Why can’t things be the way they used to be?

tariffThe way things used to be was when the US cutlery companies needed help to fight against cheap foreign- made knives our Government would exercise its authority by taxing or restricting imports.

Some examples include -The McKinley Act of 1890, the Wilson Act of 1894, the Dingley Act of 1897, the Fordney-McCumber Act of 1922.

All of these acts substantially raised the price of imported cutlery and resulted in making American knives more affordable.

There is no doubt, the US firms today are struggling against cheap imports and China is one of the major contributors.

In my interview with W R Case & Sons Cutlery Company President, Mr. Tom Arrowsmith, he said he has seen more changes that are impacting the US knife companies in the last few years than all years before.

Mass merchants of the world have driven prices down. US manufacturers heard the sirens’ call of offshore manufacturing. Today only a small handful of knife makers make all of their products in the US.”

“Virtually all of the large manufacturers in the Knife Industry have substantial portions of their products produced mostly in China.”

In addition to China flooding our market with knives, consider this-

China is very restrictive in allowing US products to enter into their Country.

Here are the China/US Trade stats-

  • For 2008 YTD (Jan-Sept)- China imported $55 bil from US and yet, exported $250 bil so far this year, resulting in a US Trade deficit of $195 bil.
  • For 2007- China imported $65 bil from US and exported $321 bil to the US, resulting in a US Trade deficit of $256 bil.

It looks to me like we need to address the deficit by limiting or taxing Chinese made products, back off what we export to them (this is problematic because it hurts our manufacturers), or a combo of the two.

walkingupuscapitolOtherwise, the American cutlery company executives need to head to Capital Hill, but unfortunately they will have to get in line…

Oh yeah, I forgot to mention one minor detail

And this could throw a wrench into things; I don’t know if you are aware, but-

China is the biggest buyer of US debt. In other words, we are borrowing huge amounts of money from China.

And don’t think the additional bailouts, bridge-loans, and public works programs coming down the pike aren’t going to cost a trillion or two too. Then we are going to need them buying our debt all the more.

Sources: US Census Bureau Foreign Trade Statistics, American Pocketknives, by Dr. David Krauss, CNJ Knife Show with Tom Arrowsmith Part I

How about a run on knives too?

Weekend Edition

Obama Gun SalesThe recent presidential election caused a run on guns. Actually it started before the election, but now seems to be continuing. Evidently folks across America feel there is likely to be tightening of gun control. 

Here’s the list of media and their stories on the trend. It is even being reported internationally.

Will that carry over to knives? I’m not seeing a barrage of media stories on knife runs, but we know our knife rights are slowly being eroded. And it could be the best news for American knife makers yet.

Published in: on November 15, 2008 at 11:01 am  Comments (3)  
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