Managing Automation - August 2008 - (Page 28)

I N T E R N AT I O N A L T R A D E trade agreements, but more-equitable ones. Ultimately, beneath the din of global unrest, the next president must consider which course best guards America’s industrial base and economic interests. What does leveling the playing field mean for the next president? Survey respondents suggested a number of remedies. And despite the attention accorded to NAFTA in recent months, it was China, not America’s closest neighbors, that drew the most attention from respondents. “I feel strongly that we must dramatically reduce trade with China only,” said an employee of a Pennsylvania tool manufacturer. “Any good business knows it is bad business to become too dependent on one source.” That outlook was echoed by LoPresti, who asked a popular question: “What if we go to war — where are we going to get our metal from?” In other words, it may just be a recipe for trouble to outsource a core component of self-sufficiency to countries that may or may not be American allies. Another Pennsylvania-based manufacturer said he felt strongly that the next administration should enforce existing trade laws, especially in Asia, “to stop illegal subsidies, currency manipulation, and illegal practices to lure foreign investment.” Across the country in Washington state, an engineer at a pulp and paper company advocated accelerated asset depreciation as an inducement to investment, saying that “duties and other trade barriers do not work. Incentives are much more effective than penalties.” He also advocated decoupling the yuan from the dollar, a popular recommendation among manufacturers. U.S. IMPORTS FAR OUTSTRIP EXPORTS Others focused on the U.S. U.S. total trade balance in goods and services, 2000-2008 tax and regulator y str uctures, pointing to both as -$379,835,000 2000 hindrances to strong manu-$365,126,000 2001 facturing. “Reduce taxes on business and get government -$423,725,000 2002 out of the way so business -$496,915,000 2003 can compete,” commented an -$607,730,000 2004 engineer at a plastics company in upstate New York. -$711,567,000 2005 Many respondents called -$753,283,000 2006 for a national consumption -$700,258,000 2007 tax in lieu of existing corporate taxes, a change they Source: U.S. Census Bureau said would help alleviate the disparity between U.S. business costs and those of its foreign competitors. “It is difficult to compete in a marketplace when we have so many taxes, insurances, and restrictions that our competitors do not,” said a management representative in a small New Hampshire molding manufacturer. On the question of American jobs, 34% of survey respondents believe the next administration should devise new protective measures, including discouraging outsourcing, while 18% want government-backed programs that create and retain U.S. manufacturing jobs. For its part, the American Manufacturing Trade Action Coalition, a lobbying organization dedicated to a strong domestic manufacturing base, offers a number of recommendations, including blocking trade legislation that is “detrimental to U.S. manufacturing jobs,” insisting on enforcement of existing trade pacts and “ensuring that the interests of the domestic industry and workers are upheld as part of major trade negotiations, including the FTAA [Free Trade Area of the Americas] and the Doha WTO [World Trade Organization].” WEIGHING THE COMPETITION The prevailing sentiment among U.S. manufacturers seems to foreboding. Less than 7% of survey participants said they were confident in America’s ability to compete globally. But underlying that unease is a remarkable confidence. In one comment after the next, respondents asserted that America can thrive in the global economy if the competitive field stands level. As one respondent wrote, “Other countries have strong policy towards keeping manufacturing in those countries. When we go out without such policy, we are at a very large disadvantage.” In a simple request for complex times, another wrote, “I hope the newly elected [president] will act with honor and forethought.” Indeed, perhaps simplicity is the principle that should govern the next administration’s trade policy. After all, the U.S. manufacturing community is willing to work, ready to take on all comers, but they don’t want one hand tied behind their backs. “We’re trying to hang on as hard as we can to making as much as we still can profitably,” LoPresti said. A lot of U.S. manufacturers are just hanging on, Mr. President. It’s time to put them back on solid ground. ■ tippedscale ma 28 2008 August

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Managing Automation - August 2008 Contents Take 1 After 18 Months, the Oracle/SAP Suit Has Little Effect on Maintenance Sales At 100, Foxboro Reinvents Around Its Customers New Private Equity Firm Eyes Software A Software Suite Just for Manufacturers i2 Chief Focuses on Services Plan Notes It's Time for Action Examining U.S. Competitveness Leveling the Field An Unhealthy Situation Exploring Alternatives Math and Science: Key to the Future Product Scan Advertiser Index Next

Managing Automation - August 2008

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