>The institutional expertise started to deteriorate, to the point that America simply didn't even have the capacity, or expertise anymore to produce stuff

Right. And the spin I would put on your point: while the U.S. could never compete with outsourced labor, institutional manufacturing expertise could (you would think) still be valuable to startups finding some kind of niche in the manufacturing space.

With all this new 3D printing infrastructure, and constantly improving robotics, maybe some manufacturing efficiencies in some spaces could emerge that compete on cost and outcompete the cost of shipping stuff across an ocean. The availability of institutional expertise could be one of the necessary ingredients for mixing and matching the way to a new efficiency.

Yeah it's bleak in terms of automating away labor, but I'd like to think robotics is the next automated frontier after LLMs and we want to get there first.