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Posts Tagged ‘industrial policy’

DOE Proposes 27 “Energy Efficiency” Penalties

Chinese, Japanese, Korean firms accused of not certifying compliance with U.S. efficiency or conservation rules.

by on Sep.13, 2010

DOE has been severely criticized for its lack of enforcement of U.S. regulations.

The Department of Energy today announced 27 new proposed penalties against companies selling products in the United States without certifying that they comply with energy efficiency or water conservation standards.

The legally required certifications are said to ensure that products sold in the U.S. deliver significant energy and cost savings to buyers. Prior to the Obama Administration, the Department had never systematically enforced DOE’s 35-year-old energy efficiency standards. Lax enforcement of energy efficiency standards undermines the goal of increased energy efficiency – now clearly a national security issue.

There are other implications as well. While not directly automotive industry related, today’s enforcement actions – coming on top of a newly activist Department of Transportation in automotive safety matters and the  U.S. Trade Representatives’ duties on Chinese tire imports, among other well-publicized examples –  are the latest indications that an industrial policy of sorts to protect manufacturing jobs is underway across the Obama Administration.

The U.S. is alone among industrial nations – either communist run or elected democracies – to lack formal policies to protect U.S. jobs, now a contentious mid-term election year issue with record high unemployment levels not seen since the Great Depression.


Biden Boasts Recovery Act Spurs Innovation

Four major science and technology breakthroughs promised.

by on Aug.25, 2010

The perfect campaign speech with promises that can't be checked for years.

Vice President Joe Biden has unveiled a new report that claims last year’s politically unpopular – and, gulp, $787 billion — Recovery Act contains $100 billion in investment in innovation that is not only “transforming the economy and creating new jobs,” but helping “accelerate advances” in science and technology.

More than the usual political folderol is involved here, in my opinion, as the Democrats turn up their rhetoric in defense of their management of a sputtering economy in the face of what appears to be an upcoming huge political backlash directed at tax and spend incumbents in the mid-term elections this fall. Biden’s assertions could also be the forerunner of a new move to propose another gigantic stimulus package if the Democrats remain in Congressional power after November.

The claims in the report, “The Recovery Act: Transforming the American Economy through Innovation,” are dubious in my view given the current state of the technologies involved, but ideal from a campaign perspective since they cannot be verified until years after the election – if anyone bothers or remembers.

And of course, there is no taxpayer “money back guarantee” offered from the Administration if the promises vanish into the ether and the companies and universities receiving the funding don’t deliver the innovations.

Following Your Money!

Remember the Partnership for a New Generation of Vehicles, which channeled millions upon millions of taxpayer dollars into national labs and the Detroit Three automakers in search of an 80 mpg car? Not one has been built to this day.

Worse, the real outcome was that Toyota, which was excluded from the pork festival for political reasons, went on its own innovation tear and with the help of the Japanese government developed its world leading hybrid technology while Detroit went back to investing in and building gas guzzlers and issuing press releases about a green future car that never arrived.


President Obama to Visit Detroit Area Jeep Grand Cherokee and Chevrolet Volt Plants Today

Renewed push defending auto bailouts, touting job creation.

by on Jul.30, 2010

Without intervention a million jobs would have been lost, according to a new report.

President Obama will visit the Jefferson North plant of Chrysler in Detroit where Jeep Grand Cherokee models are made and then stop by a nearby General Motors plant in Hamtramck where the Chevrolet Volt hybrid will be built.

At both stops, and another next week at a Ford Explorer plant in Chicago, the President will promote the taxpayer programs that saved or created “Detroit Three” automaker jobs.

The unpopular bailouts and how much of the more than $80 billion used will be returned are one of many contentious election-year issues.

Both Chrysler and General Motors of course received billions of dollars in taxpayer financing to allow them to emerge from bankruptcies last year. And Ford Motor Company received billions to retool its plants.

As a result, the Administration will claim that the 2,800 jobs at Jefferson North and the 1,100 employees at Hamtramck, among thousands of others, were saved by the unpopular loans, which now has U.S. taxpayers as the majority holder in GM, with a substantial position in Fiat run Chrysler.

