John M. Engler, a former three-term Republican governor of Michigan, has been president and CEO of the Washington, D.C.-based National Association of Manufacturers (NAM) since Oct. 1, succeeding Jerry J. Jasinowski as head of the 14,000-member organization. As he begins his term at the NAM, here's how Engler views U.S. manufacturing and the NAM's role.IW: How do you assess the status of U.S. manufacturing's recovery from the 2001 recession? Engler: Economic conditions have improved significantly over the past year, and manufacturers in most sectors are turning the tide. Business cash assets are at a 30-year high, which bodes well for job growth. Deferred investments in capital projects and technology are now moving ahead. In the year ending in the second quarter of 2004, overall business investment rose by nearly 11%, with expenditures on equipment and software rising by a robust 14%, the fastest pace in half a decade. Exports surged 10.5%, and manufacturing output grew by 5.8%, the fastest pace for these indices in seven years. . . . I would like to see a continuation of this investment climate along with rising consumer confidence so that business will spend more of that cash and keep the expansion going. IW: What is the most important public policy issue facing U.S. manufacturers? Engler: Improving America's public education system has to be our most urgent requirement. Top priority should be given to overhauling and upgrading the quality of K-12 education. We have excellent jobs going begging because too many young people didn't finish school or didn't master the basic math, science and communications skills needed to work in modern manufacturing. The looming shortage of skilled manufacturing employees is a real and growing threat to our ability to compete in today's high-tech global economy. America must do a better job educating the next generation of manufacturing workers and improve the retraining of those older workers who still have many productive years ahead. We also need to reduce the cost of production in the U.S. Unfair trade practices are a problem, but some of our biggest wounds are self-inflicted. Health-care costs are rising at double-digit rates, pricing health care out of the reach of many. Yet nearly 30% of health-care spending in America -- up to $300 billion -- may be for treatments, paperwork and processes that are inappropriate or redundant. We cannot afford such waste! And our dysfunctional legal system is the most expensive in the world, with costs also rising at double-digit rates. The November elections will directly impact our prospects for reform and our ability to control costs and be competitive. IW: What do you consider to be the basic role of the National Association of Manufacturers? Engler: We are the voice of manufacturing in this country. Our key mission is to help shape a pro-growth legislative and regulatory environment that allows U.S. manufacturers to compete successfully in the global marketplace. Our pro-growth policy agenda focuses on reducing the cost burdens that undermine our competitiveness, securing a level playing field with our trading partners and assuring an educated workforce in the future. . . . Our voice was never needed more. Many people in influential positions do not understand the vital role of manufacturing to our economic future and standard of living; some sincerely believe the erosion of America's manufacturing base is inevitable. They are wrong! It is up to us to remind our fellow citizens of the important contributions of manufacturing to our economy. Also, we must educate them about the threat to our way of life that the loss of leadership in manufacturing would mean to all of our citizens.