Eight years after Katrina: How we can stop outsourcing America's rebuilds

Posted by LDonia on 08/28/2013

katrinaIt’s been eight years since Hurricane Katrina devastated the Gulf Coast, but many Americans still remember vivid images of a once-vibrant New Orleans, ripped apart at the seams.

In the weeks and months that followed, residents of the area began rebuilding their lives. But unfortunately the nightmare didn’t end when the storm left the area; many builders in the area used drywall from China in new homes, unaware that it was toxic. The result? The drywall lead to a large number of serious health problems and the homes had to be torn down and rebuilt.

That’s right: First the hurricane took these homes out, then their replacements were struck with the force of toxic dry wall.

Congress took action earlier this year, passing a bill to address the contaminated drywall issue. At the Alliance for American Manufacturing (AAM) we applaud this step, but encourage more action.

But there is a bigger, underlying issue that needs to be addressed: trade with China.

The reason the builders used drywall from China is that it was cheap and plentiful. But why was it so? Because the Chinese government subsidizes these kinds of industries, including the artificial devaluation of it currency, creating an environment where it’s increasingly more difficult for American companies to compete.

We often speak of the number of manufacturing jobs lost as a result of China’s currency manipulation. Indeed, this is a terrible result, as it has significantly weakened our economy and lead to a steadily increasing trade deficit.

It’s worth remembering, however, that China’s currency manipulation has repercussions that extend beyond economics. It creates a security threat that puts all Americans at risk.

Last year, AAM asked two respected experts on homeland security and preparedness – Governor Tom Ridge and Col. Robert B. Stephan – to examine the direct nexus between a strong domestic manufacturing sector and America’s ability to prevent, mitigate, recover from, and rebuild quickly in the wake of catastrophic events.

They concluded that the deterioration and offshoring of America’s industrial base is becoming more apparent with each passing day, leaving new national security and preparedness concerns in its wake. In short, Ridge and Stephan concluded we are becoming too reliant on global suppliers (many of whom may not have America's best interests at heart in a time of crisis), a problem compounded by our use of a highly complex and vulnerable global supply chain needed to bolster our weak points or come to our rescue in the midst of an emergency.

Or in other words: If a major hurricane hit the east coast this year, there’s a good chance the following wave of builders would be in need of more drywall from China.

So how do we stop this dangerous cycle and create an environment where American manufacturing can thrive?

For starters, we can take action against China for manipulating its currency. As mentioned above, the drywall from China would not have been so cheap and plentiful if China was not devaluing its currency. And if China’s drywall was not cheap and plentiful, there would be more American drywall on the market.

There is a bill circulating in the House of Representatives that would punish China for its currency manipulation. Please let your representative know that you’d like him or her to support it.

Image of Hurricane Katrina from NASA Goddard Photo and Video's flickr page and used following Creative Commons guidelines.

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