Incentives for Industrial Growth

by Carlos David Mogollón, Managing Editor

The Tooling, Manufacturing & Technologies Association – founded in 1933 as the Automotive Tool & Die Manufacturers Association – sent me an editorial recently that we posted on our website, “The Costs of Free Trade,” that laments inattention to the rapid loss of the industrial core of the U.S. manufacturing community. It’s a sad thing.

TMTA spokesman Brian Sullivan notes: “There are 36,000 fewer U.S. factories than there were eight years ago. One in five manufacturing jobs has been lost, nationally, in the last 10 years -- and counting. What’s wrong with calling it ‘throw American workers out on the street trade’?.”

While I commiserate with the sentiment, I’d rather not sound so isolationist nor jingoistic like Lou Dobbs, whose ethnocentric rants tend to divert attention from the issue. But there’s a growing body of opinion acknowledging need for a more proactive U.S. industrial policy that looks at the challenges of globalization and realities of competition in world markets with a better eye toward leveling the playing field. Some form of tax, trade and other reforms may be necessary to support key U.S. industries from faltering due to unfair trade, in other words. This shouldn’t be corporate giveaways or protectionism, but rather targeted incentives for growth based on merit and accomplishment. It should be an investment in innovation the American people make in themselves.

Barring that, the word at various events we attend, most recently WEFTEC and AWT, is water and wastewater for industrial markets is looking up – as are international markets. This may be the upside to the sliding value of the U.S. dollar, which theoretically makes it cheaper to manufacture here and makes U.S. exports less expensive overseas.

Speaking of investments, it was nice to see Congress override a veto of the Water Resources Development Act, which would invest $23.2 billion into improving related infrastructure across the country over 15 years. For those who’ve argued the bill was full of pork, they should be reminded that it’s been eight years since a similar bill was passed and the ASCE Report Card on America’s Infrastructure hasn’t given any improved grades in that time for water and wastewater services.

Russ Komline, representing a group that called for the override, the Water & Wastewater Equipment Manufacturers Association (WWEMA), recently had an article in sister magazine, WaterWorld, that summarized an Oct. 3 gathering of 25 CEOs and senior business executives in Chicago for WWEMA’s fourth annual President’s Council. In assessing trends, Komline, a former WWEMA chairman and president of Peapack, NJ’s Komline-Sanderson, said, municipal, industrial and international markets were all robust in 2007, with normal strengths and weaknesses from one region to another.

As has recent research from The McIlvaine Company, he singled out a surge in the power industry – a focus of this issue, which will be at Power-Gen International – on the industrial side, and subsequent water and wastewater needs. Komline noted, while consensus foresaw little growth in federal funding in the next five years, there was a possibility that lifting of private activity bond caps could free up $5-6 billion in new capital flowing into the industry.

Lastly, we never seem to get all the news in that we’d like to present to you, so I leave you with a few headlines that didn’t make the cut in “WaterBriefs”: