Peter Grant references an article by David Hunt on the impact of offshoring. In it, I saw this little comment by Vox (italics for emphasis):

And while I can, on an intellectual basis, appreciate the economic arguments in favor of offshoring – like the one put forth by scholar Walter E. Williams, a man whose views I generally admire, here, – I will counter that the greatest global economic good does not necessarily equal the greatest American good.  Nor does it take into account other factors like national security concerns.

Now, this is a pet peeve of mine, where efficiency, and long term resiliency and survivability don’t mesh up, something I had begun hashing out even before reading Taleb’s book on Antifragile systems. And if you believe that a nation has a right to exist, then yes, national security concerns are one of those long-term things you factor in. Whether or not you believe a nation has a right to exist, if you don’t factor those in, then whatever nation/culture you are a part of will cease to exist because someone else will take advantage of your lack of foresight.

This strikes to the heart of several issues which, in and of themselves are not a big deal, but in concert, result in our culture and nation dying away, both due to demographic replacement as we chase career and alternate sexualities over family and children, and as we refuse to defend that which we have, and ensure we keep our capabilities to produce in the future. It’s not just about not looking past the next quarter, or even year to prioritize long term viability of the company vice immediate profits. It’s not just being dependent on other people for your raw materials or parts.

It’s about security, it’s about “tribal knowledge”.

One example – I get it, the US Post Office is a “waste” – and bluntly, it’s not terribly competitive. And even if every single USPS customer went to Fedex or UPS, I’d still argue in favor of keeping it. Why?

Let’s step back a minute and take a look at what the post office is. Much like Guy Kawasaki pointed out that Honda wasn’t a car company, or a mower company, or a motorbike company, but an engine company…

The USPS is a secure communication medium controlled by and beholden to the US government. Even if no other customers used it, it is theirs.

Ditto other similar wastes of money – train tracks or runway sites sufficient for large jets at places not commercially viable. The highway system. Sure, these provide a means for people to better do what they needed to do and transport goods, or have additional safety landing sites, but they also provide the logistical backbone to move goods across the country in the event of a war, or other national-scope disaster that is within federal scope of action.

In the Navy we referred to “tribal knowledge” – that knowledge passed on within the command as a whole as well as its subgroupings – auxiliary machinists, nuke machinists, electricians, etc. – about how things worked, what would get you in trouble, how to fix or deal with particular issues. A lot of it was accumulated over years and experience, and passed on to rising junior members.

A command had people, from top to bottom, knew intimately how everything worked. Officers were exposed to enough rising from their JO positions to at least (generally, of course)* ask their chiefs and petty officers, and chiefs and firsts had done bearing rollouts, worked the evaporator, etc., and knew the issues that didn’t show up in the manuals.

We’ve seen in computer companies like Dell that basically slap their label on someone else’s hardware, the fall to and below mediocrity that accompanies no longer designing from the ground up, at low level detail, nevermind building, their own product. All in the name of efficiency. The same thing can be seen at steel mills, etc.

Making parts isn’t just about the final part, it’s knowing how it fits together, how to manufacture it, etc. Companies that lose sight of the low-level detail become just another value-added vendor that is easily replaced.

The product suffers. Worse: We forget how to make it, how to machine it, lose the physical skillset to design it, or intimately understand how something meshes with software.

A company that wants to thrive for decades can’t just be concerned about profits, but about flexibility, maintaining a knowledge base and deep technical skill and knowledge that make the difference between mediocre and great. The companies looking past the quarter and only to the next year aren’t looking deep enough.

* I had the experience of seeing the Engineer come back to maneuvering to chew out a qualified, but junior, engineering officer of the watch, for trying to override the reactor operator, when the (very experienced) RO was right.