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Last week several groups, including the United Steelworkers, petitioned the federal government to whack the latest trade mole – illegally traded auto parts from China.

With President Obama announcing creation of a new trade enforcement unit in his State of the Union Address, the feds probably will investigate. But even if they whack down the auto parts mole, experience has shown a new mole will pop up.

Mole-by-mole trade enforcement isn’t the solution to America’s massive trade deficit. Although conservative candidates revel in ridiculing Western Europe, America could learn crucial economic lessons from Germany, which doesn’t rely on Whack-a-Mole and maintains trade surpluses, including one with China in auto parts.

The Steelworkers – along with the United Auto Workers, the Alliance for American Manufacturing and Campaign for America’s Future – explained why the federal government must smack down the latest trade problem that has raised its ugly head.

China and several other countries promote their auto parts manufacturers by providing subsidies and engaging in additional practices banned by the World Trade Organization (WTO). As a result, the United States imports more auto parts than it produces, a situation that kills manufacturers and manufacturing jobs here.  For example, over the past 11 years, as the U.S. auto parts trade deficit increased by 867 percent, the Unites States lost 45 percent of its auto parts jobs – a total of 419,000.

The reason the groups sought action against China specifically is that its exports of auto parts to the United States have increased faster in the past three years than any other country’s and China supports its auto parts industry in ways that violate its commitments to the WTO.

For example, China provided $27.5 billion in subsidies to its auto parts industry between 2001 and 2010. It’s fine with the WTO if countries subsidize industries that sell their products domestically.  But it forbids subsidies for exported products because that distorts the free market, wrongly destroying jobs and industries in the countries that buy those artificially low priced goods.

Beijing also aggressively limited import of American-made auto parts. This is hardly startling. In December, China imposed steep tariffs on imported American-made sports utility vehicles and other large cars. And the WTO affirmed last week that China violated its trade commitments by restricting export of key raw materials. Earlier, the WTO supported President Obama’s imposition of tariffs on tires imported from China because Beijing had violated international trade rules.

China has prospered by breaking the rules. Electronics manufacturing is a good example. In a story about Apple’s experience, The New York Times described how America lost these jobs to China. Worker wages, while achingly low in China, were not the lure. And they were not the issue for Apple, a company that makes $400,000 in profit for every worker. It was a combination of other factors including the Asian supply chain and Chinese subsidies. (more…)

Amid prolonged, painfully high unemployment, ABC News Anchor Diane Sawyer for the past year tirelessly advocated a simple solution – buy American-made products.  She clearly explained the reasoning: every American dollar spent on an American-made product helps create an American job.

Defying Sawyer’s admonition to search for “Made in America” tags, California set a record for using government money to create jobs in China. The Golden State awarded a contract for the new Bay Bridge that created 3,000 jobs in China for five years – a period during which the state’s unemployment rate persisted at two percentage points above the nation’s already high average.

Now there’s an antidote for California’s stupidity. It is legislation called the Invest in American Jobs Act.  Championed by U.S. Rep. Nick J. Rahall, (D-W.Va.) and Senators Sherrod Brown, (D-Ohio), Bob Casey, (D-Pa.), and Debbie Stabenow (D-Mich.), it would strengthen existing requirements for buying American products when federal tax dollars pay for construction of highway, bridge, public transit, rail, water systems and aviation infrastructure equipment.

To create 200,000 American jobs, Sawyer has challenged Americans to spend just $64 of their $700 in holiday purchases on American-made gifts. Imagine the American jobs that would be created if “Made in America” were stamped on every single part of all $59 billion in infrastructure projects the federal government funds in a typical year.

That’s what Rahall, Brown, Casey and Stabenow want. Unless American-manufactured components aren’t available or would be outrageously more expensive, these lawmakers believe American tax dollars should buy American jobs while financing American infrastructure.  So they propose to expand the existing “Buy American” requirements and close loopholes that allow governors like California’s Arnold Schwarzenegger to circumvent the rules.

Schwarzenegger contended that California would save $400 million on the $5.1 billion Bay Bridge if it hired a Chinese firm to build steel decking and a 52-story tall support tower and ship them 6,500 miles to San Francisco.

This turned out to be a “you get what you pay for” lesson for California. The state should have been forewarned by years of publicity about problems with Chinese-manufactured products. For example, toxic drywall imported from China sickened American homeowners, corroded pipes and resulted in hundreds of millions in successful damage claims against the Chinese firms that fabricated it. Or there was the tainted blood thinner Heparin from China that killed at least 81 Americans. (more…)

One thing you can do to help bring back American jobs is look for goods made in America when you shop. People are tired of going into stores and seeing nothing but stuff from China! This holiday season your family, relatives and friends will appreciate it even more when you give an American-made gift.