Ahead of the trip the Administration released a new study on the auto industry. It said that in the year before the Chrysler and GM bankruptcies, the companies lost almost 340,000 jobs.  In the year since then, 55,000 jobs have been added to these companies.

“If we hadn’t stepped in when we did, most observers believe at least a million jobs would have been lost,” said Ed Montgomery, the head of the White House Council on Automotive Communities and Workers.

“While there is still a long way to go, the report points out that the companies are also showing positive signs of financial performance. In the first quarter, all of them made operating profits. That’s the first time that’s happened since 2004,” said Montgomery.

Car Czar Adds Manufacturing to Job Requirements

President Obama Names Ron Bloom Senior Counselor for Manufacturing Policy. Is the Task Force on the Automotive Industry evolving into an industrial policy body?

by on Sep.08, 2009

“So let us never forget:  much of what we take for granted -- the 40-hour work week, the minimum wage, health insurance, paid leave, pensions, Social Security, Medicare -- they all bear the union label. It was the American worker -- men and women just like you -- who returned from World War II to make our economy the envy of the world. It was labor that helped build the largest middle class in history. Even if you're not a union member, every American owes something to America's labor movement.”

“So let us never forget: much of what we take for granted -- the 40-hour work week, the minimum wage, health insurance, paid leave, pensions, Social Security, Medicare -- they all bear the union label. It was the American worker -- men and women just like you -- who returned from World War II to make our economy the envy of the world. It was labor that helped build the largest middle class in history. Even if you're not a union member, every American owes something to America's labor movement.”

Yesterday, during a Labor Day speech  at an AFL-CIO picnic in Cincinnati, President Obama announced that Ron Bloom would serve as the Administration’s Senior Counselor for Manufacturing Policy. Bloom also retains his role as Senior Advisor to the Secretary of the Treasury assigned to the President’s Task Force on the Automotive Industry.

The latest development could be the first step towards a cabinet level department that looks after U.S. manufacturing interests and the middle class jobs it once created. The U.S. is the only industrialized nation in the world that lacks such a department to coordinate laws, tariffs and research to protect and create jobs.

The move follows the revelation on Friday that U.S. unemployment had reached almost 10% nationally, the highest rate in 26 years, with no recovery for workers predicted until next year, at the earliest. If you take into account  people who have stopped looking for work, are underemployed, or are involuntary part time contractors, the number could be as high as twice that or more, according to critics.

President Obama said, “Last week we learned that our manufacturing sector expanded for the first time in 18 months and had the highest monthly output in two years. It’s a sign that we’re on the right track to economic recovery, but that we still have a long way to go. That’s why I’ve asked Ron Bloom to help coordinate my Administration’s manufacturing policy. Distinguished by his extraordinary service on the Auto Task Force and his extensive experience with both business and labor, Ron has the knowledge and experience necessary to lead the way in creating the good-paying manufacturing jobs of the future. We must do more to harness the power of American ingenuity and productivity so that we can put people back to work and unleash our full economic potential.”

Bloom will work with the  National Economic Council on policy development and strategic planning for the President’s agenda to revitalize the manufacturing sector. He will work with departments and agencies across the administration – including the Departments of Commerce, Treasury, Energy, and Labor – to integrate existing programs and develop new initiatives affecting the manufacturing sector.


UAW Strongly Objects to GM’s U.S. Factory Closings

Negotiation deadlock spills over into public lobbying by union.

by on May.18, 2009

Kevin Melton, UAW Local 602, courtesy UAW

The implication is the Auto Task Force has told the union the closings will proceed.

With the 31 May deadline approaching for GM’s revised plan, the United Autoworkers Union on Friday sent a letter to members of the U.S. Congress objecting to the centerpiece of GM’s Viability plan – closing 16 plants in the U.S. and importing vehicles from low-wage, non-unionized countries.

The factory closings are not new, they have been in various versions of the plan since GM went to the U.S. government for bridge loans late, last year, but in bringing the argument over the closings public, the union is attempting to prevent some of them through political pressure after apparently being shut down at the bargaining table. The implication is that the Auto Task Force has told the union that the closings will proceed.

