Industrial Policy

It Is Time To Put Our Foot Down: Ten Steps We Can Take to Stop Closing Factories and Eliminating Jobs

Dave Johnson — Wed, 10 Mar 2010 12:18:13 -0800

The economy is still getting worse more slowly. We lost "only" 36,000 jobs last month. We need to create 11 million new jobs just to get back to where we were before "free-market" conservatives took over our government and dismanted the protections and regulations that had protected us from this.

Jobs lost, communities devastated, lives destroyed. Over and over again. Yet with all of this going on companies like Whirlpool and Toyota are still closing factories, laying of American workers, and moving manufacturing out of the country! Toyota is closing the NUMMI plant in Fremont, California, which could lose up to 50,000 jobs across California. Whirlpool -- recipient of stimulus dollars from the government -- is closing a factory in Evansville, Indiana and moving the jobs to Mexico where people will be paid $70 a week and certainly won't be buying anything made in America.

It's the system. While the executives collect bonuses and tax breaks for their destructive actions We, the People have to pick up the tab. We pay the unemployment, the stimulus, etc. Our communities pay the cost of losing the jobs and the tax base, our economy pays the cost of losing the manufacturing capability. And the executives and private equity firms and Wall Street get rich. So of course they do more of it.

How crazy is this? In the middle of this terrible jobs crisis companies are still closing factories here and shipping the jobs out of the country. Why do we allow this?

Whirlpool and Toyota (and Wall Street's $140 billion bonus pool this year) ought to be the last straw. It is time for We, the People to put our foot down and say not one more factory closed, not one more job sent out of the country! In fact, it is time to start bringing jobs BACK.

It is time to stop letting goods into the country that are made by exploited workers in areas with no environmental protections without a tariff to take away the price advantage gained from going around the protections that We, the People have fought so hard for.

There is only one way the country can earn the money to pay back what we borrowed from China, Japan and others. That is to make and sell things to others!!! THAT is what "trade" means. "Trade" does not mean allowing greedy executives to sidestep the laws and regulations and protections that We, the People fought so hard to get.

Look around us. Jobs lost, communities devastated, homes foreclosed, lives destroyed, governments going broke. All because of a runaway system that encourages the destruction of our economy. Our system actually encourages executives to close factories and lay people off! Executives make profits and get bonuses (that benefit from tax cuts) if they can figure out how to eliminate YOUR job or close a factory or cheapen a product or keep you from talking to customer support or make you pay an extra fee, etc.

Wall Street and executives benefit from this -- and get tax cuts, tax breaks and subsidies for doing it. But the economy-at-large is destroyed by these same actions when they are widespread. On top of that, we know that when we lose the factories we have to borrow money to buy the things we used to make. But we give tax breaks instead of penalties to companies that do this.

Here are just some steps that We, the People can take to start turning this around:

- A border tariff on imports to remove the price advantage of goods produced by exploited, underpaid workers.

- A border tariff to remove the price advantage of goods produced in ways that harm the environment.

- A border tariff on goods from countries that are not democracies, to remove any pricing advantage gained from not allowing people to vote and set rules that benefit themselves.

- A border tariff on goods from countries that restrict workers from organizing to improve their wages and working conditions, to remove any pricing advantage gained from not allowing workers to bargain. (America currently doesn't meet this standard.)

- Remove tax benefits and instead impose tax penalties and fines on companies that close factories here. Don't let it be profitable to do this!

- Increase taxes on the big monopolistic companies to remove the advantages that help them destroy America's smaller, regional and local businesses -- the very job creators we need.

- Increase income taxes on high incomes to reduce the incentive to pursue short-term windfalls instead of long-term interests. Make it take a long time to accumulate a fortune. Making a fortune is great but it should be a reward for helping our economy and society, not destroying them.

- Break up the "too big to fail" Wall Street firms that wrecked the economy. And get the money back -- all of it.

- Explore the use of Eminent Domain to keep factories in communities and workers in the factories.

- Formulate and follow a national economic/industrial strategy to build a new green manufacturing economy

Please add some ideas in the comments. I will have more to say on all of this.

