Route to Recovery

A trip through the epicenters of the recession

America’s Route to Recovery: Part Two – A New Revolution

December 29, 2009

For the Reuters multimedia project Route to Recovery, a team of journalists toured America to examine the impact of the recession and posted their reports on reuters.com. For the last installment in the series, reporter Nick Carey has written an extended overview of the challenges and opportunities facing the country.  The second part of this three-part report is below. Click here for part one.

Leslie Taito is executive director of Rhode Island Manufacturing Extension Services (RIMES), a nonprofit that provides consultation for small and medium-sized manufacturers in Rhode Island, a state of 1 million people.

Rhode Island was the home of America’s first mechanized cotton mill, but since Taito arrived 16 years ago, the number of manufacturers here has fallen to 1,945 from 2,800. Still, she believes that all of those that are left can be helped to survive and thrive — and the best way is to get smart and not try to compete with low-cost Chinese producers.

“Manufacturers have to specialize and find a niche where they develop high-end goods that are not sold just based on cost,” Taito said. “Sure, China can make it cheaper than we can,” she said, while weaving in and out of traffic en route through the heart of Providence. “But what they don’t have is the design or engineering capabilities that we do.”

ROUTETORECOVERY/

Maria Montero carries plastic products for quality control inspection at Blow Molded Plastics in Pawtucket, Rhode Island November 17, 2009.   REUTERS/Brian Snyder

One of the companies that RIMES has worked with in the past is Pawtucket-based Blow Molded Specialties, which makes products from hot plastic that is blown into molds where it sets. Its clients are predominantly in the healthcare sector.

President and majority owner Tom Boyd describes how the company’s largest customer switched production of a basic product to Mexico because it could be made there for 2 cents apiece instead of 8 cents in the United States.

That company had accounted for some 35 percent of business. “That was nearly the end of us,” Boyd said with a wry smile.

So instead of trying to compete on low-cost products, Boyd’s company specializes in high-end, complicated and intricate products, and even develops products for customers.

In the company’s meeting room, he shows off some of the firm’s products including one which looks almost like a plastic accordion and is about the same size, with evident pride.

This, he explains, is a plastic bellows his firm developed for a healthcare company, whose name he says he cannot divulge. It has a special function. Conventional practice in organ transplants has been to ship organs on ice. But Boyd says it has been found that a better way to ship organs is to keep them functioning, and the bellows he holds in his hands is part of a device to keep a set of lungs pumping while in transit.

Asked how much Blow Molded charges for a pump like this, Boyd shrugs his slight shoulders. “Maybe a few dollars each. And we only sold a few of them.”

But then he leans forward with right eyebrow and right forefinger raised. “Ah, but you see, the money’s not in the product,” he said, his grin widening. “The money’s in the engineering. We bill our customers for the development work we do.”

Communities around the country say they want to attract small firms like Blow Molded rather than focus on major corporations, for the simple reason that when a giant plant shuts down, it is almost impossible to replace the jobs lost.

The classic example is Wilmington, Ohio, where empty store fronts on Main Street are grim testimony to what happened when DHL axed nearly 10,000 jobs.

“When a big company like that goes, it leaves a very large hole to fill,” said Mayor David Raizk (pronounced “risk.”)

“I’d rather see 200 small companies with 50 employees each than one big one,” he said. “You can lose one, two or even 10 of those and find a way to replace them. Big companies are great when they’re in town, but when they leave they devastate communities.”

ROUTE-RECOVERY/

A pelican flies near a fisherman in Pensacola, Florida November 11, 2009. REUTERS/Carlos Barria

One such small firm is Computer Technology Solutions Inc, the largest privately-held software firm in Alabama, which has added some 40 jobs this year and now employs 150 people. “If that’s what we can do in a recession, imagine how we can do when the economy improves,” said president Sanjay Singh.

CTS got its start in a business incubator run by the University of Alabama in Birmingham. Singh said that unlike big corporations — which tend to be bureaucratic, slow-moving and inclined to withhold responsibility from young employees — CTS gives its 20-something employees multimillion-dollar projects to run on their own.

“If you give young people responsibility, they deliver,” he said. “We don’t hang over our employees’ shoulders waiting for them to get things done, we just let them do it.”

GREEN ECONOMY A LONG HAUL
There are great expectations that alternative energy or the “green economy” will help move America forward.

According to Lisa Frantzis, managing director for energy at Navigant Consulting Inc, in 2009, 7,000 megawatts of wind power was installed in America with the creation of 70,000 jobs — 50,000 direct and indirect jobs, plus 20,000 service-related jobs. Solar power saw 300 megawatts installed with the creation of 60,000 jobs.

Jay Paidipati, a Navigant managing consultant who works with Frantzis, said because of the industry’s breadth and relative youth, it is hard to make forecasts. “I would feel comfortable saying that the number of green jobs will be in the millions,” he said. “Just how many millions, I don’t know.”

ROUTE-RECOVERY/

Mesquite Lake Cattle Manure Power Plant is seen in El Centro, California, November 3, 2009.  REUTERS/Lucy Nicholson

It will be years, however, before that potential is realized. One of the main problems is the mass of rules and regulations that make building plants a lengthy process.

Imperial County in southern California has hit on a novel way to get around red tape, using a provision of state law that allows local authorities to streamline the approval process for building a plant, as long as it is under 50 megawatts.

This loophole enables officials to handle the approval process in as little as a year, compared to several years at the state level.

“Getting anything done in California is hard,” said Imperial Valley Economic Development Corporation CEO Tim Kelley, at his office in El Centro some 100 miles (160 km) east of San Diego. “But it is less hard to get it done here.”

