks. If you buy an iPhone, for example, even though it's assembled abroad, there are thousands of people throughout the world whose job it is to ensure that it's a safe product. That's not the case with copycat products. When you buy knockoff, you're buying from someone who is already breaking the law. These fly-by-night operators are unlikely to have much concern about your safety or well-being. And the last thing you want is to end up with an unsafe or even radioactive piece of metal in your pocket or in your bathroom.
When you buy a Chicago Comb, you can be assured you're getting the real deal: a safe, carefully made product, backed by the reputation of a company whose combs are sold by 100+ leading retailers throughout the world. Please check out our products, and drop us a line - we'd love to hear from you!
We went yesterday to check out some possible industrial space for lease by Chicago Comb. The building is an almost century-old, several story high, brick industrial building on the Kedzie corridor in East Garfield Park -- a neighborhood that has seen its share of struggles over the years, even though it's only a few miles west of downtown. The building has very high ceilings, wooden floors, and an incredible old elevator. We fell in love with it immediately.
The building looks fairly non-descript, but inside there's a hive of activity by artists and artisans. Creating things, and generating ideas. There's something about art which always has the feeling of being cutting edge and fresh, even when it's in an old industrial building in a rundown part of the city. In a way, art is perhaps the most innovative thing being created by people, and it's certainly something we feel spiritually close to here at Chicago Comb.
There's also a backstory to the building which we later found online. Far from being just an old industrial building, it was actually once the main factory for a company called Simpson Optical. What's Simpson Optical? As we learned, Simpson Optical was a manufacturer of precision lenses and lighting devices. During World War II, they manufactured lenses for a top-secret device called the Norden bombsight, one of the most important weapons of the war. There was a notorious German saboteur who managed to get a job there, named Haupt. He was eventually captured; the case went all the way to the Supreme Court.
We'll find out soon whether the space is definitely available for us. We're very excited to be able to do the finishing touches on Chicago Combs in the same building that gave rise to some incredible history.
As the holiday shopping season begins to wind down, we wanted to take a moment to thank all of our friends around the world, and wish you all a healthy, happy, and peaceful holiday season. Over the past few years, we've been incredibly fortunate to get to know many of our customers around the world - in the US, Canada, France, Ireland, Sweden, Germany, Singapore, Australia, the UK, and many, many other countries. Your emails, photos, and messages all mean the world to us. We're incredibly grateful to be a part of your lives, and we thank you for your support and friendship. 2014 will be an exciting year for Chicago Comb and we look forward to sharing it with you. Thank you!
We had several goals in mind when Chicago Comb was launched, and those goals still motivate us today. Foremost in our minds was the desire to make the finest men's combs in the world: combs with timeless and elegant designs, and which are made to last forever.
We also wanted to manufacture locally. Chicago was once mostly a manufacturing city, and living here makes you acutely aware of the city's great industrial past. Drive down Cicero Avenue, for example, and you'll see the old Brach's plant, once the world's largest candy factory, now empty. There are many others like it spread across the city.
Of course, there is another side to the story -- the continued vitality and innovation in Chicago manufacturing. In Humboldt Park, not far from the old Brach's plant, is the facility where Chicago Combs are laser-cut from a solid sheet of steel, using a high-tech, million dollar machine. (That machine, incidentally, is made in California).
The steel for the combs is forged in Kentucky and Indiana, and before it reaches the machine, it's cut into large sheets by a local company in Chicago. Once the combs are individually laser-cut, we bring them to metal polishing works located in Chicago and in Elgin to be finished. They're each polished by hand.
The elegant silver and black packaging used with our combs is also made in Chicago, in a facility on the west side. The round little stickers we use to seal the packages come from Florida, and the shipping boxes we use are made in Bedford Park, a suburb of Chicago.
There are significant advantages to manufacturing locally. First, from a product standpoint, we can see exactly how everything is created, and make tweaks as necessary to ensure that the products are absolutely amazing. Another benefit is seeing how Chicago Comb helps support an ecosystem of other local businesses (steel manufacturing, laser cutting, polishing, packaging, engraving, etc.) and their employees and families - many of whom we know by name.
When you use a Chicago Comb, you can feel confident that you're getting an amazing quality, locally made product. We don't cut corners. It's our singular goal to make the best comb in the world, every time.
Surprisingly, it's not always easy to figure out where something is actually made. That's true whether you're talking about a product "Made in USA", or one labeled as being "Made in China" or elsewhere.
Let's start with what should be an easy case, agricultural products. Consider, for example, an apple grown on a farm in Michigan. It arrives at your local grocer with a little sticker identifying it as US in origin. That would seem to be the epitome of a locally made product. There's no doubt that the apple was picked off a tree on a local farm. But even here, it's not clear what else was involved in the process of creating the apple and getting it in your hands. Was fertilizer used on that farm, and if so, where did it come from? What about the machinery used to harvest and transport the apples? The energy used in that process?
Organic farmers, and the organizations that certify them, have encountered a similar issue. If a farm in the past used conventional pesticides, at what point does it really become organic?
If the question of "origin" is sometimes complicated when talking about farm products, it can be far more complex when talking about manufactured goods. That's especially true for products assembled out of many different components, such as automobiles. A federal law called the American Automobile Labeling Act requires car makers to disclose, on the window sticker, the percentage of the car made in the USA.
As you might imagine, there is no such thing as a car 100% made in USA (or even 100% made in Japan or Germany). Given the complexity of the global supply chain for car parts, every car contains components from multiple countries. That doesn't mean, however, that all cars are equal in terms of origin. Cars assembled in the USA will, of course, tend to have more of the "value" (i.e., parts and labor) created and added locally.
In the next installment, we'll discuss Chicago Comb's commitment to local production, and the steps we've taken to ensure that "Made in USA" really means what it says.
Since Tedd and I launched Chicago Comb in 2010, we've grown from a small company in Chicago with a single product, to a manufacturer which sells its combs in 30+ stores in a half-dozen countries. While we've grown, our core mission and values -- creating top-notch, locally made products at the intersection of art and design -- remain the same. Thank you to our wonderful customers and friends for letting us be a part of your lives.
In the coming year, there will be a lot of exciting developments at Chicago Comb, including at least one entirely new type of comb. We can't wait to share it all with you. Thank you for your support! It has meant the world to us. And as always, please reach out to us any time, whether to discuss a product or just to connect.
John is the co-founder and President of Chicago Comb