February 2020 Volume 2

MEMBERS SPEAK

This Decade Needs New Strategies to Keep Us Strong and Free By Robert Dimitrieff

A new decade has just begun and we are already heading into a world that looks increasingly complicated. We are looking toward a future that will likely be marked by volatile global relations, ongoing tension over international trade, and the grey zone of near but not full state-on-state conflict. “Never let a crisis go to waste,” is how Winston Churchill, among others, put it. In that context, there’s a lot to work with today. The complexity and uncertainties of the 2020s already present us, including the forging industry, with new challenges and responsibilities. These complex situations, however, also offer new opportunities. Only weeks into 2020, signs indicate that we are in a period of realignment in strategic global supply chains. Change is happening in the Western Hemisphere, between Britain and Europe, and in China and the Asia Pacific nations. Our ability tounderstand, anticipate and respond to this realignment will be key. It is important for the industry to understand its key role as part of this larger picture. In the big picture, the world appears to be in a situation roughly comparable to world geopolitics at the beginning of the 20th century. Before World War I, the pieces on the chessboard of the “great game” of geopolitics appeared to be solidly placed and hard to move. History proved this wrong when the chessboard was upended in 1914.Those who failed to understand the new direction ended up paying dearly. This is not to suggest that we’re on the verge of another terrible world war. However, it does suggest that we should be better prepared to prevent one through increased strategic cooperation among close allies. Following World War II, we had the Cold War. We are now already a generation beyond this last fixed strategic alignment. That era was the last time private industry was deployed at scale to bring forward a larger national and international strategy. In the free world, we established trading and military alliances, built infrastructure, bolstered defence, and successfully integrating economic and geopolitical goals. Doing this made the world better—safer, securer, and more prosperous. Deploying this integrated strategic thinking again is the key to navigating this coming decade. We still face long-term strategic competition in the world with authoritarian and revisionist powers. Standing up to this competition will require the seamless integration of multiple elements of our respective states’ powers—diplomacy, information,

economics, finance, intelligence, law enforcement, and military capability. Strategic North American Cooperation The individual strategic objectives of businesses, industries, and North America’s three nations are not always identical. Nevertheless, it should not be hard to agree that the principal priority for all Western democracies ought to be successful long term strategic cooperation to meet challenges posed by communist and authoritarian regimes like those of China, Russia, and Iran. The magnitude of the threats to our sharedNorth American security and prosperity should not be underestimated. Atrophy or erosion of our continental manufacturing capacity needs to be viewed by stakeholders as a long-term security threat. Collectively, the forging industry in North America has faced this economic threat for some time, with the introduction of low-priced product from overseas and the commodification of forged product produced on speculation and dumped into the North American market. Forging operators in North America being pushed out of business because of aggressive dumping of forged products by overseas actors is not the result of innovation or better business practices. It is an action by other nations to sacrifice our continental manufacturing capacity and capability for their gain. Over the past 10 years, unfair hyper-competition from overseas has eroded forging and related manufacturing capacities and capabilities required to maintain critical manufacturing and infrastructure supply chains. The dispute and countermeasures that took place over 232 tariffs between our North American nations was counter-productive to maintaining critical capacity. Tariffs and countermeasures within our own trading bloc divide our own industries and critical sector supply chains that are vital to our hemispheric and global interest in defending freedom and international justice and maintaining equilibrium. These types of unnecessary disputes benefit our competitors. They should be avoided in favor of integrated strategic thinking. Prosperity, safety, and security rely on having the capacity to maintain critical infrastructure and produce the tools required to protect it. At the same time, competitive pressure is driving North America’s forging industry to move toward ever more complex and advanced manufacturing. This in turn changes the requirements and educational needs required to build a 21st century skilled workforce. It requires

FIA MAGAZINE | FEBRUARY 2020 62