NUMMI Closing Highlights Need for U.S. Manufacturing Policy

Tula Connell — Fri, 05 Mar 2010 06:58:29 -0800

Closing the New United Motors Manufacturing Inc. automotive plant in California will eliminate 25,000 jobs in the state and cost taxpayers $2.3 billion to replace the jobs lost, according to a March 3 report by University of California professor Harley Shaiken. The Daily Labor Report (subscription required) notes:

California and municipalities near the Fremont, Calif., plant will lose nearly a billion dollars of revenue in the decade after the plant closes, according to a blue-ribbon panel formed by state Treasurer Bill Lockyer (D). Using estimates by the President's Council of Economic Advisers, the report found that "just creating 4,700 jobs--the number lost at NUMMI itself--would cost $433 million."

Jobs lost. Lives destroyed. Communities weakened. Billions of dollars down the drain. All because companies can only improve their bottom line by going after the cheaper labor they can find in other countries, right? Not so, writes Ralph Gomory, president emeritus at the Alfred P. Sloan Foundation and former IBM senior vice-president of science and technology (h/t Alliance for American Manufacturing).

Cheap labor abroad is cited as the incurable handicap that explains why the United States cannot compete. But cheap labor doesn't explain the fact that Japan and Germany, both high-wage countries, are successful in the automobile industry. Nor does it explain how semiconductors, a model of a high investment, low-labor content industry, are mainly made in Asia. The premise that the inescapable burden of competing against low wages means failure is simply not correct.

Even more disturbing than this big lie, says Gomory, is the unwillingness of our nation's leaders to address the consequences of not competing.

Today our companies are motivated to take innovations abroad, produce there and import the goods into the United States. Increasingly we can expect services also to go overseas. We must produce here in the U.S.A., to employ the people of this country, and we must keep their activities effective by a steady stream of innovations in design and production. While other countries roll out a welcome mat of tax breaks and subsidies for our companies because their common sense tells them that their people being employed in productive work is the road to being a rich country, we provide no incentive for U.S. companies to produce here.

Good move, then, by Sen. Sherrod Brown (D-Ohio), who led a bipartisan group of 10 senators in sending a letter to President Obama urging the adoption of a national manufacturing policy. The letter states, in part:

The loss of manufacturing plants and jobs has stifled economic opportunity for middle class families and compromised our ability to compete in the 21st century economy. Indeed, for the last several decades, administrations have passed up critical opportunities to formulate a rational and comprehensive manufacturing policy. Continued apathy will undermine our country's ability to achieve energy independence and place our military readiness at risk.

Meantime, you can take action. Sign the petition by American Rights At Work and tell Toyota: Don't abandon your workers.

Senator Shelby's "Holds" Show Need For National Industrial Policy

Dave Johnson — Fri, 05 Feb 2010 08:11:56 -0800

Senator Shelby is placing "holds" (filibusters) on ALL OF the President's nominees, all by himself

Richard Shelby puts hold on President Obama's nominees

Shelby is frustrated over the Pentagon’s bidding process for air-to-air refueling tankers, which could lead to the creation of jobs in Mobile, Ala.

Over at firedoglake, emptywheel writes,

The key issue is that Shelby wants the Air Force to tweak an RFP for refueling tankers so that Airbus (partnered with Northrup Grumman) would win the bid again over Boeing. ... Airbus calculated that it would not win the new bid, and started complaining.

Essentially, then, Shelby’s threat is primarily about gaming this bidding process to make sure Airbus–and not Boeing–wins the contract (... this is the truly huge potential bounty for his state).

. . . But underlying the refueling contract is the question of whether the US military ought to spend what may amount to $100 billion over the life of the contract with a foreign company, Airbus. Particularly a company that the WTO found preliminarily to be illegally benefiting from subsidies from European governments.

$100 billion contract to build air to air tankers -- that's a lot of jobs and lots of them in Alabama.

This shows why we need a national industrial policy. The country has no policy to promote jobs and manufacturing so members of Congress are forced to do things like this to try to keep manufacturing in their district or state - competing with every other district or state. And in this case, even fighting to lose the contract for an American company!

Senator Shelby is fighting for jobs in his state, because the country is not. It is time for a coordinated national economic/industrial strategy -- just like every other country has -- so we're all working together instead of fighting over the scraps that are left behind.

Jobs: White House Manufacturing Policy Document and Meeting

Dave Johnson — Thu, 17 Dec 2009 13:34:42 -0800

This week the Obama administration came out with a new policy paper, "Framework for Revitalizing American Manufacturing" to coincide with a White House meeting with manufacturers. At the meeting, Vice President Biden

... announced administration support for a $5 billion expansion of a tax-credit program to encourage manufacture of wind, solar and other energy technology.

