Expanding Exports To Stimulate The Economy

[one...two...tree 2,762]

A Trade Rebound

Imports and exports have begun to recover from the lows of the economic downturn. In the first four months of this year, exports were up 17 percent from a year earlier.

by Scott Horsley

President Obama's push to boost exports is showing signs of progress.

Foreign buyers are snapping up more pork chops and airplanes with the "Made in the USA" label. And that means more jobs for American farmers and manufacturers.

But analysts say it will take a more aggressive push to meet the president's goal of doubling exports within five years.

'Liberalizing Trade'

Obama's export initiative has a simple logic: 95 percent of the world's customers live outside the United States. So when this country is looking high and low for new job opportunities, it can't afford to ignore overseas markets.

"This isn't just about where jobs are today," Obama said at a news conference Wednesday. "This is where American jobs will be tomorrow."

Export-related jobs are particularly attractive to the president because they don't depend on this country's already overextended consumers. Obama has vowed not to return to old cycles of boom, bust, borrow and spend.

U.S. Trade Representative Ron Kirk, the president's point man on exports, says it's designed to create about 2 million U.S. jobs over the next five years.

"This is stimulus we don't have to budget for," Kirk says. "This is a way to grow the economy and put Americans back to work by continuing to show leadership in liberalizing trade around the world."

In recent months, the president's export push has scored some concrete gains. Negotiators persuaded China to reopen its market to U.S. pork and convinced Russia to start buying U.S. chickens again. The Export-Import Bank has doubled financing to encourage foreign sales. And the Commerce Department has sponsored trade missions for more than 160 U.S. companies.

"And we're going to go to bat for everyone, from the largest corporation to the smallest business owner, with an idea that she wants to market and sell to the world," Obama said.

The Benefits Of Expansion

In the first four months of the year, exports were up by 17 percent from the same period of 2009. But that barely matches the level of exports before the recession.

On Wednesday, the president named 18 new members to his export advisory council, including CEO Scott Davis of UPS. Davis would love to see more cardboard boxes filling the backs of his company's big brown trucks.

"For every 22 packages that crosses a border, [it] creates another UPS job," Davis says. "So trade does create jobs in this country and around the world."

UPS and other shipping companies are actually helping to identify American firms that already export to just one other country. The thinking is that with a little encouragement, they might be able to do more.

"So it's essential that we educate the small and medium-sized enterprises about that opportunity, and then help them do the exporting," Davis says.

Dartmouth economist Matthew Slaughter applauds these moves. But, he says, it will take bigger policy changes to meet the president's target of doubling exports by 2015.

Last month, Obama announced plans to revive a long-stalled free trade agreement with South Korea. And Wednesday, he suggested that Colombian and Panamanian trade deals could come off the back burner as well.

'We're All In It Together'

Slaughter, who was an adviser to former President George W. Bush, says those moves are bound to be more controversial than simply acting as an export cheerleader.

"Americans have long been ambivalent about greater engagement for the U.S. economy," he says. "And that's with good reason. Trade and other forms of globalization tend to generate very large gains for the United Sates overall. But those gains don't always accrue to every single worker and firm and community."

Obama himself often sounded ambivalent about trade during the Democratic primary campaign. Departing from his prepared text on Wednesday, he said he hopes to escape what he called a "false political debate."

"The argument was either you were pro-trade or you were anti-trade," he said. "What we now have an opportunity to do is to refocus attention where we're all in it together."

The president said he'll continue to press for a level playing field. In competing for jobs with other countries, he said, the U.S. cannot play for second place.

http://www.npr.org/t...oryId=128365800

[mawilson 2,133]

Obama's export initiative has a simple logic: 95 percent of the world's customers live outside the United States. So when this country is looking high and low for new job opportunities, it can't afford to ignore overseas markets.

"This isn't just about where jobs are today," Obama said at a news conference Wednesday. "This is where American jobs will be tomorrow."

American jobs will be in the overseas markets tomorrow?

[Darnell 8,478]

Good Lord - just stop 1/5 of the imports from China and Mexico, re-open some plants in USA, buy back the old factory gear before it's melted down.

Ramp up for exports? #######? Pardon - who's buying OUR stuff?

I need to review that US Chamber of Commerce (overseas) memo, again.

Edited July 7, 2010 by Darnell

[Usui Takumi 1,562]

American jobs will be in the overseas markets tomorrow?

Quite literally lol. After all who is better than America at exporting jobs. No one! We are number 1! We are number 1!

In all serious for a moment, that chart is disturbing in that the trade gap is obviously expanding again after the crash.

[peejay 327]

Quite literally lol. After all who is better than America at exporting jobs. No one! We are number 1! We are number 1!

In all serious for a moment, that chart is disturbing in that the trade gap is obviously expanding again after the crash.

