If the Democrats want to win in the upcoming November elections, they need to do much more about restoring our manufacturing base and the good long term jobs the sector has always provided. That requires political leadership by President Obama and bold legislation managed by you through Congress. It's time to talk now to leaders who have new ideas like Sens. Byron Dorgan (D-N.D.) and Russ Feingold (D-Wisc.), Governor Ed Rendell of Pennsylvania (D), former Sloan Foundation President Ralph Gomory, and Warren Buffett who first offered a Plan for balanced U.S international trade that only you can bring to reality this year!
Time is running short, so I'll describe the bold Plan here to start the necessary debate on legislative action. First, where do we stand on other job creation proposals? On Dec. 3, there was a White House "Jobs Summit" to hear ideas for creating jobs to replace the 8.5 million jobs lost during the recession. But few were submitted for U.S. manufacturing and its secure long-term jobs. Instead, most proposals called for heavy deficit spending for extended unemployment compensation, repair of the infrastructure, tax credits for hiring, and aid to state governments to retain public service workers -- all worthy causes, but none answered the need for good revenue-producing, long-term jobs.
The latest idea suggested by President Obama is export expansion. He was echoed by Fred Bergsten, head of the Peterson Institute, who suggested that every billion dollars of added export sales would create about 7,000 jobs. But there are many strong exporting nations competing for that business. We're at a sharp disadvantage there to low-wage countries, especially China. More exports are not likely to be a big answer for the U.S.!
Instead, we must focus on markets where the U.S. controls the situation, and where we have clear-cut competitive advantages. Is there a big jobs opportunity like that, and is it affordable? The answer is a definite "Yes" on both counts! We tried to submit the Plan at the Dec. 3 Jobs Summit, but only short term "quick fixes" were welcome.
The answer lies in our own rich U.S. domestic market. The U.S. is the only industrial country in the world that runs trade deficits, and ours is huge. Our trade deficits averaged $700 billion dollars per year for the 5 year period from 2004-2008 -- a total of $3.5 trillion! Much of that could be business for U.S. producers and provide millions of jobs.
What should we do? Answer: restore a policy of balanced trade for America. Draft legislation to implement the Buffett Plan was written several years ago -- Senate Bill S.3899 "The Balanced Trade Restoration Act of 2006", by Senators Dorgan and Feingold -- but it's not even being discussed in Washington now. If enacted, it would shift several hundred billion dollars of production annually to the U.S. over a two or three year period to avoid any market disruption. At just 7,000 jobs for every billion dollars of sales, that should create at least 3 million good jobs! And it wouldn't need any deficit spending! Even administrative costs would be covered through small fees for import certificates.
It's up to you, Mr. Emanuel -- an opportunity of a lifetime!