For everyone who wants the United States to become a (bigger) manufacturing powerhouse again — so, most people in the U.S., and every member of Congress — a recent report from the Boston Consulting Group is a mixed blessing. On Friday, BCG released its rankings of cost competitiveness in manufacturing around the world, and the U.S. came in second place, after China. It is now more cost effective to produce goods in the U.S. than Brazil, the report found.
The U.S., along with Mexico, is one of the BCG's "rising stars" of global manufacturing, for having "significantly improved relative to nearly all other leading exporters across the globe." At least 300 companies have brought their manufacturing back to the U.S. from overseas, because "it just makes economic sense," BCG senior partner Hal Sirkin, a co-author of the report, tells Yahoo News. "The gap is closing and, when you add the transportation costs, it makes a lot more sense for a lot of products to be made in the U.S. than in China."
That sounds great, right? But remember what made China so alluring to manufacturers in the first place — low labor costs, lax environmental standards, and overworked factory workers? Here's BCG's explanation for why the U.S. is back in the manufacturing game:
The key reasons were stable wage growth, sustained productivity gains, steady exchange rates, and a big energy-cost advantage that is largely driven by the 50 percent fall in natural-gas prices since large-scale production of U.S. shale gas began in 2005. [BCG]
Another way of saying that: Fracking, foreign exchange rates, and that "stable wage growth," which Reuters calls "a euphemism for the fact that, in inflation-adjusted terms, industrial wages here are lower today than they were in the 1960s even though worker productivity has doubled over the same period of time." The only one of those factors that isn't controversial is the stronger yuan.
As this chart from The New York Times shows, the jobs that have been created in the post–Great Recession recovery have skewed toward the low end of the pay scale:
Most manufacturing jobs pay pretty decently, especially compared with fast food service. But as we celebrate the return of the American manufacturing sector, it's worth remembering that it's only partly because "Made in China" is becoming more expensive — "Made in the USA" is also becoming cheaper, for better and for worse.
For the first time since 1980, North Korea is holding a ruling party congress, and leader Kim Jong Un is expected to declare his "Byongjin" policy, a push toward economic and nuclear development.
Thousands of delegates are attending the seventh party congress in Pyongyang, and a new central committee will be elected; experts say Kim loyalists will receive the most high-profile positions. On Friday morning, Kim's personal guard surrounded the hall where the congress is being held, proving that he is inside, the BBC reports. Foreign journalists have been granted permission to cover the event, but they have handlers and are not allowed to speak with citizens. Catherine Garcia
On Thursday, entertainer Arsenio Hall filed a $5 million defamation lawsuit against singer Sinead O'Connor for saying he gave drugs to Prince before his death.
On May 2, O'Connor wrote on her Facebook page that Prince was a "long time hard drug user," The Associated Press reports, adding, "Two words for the DEA investigating where Prince got his drugs over the decades... Arsenio Hall." She also wrote that she reported Hall to the Carver County Sheriff's Office, and they are "aware you spiked me years ago at Eddie Murphy's house."
The suit, filed in Los Angeles, calls O'Connor's claims "despicable, fabricated lies" and says O'Connor is "now known perhaps as much for her bizarre, unhinged Internet rants as for her music." It states that Hall has not seen O'Connor in 25 years, and even then he had "minimal contact" with her. In his suit, Hall also denies ever giving Prince illegal drugs or spiking O'Connor with any substance, and says O'Connor only met Prince a handful of times and "detested" him. Catherine Garcia
The out-of-control wildfire in Alberta, Canada, that's threatening thousands of homes and caused 88,000 residents to evacuate is so intense it has created its own weather system.
— CBC News (@CBCNews) May 5, 2016
Brian Proctor, a warning preparedness meteorologist for Environment Canada, told CBC News that firestorms alter weather patterns, funnel smoke and particulates into the stratosphere, and produce lightning. "They tend to promote their own kind of conditions," he said. "That's why you'll see the winds nears fires... that are significantly stronger than the surrounding atmosphere." The smoke and heat from a fire can cause storm clouds to form that are typically larger and darker than regular thunderstorm clouds. Proctor says that when there is turbulence in the atmosphere, lightning strikes can occur, but no rain. This can then lead to more fires, and because these storm clouds don't move on like regular weather systems, the firestorm remains stagnant. "It's almost a self-perpetuating situation," he said.
— NASA (@NASA) May 5, 2016
The fire in Fort McMurray now covers 85,000 hectares, about 10 times the size of Manhattan. The plume is visible from space, and there is concern that the flames will reach oil sands nearby. More than 350 firefighters are on the scene, and they are beginning to make some progress. Catherine Garcia
A Los Angeles jury found Lonnie David Franklin Jr., a former LAPD garage attendant and garbage truck driver, guilty on Thursday of murdering nine women and one girl over the course of 30 years.
Dubbed the Grim Sleeper, he is believed to be one of the most prolific serial killers in California history. In addition to being found guilty of murdering 10 women between the ages of 15 and 35, Franklin, 63, was also found guilty on one charge of attempted murder. The first murder took place in the 1980s, and the last in 2007, authorities said, and the women's bodies were found discarded in trash bins and alleys around South Los Angeles, within a few miles of Franklin's house, CNN reports.
Police arrested Franklin in 2010 after conducting DNA testing, and prosecutors built their case on DNA and ballistic evidence and the testimony of a woman who survived an attack. It took less than two days to convict Franklin, and the penalty phase of the trial will start May 11. Prosecutors said a woman Franklin was convicted of raping in the 1970s, while he was in the Army stationed in Germany, may testify. He is eligible for the death penalty. Catherine Garcia
Ben Carson is not interested in being Donald Trump's running mate, telling The Wall Street Journal on Thursday he would be "a distraction" and it's "too important a time in our life."
Carson is helping Trump in his quest to pick a vice presidential candiate, and he said Democrats may be vetted. "We would consider people who are Americans and who put America first," he said. In an interview with CNBC, Trump said there is "probably a 40 percent chance" he would choose one of the 16 Republican candidates who ran against him. "I've gotten to be friends with a lot of those people, and I guess perhaps enemies with a couple," he said. Catherine Garcia
It didn't take long for Donald Trump to respond to comments House Speaker Paul Ryan made Thursday regarding supporting the presumptive Republican nominee.
Ryan told CNN's Jake Tapper he is "not ready" to endorse Trump, and there's "some work to be done" before such an endorsement could happen. Trump quickly released a statement saying he is "not ready to support Speaker Ryan's agenda. Perhaps in the future we can work together and come to an agreement about what is best for the American people. They have been treated so badly for so long that it is about time for politicians to put them first!" Catherine Garcia
House Speaker Paul Ryan said Thursday he is "not ready" to endorse presumptive Republican nominee Donald Trump. Ryan, the ranking Republican in government, told CNN's Jake Tapper that there's "some work to be done" before he'd feel comfortable supporting Trump. Back in March, Ryan said he would in fact back Trump if he won the party's nomination. Trump had promised to be a "unifier" for the Republican party, but as Slate's Jamelle Bouie points out, Ryan is the latest of several major party figures who have declined to support him:
Two ex-POTUS' & a former nominee decline to attend convention, House Speaker declines to endorse. Trump will totally unify Republicans!
— Jamelle Bouie (@jbouie) May 5, 2016
Of course, depending on your point of view, it's entirely possible Trump is proving to be quite the effective unifier. After Ohio Gov. John Kasich and Texas Sen. Ted Cruz suspended their campaigns following Tuesday's GOP primary in Indiana, Trump is the only candidate left vying for the party's nomination. Kimberly Alters