President Barack Obama’s performance in his first debate against Republican presidential candidate Mitt Romney was far from spirited, making the passion Obama expressed for American manufacturing stand out.
In his proposed revamp of America’s corporate tax rate to improve the economy, Obama promised a big tax cut for American manufacturers, “taking it down to 25 percent.” This cut would be offset by closing tax loopholes across all other lines of business, with additional incentives to bring jobs overseas back home to America, according to The Kansas City Star.
Though generally more robust on tax cuts, Romney supports a similar tax proposal that also promises a 25 percent cut to American manufacturers across the board.
Throughout the presidential race, both Obama and Romney have held America’s declining manufacturing industry accountable for the country’s high unemployment rate and lethargic economic growth. But isolating corporate tax cuts around American manufacturing in an attempt to reinvigorate this dying industry is a colossal mistake.
Giving tax breaks to American manufacturers would be a foolish attempt to bring antiquated 20th-century solutions to a technologically proficient economy. Any candidate who proposes similar tax policies should especially raise concern among students, as they are the voters who have the most to gain or lose from the country’s financial future.
It’s no secret that American manufacturing is decreasing across almost every industry. In the past 20 years, 6.4 million manufacturing jobs have been lost. Today, there are fewer manufacturing jobs than there were in 1955. Outsourcing slashes corporations’ costs to the bone, allowing quantities to soar and prices to plummet. And new advances in technology allow these same benefits to be achieved on American soil.
Though politicians paint this trend as a tragic blow to the working class, the truth is quite the opposite. In fact, the gradual decline of American manufacturing greatly benefits our country — not simply by lowering the price of goods for consumers, but by eliminating subprime jobs from the market.
Contrary to popular belief, phasing out manufacturing jobs actually makes room for more advanced, robust industries offering higher-paying jobs for American workers.
Take the music industry, for example. Though record stores experienced a 76.3 percent decline in revenue from 2000-10, the music industry has far from faded. According to Strategy Analytics’ Global Recording Music forecast, worldwide digital music sales are slated to top $8.6 billion in 2012, the highest amount ever recorded. Overall digital music spending is projected to increase by 17.8 percent this year while packaged sales — mostly audio CDs — are expected to see a 12.1 percent decline.
As a result, new opportunities are flourishing in the digital sales world, event management, social media integration and marketing. And this trend is hardly limited to the music industry.
By 2020, there will be 123 million high-skill, high-paying jobs in this country — but only 50 million Americans with the qualifications to fill them, according to Edward Gordon, an author and former college professor with expertise in workforce issues. Any economic plan that attempts to artificially sustain dying, largely low-skill manufacturing jobs for adults while funneling students into the jobs of the future would be detrimental to society. But even though Trojans and other college students will be prepared for these positions, there will still be millions of jobs left unfilled, sure to result in a net decrease in our nation’s productivity.
Washington’s policies should prepare Americans — from students to adults — for these kinds of jobs, not spending money to sustain an industry that is slowly growing obsolete.
To do this, corporations should receive incentives for providing training for high-skill, high-paying jobs for Americans. Many states already provide monetary benefits to companies that hire American veterans or released convicts. Company- and government-provided resources to help train manufacturing workers for high-skill jobs should be a central point of the next president’s economic policy.
After all, the road to a more prosperous United States lies in technological innovation in fields like software, biotechnology and financial services — not in bringing poor manufacturing jobs back from China.
Companies should not be penalized for having efficient manufacturing procedures overseas. These jobs are not valuable to the American economy, and the government ought to acknowledge this reality.
Any politician’s inability to understand the road to American economic prosperity is troubling. In light of the impending financial future, it’s crucial for students to be clear on America’s manufacturing problems — or, more accurately, the lack thereof.
Ryan Townsend is a sophomore majoring in business administration. His column “The Blame Game” runs Tuesdays.