Archive for November, 2020

U.S. Must Face up to the China Threat

Wednesday, November 18th, 2020

Over the past ten years that I have been writing blog articles, one of my reoccurring themes has been the danger posed to the U.S. by China because of their predatory mercantilism through product dumping, currency manipulation, intellectual property theft, and government subsidies. More recently, I have written about China’s written plan to become the superpower of the 21st Century through a combination of economic coercion, industrial espionage, and the buildup of their military.

In this article, I want to share some of the points made in the September 2020 issue of Imprimis, published by Hillsdale College. The article was “adapted from a speech delivered on September 29, 2020, in Rapid City, South Dakota, at a Hillsdale College National Leadership Seminar,”by Brian T. Kennedy, “president of the American Strategy Group, chairman of the Committee for the Present Danger: China, and a board member and senior fellow of the Claremont Institute.”

Kennedy catches your attention immediately saying, “We are at risk of losing a war today because too few of us know that we are engaged with an enemy, the Chinese Communist Party (CCP), that means to destroy us. The forces of globalism that have dominated our government (until recently) and our media for the better part of half a century have blinded too many Americans to the threat we face. If we do not wake up to the danger soon, we will find ourselves helpless.”

He points out that our relationship is based on two beliefs initiated during the Cold War: “President Nixon’s strategic belief that China could serve as a counterweight to the Soviet Union” and “economic liberalism would lead to political liberalism, and China’s communist dictatorship would fade away.” History has shown that these two beliefs were false and “America’s China policy from the 1970s until recently was very costly because it involved a great deal of self-deception about the nature of the Chinese regime and the men who were running it.”

He comments that after the Cold War, “pursuing the China dream appeared a safe course of action, given that the U.S. was then the world’s preeminent military power.” During the last year of the Clinton administration, “China was granted “Most Favored Nation” trading status and membership in the World Trade Organization.” We know the disastrous consequences of this action:  the lost of over 5 million good paying manufacturing jobs between 2001 – 2010 and the closure of some 67,000 manufacturers.

Under the subsequent Bush and Obama administrations, “the U.S. failed to build a military that could challenge Communist China’s aggression in the Pacific—specifically its building of a modern navy and its construction of military installations on artificial islands in the South China Sea—and acquiesced in the export of much of the U.S. manufacturing base to China and elsewhere.”

He explains that China’s 1.4 billion population is “governed by the Chinese Communist Party, which has 90 million members, and by an elite class of approximately 300 million additional Chinese who are deeply invested in the regime’s success…The system benefits these elites, whose businesses, mostly state-owned enterprises, are privately run with active participation by the CCP. Once a business reaches a certain size, it will take on board a cadre of party members who serve as a direct liaison between the business and the government.”

He goes on to explain that “the CCP operates a massive global intelligence network through its Ministry of State Security. This network does its part to assist Chinese business and industry through industrial espionage, cyber warfare, and economic coercion.”

With regard to China’s military buildup, he states that China “has a military of two million men, including the world’s largest navy. This military may not be qualitatively on par with the U.S. military, but quantity has a quality of its own. In the last five years of U.S. naval war game simulations, in which the U.S. is pitted against China, the U.S. has failed to come out victorious. We do not have enough ships and munitions to defeat China’s navy absent the use of nuclear weapons… “As for China’s air force, it possesses and is building today advanced fighter aircraft that rival anything the U.S has built. They may not yet have the quantity, but that will come with time.”

Next, he mentions the book, “Unrestricted Warfare, written in 1999 by two People’s Liberation Army colonels. It argues that war between the PRC and the U.S. is inevitable, and that when it occurs China must be prepared to use whatever means are necessary to achieve victory. This includes economic warfare, cyber warfare, information warfare, political warfare, terrorism, and biological warfare, in addition to conventional and nuclear warfare. The book’s purpose was not only to shape Chinese policy, but also to plant the idea in the minds of U.S. policymakers that China will consider nothing out of bounds.”