This area has 360 days of sun a year and has suitable geological conditions for geothermal power — there are 10 such plants already. Thirty others for solar, geothermal and wind facilities, are in the process of acquiring permits.

Red tape is not the only challenge.

Paul Rich is chief development officer at Deepwater Wind LLC, which aims to develop America’s first offshore wind farm, in Rhode Island. The farm, which would eventually provide 15 percent of Rhode Island’s electricity, should come in two phases. The first test phase with six to eight turbines could be installed off the coast by 2012. By around 2015 the wind farm would contain around 100 wind turbines.

Rich described the coast between Maine and Maryland as the “Saudi Arabia of wind,” predicting an “enormous, exponential leap in jobs, manufacturing and infrastructure.”

Part of the reason for the long lead time is the need for extensive tests of local wind conditions, he said.
“It won’t happen overnight,” Rich said. “We are trying to create a truly new industry here and it has to be done right.”

“A far bigger concern for us is finding a qualified workforce to run and maintain the wind farm when it becomes operational.”

In blighted states like Michigan, many former manufacturing workers are already training for green jobs, even though relatively few have been created.

Matthew Derra, 41, lost his job at struggling auto supplier American Axle & Manufacturing Holdings Inc in July 2008. Now he is taking an associate degree in renewable energy and wants to find a job maintaining wind turbines.

“There’s nothing out there in my old field of work,” he said. “And there will be thousands of people out there chasing every green job, but I have to try.”

“I can’t just sit home and watch television.”

ROUTETORECOVERY/

April Metts watches television at her apartment in Providence, Rhode Island November 18, 2009.  Metts was homeless for several years before getting into her subsidized apartment as part of the Housing First RI initiative.   REUTERS/Brian Snyder

Even in California, which has America’s most aggressive climate change regulations, just 159,000 of the state’s 18 million jobs are considered “green” as of the start of 2008, according to public policy group Next 10.

Still, there are encouraging signs that money is flowing into renewable energy even in a sluggish economy.

Bill Gibson, is a business broker and principal of Gibson & Associates Inc in Pensacola, Florida. Gibson finds buyers for companies that want to sell.

He noted that companies selling luxury items are having trouble finding buyers because gun-shy banks won’t lend for that kind of investment, but he has noticed a lot more interest in renewable or alternative energy firms.

“There are definitely going to be haves and have-nots,” Gibson said. “Green energy is part of the future.”

The green energy industry is also seen as an opportunity for manufacturing firms to retool.

“What concerns me is when I hear people talking about manufacturing in the past tense,” said Virg Bernero, mayor of Lansing. “If we want wind turbines, someone here should manufacture them.”

ROUTE-RECOVERY/

The Vulcan statue is seen at Vulcan Park in  Birmingham, Alabama November 14, 2009. The Vulcan statue is a symbol of old times at the iron industry in Birmingham.  REUTERS/Carlos Barria

GEEKS AT THE TABLE
Laurie White, president of the Greater Providence Chamber of Commerce, keeps a board covered in bad news — headlines from The New York Times, The Washington Post, The Boston Globe and The Economist about how badly the economy of the state has been faring. Rhode Island’s unemployment rate was 12.7 percent in November, the second highest in the country after Michigan.

“Our problems have made not just national but international headlines,” White said. “That motivates me to find a new way forward.”

Rhode Island is pinning its hopes on a strategy dubbed “Strengthening Providence’s Knowledge Economy.” It has involved bringing together local and state government, the Chamber of Commerce, the Rhode Island Economic Development Corporation (RIEDC) and hundreds of small hi-tech software companies.

“The geeks have finally been offered a seat at the table,” said business consultant Jack Templin.

White said there was an easy explanation: “The geeks are just about the only ones creating jobs right now.”
Companies like Working Planet, which handles algorithmic online market research for its clients, are now at the table.

“Up until a few years ago the chamber was focused on major companies and its existing membership base,” said Working Planet Marketing Group Inc president and co-founder Soren Ryherd. “Over the past three years the chamber has done an about face and is now also about the smaller companies that are creating jobs.”

“We have also become more organized because we need to reach the local universities so we can find and retain top talent,” he added.

Mike Saul is the interim executive director of the RIEDC and has spent much of his career as a “turnaround guy” taking poorly performing companies and making them thrive. He wants to do the same here, in part because three of his four children, like many of the state’s offspring, live outside Rhode Island because there was no work here for them.

“In any turnaround that is going to work you have to ask where is the enterprise value that I can push forward,” he said. According to Saul, the state’s education system and its wind potential create much of its enterprise value.

“Rhode Island’s attempts at economic development have been episodic in the past, but this time everyone is on the same page,” Saul said. “A crisis makes things happen. It helps individuals reinvent themselves and will help this country reinvent itself.”