And what jobs we don't export we import millions of immigrants illegal and legal to fill domestically even while long term unemployment and underemployment trends are double digit. How much more ridiculous can any country be?

[Obama 2012 1,714]

Exports are a good thing. However you have to be making something again to actually have exports that are worthwhile...

[lostinblue 1,989]

I guess it depends on how serious he is.

Thanks to the Journal for shining light on "The Bucyrus Travesty" (Review & Outlook, June 30). Denying Bucyrus International Inc. a loan guarantee is yet another act of economic suicide by misguided zealots—both political and environmental. Obama-appointed Export-Import Bank Chairman Fred Hochberg should travel to Wisconsin with President Obama and personally face the Bucyrus workers and explain what he has just done. That might give Mr. Hochberg pause. How can he look at himself in the mirror or with a straight face explain that he has doomed $600 million of business and 1,000 U.S. jobs because the deal with India's Reliance may have an "adverse environmental impact" in India? The deal was killed even though India is already building the plant, will mine the coal, and will award the business to one of our international competitors. This is dumb.

Then the bank put salt in the wound by approving $528 million in low-cost loans to Fisker Automotive in Vice President Joe Biden's hometown to build electric cars selling for $48,000, and that's before the taxpayer is taken for a $7,500 tax credit. I couldn't lie awake at night dreaming up this kind of nightmare economic scenario.

Chris J. Krisinger

Burke, Va.

I am a production manager at one of the supply chain companies for Bucyrus. We are located in the Atlanta area, so the impact on jobs reaches far beyond the Midwest. The Reliance-Bucyrus deal would have been a big boost to our business as a steel service center. Meanwhile, my employees sweep the floor wondering when the next layoff is coming. If Bucyrus was in the auto business with the United Auto Workers, the Obama administration would be falling over itself to approve this deal with the Indians.

Jim Hayes

Canton, Ga.

This is another excellent example of the administration just not getting it and confusing priorities. I am a former Obama supporter.

Ted Wolf

New York

You highlight the hypocrisy that often accompanies government subsidies. However, it also indicates the inability of some national administrations to balance climate change and legitimate development objectives.

With 412 million people without access to electricity—34% of its population—India needs all the electricity it can get. However, this is clearly irrelevant to the Export-Import Bank, which seems to only have regard for the political incorrectness of associating itself with a coal project; never mind that coal supplies around 50% of America's own electricity.

The decision will not stop the project. The need for electricity in India is too great. The decision therefore will do nothing to curtail the emission of greenhouse gases, or even allow U.S. companies the opportunity to export technologies to help reduce emissions, but merely provide those making it with a sort of mindless warm inner glow.

Milton Catelin

Chief Executive

http://online.wsj.com/article/SB10001424052748703571704575341133538729898.html?mod=WSJ_article_related

[lostinblue 1,989]

I guess it depends on how serious he is.

Thanks to the Journal for shining light on "The Bucyrus Travesty" (Review & Outlook, June 30). Denying Bucyrus International Inc. a loan guarantee is yet another act of economic suicide by misguided zealots—both political and environmental. Obama-appointed Export-Import Bank Chairman Fred Hochberg should travel to Wisconsin with President Obama and personally face the Bucyrus workers and explain what he has just done. That might give Mr. Hochberg pause. How can he look at himself in the mirror or with a straight face explain that he has doomed $600 million of business and 1,000 U.S. jobs because the deal with India's Reliance may have an "adverse environmental impact" in India? The deal was killed even though India is already building the plant, will mine the coal, and will award the business to one of our international competitors. This is dumb.

Then the bank put salt in the wound by approving $528 million in low-cost loans to Fisker Automotive in Vice President Joe Biden's hometown to build electric cars selling for $48,000, and that's before the taxpayer is taken for a $7,500 tax credit. I couldn't lie awake at night dreaming up this kind of nightmare economic scenario.

Chris J. Krisinger

Burke, Va.

I am a production manager at one of the supply chain companies for Bucyrus. We are located in the Atlanta area, so the impact on jobs reaches far beyond the Midwest. The Reliance-Bucyrus deal would have been a big boost to our business as a steel service center. Meanwhile, my employees sweep the floor wondering when the next layoff is coming. If Bucyrus was in the auto business with the United Auto Workers, the Obama administration would be falling over itself to approve this deal with the Indians.

Jim Hayes

Canton, Ga.

This is another excellent example of the administration just not getting it and confusing priorities. I am a former Obama supporter.

Ted Wolf

New York

You highlight the hypocrisy that often accompanies government subsidies. However, it also indicates the inability of some national administrations to balance climate change and legitimate development objectives.