Here are some resources and American-made gift ideas:

See all kinds of American-made products at USAb2C.com. From their website:

America’s largest Internet Mall for American Made Products including American Made Toys, Tools, Shirts, Clothes, Baby, Shoes, Slippers, Towels, American Made Jeans, Boots, Bikinis, Electronics, Clocks, Bird Feeders, Furniture, Books, China, Backpacks, Socks, Dolls, Hats, Apparel, Tablecloths, Blankets, Pet

Products Made In The USA – America

Over 6,000 American Made Products!!

New Balance: “New Balance is the only athletic shoe company that continues to prove high-quality athletic footwear can be produced competitively in the United States. We are committed to American workers. More than 80% of these shoes are assembled in the U.S., helping New Balance to employ over 1,200 U.S. manufacturing workers.”

Loggerhead Apparel: “Loggerhead Apparel will provide top-quality, American-grown, South Carolina-made clothing at a fair price. Ten percent of the revenue gained from the sale of all Loggerhead Apparel shirts will be donated directly to local causes supporting the conservation and protection of the Loggerhead.

In addition to supporting the Loggerhead, Loggerhead Apparel will also support the local textile industry, because no part of the production process will take place outside of the United States.”

Diamond Gusset Jeans: “Genuine. Original. Always 100% American made. Diamond Gusset Jeans. Celebrating our 25th year.” See Looking For America.

Step2 Toys: “The Step2® Company, LLC, headquartered in Streetsboro, Ohio, is the largest American manufacturer of preschool and toddler toys and the world’s largest rotational molder of plastics.” See their Creative Play Plus blog.

Okabashi Shoes: “At Okabashi we believe that technology and design can be utilized to deliver a great product to the consumer at a great value, without shifting U.S. jobs overseas. Okabashis are proudly made in the United States in Buford, GA and shipped worldwide from there.”

American-made iPhone accessories from Insanely Great: “Based in Menlo Park, California, Insanely Great Products, Inc. was created to design and build great products in America.” There’s more, here is a bit, and go read the rest:

We believe that a mistake has been made the last few decades in outsourcing too reflexively when many parts and complete products also can be made locally in the United States. It has become conventional wisdom to outsource just about every manufactured part, with the idea of U.S. manufacturing somehow viewed as practically quaint, a part of our legacy, rather than our future as a country. As happens with so many trends, we believe this one has overshot the mark, and we plan to develop an infrastructure of small, agile, distributed manufacturing units, able to rapidly meet changing demands and provide mass customization that makes at least a beginning step in starting a new trend.

Small, intelligent and agile manufacturing in America just might be what it takes to create a new source of employment to begin to reverse the outflow of manufacturing jobs.

John Briggs blogs on Made in America topics and U.S. companies at simplyamericandotnet — “Putting our Extended American Family Back to Work”

Note: I flat-out stole a lot of this info from the manufacturethis blog. I feel no shame for it.

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Johnson also is a fellow at the Commonweal Institute and a Senior Fellow at the Institute for the Renewal of the California Dream.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture as part of the Making It In America project.

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Follow Dave Johnson on Twitter: www.twitter.com/dcjohnson

The Alliance for American Manufacturing (AAM) recently attended the High Point Market in High Point, NC. Held twice a year, High Point Market is the largest home furnishings industry trade show in the world, attracting over 80,000 buyers and interior design professionals from around the globe.
This year, for the first time ever, the market included a 16,000 square foot Made in America Pavilion which showcased 30 companies that manufacture their products exclusively in the USA.

Efforts by those who never want to hear someone say, “Bye-bye American manufacturing,” converged coincidentally to make June Buy American month.

First, at the forceful urging of U.S. Sen. Bernie Sanders of Vermont, the Smithsonian on June 8 opened an all-American-made gift shop in the National Museum of American History. Three days later, U.S. Sen. Sherrod Brown of Ohio introduced legislation requiring federal agencies to buy only 100 percent American-made flags.

Then, at the Netroots Nation 2011 conference in Minneapolis, Minn. this week, the AFL-CIO will serve American union-made beer, including Schell’s, brewed in Minnesota by members of my union, the United Steelworkers (USW). The Alliance for American Manufacturing will host at Netroots an American-made fashion show at which it will serve USW-member made Kellogg’s Nutri-Grain bars.  And the BlueGreen Alliance is distributing to Netroots attendees mercury-free, USW-made, energy-efficient, non-curly cue Oshram Sylvania halogen light bulbs. (more…)

By Scott Paul
Executive Director of Alliance for American Manufacturing (AAM)

When IHS Global Insight revealed this week that China has passed the United States to lead the world in manufacturing output, the response from some in government and manufacturing was to quibble with the data. The correct response is to develop a national manufacturing strategy, so that we can once again lead the world in manufacturing, which is a position we’ve held for 110 years.