Part Three – The Mind Factory

ROUTETORECOVERY/

A U.S. flag decal is stuck to the window in a door to the Harrington Hall homeless shelter in Cranston, Rhode Island November 18, 2009.    REUTERS/Brian Snyder

A NEW REVOLUTION
Leslie Taito is executive director of Rhode Island Manufacturing Extension Services (RIMES), a nonprofit that provides consultation for small and medium-sized manufacturers in Rhode Island, a state of 1 million people.
Rhode Island was the home of America’s first mechanized cotton mill, but since Taito arrived 16 years ago, the number of manufacturers here has fallen to 1,945 from 2,800. Still, she believes that all of those that are left can be helped to survive and thrive — and the best way is to get smart and not try to compete with low-cost Chinese producers.
“Manufacturers have to specialize and find a niche where they develop high-end goods that are not sold just based on cost,” Taito said. “Sure, China can make it cheaper than we can,” she said, while weaving in and out of traffic en route through the heart of Providence. “But what they don’t have is the design or engineering capabilities that we do.”
One of the companies that RIMES has worked with in the past is Pawtucket-based Blow Molded Specialties, which makes products from hot plastic that is blown into molds where it sets. Its clients are predominantly in the healthcare sector.
President and majority owner Tom Boyd describes how the company’s largest customer switched production of a basic product to Mexico because it could be made there for 2 cents apiece instead of 8 cents in the United States.
That company had accounted for some 35 percent of business. “That was nearly the end of us,” Boyd said with a wry smile.
So instead of trying to compete on low-cost products, Boyd’s company specializes in high-end, complicated and intricate products, and even develops products for customers.
In the company’s meeting room, he shows off some of the firm’s products including one which looks almost like a plastic accordion and is about the same size, with evident pride.
This, he explains is a plastic bellows his firm developed for a healthcare company, whose name he says he cannot divulge. It has a special function. Conventional practice in organ transplants has been to ship organs on ice. But Boyd says it has been found that a better way to ship organs is to keep them functioning, and the bellows he holds in his hands is part of a device to keep a set of lungs pumping while in transit.
Asked how much Blow Molded charges for a pump like this, Boyd shrugs his slight shoulders. “Maybe a few dollars each. And we only sold a few of them.”
But then he leans forward with right eyebrow and right forefinger raised. “Ah, but you see, the money’s not in the product,” he said, his grin widening. “The money’s in the engineering. We bill our customers for the development work we do.”
Communities around the country say they want to attract small firms like Blow Molded rather than focus on major corporations, for the simple reason that when a giant plant shuts down, it is almost impossible to replace the jobs lost.
The classic example is Wilmington, Ohio, where empty store fronts on Main Street are grim testimony to what happened when DHL axed nearly 10,000 jobs.
“When a big company like that goes, it leaves a very large hole to fill,” said Mayor David Raizk (pronounced “risk.”)
“I’d rather see 200 small companies with 50 employees each than one big one,” he said. “You can lose one, two or even 10 of those and find a way to replace them. Big companies are great when they’re in town, but when they leave they devastate communities.”
One such small firm is Computer Technology Solutions Inc, the largest privately-held software firm in Alabama, which has added some 40 jobs this year and now employs 150 people. “If that’s what we can do in a recession, imagine how we can do when the economy improves,” said president Sanjay Singh.
CTS got its start in a business incubator run by the University of Alabama in Birmingham. Singh said that unlike big corporations — which tend to be bureaucratic, slow-moving and inclined to withhold responsibility from young employees — CTS gives its 20-something employees multimillion-dollar projects to run on their own.
“If you give young people responsibility, they deliver,” he said. “We don’t hang over our employees’ shoulders waiting for them to get things done, we just let them do it.”

GREEN ECONOMY A LONG HAUL
There are great expectations that alternative energy or the “green economy” will help move America forward.
According to Lisa Frantzis, managing director for energy at Navigant Consulting Inc, in 2009, 7,000 megawatts of wind power was installed in America with the creation of 70,000 jobs — 50,000 direct and indirect jobs, plus 20,000 service-related jobs. Solar power saw 300 megawatts installed with the creation of 60,000 jobs.
Jay Paidipati, a Navigant managing consultant who works with Frantzis, said because of the industry’s breadth and relative youth, it is hard to make forecasts. “I would feel comfortable saying that the number of green jobs will be in the millions,” he said. “Just how many millions, I don’t know.”
It will be years, however, before that potential is realized. One of the main problems is the mass of rules and regulations that make building plants a lengthy process.
Imperial County in southern California has hit on a novel way to get around red tape, using a provision of state law that allows local authorities to streamline the approval process for building a plant, as long as it is under 50 megawatts.
This loophole enables officials to handle the approval process in as little as a year, compared to several years at the state level.
“Getting anything done in California is hard,” said Imperial Valley Economic Development Corporation CEO Tim Kelley, at his office in El Centro some 100 miles (160 km) east of San Diego. “But it is less hard to get it done here.”
This area has 360 days of sun a year and has suitable geological conditions for geothermal power — there are 10 such plants already. Thirty others for solar, geothermal and wind facilities, are in the process of acquiring permits.
Red tape is not the only challenge.
Paul Rich is Chief Development Officer at Deepwater Wind LLC, which aims to develop America’s first offshore wind farm, in Rhode Island. The farm, which would eventually provide 15 percent of Rhode Island’s electricity, should come in two phases. The first test phase with six to eight turbines could be installed off the coast by 2012. By around 2015 the wind farm would contain around 100 wind turbines.
Rich described the coast between Maine and Maryland as the “Saudi Arabia of wind,” predicting an “enormous, exponential leap in jobs, manufacturing and infrastructure.”
Part of the reason for the long lead time is the need for extensive tests of local wind conditions, he said.
“It won’t happen overnight,” Rich said. “We are trying to create a truly new industry here and it has to be done right.”
“A far bigger concern for us is finding a qualified workforce to run and maintain the wind farm when it becomes operational.”
In blighted states like Michigan, many former manufacturing workers are already training for green jobs, even though relatively few have been created.
Matthew Derra, 41, lost his job at struggling auto supplier American Axle & Manufacturing Holdings Inc <AXL.N> in July 2008. Now he is taking an associate degree in renewable energy and wants to find a job maintaining wind turbines.
“There’s nothing out there in my old field of work,” he said. “And there will be thousands of people out there chasing every green job, but I have to try.”
“I can’t just sit home and watch television.”
Even in California, which has America’s most aggressive climate change regulations, just 159,000 of the state’s 18 million jobs are considered “green” as of the start of 2008, according to public policy group Next 10.
Still, there are encouraging signs that money is flowing into renewable energy even in a sluggish economy.
Bill Gibson, is a business broker and principal of Gibson & Associates Inc in Pensacola, Florida. Gibson finds buyers for companies that want to sell.
He noted that companies selling luxury items are having trouble finding buyers because gun-shy banks won’t lend for that kind of investment, but he has noticed a lot more interest in renewable or alternative energy firms.
“There are definitely going to be haves and have-nots,” Gibson said. “Green energy is part of the future.”
The green energy industry is also seen as an opportunity for manufacturing firms to retool.
“What concerns me is when I hear people talking about manufacturing in the past tense,” said Virg Bernero, mayor of Lansing. “If we want wind turbines, someone here should manufacture them.”