. . . The session, part of Biden’s task force on the U.S. middle class, is another in a series of administration events intended to focus on efforts to drive down the unemployment rate, which was at 10 percent last month. President Barack Obama has announced plans to seek more spending for repairing and modernizing the nation’s infrastructure, expanded credit availability for small businesses, and tax credits to encourage greater energy efficiency for homes and businesses.

. . . At the meeting, CEOs including David Cote of Honeywell; Robert McDonald of Procter & Gamble Co., Keith Wandell, chairman of Harley-Davidson Inc. and Robert Keegan of Goodyear Tire & Rubber Co., said the administration should do more to open foreign markets to U.S. products and lower corporate taxes.

Labor leaders Ed Hill, the president of the International Brotherhood of Electrical Workers, Bruce Raynor, the president of Workers United, and Elizabeth Shuler, Secretary-Treasurer of the AFL-CIO, also attended the meeting.

According to the Detroit Free Press,

The administration’s plan suggests a variety of moves to boost manufacturing, from better training for factory workers to opening overseas markets and defending patents and copyrights. It also calls for government aid to areas where manufacturing has retreated, leaving no replacement for crippled local economies.

While job losses in manufacturing have slowed over the past few months, factories have steadily shed jobs in the past decade, thanks to a combination of off-shoring and rising productivity. ...

Manufacturers themselves have been divided in the past over ways the government could boost their output, with smaller firms calling for more aggressive action against China. By artificially holding down the value of its currency by up to 40%, China provides a subsidy to its exporters, one that’s increasingly under criticism from other nations.

I recommend reading or at least skimming the policy document.

Making It In America: Building The New Economy

Eric Lotke — Wed, 28 Oct 2009 10:06:30 -0700

Key progressive leaders participating in the October 29, 2009 "Building the New Economy" conference in Washington address the issues raised in this report and discuss what it will take to ensure that the new economy that emerges from the wreckage of the old will provide Americans with good jobs.

Download and read the full report »

Executive Summary

We can’t pull out of the present downturn and return to the economy of the past—a high-consumption, low-wage economy based on asset bubbles and foreign borrowing. We need to look ahead. Our response to the current crisis must plant the seeds for the economy of the future.

The contours of the new economy are starting to take shape. Barack Obama set a different tone with an inaugural address that promised a “new foundation for growth.” Some of this is happening already: Construction crews are fixing bridges, filling potholes and laying new airport runways; work has started to improve our nation’s electric grid and create new, renewable sources of energy, and Congress is working on the biggest boon for college student financial aid in a generation, shifting $87 billion in subsidies from banks to students over the next decade.

Outside of government, we hear talk of sustainability, about returning to a real economy based on production, not consumption, and manufacturing, not finance. Celebration over cheap Chinese imports is giving way to alarm over the loss of jobs, currency manipulation, low environmental standards and dangerous workplaces that lower Chinese costs and give Chinese imports an unfair advantage.

But the opposition to reform is fierce. Wall Street is mobilizing against financial reform and regulation. Obama’s decision to impose tariffs on Chinese tires was called “economic vandalism," and modest “buy American” provisions in the Recovery Act met accusations ranging from “counterproductive” (U.S. Chamber of Commerce) to “the worst instincts of Congress” (The Wall Street Journal). And federal budget deficits generate concern across the political spectrum.

The next economy must be built on a solid platform. We need to rebuild our infrastructure, renew our manufacturing base and educate our people. America needs an industrial policy to help fit these pieces together. From workforce development to component manufacture, we need a strategic collaboration between the private sector and the government to reach our shared national goals. We need an opportunity for stakeholders to come together to remove obstacles, allocate resources, and create rules that work for everyone involved.

This report makes the case for that policy and explains what should be the key elements.

The Case For Big Government

Jeff Madrick — Thu, 22 Oct 2009 05:56:06 -0700

America had been living a free-market myth for a generation until the credit crisis of 2008 and 2009 descended on the nation—and the world. One expression of that myth, found frequently on the editorial pages of the popular media, was that government does not grow economies, business does. In other words, government, don't meddle where you're not needed. Politicians are even easier to belittle than government itself.