He comments that “In thinking about the implications of the word unrestricted, it is useful to look at the CCP’s treatment of its own people. Estimates put the number of those killed at the hands of the CCP—whether through war, starvation, or execution—at roughly 100 million…. And these numbers do not even take into account the forced abortions stemming from China’s one-child policy. That number is conservatively estimated to be 500 million—500 million children murdered in the womb.”

He reminds us of “CCP’s imprisonment in concentration camps of one to two million Muslim Uyghurs in Xinjiang province. Fewer of us are aware of how the Chinese government facilitates the abduction of Uyghur women for sexual use by Chinese soldiers—or even worse, if that were possible, how the government harvests the organs of the Uyghur population for sale both in China and abroad.”

Next, he states that “The CCP operates a vast intelligence network in the U.S as well. It is made up not merely of intelligence operatives working for the Ministry of State Security, but also a myriad of business and industry officials, Chinese scholar associations, Confucius Institutes operating on American campuses, and 370,000 Chinese students attending American universities.…It should not be surprising that a combination of the efforts of this network and of China-based cyber criminals yields $500 to $600 billion of intellectual property theft annually.”

Of particular importance to me is his comment that “Perhaps the greatest threat to the U.S. posed by the CCP is its corruption of America’s business and financial elites, who view the economic benefits of dealing with China as more important than America’s national interests. If there is a single group committed to the globalist project and the delusory China dream, it is Wall Street. Our great investment banks are now selling trillions of dollars in debt and equity in Chinese corporations to American investors and retirees. They are literally betting on the success of China at the expense of the U.S.”

I’ve long written about how American companies have put short term profits before their loyalty to America by transferring so much of their manufacturing to China. As a result, we have decimated our middle class as manufacturing jobs are the foundation of the middle class.

He concludes saying, “Americans are not looking for war with Communist China, but Communist China appears to be at war with us. As a first order of business, we must continue what we have at long last begun: building a military designed to deter Chinese aggression and pursuing trade and other policies that put our own national interests first.

Equally important—especially given the violence in our cities that our foreign enemies cheer—is defending our American way of life and teaching our countrymen why America deserves our love and devotion, now and in the days ahead.”

It’s past time to wake up.  It’s time for action. The next administration must make putting American first if we want to remain a free democratic republic and maintain our national sovereignty.

How has the COVID Pandemic Affected Makerspaces?

Wednesday, November 4th, 2020

In the past several years, I have visited four makerspaces in southern California, and I recently decided to see how the COVID pandemic had affected these facilities.  Makerspaces play a role in reviving the entrepreneurial “maker spirit” necessary to rebuild and grow American manufacturing.  

The first center I had visited several years ago was MakerPlace, located in San Diego, California. MakerPlace was founded in 2012 by Brian Salmon, Michael Salmon, and Steve Herrick. It was touted for its promising concept of a shared “dream garage,” where hobbyists or professionals could use high-end tools and industrial equipment to make their creations. It had equipment for metalworking, electronics, embroidery, sewing and specialty tools such as laser cutters and engravers.  It also rented out studio and office space, making it a sort of workshop/coworking hybrid.

When I called to talk to the owner, I was unable to connect, so I searched online and found two articles in the San Diego Union Tribune. The first article from December 6, 2019 said that the sole remaining business head of the company, Steve Herrick “decided he was ready for retirement and sought a buyer.” In December 2019, Joseph Henseler and his wife and partner, Lorena Isabelle took over as the new owners.  Hensler had ran his construction and design firm, Duende out of the MakerPlace for six years.

The second article, dated February 2, 2020, stated that MakerPlace “has abruptly shut down, asking members to remove all their belongings in less than 10 days. The shop sent an email to its members with few details about the closure. ‘MakerPlace is officially closing,’ the email reads. The building will be open “only for picking up your own personal items/tools/materials. Anything that’s not picked up by Feb. 14 will be forfeited.” The announcement of the closure came as a shock to members, and some had paid in advance for months of use.

Since the announcement of the closure occurred prior to the shutdowns for the COVID pandemic, it is likely that MakerPlace closed for financial reasons not caused by the pandemic.