GEEKS AT THE TABLE
Laurie White, president of the Greater Providence Chamber of Commerce, keeps a board covered in bad news — headlines from The New York Times, The Washington Post, The Boston Globe and The Economist about how badly the economy of the state has been faring. Rhode Island’s unemployment rate was 12.7 percent in November, the second highest in the country after Michigan.
“Our problems have made not just national but international headlines,” White said. “That motivates me to find a new way forward.”
Rhode Island is pinning its hopes on a strategy dubbed “Strengthening Providence’s Knowledge Economy.” It has involved bringing together local and state government, the Chamber of Commerce, the Rhode Island Economic Development Corporation (RIEDC) and hundreds of small hi-tech software companies.
“The geeks have finally been offered a seat at the table,” said business consultant Jack Templin.
White said there was an easy explanation: “The geeks are just about the only ones creating jobs right now.”
Companies like Working Planet, which handles algorithmic online market research for its clients, are now at the table.
“Up until a few years ago the chamber was focused on major companies and its existing membership base,” said Working Planet Marketing Group Inc president and co-founder Soren Ryherd. “Over the past three years the chamber has done an about face and is now also about the smaller companies that are creating jobs.”
“We have also become more organized because we need to reach the local universities so we can find and retain top talent,” he added.
Mike Saul is the interim executive director of the RIEDC and has spent much of his career as a “turnaround guy” taking poorly performing companies and making them thrive. He wants to do the same here, in part because three of his four children, like many of the state’s offspring, live outside Rhode Island because there was no work here for them.
“In any turnaround that is going to work you have to ask where is the enterprise value that I can push forward,” he said. According to Saul, the state’s education system and its wind potential create much of its enterprise value.
“Rhode Island’s attempts at economic development have been episodic in the past, but this time everyone is on the same page,” Saul said. “A crisis makes things happen. It helps individuals reinvent themselves and will help this country reinvent itself.”

Comments

US housing will continue to deteriorate in 2010 with strategic foreclosures increasing from the current 25% of total foreclosures rate. Why stay in a mortgage when everyone else on your street is paying rent on previously foreclosed properties and renting for 1/3 of your monthly mortgage payment? See a wild California foreclosures story at http://storyburn.com

Posted by Deuce | Report as abusive
 

End “Free Trade”. Any U.S. company that exports American made products and jobs to a foreign country pays 100% tariff on that product when it is re-imported into the U.S. Products made in the coolie labor providing third world pay 50% tariff. If these companies are willing to destroy vast segments of the U.S. economy to save 6 cents they will pay on the other end to repair the damage. “Free Trade” is unsustainable and will dsetroy us.

Posted by RFL | Report as abusive
 

First we must vote out the entire Congress and get totally new constructive minds managing the USA.
Second, with labor intensive jobs gone, everyone MUST get a basic education.
Three, USA business must keep jobe in the USA, or face stiff taxes for every job in a foreign country.
Four, The general population MUST enforce a basic morality standard and make the USA a proud place to live.
Five, STOP immigration!!!!!

 

Interesting people saying we should slap huge tariffs and stop immigration. I’m sorry but if I guess the person asking to stop immigration is a native american. Huge tariffs cause to many international relations problems, wake up we are not the only country on the planet and we can’t live in isolation. You’ll notice in the article it sited examples of how companies would specialize in products that have to be very precise, such as those for the medical industry. They would even design and engineer those products. That is the solution. We have to become more educated, more innovating. Simple everyday things can be made by unskilled labor or semi skilled labor in another country. The cutting edge of technology, and those products need to be made in the USA. We have to stop pushing religon in the biology class room and calling intelligent design a scientific theory. We have to stop limitng research and development on stem cells. The USA used to be the technology leader in all areas. Now our students rank behind other countries in math and science. Time to change.

Posted by Kermit | Report as abusive
 

We don’t have to live in isolation but we can’t even manufacture the products we need to support ourselves! Do you know that the USA can’t even manufacture enough small arms ammunition with wich to defend the country? That we have to purchase a significant amount from foreign manufacturers? Stop “Free Trade” NOW! End H1-B visas NOW! When you have to beg the necessities of daily life from the enemy you become his slave!

Posted by RFL | Report as abusive
 

Follow the money. It is just not true that Asian competitors do not have the design or engineering capability that the USA has. They have it now and they are producing 100x as many high level graduates as the USA. Also, when their students are done with their masters and doctorates, they do not owe $50-250k in student loans. Now our banks (student lenders included) are borrowing at -0% and loaning at 6-7-10-11%. My children (one finishing masters in Engineering, one in Med school) will owe more than $100k when they graduate. Their loan payments are more than $1000 per month. They can’t compete.