Why a strategy? Well, Germany has one. China has one. South Korea has one. In fact, every other industrialized nation has a network of currency, trade, tax, investment, innovation and skills policies that promote domestic manufacturing. We stand alone in allowing our jobs to be freely outsourced overseas. Our economic and training policies spur on a service and financial sector economy at the expense of investments in manufacturing.

First, let’s consider the data on the size of manufacturing. Manufacturing accounts for one-third of China’s economic output. For most of our industrial competitors, the number is somewhere between 15 and 20 percent. In America, manufacturing accounts for less than 13 percent of our GDP, and that figure is falling every year.

The rate of growth in manufacturing in China has averaged over 20 percent per annum over the past three years. In the U.S., despite a recent rebound, that figure is only 1.8 percent. We’ve shed 50,000 factories and 5.5 million manufacturing jobs over the past decade. Meanwhile, one company in China — Foxconn — created more manufacturing jobs last year than the entire U.S. economy. (more…)

By Scott Paul
Executive Director of Alliance for American Manufacturing (AAM)

Our new man in China, Gary Locke, will have a big, bilateral economic mess to help clean up. The United States posted a record $273 billion trade deficit with China last year. China continues to slow-walk the Yuan’s appreciation against the dollar. And, China shows few signs of easing up on its mercantilist and protectionist policies that help to keep our export outs, and give Chinese production an unfair advantage in our market and others around the world.

Secretary Locke — announced by the president to become our next ambassador to China if confirmed by the Senate — compiled a pretty good record at the Commerce Department on these issues. The Administration stepped up trade enforcement to a degree we have not seen for 25 years, including landmark cases on Chinese tires and clean technology products. But, the Commerce Department refused to consider China’s currency manipulation as an unfair subsidy, which has prompted Congress to consider stepping in.

The mess that Ambassador Locke would need to clean up has been decades in the making. President Clinton’s team negotiated an exceptionally weak deal as China entered the World Trade Organization. The U.S. agreed to lower tariffs on Chinese products, end its annual trade-linked review of China’s human rights record, and diminish many of our trade enforcement options. In effect, the deal tied America’s hands even as China’s economic power — and mercantilism — expanded. (more…)

By Steven Capozzola
Media Director, Alliance for American Manufacturing

Bill Lambrecht at the St. Louis Post Dispatch has written an excellent article documenting some of the unexpected problems U.S. manufacturers are facing from illegally dumped imports from China.

Lambrecht relates the story of Missouri’s Mid Continent Nail.  The Poplar Bluff, MO-based company was relieved when a 2008 case with the U.S. International Trade Commission (ITC) found that Chinese companies were dumping low-cost nails into the U.S. in an effort to undercut the pricing of U.S. manufacturers.  The ITC determined that these ”dumped” nails broke laws guarding against unfair trade.

Following the ITC ruling, the Commerce Department imposed duties on certain nail imports, which should have helped Mid Continent and other U.S. manufacturers of nails for home and industrial use.

Unfortunately, Mid Continent never saw the hoped-for gain in sales.  Instead, underpriced Chinese nails kept coming into the U.S. market. (more…)

By Steven Capozzola
Media Director, Alliance for American Manufacturing

Hey everyone: QUICK TRIVIA QUESTION: Where are iPads and iPhones manufactured?…

Need we even tell you the answer? Aren’t all of you quite obviously aware that these omnipresent, hi-tech gizmos are “Made in China?”

Brace yourself: In an interview on ABC This Week, Sen. John McCain, R-Ariz., stated that iPads and iPhones are manufactured in the United States.

Apparently, McCain was trying to make the point that the U.S. makes cool hi-tech goods and just needs free trade agreements to gain more overseas market access.

Unfortunately, the good Senator is wrong on several counts:

1. In addition to iPads and iPhones, China manufactures a tremendous amount of hi-tech equipment.  Those products are NOT made in USA. (more…)

By Tula Connell
AFL-CIO Managing Editor

Several disturbing items out now as Treasury Secretary Tim Geithner gets set to meet next week with Chinese President Hu Jintao.

At a time when our nation has a massive jobs deficit and an urgent need to catch up with other nations that are moving ahead of the United States in green industries, the Alliance for American Manufacturing notes today that Evergreen Solar, a maker of solar panels in Devens, Mass., is closing a factory that employs 800 people. The company says it can’t compete with cheap Chinese solar panels.

Evergreen Solar is just the tip of the iceberg, as demonstrated by the Alliance’s next news note:

In 2011, the U.S. is poised to lose its 110-year run as the world’s leader in factory production to China. China’s economy surged ahead of Japan in 2010 to become the world’s second largest. While the U.S. remains the largest by gross domestic product, analysts predict that the U.S. risks losing that position by 2025—if not sooner. China has moved into the #2 position in the publication of biomedical research articles. (more…)