Despite our success, it is true that the U.S. has serious challenges in manufacturing. For example, in 2000, China replaced the U.S. as the world’s second leading exporter, with the EU as number one. Today, America’s global market share of manufactured exports ranks third (as opposed to total manufacturing, where we still rank first) because our export share has declined from 19 percent in 2000 to less than 14 percent. Still, during this period, the absolute dollar value of manufactured exports has steadily increased, though less rapidly than exports from China, India and Southeast Asia.
A healthy manufacturing sector requires policy changes at every level. As global economic competition heats up, we as a country need to do the following to stay competitive:
- Improve K-12 education,
- Reform higher education by expanding access and decreasing costs,
- Increase private sector R&D investment,
- Upgrade transportation and telecommunications infrastructure,
- Expand the use of advanced information technologies in every sector,
- Reform our immigration laws to make it easy for highly-talented and high-work ethic immigrants to come to the US to improve their lives and ours, and
- Contain federal, state and local governments from increasing taxes and expanding regulations in ways that dampen investment, kill jobs, stunt innovation and slow economic growth.
More generally, we need pro-growth and pro-investment policies at every level of government – policies that reduce...