American must enforce laws that prevent unfair competition: foreign owned (or largely financed by), foreigh free advanced education, are parts.

Buy American. That is the best short term answer. The government cannot help: they are bought and paid for by the beneficiaries of foreign supported organizations. Read: Walmart, Microsoft, Dell, Sears, ATT, HP. Call any of these for technical support and your call is answered in Asia. How complicated is this problem? Not.

Americans can compete with any country or culture. But they are being cheated out of the opportunity.

Don’t bother writing your Congressman on your imported computer, and printed on your imported printer (all of the brand names your know). Don’t call on your cell phone or your home phone: they are also made overseas.

Start now: Buy American. Okay so you will have no cell phone, no auto computer, no home computer, no TV, and largely not medicines. See the point???

Posted by Greg | Report as abusive
 

I agree with Peter Creighton above. In fact the US ranks 17 in science and math education (standardized tests for high-school aged children)although I would bet that the majority of Americans believe we are number one. Our education system is shoddy which helps explain why only about half of americans understand the theory of evolution at it’s most minimal level.

Getting our country on track involves providing superior educational opportunities that, in my humble opinion, should start with splitting our high-schools into two groups as they do in some other countries. In 8th grade students are tested and interviewed to see if they should enter the “college pathway” high schools or the “regular” high schools. The level of education and expectations of the former would aloow for a “no child held back” mentality rather than the idiotic “no child left behind” philosophy that is destroying the upper end kids. Schools should also be year-round with intermittent 3 week vacations (say 3 per year) as this has been shown to advantageously effect especially low-income children.

College and advanced educations for US kids should be cheap (I owed 120 K and it has killed me over the years) or with super low interest (I am still paying mine at 9% with no tax write-off.

A second comment is the fact that limiting imports through taxation is always a bad idea. Yes, it might falsly maintain wages at a higher level for awhile, but face it, we live in a global environment and thus a global economy – Isolationism is not an effective means to keep uneducated masses in high-paying jobs. We will be eaten alive if we try that.

The answer is to educate and innovate – we have the ability.

I do think that although it is almost impossible to keep immigration at a zero level, it is crazy to provide tax-payer financed education and health care to illegals.

Wow, what a mess……

Posted by Robert Pierce | Report as abusive
 

I guess I was actually agreeing with Kermit (sorry Peter, not so hot on your ideas)

Posted by Robert Pierce | Report as abusive
 

This series, what I’ve read of it, has been excellent and eye opening. I grew up in the Cleveland area during the salad days, and my family on both sides was tied into the auto industry. I still have family and friends out that way, so the segment on Youngstown was especially poignant for me.

When I was a young man I camped all over Ohio, and traveled through Youngstown on occasion. It was a gritty mill town at the time, but reasonably prosperous. Their tough times, coming so quickly, must be a real shock. Most heavy manufacturing off to China or Mexico, all that housing stock vacant and with little prospect of recovery in either in the near future.

Some of the comments made seem right by way of solutions. Better education with low tuition and focusing on new tech, yet I don’t see this turning around anytime soon. It’s going to take time, and Americans are an impatient lot.

In places like Youngstown, which are scattered all over the country, I wouldn’t be at all surprised to see social unrest the likes of which we haven’t seen since the sixties struggles of black folks. I had a history professor who was fond of saying that when unemployment reaches into the 20% range and above, which it did during the thirties, you’re sitting on a revolution. The difference being that this time around there is much less social cohesion than in 1930.

Scary stuff, but I reckon we’ll muddle through. I’ve been told the Chinese ideogram for crisis means both danger and opportunity.

Posted by Jack Heinlen | Report as abusive
 

The fact is that we now live in a Global economy. We can no longer afford to go it alone, either militarily nor economically. America would eventually become economically irrelevant if it were to isolate itself from the World enonomy through tariffs. In the theory of Free Trade, when nations trade freely, through a process of trial and error, each nation produces what it is best at. The net result is: more trade = more productivity = more prosperity. Some primary resons America is not competitive are: over regulation, high taxes combined with poor tax policies that discourage saving and investment, too much debt and erratic monetary policies.

It is very difficult for anyone to look into a crystal ball and decide how America can best compete in the global economy. As I mentioned, it’s usually a trial and error process. However, here is a suggestion. When I look at young people today, they don’t seem terribly interested in math, science and engineering even if we invested a lot of money into those fields. When I see young people constantly on their cell phones and texting it strikes me that American young people are networkers. Their strength lies in enabling various groups and enterprises from around the globe to network. Perhaps we would be better off spending more money on football games and senior proms.

Posted by Vic G | Report as abusive
 

“..the Chamber of Commerce (Providence, RI) did an about face…”

Apparently, they are now welcoming “the geeks”.

I wonder if the lack of highly intelligent people in the Chambers of Commerce was part of the problem. At least the “Chambers” will still be “in control”.

Too bad for the geeks. Except the really smart ones.

If you stop to consider that we are a nation of Chambers of Commerce, Real Estate Agents, and Car Dealers, you will get a good idea of what we are “leaving behind”–and why!

Posted by steverino | Report as abusive
 

I CAN CREATE 15 MILLION JOBS ALMOST OVER NIGHT in America..

If America Pulls out of NAFTA and WTO so many jobs will be created we can not fill all of them.

I will bet anyone one million dollars to a donut that I can create 15 Million JOBS if I was President. America would instantly kick into overdrive and you would see more Jobs created than Americans could fill almost over night.

