Grease the manufacturing sector, win an election
There has been a lot of discussion about the coalition of women, African Americans and Latino voters that supported Obama, yet we seem to have missed what pushed the swing states over the line.
The key to understanding Obama’s victory is the not simply the auto-bailout, but his ability to convince people that American manufacturing is worth supporting because it is in the national interest. That it represents the future.
Take a look at his speeches. Or his adverts. Many of these were targeted at Ohio, Pennsylvania and Michigan, used the real stories of manufacturing workers and the lessons of the bail out - contrasting them with the position of Romney who argued that the auto-industry should be left to go to the wall.
Manufacturing was at the heart of Obama’s pitch for re-election because it worked for him. Fifty-nine per cent of the population of Ohio supported the auto-bailout.
Let’s examine his policies. Obama sought to adopt the tried and true way to cope with an economic disaster. He invested in the economy and he backed America’s strength of ingenuity and self-reliance.
Obama has strengthened the Buy Local policies, which build on an incredibly strong Buy American foundation – for example, the Jones Act which mandates that defence ships must be built locally.
Obama invested in initiatives that got work back into factories, but enhanced their capacity by creating technological capital and investing in industries with the capacity to grow - industries like renewable energy.
The so-called battleground states played a part. Predominantly working people, hit hard by the global financial crisis - Obama pitched directly at specific parts of America that were concerned first and foremost about their jobs.
But when you look at the results it really hits home: under the leadership of Obama, Ohio’s unemployment rate has gone from 11 per cent in 2008 to 7 per cent today.
Ohio’s manufacturing sector increased output by 12 per cent, or $8 billion over the past two years. It represents a quarter of the state’s economy.
Ohio is now actually relocating jobs back from overseas. The companies are changing. They’re becoming more hi-tech, higher skilled and higher waged. Now, Ohio’s economy will rest on the skills of its workers.
These lessons should be screaming at those seeking re-election in Australia. Because here’s the rub, manufacturing is under similar pressure in this country, and it will play as strategically significant a role in the up-coming election.
Skills lie at the heart of our economy. Manufacturing employs a similar proportion of Australians to Ohio, and is significant in almost every state and region of Australia.
We also face profound challenges. Post GFC, Australia has lost tens of thousands of jobs. The high dollar is killing us. Free trade agreements aren’t supporting our exports because we lack level playing fields with our competitors.
Australia has lost a decade of productivity reform due to an unerring focus on industrial relations when the real gains are in technology, skills and management reform. We’re trying to cut tea breaks while the world is investing in their own.
We’ve lost 125,000 manufacturing jobs since the GFC. And like Obama’s America, we have to stand up and face the future.
Manufacturing will be critical at the next election, because people’s jobs matter. They know we have to use our smarts and our skills to make manufacturing stronger and more sustainable.
But we need government to back us in. We need proper infrastructure priorities with funding. In real terms, it’s better than a surplus because it lifts us all.
We need to buy Australian. We need to make sure major projects buy Australian. And we need to be serious about it. We need to be prepared to know that Australian made is quality and that we should feel proud to by it and confident in its capacity.
And, like the US, we need a car industry at the heart of it. The car industry provides the whole sector with a strong connection to research and development, associated components, parts and service industries.
Saving the auto-industry was critical for Obama’s endeavours in turning the economy around and keeping him in the White House. Our Federal Election should be shaped on similar lines.
One side of politics has called for half a billion dollars to be gutted from the car industry. There are bigger issues here than glib one-liners. This is in our national interest.
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