Alan Reuther, UAW Legislative Director, wrote Congress that “As the discussions continue concerning the restructuring of General Motors, the UAW wishes to restate our strong opposition to the company’s plan to close 16 manufacturing facilities in the United States, while at the same time dramatically increasing the number of vehicles it will be importing from Mexico, Korea, Japan and China for sale in this country. We urge Members of Congress to join with the UAW in urging the Obama administration to insist, as part of any further government assistance, that GM should be required to maintain the maximum number of jobs in the U.S., instead of outsourcing more production to these other countries.”

The Chrysler restructuring plan now being worked out in bankruptcy court in New York City also closes U.S. factories and turns the company over to off-shore based Fiat. The factory closings, though, are smaller in number and the small cars and engines that will be supplied by Fiat will be built in the U.S., Canada or Mexico. Furthermore, by getting access to Fiat’s overseas distribution system, exports of Canadian or U.S. made vehicles could increase, preserving or creating UAW jobs.

Subscribe to TheDetroitBureau.comThe core issue the union is raising – U.S. jobs — is an aspect of industrial policy debates that politicians from both the Democratic and Republican parties have ducked for decades. With unemployment at record levels and increasing, our lack of industrial policy is glaringly obvious. Every major nation in the world has policies, laws, tariffs and non-tariff regulations that protect jobs and encourage the export of goods and services into the large, profitable and unrestricted U.S. market.   

U.S. employment continued to decline in April as another 539,000 jobs evaporated to total 13.7 million out of work people, and the unemployment rate rose from 8.5% to 8.9%, according to the Bureau of Labor Statistics. Since the recession began in December 2007, 5.7 million jobs have been lost. In April, job losses were large and widespread across nearly all major private-sector industries. Overall, private-sector employment fell by 611,000. Over the past 12 months, the number of unemployed persons has risen by 6.0 million, and the unemployment rate has grown by 3.9 percentage points. 


Detroit: Victim of the Cold War

The fight to contain the Soviet Union meant rebuilding the Japanese and German economies at the expense of our own.

by on Mar.19, 2009

Soldiers of the 55th Armored Infantry Battalion and tank of the 22nd Tank Battalion, move through smoke filled street.

Soldiers of the 55th Armored Infantry Battalion and tank of the 22nd Tank Battalion move forward.

When World War II officially ended on September 2, 1945, and the Allies were declared victors, German and Japanese cities and industries were in shambles, having been bombed repeatedly even before the two A-bombs were dropped.

Too soon thereafter, the Russian Bear ambled forward, promoting Communist movements throughout the European countries that had recently been freed from the grip of the Nazis, mostly by the Soviets.

In the Far East, similar movements threatened new formed democracies carefully cultivated by the United States and what was left of the United Kingdom. All of this kicked off the Cold War that America ultimately won in the early 1990s when the Soviet Union collapsed from the weight of  its defense spending and failed planned economies.

But an unrecognized consequence of the Cold War has been that Detroit became the victim of our policies to thwart the Soviets.

In Japan, every major city except Kyoto had been virtually destroyed with fire bombs, and Soviet invaders took the northernmost Kurile Islands. During the American Occupation, General Douglas MacArthur decreed that General Motors and Ford Motor Company would not be allowed to reopen their factories in Japan. Before the war, GM had operated an assembly plant in Osaka and Ford, an assembly plant in Yokohama.

Their cars and trucks had been popular with the Japanese public prewar when there was little domestic Japanese automaking. Postwar, the Japanese government ordained that no foreign company could own a majority interest in a Japanese company, and imports were severely restricted by currency and non-tariff barriers.

As it dawned on American leaders that the Soviets were not our friends, propping up the economies of Japan and Germany became our national policy, paid for by U.S. taxpayers. According to the Congressional Research Service, from 1946 to 1952, Japan received $15.2 billion (in 2005 dollars) of U.S. aid to feed its starving people and rebuild. (more…)