The American people have been screwed for the last 80 years and they do not even have a clue of what is happening.

All the Democrat or the Republican Congress/people and Presidents for the last 80 years in Washington D.C. of both parties do not care about America or the American People.

Most of the American Politicians have been either been bought off by the wealthy Council on Foreign Relations (CFR PARTY) or they just sit on their hands and go along to get along.

The CFR Party was founded by JP MORGAN , Paul Warburg (Jew), John D. Rockefeller (Jew), three super wealthy CFR members back in 1921 with the specific goal to control the American people by buying control of all means of communication to control and generate public support to advance the CFR Party agenda.

With control of the people they could now buy off and elect American Politicians of both parties to carry out their CFR PARTY agenda which is called International Free Trade.

But how can any country survive when all of the Politicans advocate sending all of the best paying jobs off shore to China and watch millions and millions of deplaced workers walk the street, lose thier homes, families go hungry in the name of International Free Trade.

That is exactly why the American Government is shipping all the American Manufacturing Plants off shore to China as fast as they can in the last 16 years. You are watching the largest transfer of wealth is the history of the world (from America to China). The American Federal Government is serving up all of the America wealth to China on a silver Platter.

Please tell me how America and our way of life will survive if the politicans continue destoying America?

At some point American workers will be required to compete with the Chinese workers for Slave Labor $2/day jobs. Every American regardless how much money you have will be affected in one way or another because a lowering tide will automatically lower all boats.

I think we are in the about the 8th inning right now.

If you think I am wrong I have only two questions for you to think about.

Why would AMERICA the most Wealthiest, the most Advanced, the most Strongest Country in the entire World, want to enter into NAFTA and the WTO and want to try to compete with third world Countries where the Workers are forced to work for Slave labor wages at $2/day?

There can only be one out come. All of the American International Manufacturers will be forced to move all of our great Factories that won world war II and our Technology off shore to Communist CHINA. Please tell me how that is in the best interest of the American People?

The American People has no choice in the matter either the USA pulls out of NAFTA and the WTO or at some point our country will just sink into the Abyss. You absolutely cannot have a complete Economic Recovery without Creating Good High Paying Jobs. Flipping Hamburgers at McDonald’s and working as a store clerk at Wal-mart will not do the trick.

I heard today on the news that the President Obama is going to start sharing America’s top nuclear secretes with China?

A country that has no Manufacturing base is called a THIRD WORLD COUNTRY. That is exactly where America is headed.

Once all the high paying manufacturing jobs are sent off shore to China. Please tell me where the America government will collect tax revenues to support our way of Life?

The CFR PARTY Global International Trade policy will end up driving America into total Bankruptcy, that is exactly what is happening right now. When the America people finally figure this out what is really happening it will be too late to stop it.

You want me to tell you why I already know this is the long term Plan.

Why don’t President Obama create those 15 million JOBS right now as the USA desperately needs additional Jobs?

My answer is because President Obama is a card-carrying member of the CFR Party and they have a concerted plan to redistribute all the American People’s wealth to all of the Third World Countries.

It is called enslaving the American workers and the total destruction of America as we know it. If you beat the American Worker down far enough he will be ready to accept anything you offer to feed his family.

All of you people who have money in the Bank and well fix and you love this International Trade, just wait till you lose everything then tell me about how smart you was.

Back to my Question:

How I would create 15 million jobs almost over night?

There is one thing the America Government has total Control over and that is WHERE and WHO will produce all of the products the American people buy and use on a daily basis.

I would PULL OUT OF NAFTA and the WTO and close the doors to the American Consumer Market (the biggest consumer market in the world) and I would tell the entire world if they want sell their Products in America they must build their products in America. This is exactly what China does.

I know all of you American people have been told for 80 years that protectionist will hurt the USA even more because all other countries around the world will stop buying American made products and the USA will lose a lot more American JOBS than they ever gain.

That my friend is just not true.

How can anyone make that statement without at least evaluating the Export and Import numbers?

Normally that answer is true. But, the American International trade deficit has grown so super huge in the last 16 years (and still growing); that if America just stops exporting anything and just produces the items we use on a daily bases that we are now importing mainly from China, we can create 15 million additional new jobs almost instantly.

In fact I really do not care if the rest of the world buys even one penny of American made Products from America. If America just manufactures all of the products we use on a daily bases right here in America, we will create an additional 15 Million Jobs automatically.

Also, the USA yearly National Budget Deficit will automatically be lowered by $760 Billion because that Trade Deficit Money will not be transfer off shore to China like now. The Federal Government will get a huge boost in Tax Revenues from the 15 million American higher paying Jobs.

The American Government must understand they can not continue to allow sending all the high paying American JOBS off shore to Mexico, India, China and Japan and still have enough JOBS to support the American way of life.

YOU CAN NOT GIVE SOMETHING AWAY AND STILL HAVE IT. . . .

Right now all of them 15 Million Jobs I am talking about have all been moved off shore to China, Mexico and Japan, Germany, India. They are producing all of those goods and are shipping it back to America to supple our daily needs.

Then when this very same goods is imported back into the America, the American Government who is broke, must borrow money from China and Japan to buy the very products that should have been produce right here in America in the first place.

This is Equivalent to our Stupid American Government forcing the American workers to sit on his Hands and then tell China to produce all of the goods America consumes and then when the goods is imported back into America the Federal Government is broke and are forced to borrow money from China and Japan to purchase all of this goods we are using on a daily bases.

This has got to the most stupid damn bunch in Washington or they are just conspiring to bankrupt and destroy America?

