What's New on the PRR Panhandle 2.0?

[healey36]

Yes, thanks for the look. The deindustrialization of the country marches on.

[MurphOnMillerAve]

....The deindustrialization of the country marches on.

It still shocks me. However, now I understand some of why it has been happening, having seen a short piece on TV last night about inventions and their inventors getting protection for their new ideas and products as quickly and as extensively as possible. Yet, when pressed on that point, using the example of a couple "widget" type new products, the expert stated that even before the inventors were able to get the idea or prototype into production, the Chinese had stolen the idea and had already marketed it. When asked what could be done about that, the interviewee had no idea, beyond the usual copywriting, what would work to thwart and beat China.

Watching that interview was, for me, an epiphany. I had no idea the Chinese were that unstoppable, meddlesome, and aggressive at stealing new ideas.

[healey36]

While the threat from China, much like the issues we had with Japan thirty years ago, are real, I tend to think they are somewhat exaggerated (certainly folks in the Midwest would dispute that, but I'm talking on a macro-level). The Chinese are de-engineer/re-engineer experts...give them a product, patented or not, and they can quickly replicate and manufacture it. That's their game. They have virtually nil capability to develop something on their own, so they are forced into this economic banditry. Their lack of innovation and continued issues of quality are their Achilles heal. Nearly all of their product for export is designed offshore (i.e. by the purchaser). Until they can develop a capability to research, innovate and design they will remain the world's manufacturer, and that's it.

The quality thing is somewhat of a mystery to me...they should have figured that out by now. Our experience with Chinese manufacturers was that you had to keep your foot on their neck to force them to (1) abide by your spec's and (2) work to your acceptable failure rate. They had no inherent compunction to act in the best interest of the buyer. You had to have folks on-site at their facility, constantly observing their processes. Turn your back for one moment and everything went to hell...you'd get a shipment of stuff that was 60% junk.

Then there's the whole corruption thing. A constant stream of "facilitating payments" was required to keep supplies moving. Our experience with Mexico was similar.

It would be interesting to quantify what happened to Weirton in terms of being a victim of foreign dumping, unaffordable wage and pension cost, and presumably a failure to innovate their manufacturing process. That's something we'll never know, but certainly a combination of the three.

It's funny...the Chinese and the Koreans did to the Japanese what the Japanese did to us. Things run in cycles...

Healey

[G3750]

While the threat from China, much like the issues we had with Japan thirty years ago, are real, I tend to think they are somewhat exaggerated (certainly folks in the Midwest would dispute that, but I'm talking on a macro-level). The Chinese are de-engineer/re-engineer experts...give them a product, patented or not, and they can quickly replicate and manufacture it. That's their game. They have virtually nil capability to develop something on their own, so they are forced into this economic banditry. Their lack of innovation and continued issues of quality are their Achilles heal. Nearly all of their product for export is designed offshore (i.e. by the purchaser). Until they can develop a capability to research, innovate and design they will remain the world's manufacturer, and that's it.

Absolutely correct. I can recall Weirton Steel executives giving the Japanese executives tours through the mills. My father's opinion, who was in the Navy and fought against the Japanese in World War II, pretty much echoed Bull Halsey's. He knew they were there to steal secrets, and they did all the while smiling to your face. They also "dumped" (sold goods for export at below production costs) steel into the American market because their lobbyists had bought Congress.

The Chinese make the Japanese look like Boy Scouts. The term "Chinese bandits?" totally applicable.

The quality thing is somewhat of a mystery to me...they should have figured that out by now. Our experience with Chinese manufacturers was that you had to keep your foot on their neck to force them to (1) abide by your spec's and (2) work to your acceptable failure rate. They had no inherent compunction to act in the best interest of the buyer. You had to have folks on-site at their facility, constantly observing their processes. Turn your back for one moment and everything went to hell...you'd get a shipment of stuff that was 60% junk.

Then there's the whole corruption thing. A constant stream of "facilitating payments" was required to keep supplies moving. Our experience with Mexico was similar.

From some of the things Scott Mann of 3rd Rail and John Smith of Pecos River have posted and written over the years, you can infer much of the above. As you put it, only a boot on their necks achieved quality results. Certainly MTH product quality, especially in the late 90's and early 2000's suffered from the belief that the Chinese manufacturing facilities were "fire and forget".

It would be interesting to quantify what happened to Weirton in terms of being a victim of foreign dumping, unaffordable wage and pension cost, and presumably a failure to innovate their manufacturing process. That's something we'll never know, but certainly a combination of the three.