I have spent much of my professional life making the opposite point. Government does indeed grow economies. It creates jobs and it produces prosperity. When politicians make correct decisions, they indeed make economies grow. There is no example of a major rich nation in the world whose government does not educate its children and teenagers; build its roads, bridges, superhighways, and airports; establish regulatory bodies to minimize financial busts; develop sanitation and water systems, and health care standards; support those who are temporarily unemployed; and provide a public pension to the elderly and a subsidy to the poor.

Key progressive leaders participating in the October 29, 2009 "Building the New Economy" conference in Washington address what it will take to ensure that the new economy that emerges from the wreckage of the old will provide Americans with good jobs.

This is the call of big government. Label it proportional government if the words “big government” bother you. It is people getting together to do what they believe they must. And, yes, this is what good politicians do. Let's call it like it is.

As economies grow larger, societies more populous, scientific and social knowledge deeper, and interconnections more complex, government grows as well—at least in societies that succeed. And when government works as it should, it is also typically the leading agent of change. As economies progress, societies learn more, and expectations rise, government's main purpose is to manage, foster, and adapt to this change. It is a profound task.

Our own government has a history of managing and adapting, often radically, to change, looking ahead, not backward. It did so in the face of influential forces, fearing the future and aiming to protect established interests, which invariably opposed new obligations for government: financing the canals in the 1820s; building free primary schools starting in the 1830s and high schools in the late 1800s; developing government-built sanitation and water systems in the early 1900s that made the cities possible; creating a central bank to mitigate the disruption of boom-and-bust cycles and regulate unstable financial markets; enforcing labor rights such as hours worked, job safety, and a minimum wage; implementing vaccination programs and health research.

All myths are by definition simplistic. The one that became entrenched in the late 1970s and early 1980s had as its core claim that government's presence was usually an impediment to prosperity and that the best course for the American economy was to reduce aggressively government's size and reach. So popular was this destructive notion that the end of the “era of big government” was announced proudly in 1996 by a Democratic president, Bill Clinton.

In the past 30 years, government, with a few exceptions, did not adequately sustain and nurture society, or help it adapt to change. Government invested less in America, it regulated less, and it led less. It was a lost generation.
The financial crisis occurred because of this widespread disdain for and distrust of government. Under ideological pressure to which both political parties subscribed and under the influence of powerful vested interests, government stepped back and gave financial markets largely free rein. Very risky investments were made with enormous levels of debt; the failure of one firm could take down an entire industry . Common sense was discarded and new, highfalutin theories about the rationality and efficiency of markets dominated thinking at the best universities, the halls of Congress, and the boardroom of the nation's central bank. Always, the argument was the financial community understood risk better than any government could.

When you comb the serious academic evidence about how and why economies grow, you will find that no case can be made that big government or even high taxes impede economic growth over time. History offers no lesson about the values of minimal government. There has never been a laissez-faire modern economy. To the contrary, the evidence shows that government typically contributed vitally to growth. As odd as it is to have to say this, without effective government, America would be poor today.

The lost faith in government has detrimentally affected almost all aspects of life in America in the last generation: health care, education, retirement security, the quality and durability of jobs, family time available to raise children, rising prison populations, and the nation's wealth itself.

Government is not always good. It requires vigilance and weeding. But it also requires the confidence and understanding of its people. These it must earn, but the people in turn must also learn their own history, free of ideological cant and petty anger.

The major question today is whether the deep setbacks caused by the credit crisis will awaken the nation to the need to revitalize government again. If America returns to the norms of the past 30 years, the nation will not succeed.

A New Economy from Old Roots?

Dave Johnson — Wed, 30 Sep 2009 16:11:44 -0700

How do we build a new economy out of the collapse of the old economy? How do we start fresh to begin creating jobs again, while building in economic and environmental sustainability, as well as workplaces that respect human needs and rights? How do we change things so that we all get to share the benefits of the economy rather than just contributing to the increasing wealth of a few vastly wealthy people?

While we look for a vision for a new economy, we should examine what has worked in the past. America had periods in which regular people enjoyed sustained increases in their standard of living. For a long time it was a conventional wisdom that each American generation would do better than the previous generation, more people would receive good educations, medical care would get better, the middle class would grow, leisure time would increase, poverty rates would decrease, retirement would be easier, etc.

But this pattern stopped. Beginning in the late 1970s and especially in the 1980s incomes began to stagnate, wealth increasingly concentrated at the top, working hours and workplace pressures steadily increased, availability of good health care started to decrease, etc. The standard of living of most Americans began to and continues to decline. At the same time corporations became more predatory as consumer protections vanished. Meanwhile outsourcing, deunionization and other anti-worker policies led to increasingly unpleasant, stressful and unrewarding worklives for more and more people.

