Obama: Manufacturing is the Foundation of an Economy That is 'Built to Last'

Jan. 25, 2012
'Tonight, my message to business leaders is simple: Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed.'

It was the moment that so many U.S. manufacturers had been waiting for: the president of the United States -- in front of a primetime national audience -- talking, at length, about the importance of manufacturing.

It was the president asserting that the blueprint for economic revival begins with manufacturing.

It was the president making the case for reshoring.

It was the president calling out China for its nefarious trade practices, and proclaiming that if American workers can compete on a level playing field, "I promise you -- America will always win."

It was the president talking about the need to bridge the skills gap.

It was the president urging Congress to reform the corporate tax code.

It was the president shining the spotlight on the miraculous resurrection of General Motors, Ford and Chrysler.

It was the president promising that a renaissance is possible in Rust Belt cities such as Detroit, Cleveland, Pittsburgh and Milwaukee.

It was the president singing the praises of exporting, and declaring, "I will go anywhere in the world to open new markets for American products."

Call it election-year politics. Call it what you will. But President Obama's State of the Union address Tuesday night reminded the nation that manufacturing is the backbone of a strong U.S. economy. If nothing else, Obama's words hopefully served as a wakeup call to mainstream America that without a national focus on creating and sustaining American manufacturing jobs, there will be no true economic recovery.

"So we have a huge opportunity, at this moment, to bring manufacturing back," Obama said Tuesday night. "But we have to seize it. Tonight, my message to business leaders is simple: Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed."

That effort should start with an overhaul of the corporate tax code, which, Obama said, rewards companies "for moving jobs and profits overseas."

"Meanwhile, companies that choose to stay in America get hit with one of the highest tax rates in the world," Obama added. "It makes no sense, and everyone knows it. So let's change it."

To that end, Obama called on Congress: "Send me these tax reforms, and I will sign them right away."

Trade Enforcement Unit Unveiled

Pointing to his goal of doubling U.S. exports over five years, Obama hailed the recent free-trade agreements with Panama, Columbia and South Korea as key reasons why "we're on track to meet that goal ahead of schedule."

He also called out China for its unscrupulous trade practices.

"I will go anywhere in the world to open new markets for American products. And I will not stand by when our competitors don't play by the rules," Obama said. " We've brought trade cases against China at nearly twice the rate as the last administration -- and it's made a difference. Over a thousand Americans are working today because we stopped a surge in Chinese tires.

"But we need to do more. It's not right when another country lets our movies, music, and software be pirated. It's not fair when foreign manufacturers have a leg up on ours only because they're heavily subsidized."

Obama then unveiled a new Trade Enforcement Unit "that will be charged with investing unfair trading practices in countries like China."

"There will be more inspections to prevent counterfeit or unsafe goods from crossing our borders. And this Congress should make sure that no foreign company has an advantage over American manufacturing when it comes to accessing financing or new markets like Russia.

"Our workers are the most productive on Earth, and if the playing field is level, I promise you -- America will always win."

Skills Gap in Focus

Signaling just how important manufacturing is to the economy and to Obama's re-election hopes, first lady Michelle Obama was flanked to the left by Jackie Bray, "a single mom from North Carolina who was laid off from her job as a mechanic."

"Then Siemens opened a gas-turbine factory in Charlotte, and formed a partnership with Central Piedmont Community College," President Obama said. "The company helped the college design courses in laser and robotics training. It paid Jackie's tuition, then hired her to help operate their plant."

Obama used Bray's story to highlight the skills gap in American manufacturing, lamenting that some industries "in science and technology have twice as many openings as we have workers who can do the job."

"Join me in a national commitment to train 2 million Americans with skills that will lead directly to a job," Obama said.

"My administration has already lined up more companies that want to help. Model partnerships between businesses like Siemens and community colleges in places like Charlotte, Orlando and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers -- places that teach people skills that businesses are looking for right now, from data management to high-tech manufacturing."

"And I want to cut through the maze of confusing training programs, so that from now on, people like Jackie have one program, one website, and one place to go for all the information and help that they need. It is time to turn our unemployment system into a re-employment system that puts people to work."

Obama went on to talk about the need to strengthen the nation's education system "to prepare for the jobs of tomorrow."

Action Needed

While the president seemed to indicate that he understands the challenges and opportunities facing U.S. manufacturing, they are, of course, just words. National Association of Manufacturers (NAM) President and CEO Jay Timmons urged Obama to back up those words with action.

"We agree with the president on one point: Manufacturers are poised for a renaissance," Timmons said in a statement. "However, it is 20% more expensive to manufacture in the United States compared to our largest trading partners. This cost gap is a barrier that must be eliminated."

The gap, Timmons added, "is self-inflicted by Washington."

"We have the opportunity to fix it and to reaffirm the global leadership of manufacturing in the United States."

Timmons called on the Obama administration to implement "an aggressive trade policy," an "all-of-the-above energy policy" and "comprehensive tax reform that will lower the corporate tax rate so that we can compete for investment across the globe."

"Tax reform must also lower the rates of the 65% of manufacturers that file as individuals for the good of the economy and jobs," Timmons said.

Timmons also reiterated NAM's disappointment in Obama's decision to reject the Keystone XL pipeline, and urged Obama to "take action to put an end to the rampant overregulation and overreach by the National Labor Relations Board and the Environmental Protection Agency."

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