It's funny...the Chinese and the Koreans did to the Japanese what the Japanese did to us. Things run in cycles...

Healey

Healey you correctly named the root causes for most of the mainstream steel industry's decline. I recommend this book:

https://www.amazon.com/Wolf-Finally-Cam ... 0822953986


However, Weirton's story has several twists to it and ultimately the end was self-inflicted. I would recommend these:

https://www.amazon.com/Board-Betrayal-G ... 0923568514 This may be available as a PDF

https://www.goodreads.com/book/show/129 ... rton-steel This one is available at the Weirton Museum.

George

[healey36]

Thanks for the links, George...I'll check 'em out.

We did some telecomm business with the Mittal family back in the mid-1990's. Being predominantly a steel and automobile concern, they were desperately trying to diversify and were rather disorganized in the way they went about it. For every good deal they entered there were three or four others that were suspect.

Theoretically the whole globalization scheme will, if unobstructed, level the playing field, at least on a wage basis. Maybe then the U.S. will see some heavy industry return. Unfortunately, and this is the bit nobody was told, it'll take at least a couple of generations to happen. A lot of folks got trodden upon in the process.

For me, model trains always look their best running through an industrial setting, harkening back to the glory days of the 1930's, 1940's and 1950's. Can't wait to see how PRR Panhandle 2.0 shakes out!

Healey

[G3750]

Thanks for the links, George...I'll check 'em out.

We did some telecomm business with the Mittal family back in the mid-1990's. Being predominantly a steel and automobile concern, they were desperately trying to diversify and were rather disorganized in the way they went about it. For every good deal they entered there were three or four others that were suspect.

That's interesting! Arcelor-Mittal has sold off almost all of the mill area that was shut down. The huge Basic Oxygen Furnace is in the process of being sold. I wonder what the EPA will do about the portions that were sold off? They've got to have lots of poison in that soil over the course of 100 years.

Theoretically the whole globalization scheme will, if unobstructed, level the playing field, at least on a wage basis. Maybe then the U.S. will see some heavy industry return. Unfortunately, and this is the bit nobody was told, it'll take at least a couple of generations to happen. A lot of folks got trodden upon in the process.

I'm not a fan of globalization, nor do I believe that it is right or inevitable. Globalization has the effect of destroying economies, all for the good of privileged global string-pullers. I think national governments should be in the business of protecting their citizens' economic well being. If and when wages achieve global equilibrium, workers will be working for peanuts.

For me, model trains always look their best running through an industrial setting, harkening back to the glory days of the 1930's, 1940's and 1950's. Can't wait to see how PRR Panhandle 2.0 shakes out!

Healey

WRT industrial settings, I whole-heartedly agree! I grew up watching that and it just seems natural to me.

Yeah, I can't wait to get to bench-work construction, but the backdrop must come first.

George

[rogruth]

George,
Waiting patiently.
Backdrop on #1 was great.
Backdrop on #2 should be even better.

Is your bridge sized for double track?
I know the real bridge has been single for some time.

[G3750]

George,
Waiting patiently.
Backdrop on #1 was great.
Backdrop on #2 should be even better.

Is your bridge sized for double track?
I know the real bridge has been single for some time.

Roger, the backdrop is still being made.

Yes, the bridge is double tracked.

George

[healey36]

I'm not a fan of globalization, nor do I believe that it is right or inevitable. Globalization has the effect of destroying economies, all for the good of privileged global string-pullers. I think national governments should be in the business of protecting their citizens' economic well being. If and when wages achieve global equilibrium, workers will be working for peanuts.
George

Remember Ross Perot and the drumbeat of the "great sucking sound"? Well he called it and nobody paid any attention (actually, I think he was talking about NAFTA at the time, but that was just the first leg up). The reason that globalization will probably never see the predicted "great-levelling" is the advances of robotics and artificial intelligence. Scary stuff and I'm inclined to believe this will end badly. You're already hearing talk by some governments of paying a guaranteed minimal subsistence stipend to their citizens...I think that's the result of an expectation that some pretty sizable numbers of folks are going to get displaced in the evolving world economy.

Are you planning on hanging the backdrop(s) prior to building the benchwork? Probably makes sense depending on how deep the benchwork will be.