Many of today's problems are traceable directly to the policy results of anti-government propaganda that was blasted out from well-funded conservative think tanks starting in the 1970s. The anti-government campaign led to defunding of many national, state and local government programs that improved education, helped the poor or enriched people's lives. We suffered deregulation in many areas where the government had protected consumers, workers, investors and the environment. Huge reductions in taxes for the wealthy were either offset by tax increases for the rest of us or government borrowing. And that borrowing has led to increasing problems of paying the interest and threats to funding even basic programs like Social Security and education.

So what worked, before the conservatives trashed the place?

Regulation

One thing we know for sure now, learned the hardest way thanks to the financial crisis: regulation worked. Regulation was necessary, it worked, it kept firms from taking risks that could bring down the economy. And we can also see now how regulations protected consumers from predatory corporate activities, workers from wage theft or unsafe working conditions, and the environment from exploitation and destruction.

Taxes

Before Reagan the tax rates at the top were very high. After you reached - and took home - a certain very high income you paid a high percentage of the rest in taxes. This had many beneficial results – even for the people who paid higher taxes. Government could afford to keep the physical, education and legal infrastructure in good condition without borrowing. Government could afford to invest in programs that improved our standard of living, health, knowledge and technology, which helped businesses grow. Businesses thrived in such well-watered soil.

The high tax rates also kept the bad side of human nature in check. When it took years to build up a fortune businesspeople had to rely on the health of the greater community to nurture their own wealth-building enterprises and keep them thriving over a long period. They had to think and act long-term. The roads needed to be kept in repair, the schools needed to provide excellent education to potential employees, the courts needed to be functional to enforce contracts, and they wanted the communities they were going to have to stay in to be pleasant places to live.

But once taxes were lowered vast windfalls could be realized from a single event and it made more sense to try to fleece the community with quick-buck schemes than to rely on it. We began to see corporate raiders break up solid, ongoing companies, steal pension funds, etc., while encouraging communities to cut spending on schools, roads, etc. It became more profitable sell off or outsource our manufacturing capacity. And then, as things fell apart, the few who benefited could just fly away in their private jets or sail away in their huge yachts. The greater community was no longer any use to them except as crops to be harvested. Vulnerable consumers are the only crop that is coming up in this economy.

Big Government

Government is We, the People making the decisions. "Big government" is simply another way of saying that more of the important decisions are made by the people. Shrinking government means handing the decisions over to big corporations. In the real world this is the choice. And in the real world big corporations make decisions that benefit them, and only them. Before you badmouth government think carefully about what the alternative is.

Old-Fashioned Government Planning

As I said in a post here a few months ago,

The phrase “industrial policy” sounds so Walter Mondale, 1970s, smokestacks and brick factory old-fashioned. I suspect the subject turns people off, eyes glaze over, hands reach under the table for iPhones and Blackberries…

But here we are without an industrial policy. How’s that working out for us? Every other country has one. China seriously has one. We instead have huge trade deficits. We don't make things here so we have to borrow money to buy things made elsewhere.

To add insult to injury, recently Deutsche Bank released a research note advising investors that the U.S. was not a good investment because of our lack of a government industrial policy. See Deutsche Bank: Absence of US Clean Energy Policy Will Send Global Capital Elsewhere.

While we envision a new direction for our economy, maybe we should also be looking at returning to a few old-fashioned ways of doing things, too.

Pittsburgh, G-20 and the New Economy: Lessons to Learn, Choices to Make

Isaiah J. Poole — Mon, 21 Sep 2009 08:42:51 -0700

America faces daunting challenges. Jobs are scarce, roads are crumbling and states are reducing vital services. We face staggering levels of public and private debt.

It is fitting that the G-20 meet in Pittsburgh at this time. As White House spokesman Robert Gibbs explained, “[Pittsburgh] has seen its share of economic woes in the past, but because of foresight and investment is now renewed, giving birth to renewed industries that are creating the jobs of the future.”

Gibbs is right, in part. Pittsburgh has come back from enormous setbacks in its dominant industry, steel. A combination of deliberate planning, public investment, and partnerships between government and private industry created a new, mixed economy better able to compete in challenging new conditions.

