The president's plan for manufacturing institutes is good, but it's not enough

Posted by mmcmullan on 01/16/2014

There are lot of people out there who would love to talk to President Obama. Just look at all of ’em, hanging on his every word!

Makes sense. He's a handsome man. And after all, he’s The President. He’s got a lot of constituencies to please. Each decision he makes has its advocates and corresponding critics. And, in this glorious age of hyper-partisanship, those two groups increasingly stake out hardline stances.

With that in mind, you might think we’d dig out the pitchforks and start boosting each other over the wrought iron fences surrounding the White House after the president told a crowd at North Carolina State University yesterday that our favorite corner of the economy has added “almost 80,000 manufacturing jobs in the last five months alone” but didn’t mention that it only added 77,000 on the year. Because context is important.

But no. Nope. We’re not here to pile on. We’re gonna take a nice and gentle approach. It’s true: We’ve got some dinosaur-sized bones to pick with the president’s approach to America’s manufacturing policies, or lack thereof. But he was down in North Carolina’s research triangle to award the area with a new public/private “manufacturing innovation hub.” And that’s a good thing. So let’s start there.

So Raleigh, North Carolina scored a manufacturing hub. Reuters describes it as “a consortium of 18 businesses and six universities that will be led by North Carolina State University and will lead an institute to develop high-power electronic chips.” It’ll be part of the president’s National Network for Manufacturing Innovation, an idea the administration has kicked around for a few years now. This network is modeled on existing ones used by other nations, like Germany’s Fraunhofer Institutes that essentially serve as incubators for industrial research, and the White House has determined them necessary for the country’s future economic competitiveness.

We’ve got some catching up to do. Germany’s got more than 60 of them; now that we can pair Raleigh with the additive manufacturing institute in Youngstown, Ohio, we’ve got two.

We’ll get a few more in a couple of weeks. Raleigh’s new institute was the first of three announced by the president about six months ago. The next two will focus on digital manufacturing and design, and lightweight and modern metals manufacturing, respectively.

But what then?

When he announced the competition for these three institutes last summer, we were all smiles around here. And without a doubt, it’s nice to see them come to fruition. Yet this is a piecemeal approach. We can infer, through his vociferous support for an institute network, that he understands the importance of the long game. But he’s effectively punting on manufacturing in the present. Despite the rosy terms in which the administration describes manufacturing employment (“Manufacturers have added over the last four years more than 550,000 new jobs!” said the president in Raleigh) we lost millions of those jobs to overseas competitors in the decade beforehand. The White House seems to pay little attention to the burgeoning trade deficit (which shows we consume far more than we produce), or the fact that the world’s second largest economy – China – actively fuels that deficit through a myriad of market distortions, currency manipulation chief among them.

This was no secret to Obama the candidate. Obama the president, unfortunately, has zipped his lips to this issue.

Again, none of this takes away from the president’s nascent manufacturing institute network. It’s a good idea, and necessary for America’s future industrial competitiveness. But as the last jobs report (a nothingburger filled with poor-paying retail jobs) showed, a true middle-class resurgence will need a legitimate manufacturing employment rebound. The middle class needs help now, so we can’t give up the short game. President Obama should be advocating for a manufacturing strategy day and night … but he’s unfortunately content with this half-hearted approach.

And that inaction leaves a current swath of American manufacturers with nowhere to go.

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