Building The New Economy

"Budgetball is an innovative sport that combines fiscal strategy and physical play."
- Budgetball Rulebook, "Pass the Ball - Not The Buck"

Billionaire Pete Peterson is funding an elaborate campaign to convince a nation with more than 15 million unemployed citizens that the most urgent crisis we face today is not unemployment ... or poverty, or inadequate healthcare, or the decimation of the middle class. He's already created a "news service" to propagate his ideas - the Washington Post outsourced its financial reporting to him - and hosted a "deficit summit" headlined by the same people that got us into the mess we're in today. (Greenspan? Rubin? That's not called a "summit." It's called "rounding up the usual suspects.")

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If you move the manufacturing away, research and development will eventually follow. more »

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Wind energy is supposed to be able to create thousands of manufacturing jobs, but unfortunately the early wind energy manufacturing jobs financed by U.S. more »

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Did you know that the Army can no longer purchase domestically produced Howitzer triggers? Yesterday at the Building the New Economy conference, Carolyn Bartholomew, chair of the U.S.-China Economic and Security Review Commission explained that she'd seen this news turn on lightbulbs in the minds of Republicans as to why it's important to preserve manufacturing capacity in America. more »

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The kind of global economic stress we are experiencing is bound to create tensions within the world trading system. Understandably, every company is working to improve its own position. But in countries and regions that are unconstrained by the due process requirements of the U. S. justice system, we have seen signs of trade actions that seriously undermine the global steel market. Nowhere are these destabilizing actions more apparent than in China.

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To our nation’s peril, the free trade orthodoxy continues to ignore a fundamental economic fact: It matters where things are made.

Over the past decade the U.S. industrial base has suffered an unprecedented decline. The loss of more than 5 million manufacturing jobs and the closure of more than 50,000 manufacturing facilities have undermined our nation’s technical capacity to innovate and to make things, while at the same time decimating our middle class.

Flawed trade and tax policies and a financial system focused on short-term profits drove good jobs offshore, led to record trade deficits, and left the economy in ruins. With the manufacturing share of gross domestic product withering to 12 percent (from 15.9 percent in 1995) and the financial sector growing to 22 percent, the structure of the U.S. economy looks more like Monaco than Germany. This growth model of asset bubbles, low wages, credit pyramids, toxic assets and unregulated out-of-control global capital has been a recipe for disaster.

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The American manufacturing industry and its employees are constantly told that they need to be better competitors in the global market, that they must increase the value they add. How are they doing on that?

Something that jumps out from data about the share of global manufacturing had by the United States, China and five other industrialized nations, is that the US is about even with China. As of 2008 and according to UN figures, China's manufacturing accounts for 17.3 percent of world output in dollars (though this number is slightly inflated), while the US' share is 17.7 percent. All else is rarely equal, so this is about as close as you'll get in the real world.

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We've got a new red scare. Forget Glenn Beck; the fear isn't that America is going red, it's that it is in the red. Conservatives in both parties are raising alarms about deficits and government spending. Well, get over it. If we are going to generate growth and shared prosperity out of the mess we are in, expanded public investment must be a centerpiece of the new economy.

In today's Washington, this verges on heresy. The chattering classes are raising a clamor about Obama's deficits. The growing fixation, fanned by conservatives in both parties, may well cripple any short-term recovery. Worse, the wrong-headed debate could well undermine the reforms vital to the new economy we need to build out of the ruins of the old.

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President Barack Obama announced today $3.4 billion in government grants to help build a "smart" electric grid. Like many Obama initiatives, it’s a smart first step. But much more is needed and one piece is rarely mentioned at all. more »

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