But optimism is only half the story. As we documented in our earlier report, "Pittsburgh, The Rest of The Story," Pittsburgh’s comeback reveals the limitations of local efforts. In the absence of a national industrial strategy and a different approach to trade, the U.S. will be lucky to end up where Pittsburgh is now. It’s not the cellar, but it isn’t the Super Bowl either. Pittsburgh’s population is declining and its young people are leaving. Many high-paying jobs in manufacturing were replaced with low-paying jobs as waiters or hotel clerks, and many were never replaced at all. Real attention is needed to address the unsolved half of the problem.

America grew up as an industrial superpower, from mass-produced automobiles to the Arsenal of Democracy. But our once-robust system of economic production — the invention, design and manufacture of products — has been steadily eroded. In its place has come an economy based on asset bubbles and foreign borrowing. We’ve shifted from production to consumption, from high wages to low wages, from creditor to debtor. Even when the economy was growing, we ran a current account deficit in excess of $700 billion every year. We borrow $2 billion every day to cover the difference.

That strategy was never sustainable and is no longer available. Now is the time for a new economic strategy, one based on balanced growth for the nation and living wages for the people. As President Barack Obama said in April, we need a larger vision of America’s future:

“…. a future where sustained economic growth creates good jobs and rising incomes; a future where prosperity is fueled not by excessive debt, or reckless speculation, or fleeting profits, but is instead built by skilled, productive workers, by sound investments that will spread opportunity at home and allow this nation to lead the world in the technologies and the innovation and discoveries that will shape the 21st century.”

The Chinese Steel Steal

Isaiah J. Poole — Thu, 13 Aug 2009 13:05:06 -0700

Scott Paul, executive director of the Alliance for American Manufacturing, explains how Chinese steel manufacturers gain an unfair trade advantage over their U.S. counterparts, even though U.S. plants are demonstrably more efficient and technologically advanced. He spoke to a group of bloggers at the Netroots Nation conference in Pittsburgh Aug. 13, 2009, after they toured the Mon Valley Works steel plant outside the city.

F-22 Fight Unveils a Broken Policy

Armand Biroonak — Wed, 05 Aug 2009 12:32:26 -0700

As I’ve written prior, the very expensive F-22 fighter jet program will likely end when Congress passes the defense authorization later this year. Its demise though came only after a hard fight between the Obama administration and Congress. Despite all of the F-22’s faults, many members of Congress still saved the jet in order to preserve jobs – a reason they cannot be completely faulted for. That is why the F-22 saga is a prime example of our broken system; we lack a government strategy to make sound investments and create jobs. Instead, Congress is often forced to fight for programs that nobody wants.

Just to kill the F-22 was difficult. With production in 44 states, 200 members in Congress pleaded with the Obama administration in a letter earlier this year, stating the jet was invaluable to the economy. And when the defense funding bill moved through Congress, Republicans and Democrats, voted against killing the F-22, including more liberal senators like Barbara Boxer (CA), Diane Feinstein (CA) and Chris Dodd (CT). Even Sen. Kerry (MA) questioned ending the F-22 until the administration assured him that Massachusetts’ job losses would be mitigated with production of the alternative F-35 jet.

And although the end of the F-22 is a victory for defense reform advocates, Congress has funded other programs that Secretary Gates called to cut. To preserve thousands of jobs, programs such as the F-35 alternative engine and the VH-71 presidential helicopter will continue at a cost of nearly $1 billion next year alone.

But despite advocates’ claims that weapons generate jobs, defense spending is actually among the least productive investments. According to a study by the Political Economic Research Institute at UMass Amherst, per $1 billion, defense only produces 8,600 jobs, compared to infrastructure’s 12,800, education’s 17,700, or mass transit’s 19,800.

And over the long term, economist Dean Baker found, “military spending drains resources from the productive economy. For this reason, it will typically lead to slower economic growth, less investment, higher trade deficits, and fewer jobs.”
Not to forget, defense products yield little utility, serving military purposes, as opposed to broader benefits that come with a bridge built or solar panel installed.

Though of course there are many, many other programs that present a clear choice between logic and lunacy, which Congress must bankroll solely for jobs. This is why it is important for the Obama administration to get serious about an industrial plan to redirect defense investment to underserved areas such as clean energy and infrastructure. Such a plan not only gets more bang for the buck, but also can serve as a foundation for sustained job creation, particularly to revive our manufacturing sector.

Look for my upcoming posts on how a transition from defense to alternative investments is easier than we might think.