If you think I am wrong. You can goggle it and check it out for yourself. Then go to “youtube.com” and do some key word searches and listen to some of the videos and do your own research on the web.

I CAN CREATE 15 MILLION JOBS ALMOST OVER NIGHT right here in America ! ! !

Here is my Job creation Computations:

America Imported in 2006 mainly from China, Mexico, Japan and India well over $760 Billion Dollars more than we exported in 2006.

The $760 billion dollar import number that I am quoting includes Oil Imports which is something that America cannot change over night therefore must be subtracted out of total import number. The total U.S. crude oil imported during 2006 amounted to: $309.4 billion dollars of crude oil in 2006.

So, $760 billion minus $309.4 billion = $450.6 billion dollars worth of Manufactured Goods that could have and should have been produced right here in America.

Based on conventional wisdom in job creation, if you take $450.6 billion dollars worth of imported goods / $30 billion to create one million jobs = 15.02 million jobs would be automatically created almost over night.

++++++++++++++++++++++++++++++++++++++++ +++++++++
Now because some of you people still do not get it I am going to recalculate the cost of the Trade Deficit in just Jobs.

So please do not tell me the stock CFR PARTY answer: “YEA, but look at all of the EXPORTS JOBS the USA will LOSE.”

The American people have been BRAIN WASHED by the CFR PARTY into believes in that GLOBALIZATION is in the best interest of USA. I think they are trying to destroy the USA because that will be the final outcome.
++++++++++++++++++++++++++++++++++++++++ +++++++++

Total USA Imports in 2006:
———————————-
$ 2,211.7 billion ——- (this is the total Import number including all Oil Imports in 2006)
$ 309.4 billion less — (minus the total amount spent on Imported Crude Oil in 2006)
————————————————–
$ 1,902.3 billion / 30 billion=63.41 million jobs from Import. ======================================== ==========

Total USA Exports in 2006:
———————————-
$ 1,451.7 Billion / 30 billion=48.39 million jobs from Export.

If USA Pulls out of NAFTA and WTO right now:

USA could possibly lose 48.39 million Jobs from EXPORTS.

However, I am sure many countries will still export many items from the USA because they will be forced too. That would create even more jobs gained than I have estimated.

USA would absolutely gain 63.41 million Jobs from IMPORTS.

So, 63.41 minus 48.39 = 15.02 million NET JOBS GAIN.

My calculation means an ABSOLUTE 15.02 million Jobs gained if the rest of the world did not buy one penny of USA EXPORTS.

But, instead the Washington Politicians with all their Infinite Wisdom elected to move all of that manufactured goods off shore to China. Even as America has up-ward of 17% unemployment rate and climbing.

Then to make things even worse the Federal Government must borrow money from China and Japan to purchase back these very products as they are being brought back into America.

I think we are witnessing the Federal Government in the process of transferring all the America Assets off shore to Communist China on a silver platter.

The CFR PARTY goal is to turn America into a Communistic “North America Union” state consisting of Mexico, USA and Canada. The CFR are in total control of the American Government and have been for well over 80 years.

Why would the American Government sit on their hands and watch as all the Manufacturing Base and all our high Technology are being shipped off shore to a Communistic Country like China?

Make no mistake about it China is still a Communistic Country.

We are handing all of the American Military Defenses and our entire manufacturing base over to China on a silver platter.

Please tell me; “What the HELL are we going to do if we get into a War with Russia and China”?

I guess we’ll just concede the War without firing a shot like Poland did to Hitler during World War II. It looks like we would have been better off too have lost World War II to Hitler, at least we would not be forced to work for $2/day slave labor.

They must be stopped or one day America will wakeup under total Control of China Government.

This is so sad because we had it all and our Federal Government just transfers everything we own off shore to China, Mexico and India.

Have you ever asked yourself?

Why is it “when we elect a President from a different party and he always looks and acts almost identical as the last President”?

It really makes no difference who you vote for President as you will still end up getting the same party and it is called the “CFR PARTY”.

If you think I am crazy go Google it on “youtube.com”. Then Google any name along with “member of CFR”. Then start reading, reading and reading.

The American people have absolutely nothing to say about it.

You will never take back your country with the Ballot Box. I personally think it will require an all out Civil War. At some point the American People will say ENOUGH is ENOUGH and that is when all hell is going to break lose.

The Presidential Elections have been predetermined by the CFR PARTY since 1921.

Why is it every Presidential Candidates of both the Democrat and Republican Parties are always all members of the Council on Foreign Relations (CFR) which is controlled by the most wealthiest Jews in the world?

The “CFR Party” has tons of money so they figured out in 1921, if you want the President of the USA to be a card-carrying member of the “CFR Party”. They simply BUY OFF all the Presidential Candidates of both the Democrat and Republican Parties before the election even starts. Then the “CFR Party” WINS EVERY ELECTION before anyone ever casts a single vote.

Where is Joseph McCarthy when you really need him?

All of these politicians should be tried for treason and every penny of their ill-gotten wealth from all of these lobbyists confiscated and returned back to the U.S. Treasury.

This has to be a Concerted Conspiracy because most of these politicians hold Major Educational Degrees from some of the best colleges in America.

I worked as Industrial Engineer working as an Expert in Industrial Relocation, Manufacturing Efficiency & Engineering, Industrial Economy Analysis, etc. for Rockwell International. Most of my adult life was spent studying the very things of which I am posting about. So, please trust me I know exactly what I am talking about because that was my job for 30 years.

Here is the Main Problem in America.

The American People keep thinking their Representatives in Washington are looking after your interest and will always solve problems and do whatever is best for America and the American People.