With 412 million people without access to electricity—34% of its population—India needs all the electricity it can get. However, this is clearly irrelevant to the Export-Import Bank, which seems to only have regard for the political incorrectness of associating itself with a coal project; never mind that coal supplies around 50% of America's own electricity.

The decision will not stop the project. The need for electricity in India is too great. The decision therefore will do nothing to curtail the emission of greenhouse gases, or even allow U.S. companies the opportunity to export technologies to help reduce emissions, but merely provide those making it with a sort of mindless warm inner glow.

Milton Catelin

Chief Executive

http://online.wsj.com/article/SB10001424052748703571704575341133538729898.html?mod=WSJ_article_related

Up to 1,000 jobs at Bucyrus International Inc. and its suppliers could be in jeopardy as the result of a decision by the U.S. Export-Import Bank, funded by Congress, to deny several hundred million dollars in loan guarantees to a coal-fired power plant and mine in India.

About 300 of those jobs are at the Bucyrus plant in South Milwaukee, where the company has 1,410 employees and its headquarters. The remaining jobs are spread across 13 states, including Illinois, Minnesota and Indiana.

On Thursday, the Export-Import Bank denied financing for Reliance Power Ltd., an Indian power plant company, effectively wiping out about $600 million in coal mining equipment sales for Bucyrus, chief executive Tim Sullivan said.

The fossil fuel project was the first to come before the government-run bank since it adopted a climate-change policy to settle a lawsuit and to meet Obama administration directives.

“President Obama has made clear his administration’s commitment to transition away from high-carbon investments and toward a cleaner-energy future,” Export-Import Bank Chairman Fred Hochberg said in a statement. “After careful deliberation, the Export-Import Bank board voted not to proceed with this project because of the projected adverse environmental impact.”

[Darnell 8,478]

Ye Gods, I don't mean to sound blase about this, but if Bucyrus makes coal-handling / mining gear, IMO -

it's time to gear up for making solar stuff, soonish.

Ya, I know, retool is costly, but isn't there a 2 Bil program for that, recently ?

[Gary and Alla 3,694]

The best way to boost exports would be to MAKE STUFF HERE!

Apply the FAIR TAX, eliminate ALL coporate income and payroll taxes (which only get passed on to us anyway) and all the jobs we ran out of this country will come back...PLUS. Theh they will have to export their goods elsewhere and import $$$$$$ to pay for it which will be paid to AMERICANS (or at least illegal immigrants in America who will spend 1% of it at the coin-op laundry)

Why is Obama so cluelsss?

[Gary and Alla 3,694]

Quite literally lol. After all who is better than America at exporting jobs. No one! We are number 1! We are number 1!

In all serious for a moment, that chart is disturbing in that the trade gap is obviously expanding again after the crash.

Really! We worry about the "illegal immigrants" when in fact we run all the good jobs off to foreigners that never come to our country.

Implement the FAIR TAX and illegal immigration will cease to be a "problem".

[Obama 2012 1,714]

As nice as the fair tax always sounds, it's not feasible unless it's done constitutionally and there's limits put on it. We all know if you leave it to congress, the rate will eventually end up at some ridiculously high number... Also it would have to demand constitutionally that income taxes be removed.

On top of all that even, spending would have to go way down... This multi-trillion dollar budget that we have going cannot happen...

Of course, the states would take care of themselves and stop relying on the Feds for everything.......

[evli1966 88]

As nice as the fair tax always sounds, it's not feasible unless it's done constitutionally and there's limits put on it. We all know if you leave it to congress, the rate will eventually end up at some ridiculously high number... Also it would have to demand constitutionally that income taxes be removed.

On top of all that even, spending would have to go way down... This multi-trillion dollar budget that we have going cannot happen...

Of course, the states would take care of themselves and stop relying on the Feds for everything.......

Riduculus number.

You sound like they might want to raise taxes so high that there would be a 90% tax on cigars....Oh wait there is.

My bad.

I agree we would need an amendment to prevent such stupidity.

Can we get an amendment that would prevent people named Barrak Obama from becoming president?

[Usui Takumi 1,562]

Whats so great about the FAIR TAX? Generally speaking compared to today the majority of the tax burden would actually shift from the wealthy to the Middle Class. I just ran my own household income through it and my taxes jump by like 70%.

[slim 1,530]

who's buying OUR stuff?

China.

Ye Gods, I don't mean to sound blase about this, but if Bucyrus makes coal-handling / mining gear, IMO -

it's time to gear up for making solar stuff, soonish.

Ya, I know, retool is costly, but isn't there a 2 Bil program for that, recently ?

Coal is king. They can get a 2 Bil program for solar but they'll make more than that in coal.

Whats so great about the FAIR TAX?

It's fair. Holy s#!t, Americans paying their fair share. What a radical concept.