Global exports - a way to grow Michigan jobs
Tom Watkins
Say, what? Yes, the president is off to the land of "outsourcing" in search of American jobs. President Obama said," For America, this is a jobs strategy."
It is expected that the executives along for the ride will ink $10 billion in deals for U.S. companies on this excursion, and support 54,000 U.S. jbs.
Exporting Michigan products and services is a sensible way to grow our state's economy. Metro Detroit, driven by the auto industry, currently ranks 9th on the list of top 100 metro areas for dollar volume of exports, according to Crain's Detroit Business. We need to set a goal to move rapidly up this list.
The president is on the right track and Governor-elect Rick Snyder should be looking to follow in his footsteps. China, India and other Asian nations, with billions of potential new consumers, can be fertile ground to grow Michigan jobs.
In a world where ideas and jobs can and do move around the globe effortlessly, the president understands that our foreign policy goals are inextricably linked to job creation goals right here at home.
With populations of 1.2 billion and 1.3 billion people, respectively, surging middle classes and annual economic growth rates of 8% and 10+%, India and China are ripe for the picking. They want and need American technology and products that have the ability to put OUR people to work!
Furthermore, "with the increasing weakness of the dollar and dramatic improvements in Michigan's manufacturing productivity, the potential for the export of manufactured goods has rarely been better," according to David E. Cole, chairman emeritus at the Ann-Arbor-based Center for Automotive Research.
From apples, berries and corn to cars, hybrid technology, and higher education, Michigan has much to sell in the world marketplace.
The Economist, in a recent article, points out the continued rise of the Chinese economy and increased pay for Chinese workers will likely benefit the world economy: “A 20-percent rise in Chinese consumption might well lead to an extra $25 billion of American exports. That could create 200,000 American jobs.”
President Obama has called for the doubling of U.S. exports in the next 5 years. Is Michigan ready to capture its fair share of this surge? How can we do better? These are the questions that our new governor's economic team must be burning the midnight oil to answer.
Michigan's current governor had avoided traveling to the China, the 2nd largest world economy, for political reasons, thereby missing the opportunity to attract Chinese investment and job creation in Michigan.
In a 2009 Dome Magazine essay, I laid out how the governor, with the help of Michigan's Chinese/American business and academic community, might tap China's rise for our gain. (See China Bridge -- Michigan Stop whining and start building ) The ideas await our new governor's action.
Smart, thoughtful visionary leaders will stop the political pandering, and China/India bashing that have become part and parcel of Michigan's election cycle. Far better to find ways to make the East's rise help manufacturing jobs here at home.
The International District Export Council recently held its conference in Detroit and Windsor, making urgent calls for tapping into the expanding export market for growing jobs here in Michigan. Speakers explained how public-private partnerships, university research, tax and regulatory changes can grease the wheels for expanding jobs and profits.
GM is touting it growth in China as a selling point in its upcoming IPO and Ford found a buyer there for Volvo as well. China's Pacific Century Motors recently purchased Nexteer Automotive in Saginaw from GM, thereby saving 4,000 high paying jobs. Singapore-based Tata Technologies in Novi is currently seeking to fill over 200 positions across North America.
Global trade can and is lifting all boats. David Cote, chairman and CEO of Honeywell and traveling with the President, captures the attitude we need to adopt in Michigan: "Job creation in the age of globalization is not a zero-sum game."
Michigan business leaders, with the help of our state and national political leaders, CAN collaborate and create jobs for the home team.
Remember -- the American people sent a very clear message during last week's elections: It's all about, Jobs, Jobs, Jobs and more jobs!
Tom Watkins is a business and educational consultant in the U.S. and China. He served as state superintendent of schools from 2001-05 and as state mental health director from 1986-1990. He can be reached at tdwatkins@aol.com.
Comments
Basic Bob
Sat, Nov 13, 2010 : 6:03 a.m.
A company I worked with bought some conveyors from a Chinese company, and they told them which material to use (shafts, bearings, etc.). Well, the Chinese government would not allow them to import the parts from foreign countries, so they substituted with locally available components. Needless to say, it might have been the same size, but everything else about it was off. You get what you pay for. Solving the trade imbalance starts with ending our obsession with cheap and poorly made foreign products.
Sean Gray
Thu, Nov 11, 2010 : 6:15 p.m.
For a quick comparison since some assume China's economy is larger than the U.S. "The CIA Factbook, a source of data that many experts use to compare national economies, reported that Chinas 2008 GDP was $4.6 trillion and Japans was $4.9 trillion. The 2009 numbers are likely to be $4.75 trillion for China and $4.6 trillion for Japan." The U.S. economy is right around $14 trillion, three times that of China. Most estimates I see say China could overtake us by 2020. But then I heard the similar things about Germany and Japan in the 80s and 90s. Read more: China Is Now The Worlds Second Largest Economy - 24/7 Wall St. http://247wallst.com/2009/12/27/china-is-almost-certainly-worlds-second-largest-economy/#ixzz151CkCfrA
packman
Thu, Nov 11, 2010 : 5:40 p.m.
Just read about the company in Fremont CA that manufactures solar panels. They plan to lay off 150 people because they can't compete with China in the solar panel market. This after they receieved around a half billion dollars in stimulus money. Let's see, now CA will be required to borrow yet more money from the Feds to pay unemployment. The Feds in turn will have to borrow more from China. A revolving door sort of scenario where our money gets off in China with each revolution.
whodat
Thu, Nov 11, 2010 : 3:05 p.m.
Top Cat - - You beat me to the punch on that one! How can we trade with nations like China and India when their average wage is less that $1.00/hour? They remain far too poor to take back our exports. Free trade is killing us, there needs to be some sort of protectionism when it comes to our trade policies..notice I said SOME. And the statement "With populations of 1.2 billion and 1.3 billion people, respectively, surging middle classes and annual economic growth rates of 8% and 10+%, India and China are ripe for the picking. " is very misleading. Sure, India's middle class might be growing, but we cannot confuse that with our middle class, it's two total different levels of income. Even with increasing middle classes in India and China, they still remain far too poor to buy our exports.
Top Cat
Thu, Nov 11, 2010 : 2:46 p.m.
What Mr. Watkins does not say is that China and most other countries have been pursuing a strategy of economic nationalism, i.e. promoting exports and using various strategies to protect home grown industries from imports. America has pursued a strategy of free trade. The result for us is an annual $500 billion+ trade deficit, millions of lost jobs and the need to borrow back the money to purchase the imports. Sending the President abroad with a tin cup in his hand doesn't solve anything.