Wrong!!!

If you do not listen to me then you are part of the problem too. If you think I am wrong go Google it and check it out. Then go to youtube.com and do key word searches and listen to the videos. Start thinking for yourself and doing your own research.

This is about Presidents and congress of both Democrat and Republican Representatives in Washington who have turned the operation of running the Federal Government entirely over to the Council on Foreign Relations (CFR PARTY).

This is also why Israel always gets exactly whatever they want from America. America has been helping Israel in every way possible even to the point of using borrowed money to support them.

Here is some of the things that should be done to make America Great again.

Add an amendment to eliminate all forms of “affirmative action” in every school, college and all other organizations in America.

Add an amendment to eliminate the American Electoral College System.

Add an amendment that Federal Elected Offices must have a majority of the total vote to win Office.

Add an amendment for Term Limits on all Federal Congressional Offices.

Add an amendment to abolish the Federal Reserve System because the America Treasury should be printing all money under the direction of the American Congress.

Add an amendment to put America back on the Gold Standard.

Repeal the State Home Land Security Act.

Build a Concrete Wall 15 feet high and 3 feet wide on our Southern Border and topped off with razor wire.

Rescind the Anchor Baby Law back to its original inception.

Any Illegal Aliens caught on American Soil would be given a mandatory 20 year prison sentence. Then watch them all run south back home.

Bring home all America Soldiers all over the world and shut down all of the Foreign Military Bases. We are not going to be the policeman to the rest of the world.

Add an amendment to make Lobbyist Illegal with a Mandatory 20-year prison sentence.

Appoint Ron Paul as Secretary of Treasury and very close adviser.

Appoint Lou Dobbs as Secretary of State.

Then hold the 2008 elections all over again for every office in the Federal Government.

Is there no end to the ruthlessness of the most Super Wealthiest People in the World?

If the American people wants their great Country back. There is only ONE WAY to get it back and that is march on Washington and physically take it back.

Did you think for one minute that all of those Prima Donna in Washington will give up all of that Power and money easily?

The CFR PARTY members always win the Presidential and Key Congressional elections and because it is absolute impossible to vote the CFR PARTY out of office.

You see if you control all the money in the world then you can always buy anything you want, even the United States Government.

The CFR PARTY buys-off all the main Candidates of both parties, then the American people elect one of the two carry-carrying members of the CFR PARTY every time.

The CFR Party has totally controlled the American Federal Government for well over 80 years.

So, if you want to end up working for $2/day just like the Chinese slave labor, just keep votes for your favorite Republican and Democrat Candidate. They are all a bunch of damn greedy Crooks.

SO MOTE IT BE. . . . .

Do you truly want to help straighten out the United States Government now? Then, copy and post this article everyplace on the Internet you can post.

The American People have a right to know exactly who runs our Federal Government.

BY: Harry Dingey

Have a good day my friends.

Posted by Harry Dingey | Report as abusive
 

Hey Harry,

I’ve got one word for you, succinct.

A factor I don’t think has been mentioned is WWII. A part of the wealth generated in the U.S. came directly from being the last man standing at the end of that dust up. All the other major manufacturing nations: Germany, Britain, Japan et al lay in ruins, so the U.S. had a open field, and we enjoyed an unprecedented prosperity up through the seventies as a result.

While I share some of your concerns about loss of sovereignty, I have a difficult time when you start into the conspiracy stuff. I don’t think all men who make these agreements are crooks, or wish the U.S. ill. Some undoubtedly are.

I also don’t think the neo-isolationism you propose is a viable answer. Like it or not, it has become a truly global marketplace, something that has been in the works for at least a century.

I haven’t set foot in an American school in decades, but from what I can gather we do need to get our kids interested in math and science again. As I said above, this is going to take time and there is no magic wand. In order to make math interesting takes spectacular teachers. They were in short supply when I was in high school almost forty years ago! Science on the other hand, a poor step-child of mathematics, was always endlessly fascinating. You needed the former to do much with the latter.

Signing off there, rather than violate my succinct rule. LOL.

Jack

Posted by Jack Heinlen | Report as abusive
 

Great article, interesting and revealing comments.

Posted by VicD | Report as abusive
 

I would not advocate large tariffs on foreign companies sending products to America. Just significant penalty tariffs for American companies that have their products built outside of this country by cheap foreign labor. If their executives were willing to accept a reasonable compensation instead of the grossly exorbitant compensation they have convinced themselves that they are entitled to, they would have no problem paying their employees a reasonable salary and still thrive. GREED is one of the biggest problems with the economy. The argument that top talent must receive grossly excessive compensation does not hold water. How much talent is required to drive a company into the ground as the bankers did to the banks? I submit that a half trained chimpanzee could accomplish that, and for peanuts not millions per year.

Wallstreet as it is currently run is another major drain on the economy. Too many think they should make too much for doing nothing. Oil is a major example. In what way does the energy futures markets improve the quality, quantity or availability of energy? Especially when you consider that the major players in that arena are the energy companies and their executives. (I believe that the average person is a very distant minority player). They basically sell energy to themselves several times, each time at a profit. And who do you suppose pays for ALL of it? That’s right, the consumer.

Reign in the compensation of the greedy execs and stop putting consumers out of work will go a long ways toward fixing and maintaining the economy in the long term.

Posted by Dans | Report as abusive
 

I read one comment saying that their 2 children on graduation will have $100K in education debts.
Here in Sweden we can study right thru university completely free of charge, and even get a very generous monthly allowance to help with books and food etc etc

Posted by George | Report as abusive
 

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •