My onshore obsession with 'Made in the USA'
By Jennifer Granholm, POLITICO
As I began this column, I looked at the “made in” label on everything physically within reach. I’m typing on a Dell computer. Made in China. The J. Jill shirt I’m wearing? Made in India. My Timex watch? China. The ShoreTel phone on my desk? China. My Asics tennis shoes? China. It made me sad and frustrated that the products surrounding me right now undoubtedly support scores of jobs abroad. Good for those workers.
But what about us? Or, what about U.S.?
In scanning my work space, I did have one moment of fleeting joy: The Expo dry erase marker in my pencil cup was proudly stamped “Made in USA.” I immediately Googled the company and learned that they’re made by Sanford Corp. in Oak Brook, Ill. Owned by Newell Rubbermaid. A multinational company on the Fortune 500 with about 20,000 employees around the world. Yet these dry erase markers were still made in the U.S. It made me want to order more.
So when President Barack Obama at the Democratic convention last week said “we can create a million new manufacturing jobs in the next four years,” I was on my feet.
And I’m not alone. Admit it: You know you want it. You’re insatiable for it.
You want products stamped “Made in the USA.”
It just feels good to buy products made here. You want the quality. You want the jobs. But our purchasing options have been strangled by the global shift in manufacturing jobs to low-wage countries.
So here are eight policy suggestions to make the march to 1 million manufacturing jobs happen:
• Aggressively incentivize states to create industry clusters that make a good business case for those jobs to locate here;
• Offer low-cost access to capital to get factories built — try zero percent, guaranteed federal loans if you build a factory;
• Incentivize locals to assemble land for manufacturing and supplier parks;
• Reward states that create training sectors to dovetail with specific industry-driven advanced manufacturing skill needs;
• Reward states that streamline permitting for siting a factory;
• Offer a five-year federal tax moratorium for brand-new or reshored factories;
• Incentivize the repatriation of $1.7 trillion in multinational corporations’ offshore holdings by lowering the corporate tax on a one-time basis and put the hundreds of billions in resulting new tax revenues into capitalizing an infrastructure bank;
• Set specific Foreign Direct Investment goals for recruiting international companies to locate their manufacturing operations in America.
It was a great relief this week to find out that we’re not the only ones who want more U.S.-made products. The Washington Post reports on Sept. 9 that middle-class shoppers in Mexico are flocking to U.S. stores and products, and that U.S. exports to Mexico have exploded to $198 billion last year, up from $41 billion in 1993.
\And there’s more: For the first half of 2012, U.S. exports set a record of $773.4 billion in goods. Thirty-four states saw new export records in this period, with transportation equipment and agriculture products leading the way. The U.S. is now on a pace to exceed the record $2.1 trillion in exports we saw in 2011.
Why? Because “Made in the USA” has become synonymous with quality and prestige — so much so that U.S. brands are status symbols in other countries.
Indeed, we have evidence that some American companies are starting to onshore their manufacturing. Back in February, the Boston Consulting Group surveyed 106 companies and found that 37 percent planned to bring jobs back. Anecdotal evidence suggests that these companies are reshoring after discovering that they need hands-on quality control; that shorter lead times are essential for changing consumer tastes and managing inventory; that wages are rising in so-called low wage” countries and that transportation costs are too volatile.
They have also discovered that the U.S. worker and American craftmanship are second to none, and quality and consistency are more important for retaining customers than a cheap price tag. Some smart businesses are making the smart business decision to c’mon home.
Now just imagine — imagine — what we could do if we had a national policy to encourage on-shoring on steroids?
The American Jobs Act introduced last year would offer businesses payroll tax incentives for hiring Americans, and covered 100 percent of business expensing for the year. Republicans in Congress have refused to move on this measure. President Obama has also proposed that we end tax incentives for companies that offshore jobs and profits. That’s an important start.
By contrast, GOP presidential nominee Mitt Romney’s tax plan continues to reward the offshoring of U.S. jobs. Under Romney’s plan, a U.S. company that chooses to build overseas would be permanently free of U.S. taxes. For those companies that have already moved offshore, the same deal applies.
If we permanently exempt overseas profits like this, companies have even more incentive to take their investment elsewhere. Not only would Romney’s tax plan cost our Treasury more than $130 billion over 10 years for multinational corporate tax cuts, the Center for American Progress estimates, it would cost America approximately 800,000 jobs.
We need some healthier obsession, please — Congress: Can you lose a little more sleep over how to create good-paying advanced manufacturing jobs in the U.S.?
Then the rest of us can sleep a little easier in our bedrooms full of quality, American-made products.
Aaahhhh. “Made in the USA.” Are there any sweeter words?9/11/2012