Those sorts of statistics should bring into cold, clear focus why America's education system is at such a disadvantage when it comes to manufacturing. The problem isn't a lack of elite graduates. We have those. It's our unskilled working class.

It's been widely reported that Chinese schools graduate roughly 600,000 engineers a year, versus about 70,000 in the United States. Some have tried to downplay the severity of that gap by pointing out that as many as half of those Chinese engineers have the equivalent of a 2-year associate's degree. That may be true. But it's also missing the point. China has learned to produce graduates with mid-level technical skills that, as The Atlantic's cover story this month illustrates, are crucial to the modern manufacturing process. The United States needs to learn to do the same if it wants to remain a manufacturing force in the future. Our immediate goal shouldn't be to prep more students for Harvard, Penn State, or University of Central Florida. It should be to find a way to make sure that more than 25% of the students who enroll at community colleges actually graduate within 3 years.

Industrial Policy Matters

The Times reports that when Apple was looking for a new factory to cut the high-strength glass for its iPhone screens, it picked a Chinese plant that had already built a new wing for work in anticipation that it might win the contract. It was able to afford that pricey gamble thanks to subsidies from the Chinese government.

In the United States, of course, most factories could not have counted on Washington for the same kind of support. Here, conservatives like to argue that the government shouldn't be in the business of "picking winners and losers." But that's what our competitors have been doing for decades, to great success. Both Germany and Japan rose up from the ashes of World War II and rebuilt themselves as industrial powerhouses thanks largely to carefully managed government industrial policy. China has done the same in the 21st century. Yet, as the scandal around failed solar panel maker Solyndra showed, a large part of the U.S. public is still deeply ill at ease with the idea.

The ironic part is that, although conservatives rail against the idea of an active federal industrial policy, they're very comfortable with it on the state level. Southern states such as Alabama and Tennessee have made an art of attracting foreign auto-makers using the promise of millions in tax breaks and other perks. Rather than putting the unmatched muscle of the federal government behind building our manufacturing base, we've settled for the scattered efforts of 50 states.

Where Apple Goes, Others Follow

Manufacturers have a habit of playing follow the leader. Or more precisely, follow the customer, especially when that customer is another industrial company.

Again, it's the natural outcome of needing to be close to the supply chain. The Times piece focuses on Corning, the Upstate New York-based company that produces the high-strength glass used in iPhone and other smartphone screens, which has moved much of its production to Japan and Taiwan in order to be closer to its buyers.