The second makerspace that I had visited on Manufacturing Day in October 2016 was Open Source Maker Labs (OSML) in Vista, California.  OSML is the only makerspace in North San Diego County.  Dan Hendricks opened OSML in 2013 to provide a high-tech digital fabrication lab where members can learn, collaborate, innovate, design, and build almost anything.  Their lab is filled with open workspace and tools:  electronics, CNC machines, 3D printers, laser cutter, panel saw, press brake, welding and soldering tools, drawing and modeling programs, and a computer lab.

When I spoke to Dan last week, he said they closed down for two weeks until they realized they fit the definition of an essential business that was allowed to stay open under Governor Newsome’s order. 

I asked what he has had to change.  He said, “We follow the stage 2 guidelines and limit the use of our labs to members by appointment only and limit the number of people based on our square footage. We practice a smart sanitization routine for our Maker Lab. We only lost a couple of older members worried about their health, but have picked up some new, younger members. We haven’t had to turn anyone away.  We focus on R&D technology and have a lot of the software needed for designing new products.  We offer a co-working incubator-type atmosphere for startup and existing small to medium-sized companies.”

He added, “I’m an Adjunct Professor at Cal State San Marcos, so we are doing some online classes in partnership with the college. I will be doing an online class on IIoT for the next term.  Our strategy was to ride out the pandemic and not change to be ready to help with the recovery and support the new companies that will form during the recovery and provide R&D resources for existing small and medium sized companies to do their R&D at our facility.

In 2016, I also visited Vocademy – a Maker Space in Riverside, California, founded by Gene Sherman. Vocademy was a combination of the “best parts of makerspaces, school shop classes, trade schools, R&D labs, and dream garages, all in one place. His dream was “to solve the skills gap for the manufacturing industry.” Unfortunately, it was Sherman’s focus on providing shop classes for schools and being a vocational trade school that made Vocademy an early casualty of the COVID pandemic so that it closed down on March 20, 2020 after Governor Newsome ordered all schools and non-essential business to shut down because of the COVID pandemic.  An article in the Press-Enterprise of March 28th, stated: “Vocademy…can’t afford to stay open due to the state order mandating business and school closures, wrote Gene Sherman, the nonprofit’s founder and CEO.

The academy partners with schools, and when those schools closed until next school year, 70 to 80% of Vocademy’s revenue was lost, Sherman said in an email.

In addition, many of our current students did not wish to attend class and other potential community students told us they will not be signing up because of virus fears, Sherman wrote. “We are a small business and, unlike a public school, our revenue does not come directly from educational funding.”

It broke my heart to hear that Vocademy has closed because providing vocational shop classes to youth is critical to providing the next generation of manufacturing workers need to rebuild American manufacturing.

I had visited Urban Workshop in May 2018 after attending a conference. The Urban Workshop Is located in Costa Mesa and was founded by and is privately owned by, Steve Trindade. The 28,000 square foot floor plan includes workshop areas for a variety of manufacturing processes, co-working office space, a work assembly area with assorted hand and power tools, storage space for work in process and materials for members, a conference room, a large meeting room, and a retail store offering convenience materials and consumables.

When I interviewed Steve last week, he said, “We were closed for 60 days before re-opening. I sent a heart-felt message to members and most of them continued to pay their membership dues and monthly charges for storage space. We told them we would make it up at the end after we reopened. We lost our hands-on contract work with a charter school, but we were able to make 50 videos for their online education program.”

He explained, “What saved us is that we have four different revenue streams:  membership dues, fees for storage space for members, fees for classes, and co-working space. We made some decisions early on that were based on my experience in ramping up and down for the racing industry I was in previously. We went down from 330 members to 180 members, but went back up to 335 members within 80-90 days of reopening. We implemented a stringent sanitizing program and members have to make appointments”

He added, “We are continuing our program to license our operational procedures and class documentation to other makerspaces as a “Maker Space Blueprint,” provide operational training in setting up and running a makerspace, and provide instructor training to enable them to succeed and prosper.”

I told him I was glad they have survived the effects of the pandemic because makerspaces play an important role in rebuilding American manufacturing.  We agreed that new businesses will be formed by people who have lost their livelihood during the pandemic just as previous recessions spurred the formation of new businesses