It's not just the expense, it's that before you had places like Harbor Freight selling cheap Chinese tools, the ordinary person would have had problems just finding those sorts of things. American companies could have made such tools, and marketed them to the general public, even if they cost a bit more, but they chose to ignore the potential market.
I think part of that is true and part of it is a larger systemic issue. For example, I buy engine hoists, engine stands, and gantries at HF as they are cheap and reasonably sturdy. The majority of the cost is in the steel and welding since the pieces themselves are not really of an intricate design. If I wanted to start a business here in the states I could not even buy the steel for the cost of the ENTIRE TOOL SHIPPED FROM CHINA (I checked on this with steel vendors at the time is why I feel confident in my statement) - let alone the equipment, the infrastructure, the building, the employees, marketing, business costs, liability etc. So did I ignore a potential market? No, I found the business case unsustainable due to a myriad of reasons. China's cheap labor, cheap steel (both of which may be technically inferior but adequate for the intended use), cheap shipping, trade agreements, etc. etc. etc. The problem is I don't think for the low technology items the difference would be a bit more. I think it would be orders of magnitude based on my experience.
On the other hand, the inverse appears to be true, at this and earlier points of time, in technically detailed product. I work for a company that actually has a engineering / fabrication / production facility in the U.S. We could move production to China, but looking at the total cost - the cost to train / certify the population for the quality we require, the costs of learning to do business in China, let alone the standard business costs - wouldn't make sense. It may never make sense as the people of China crave Western style trappings and go through some of the same issues as the U.S. did in the 20th century. In fact, I think we've passed the point where "move everything to China" is the default choice, based on the narrowing lifestyle disparity which naturally results in higher labor costs. So in that way I don't fear that we will ever lose all of our manufacturing base.
But I still wish that we could figure out a way to bring some of our manufacturing back home, at all levels of complexity, without inciting a trade war.