It's been a few years since I posted a comment here, but things haven't changed much except for accelerating on the same path.
We used to have wars when one country tried to overtake another country. The wars now are not physical but rather they are financial.
China has done a good job of improving education of their population. They not only copy American (and other) products but they also do most of the manufacturing of American products. They have gotten much better at producing their own products undercutting the price of the American equivalent. China has already won the financial battle.
China: Good products, lower labor costs, regulations that benefit China, many have questions about how China treats their citizens.
The United States: Products that are falling behind the Chinese quality and prices. Increasing labor costs. Regulations that are not favorable to American business.
America has already lost the battle. America has borrowed so much the number of Trillions of dollars is numbing. Who buys American debt? To a large extent the Chinese. At this point it looks like America will never again pay off the national debt. We are living a lie. We live in huge homes. We have RVs, quads, motorcycles, second homes, more than 2 cars per family/household. We are slipping behind financially but spending as if there is no limit.
We have to manufacture more, and design better products. We have to close the labor cost gap between America and China but we are doing just the opposite. One of the biggest culprits is increasing the minimum wage.
Increasing the minimum wage sounds so good on the surface. Of course those who have minimum wage jobs need more money. Who doesn't! But of course that backfires in two ways.
1) Increase the minimum wage and that increase will be paid through increased costs. For example if a restaurant is forced to increase the minimum wage from $10 to $15 the owner has no other recourse than to raise prices. Customers either will shop elsewhere, change their eating-out habits, tip less (directly impacting that increase in wages), or they will just pay the higher price which will leave them with less cash in their pocket. The restaurant customer will then have to find a way to afford the higher cost products so they will push for a raise in salary from their company. This is called inflation.
If you don't think this is true you're not paying attention. Last year major minimum wage prices were either put in place or put on a timeline to bump them up over the next couple of years. This year inflation is ramping up and running at an annual 6% or more. Nobody has benefited from minimum wage increases, especially those who are collecting that wage.
2) Increasing minimum wages increases the labor cost gap between America and China. We are failing to keep up with the Chinese in manufacturing. Your iPhone may have been designed by an American company but it is built by other countries. Our ability to manufacture has slipped through our fingers. As our labor costs, and regulations, create a further manufacturing imbalance America is selling the country to the Chinese.
Check out the world of inexpensive robots, for example Universal Robots makes Cobots that are relatively low cost, easy to train, don't require medical plans, don't have labor disputes, and can work 24 hours a day. These inexpensive robots can do a lot more than most people would imagine. They can, with cameras, determine how to stack products on an assembly line. They can do inspections, push buttons, rotate items, are very precise, and can tolerate environments not suitable for humans. These robots are mostly aimed at the low cost (read minimum wage) repetitive jobs. With ever increasing labor costs the only way many companies can keep costs low is to use the new cobots.
I have a friend who owns a company with about 15 employees. He has seen how easy it would be to replace two or three of those employees with robots. He is holding out though because he cares for his employees but little by little his customers are shifting to having their products built overseas rather than by my friend.
Increasing minimum wages isn't the end-all fix for our failing manufacturing industry, its just one example of how we are going down the wrong path.