Healey

[chuck]

The way all of this is being done has changed dramatically. You don't need "fill in the blank" to make "fill in the blank". Watch a couple of episodes of "How it's Made" and you will be astounded at the level of automation being used to make both elaborate as well as mundane stuff. The robots don't look anything like what was forecast in the 50's/60's but they are there and they are insanely efficient.

That's the big fallout from the last economic collapse. Industries that had been sitting on the fence regarding automation brought in machines instead of bringing back workers. The new jobs are either well paying technical work (programming/monitoring/fixing) the machines or low level unskilled jobs feeding in raw materials or packing up the manufactured product. The companies haven't got their heads wrapped around the fact that while the machines don't get sick/need vacations/insurance/etc they also don't buy sh*t and at some point that becomes a very big problem when you only have a handful of people at a plant making enough to buy maybe 1% of what you are producing. Who buys the rest?

We still process steel, just not in the same way. It's either small batches of exotic stuff or recycling old stuff which takes much less energy/space/people. We still make stuff (appliances/cars/furniture/carpets/...). Nothing requires the human labor it used to and what is required is usually highly skilled.

Even foreign production is taking short cuts. They aren't doing it the "old way" (at least not for very long). They're starting out where we finally moved to. They will be also be facing the same problems of what to do with all of these people that don't know how to do much or can't afford to buy whatever is being produced.

BTW, there is about to be a roll out of AI based accounting. You don't need to have someone that knows how to use Excel, Excel will be able to run itself. There will be low level data entry clerks and a few "supervisors" that will review/analyze the data. Even "white color" jobs won't be safe. I'm going to laugh my * off when this stuff is screwed up an no one notices because a lot of humans don't notice now. Garbage in, garbage out on a massive and almost instantaneous scale.

All of this has happened before, many times. The railroad industry went through a massive upheaval when steam loco's were shut down in a very short time in the early 50's. All of those skilled workers in the back shops suddenly had no jobs. I feel the biggest difference between what's been happening in the last 20 years and pretty much everything that went before was that the people that were focused on making money understood that they needed to make and sell "something" to make money. Now there is too much focus on making money period. It doesn't matter whether I actually have anything to make/sell, I just need to accumulate money. It used to be companies had five or ten year forecasts/plans. Now it's tomorrow or next week, next quarter at the latest. This is not sustainable.

[healey36]

Absolutely...it's the old Tom Peters mantra "Chaos creates opportunity". I worked in Accounting/Corporate Finance for nearly forty years...I'm looking forward to seeing how that whole automation thing works out for the brain-trust. Accounting grows less and less rules-based with each passing year...

We're destroying the PRR Panhandle 2.0 thread...oy...

[rogruth]

Panhandle 2 will be back.

[G3750]

Are you planning on hanging the backdrop(s) prior to building the benchwork? Probably makes sense depending on how deep the benchwork will be.

Healey

Oh God YES. I learned that lesson big-time!!!

I have one section of benchwork, the Staging Area, to construct first. That's because its western wall holds up the eastern side of the backdrop.

But that's it. My focus will be on getting the backdrop installed after that.

Then the construction of benchwork will commence - beginning at the bridge. If we manage to get the bridge correctly positioned relative to the backdrop, everything should fit nicely.

George

[G3750]

I'm not a fan of globalization, nor do I believe that it is right or inevitable. Globalization has the effect of destroying economies, all for the good of privileged global string-pullers. I think national governments should be in the business of protecting their citizens' economic well being. If and when wages achieve global equilibrium, workers will be working for peanuts.
George

Remember Ross Perot and the drumbeat of the "great sucking sound"? Well he called it and nobody paid any attention (actually, I think he was talking about NAFTA at the time, but that was just the first leg up). The reason that globalization will probably never see the predicted "great-levelling" is the advances of robotics and artificial intelligence. Scary stuff and I'm inclined to believe this will end badly. You're already hearing talk by some governments of paying a guaranteed minimal subsistence stipend to their citizens...I think that's the result of an expectation that some pretty sizable numbers of folks are going to get displaced in the evolving world economy.

Are you planning on hanging the backdrop(s) prior to building the benchwork? Probably makes sense depending on how deep the benchwork will be.

Healey

Ross Perot was absolutely right about NAFTA.

I am a technology guy. But there is the judicious and correct application of technology. Technology for technology's sake is not a good approach. AI is, IMO, vastly overrated. We will see.

George

[chuck]

AI is, IMO, vastly overrated. We will see.

Quite true.

Underlying problem is the real thing is getting to be in extremely short supply.