Trump’s Favorite Pen, the Sharpie, Is a Made-in-America Success Story

President Trump loves a Sharpie pen, and now he has all the more reason to love the company that makes them.The president signed the flurry of executive orders he issued the day he returned to office with a Sharpie.He’s used them for years, finding them more reliable than fancier pens.Now we know they have another merit, too: They’re almost entirely made in America.Only the felt tip of a Sharpie comes from abroad — it’s made in Japan, according to the Wall Street Journal’s Natasha Khan, who published an eye-opening article on the penmaker last week.What makes Newell Brands, the corporation behind the Sharpie, so newsworthy is its success saving money — and holding down consumer prices — by making the pens in America.Newell was once as dazzled as other manufacturers by the prospect of making its products more cheaply in Asia.In 2018, though, the chief financial officer, Chris Peterson, looked into producing the latest Sharpie, a gel version, at the company’s factory at Maryville, Tennessee.The new pen required updating the plant and training employees to operate and maintain the new machines.Yet that’s what made the project a triumph: investment, in an American factory and the Americans working there.This country can make top-quality consumer goods at affordable prices, but only if companies invest in cutting-edge machinery and in enhancing employees’ skills.Mr. Peterson, who became the company’s chief executive, had Newell pay to send factory floor staff to college.They came back ready to take on more technically demanding tasks, and naturally their wages shot up — on average by 50 percent over the last five years, in Mr. Peterson’s estimation.The mandarins of globalization say higher wages surely have to mean lower profits, and doesn’t better machinery mean fewer employees?Yet Newell’s production costs dropped even as employment levels held steady:Not every story in American manufacturing has such a happy outcome, but Newell proved the process that once lifted manufacturers and their employees together into prosperity still works in the 21st century.Ford Motor Company famously discovered it could sell more cars by paying its employees well enough to afford the automobiles they were making.Long before globalization, America’s national economy boomed thanks to a virtuous cycle of rising wages, more technological investment, an increasingly educated workforce, and higher consumer spending on American-made goods.Success at home led to success abroad: America was an exporting superpower that “ran persistent trade surpluses” between 1870 and 1970, the Federal Reserve Bank of St. Louis relates.Mr. Trump wants to make American manufacturing great again.Yet tariffs, which can help, are not enough by themselves.The Sharpie case shows domestic investment is critical.One reason for American manufacturing’s relative decline in recent decades has been the high cost of building new plants or renovating old ones.Even if it’s profitable to manufacture in America, the upfront expenses are a hurdle, especially when foreign countries, which subsidize their industries in myriad ways, offer quicker returns on investment.Mr. Trump incurred the wrath of free-market purists by getting government more involved in businesses like Intel and United States Steel.Yet industries like chip-making and steel — or for that matter ship-building and aerospace — are sectors with heavy government involvement throughout the world.The few countries that have significant manufacturing in those fields all use government aid to sustain their industries.Even smart free-market economists are dangerously naive about this:At a recent Dallas-area debate I participated in, National Review’s economics editor, Dominic Pino, who’s since moved to the Washington Post, contrasted “the government-driven protectionist model that we have used for U.S. Steel for decades,” which has “now resulted in the quasi-nationalization of that company,” with “FedEx, which is profitable, employs way more Americans … and actually delivers services that Americans use every single day.”Trouble is, nowhere on earth is steel manufacturing as fully private an enterprise as FedEx is.The choice Mr. Pino was presenting wasn’t between government-backed steel or free-market steel — it was between partly government-backed steel or no domestic steel-making at all.For most American manufacturers, private investment is enough — though even then, government must consider what unfair practices other countries may adopt to lure investment away from our shores.There’s also a role for government in ensuring a reasonably level playing field at home, so investment isn’t incentivized out of manufacturing and into other sectors without the heavy upfront costs of plants and machinery.Yet the Newell Brands example shows business leaders themselves can work miracles and defy globalization’s laws of gravity when they put capital behind America’s factories and employees.Creators.com

Trump’s Favorite Pen, the Sharpie, Is a Made-in-America Success Story

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