Obama's Key to Fixing the U.S. Economy
Janaury 9, 2012
Feeling a little wind at his back, President Barack Obama, riding a upswing in his approval ratings now at an aggregate 47.2%, announced a new White House push to bring jobs back to the United States. Among the most storied U.S. businesses, retail giant Walmart and electronics titan Apple Computer outsource most of their manufacturing jobs to China and India. While there’s something commendable about whopping profit margins, there’s something disgraceful about sending jobs overseas. Friday’s unemployment report of 8.5% is a three-year low, signaling a new pulse to the U.S. economy. As GOP frontrunner Mitt Romney fashions his remarks heading into tonight’s debate and New Hampshire’s Jan. 9 primary, he can’t continue ignoring Obama’s progress on the jobs front. Calling Barack the “jobs killer” no longer jibes with verifiable economic facts. .
Long overdue, the White House is finally taking a stand on “outsourcing,” the practice of either manufacturing or servicing products overseas. Cheap labor markets, especially in Asia, have fueled the consumer economy but robbed taxpayers of the jobs needed for gainful employment and maintaining the tax base. Today’s oversized budget deficit at $1.4 trillion, roughly 10% of the nation’s GDP, prompted Standard & Poors Aug. 6, 2011 to downgrade U.S credit from AAA to AA-plus. If something were done years ago to bring jobs back to the states, the downgrade would have never happened. All the recent efforts with the bipartisan Deficit Reduction Committee would be irrelevant if the U.S. retained its manufacturing base at home. Sending jobs overseas reduces the tax base, shrinking vital income to the U.S. Treasury. As unemployment drops, the nation’s deficit also shrinks.
Hosting an “Insourcing American Jobs” conference at the White House next week, Obama hopes to capitalize on recent good economic news. His GOP opponents are no longer in real time, bashing the president for “killing jobs.” No sooner that U.S. Supreme Court Chief Justice John Roberts said, “congratulations, Mr. President” on Inauguration Day Jan. 20, 2009, the recession was declared all Obama’s by the GOP establishment. Now that unemployment’s dropped, there’s no acknowledgement of any positive change by the president’s critics. “We’ll hear from business leaders who are bringing jobs back home and see how we can help other businesses follow their lead,” said Barack. Just as the import auto industry has done years ago, other businesses, including major appliances and big screen TV makers, need to shift manufacturing or assembly back to the states.
Inviting executives from about a dozen companies, including MasterLock, Dupont Chemical, GalaxE Sofware, etc., doesn’t include the big boys like Germany’s Siemens or South Korea’s Samsung and LG, would have been far more productive, since the lion’s share of major appliances and big screens are manufactured overseas. When the “Insourcing” conference begins Jan. 11, Obama needs to develop the consensus that it’s time for foreign manufactures to follow the auto industry’s lead. There’s simply no excuse of major appliance and big screen makers to not manufacturer or assemble in the U.S. White House officials need to work with Congress to find the kind of incentives to get foreign manufactures to refurbish plants and begin manufacturing at home. Creating more domestic jobs is the only sure way to reduce budget deficits and assure a future upgrade to U.S. credit.
Creating more manufacturing domestically plays well in the upper Midwest Rust-Belt, containing the largest percentage of outmoded U.S. manufacturing plants and equipment. Barack’s critics see his latest move as an Election Year ploy. They find any attempt by the president to do something constructive with respect to jobs as a cynical political trick. But it’s no joke reducing today’s colossal unemployment with the expressed purpose of balancing the U.S. budget. If today’s Deficit Reduction Panel were more focused on increasing employment, they’d find the shortest path to a balanced budget. Inducing or requiring foreign manufacturers to set up shop in the state would be the best way to a balanced budget and economic growth. Slashing budgets throw more public employees into unemployment, doing nothing to generate more tax revenues to balance the U.S. budget.
Obama’s plan to host a White House “Insourcing” conference sends the right message to foreign manufacturers currently making hay in the U.S.: Either manufacturer in the states or face stiff tariffs. While no one wants a trade war, the U.S. economy—and Treasury—can no longer afford to keep profits overseas. U.S. workers need the security of stable manufacturing jobs. Whatever the evils of unions, no patriotic American can possibly want manufacturing jobs to go overseas. Responsible corporate executives need to get the big picture: That high levels of domestic unemployment hurt the consumer economy. Watching the nation’s stubborn unemployment rate drop to 8.5% is a beginning first step in fixing the economy. Encouraging foreign and domestic manufacturers to stay in the states assures as steady supply of future jobs. Outsourcing slows the recovery and hurts the economy.
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