Do manufacturers need special treatment? Not only do they need it – they deserve it, says IAM Communications Director Rick Sloan and Leo Hindery, Chairman of the Smart Globalization Initiative at the New America Foundation, in an op-ed published on The Huffington Post.
Together Sloan and Hindery refute a New York Times article written by President Obama’s first chairwoman of the Council of Economic Advisors, Christina D. Romer, in which Romer “spent 1,200 words arguing that we should do nothing about the crisis in American manufacturing.”
“She meticulously constructed three straw men — market failures, jobs and income distribution — and then proceeded to knock the stuffing out of each of them,” wrote the co-authors. “It was a heroic, if not faintly humorous, performance given Ms. Romer’s recent position in the administration and the fact that few others in the country misread more the depth and the duration of the still largely ongoing Great Recession of 2007.” Romer was an architect of the Obama administration’s stimulus package, auto bailout, “green shoots” and “recovery summer” policies.
Manufacturing is critical to the American economy, explains Sloan and Hindery. “Every dollar in final sales in manufacturing products supports about 1.40 in other sectors of the economy,” they write. “By contrast, the hallowed financial services sector generates only about 50 cents for every dollar of activity. Manufacturing productivity consistently outpaces productivity growth in other sectors of the economy. And, manufacturing employees earn higher wages and receive more generous benefits than other working Americans.”
But the co-authors warn the decades-long decline in U.S. manufacturing will continue unless the U.S. creates its own manufacturing strategy. “The erosion of our manufacturing base — our skilled workforces and our plants, production processes and supply chains — continues even as economists like Ms. Romer urge us to do nothing,” said Sloan and Hindery. “But doing nothing is not an option now. Until America has its own manufacturing policy to rival those of our trade competitors, U.S. manufacturing employment will continue to decline, as will manufacturing output as a percentage of GDP, and the U.S trade deficit will remain crushingly high.
“We haven’t a moment to lose.”
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