When the current set of lockdowns and quarantines come to an end, the U.S. economy will need a boost to ensure that it does not linger in a COVID-induced recession. And step one will be reclaiming much of the manufacturing capacity that has been offshored over the past few decades.
A clear lesson of the coronavirus pandemic is that America can no longer rely on global supply chains. For example, much of the personal protective equipment (PPE) needed to keep our health care professionals safe while serving stricken patients is now made overseas. This has led to troubling supply shortages during the current crisis.
To address such import vulnerabilities — and get Americans working again — Congress should enact a two-pronged, $5 trillion ‘Made in America 2030’ plan. Such a program would tackle America’s ailing infrastructure — including crumbling roads, bridges and water works — as well as aging airports and transit systems. It would also address the offshoring of key manufacturing sectors by rebuilding capacity in four areas crucial to national and economic security: medical supplies; the pharmaceutical industry; broadband Internet communications (including 5G wireless networks); and, alternative energy.
All of these industries are vital for national security and technological leadership. But at present, the U.S. has lost manufacturing capability, particularly in sectors like medical supplies and pharmaceuticals. And in broadband networks and alternative energy, the loss of leadership and productive capacity is seriously eroding America’s research and development capabilities. Bringing these industries back would strengthen the U.S. economy while also creating at least three million jobs and boosting GDP by $500 billion a year.
All of this would be contingent on newly reshored industries growing over time. But a bipartisan plan could offer programs that the left supports — like broadband for all and incentives for alternative energy. And it would be based on an approach supported by the right, of private-sector implementation. Altogether, such broad initiatives could work to reestablish America’s global industrial leadership.
Over the past 30 years, the U.S. has invested in infrastructure at half the rate of major competitor nations — 1.3 percent of GDP compared to 2.6 percent for international competitors. It’s clear that our roads, bridges, airports, ports, and hospitals need major investment. A $2.5 trillion infrastructure plan to rebuild these key areas could deliver real, timely results if it were managed by an independent infrastructure commission staffed with experienced, non-political leaders charged with clearly defined objectives.
Such an infrastructure effort could provide meaningful benefits for the economy if Congress strengthens current Buy American rules. Doing so would mean using American-made products, components and materials whenever possible. Past mistakes, like the building of a new San Francisco-Oakland Bay Bridge with defective Chinese steel, must not be repeated. And the U.S. should withdraw from the World Trade Organization’s Government Procurement Agreement, since it currently allows dozens of countries to bid for taxpayer-funded projects on an equal footing with domestic American companies.
There’s an urgent need to rebuild these key industries. As the shortage of face masks in the COVID-19 crisis has demonstrated, subsidized competition from China has decimated a wide range of America’s productive enterprises. According to Mike Bowen, CEO of Prestige Ameritech — the largest U.S.-based producer of medical masks — between 2004 and 2005, the United States lost 90 percent of its domestic mask production. And it happened due to competition from China’s cut-price, government-subsidized masks.
Made in America 2030 is the necessary path to rebuilding these important industries. Investment in medical supplies and pharmaceuticals would restore national self-reliance in health care. Investment in broadband infrastructure would put the U.S. in the lead in 5G wireless networks — and also create American alternatives to Chinese vendors. And investment in renewable energy systems like solar and wind would spur a much-needed technological advantage for 21st century growth industries.
Infrastructure investment and industrial revitalization are twin steps that must be taken in the wake of the coronavirus. The U.S. must start creating good-paying jobs now and in the coming years — particularly in manufacturing, engineering and product development. Similarly, boosting U.S. leadership in broadband and alternative energy will help America begin to redress the loss of its technology industry to Asia. Enacting such a far-reaching program like Made in America 2030 may be ambitious, but it’s an effort for which future generations will be thankful.
Jeff Ferry is chief economist at the Coalition for a Prosperous America.
Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.