President Obama yesterday continued to preach the need for the US to dramatically increase its exports, but there’s an element missing in the equation.
In remarks at the Export-Import Bank annual conference, Pres. Obama reiterated a stated goal of doubling US exports over the next five years. According to published reports, he called boosting exports a “short-term imperative” that would pay off in higher US employment and long-term economic stability. That’s a worthy – if perhaps unachievable – objective, and one that would go a long way toward resolving the country’s longstanding one-sided trade practices.
In his talk, Pres. Obama pinpointed to certain specific actions to help steer toward that goal, including US IP protection, enforcement of existing agreements and ratification of new ones (e.g., the Anti-Counterfeiting Trade Agreement),shortening governmental reviews of certain high-tech exports from 30 days to 30 minutes, and new agreements for Pan-Pacific trade.
But what was missing in his remarks was a strategy for enhancing the competitiveness of US businesses on the world stage. Despite perception, it’s true the US remains the world’s largest manufacturer – and by a large margin. But the US is losing ground in certain critical industries – electronics being one – where competitors have overtly or covertly signaled intentions to snare as much of the pie as possible.
I would like to see the US government invest in companies seeking to achieve true “lights out” manufacturing. While the direct impact on employment would be nominal, rebuilding the domestic manufacturing infrastructure requires a local supply base – materials and equipment providers, service specialists, programmers, etc. – something the US is in danger of completely losing. While I don’t envision massive technology parks here made up of the entire electronics supply chain, the needs to be an ample domestic market to ensure the sources of supply do not dwindle to a small number of distributors.