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S. HRG. 112–293 

MANUFACTURING OUR WAY 

TO A STRONGER ECONOMY 

HEARING 

BEFORE THE

COMMITTEE ON COMMERCE, 

SCIENCE, AND TRANSPORTATION 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

MAY 11, 2011 

Printed for the use of the Committee on Commerce, Science, and Transportation 

( 

(II) 

SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

JOHN D. ROCKEFELLER IV, West Virginia, Chairman 

DANIEL K. INOUYE, Hawaii 

JOHN F. KERRY, Massachusetts 

BARBARA BOXER, California 

BILL NELSON, Florida 

MARIA CANTWELL, Washington 

FRANK R. LAUTENBERG, New Jersey 

MARK PRYOR, Arkansas 

CLAIRE MCCASKILL, Missouri 

AMY KLOBUCHAR, Minnesota 

TOM UDALL, New Mexico 

MARK WARNER, Virginia 

MARK BEGICH, Alaska 

KAY BAILEY HUTCHISON, Texas, Ranking 

OLYMPIA J. SNOWE, Maine 

JIM DEMINT, South Carolina 

JOHN THUNE, South Dakota 

ROGER F. WICKER, Mississippi 

JOHNNY ISAKSON, Georgia 

ROY BLUNT, Missouri 

JOHN BOOZMAN, Arkansas 

PATRICK J. TOOMEY, Pennsylvania 

MARCO RUBIO, Florida 

KELLY AYOTTE, New Hampshire 

DEAN HELLER, Nevada 

ELLEN L. DONESKI, Staff Director 

JAMES REID, Deputy Staff Director 

BRUCE H. ANDREWS, General Counsel 

BRIAN M. HENDRICKS, Republican Staff Director and General Counsel 

TODD BERTOSON, Republican Deputy Staff Director 

REBECCA SEIDEL, Republican Chief Counsel 

(III) 

C O N T E N T S 

Page 

Hearing held on May 11, 2011 ............................................................................... 1 

Statement of Senator Rockefeller ........................................................................... 1 

Statement of Senator Hutchison ............................................................................ 3 

Statement of Senator Ayotte ................................................................................... 34 

WITNESSES

Stephanie A. Burns, Ph.D., Chairman, Dow Corning Corporation ..................... 5 

Prepared statement .......................................................................................... 8 

Leo W. Gerard, International President, United Steel, Paper and Forestry, 

Rubber, Manufacturing, Energy, Allied Industrial and Service Workers 

International Union (USW), AFL–CIO .............................................................. 11 

Prepared statement .......................................................................................... 14 

Mike Rowe, Creator, Executive Producer and Host, Discovery Channel’s 

DIRTY JOBS ........................................................................................................ 21 

Prepared statement .......................................................................................... 24 

(1) 

MANUFACTURING OUR WAY 

TO A STRONGER ECONOMY 

WEDNESDAY, MAY 11, 2011 

U.S. SENATE, COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION, Washington, DC. 

The Committee met, pursuant to notice, at 2:12 p.m. in room 

SR–253, Russell Senate Office Building, Hon. John D. Rockefeller 

IV, Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. JOHN D. ROCKEFELLER IV, 

U.S. SENATOR FROM WEST VIRGINIA 

The CHAIRMAN. Welcome. This hearing is of just vast importance, 

and what is frustrating is when you say the words, how we’re going 

to do manufacturing better, all the people who are suffering from 

it, like everybody in West Virginia and everybody everywhere else, 

they can’t engage with the subject properly. 

Manufacturing somehow is a word which people can’t get into 

and say, ah, that means we should do this, this, this and this, and 

it’s complicated, but you’re here to straighten that out. 

Manufacturing, obviously, has been and will continue to be a 

focus of this committee for a very simple reason. In fact, it’s our 

main focus this year. It’s our second formal hearing here. I’ve had 

four other hearings, many of them in West Virginia. I’ve had four 

in West Virginia, including the glass industry, for example, and 

people are just literally going out of business and want to know 

how to stay in business, sometimes with government help, sometimes without it. 

I don’t know what this budget is going to do to us but I’m not 

looking forward to having to report on the answer to that question. 

We just didn’t become the envy of the world because of the things 

we made and the country that we built. We’re envied because the 

people know that if you work hard in America opportunities are 

going to follow. That is the history of our country and that was the 

history of our country, its not right now, which is why we have to 

change it. 

Now, you can be a steelworker. You can be a coal miner. You can 

be a glassmaker, but you really put in the hours, and it’s probably 

generational, and you’re fanatically loyal, work incredibly hard, 

and then you just get swept off the map. In fact, two of the three 

industries that I mentioned pretty much have been swept off the 

map. 

It’s certainly true in West Virginia. My state was built on 

coalmining, on steelwork, and a lot of other factories producing a 

2 

very wide range of goods. We’re not a rich state, so that every one 

of those jobs is incredibly important to us. Many of the towns and 

cities across the state grew and thrived because of the industry 

that provided reliable jobs. 

I voted against NAFTA. This isn’t in my script, but it still makes 

me mad, because I knew at the time that it would cause, in our 

rural counties, where we have only garment makers and sneaker 

makers, to close down. And it was in 2 years, they were all closed 

down, and that really hurt. That really, really hurt. 

So we must dig in. We must redouble our efforts to ‘‘make it in 

America.’’ Manufacturing is critical, and it’s critical to the national 

security. There are some things that we simply cannot outsource. 

We cannot outsource our ability to defend this country, for one, our 

secure communications networks or our research and development 

efforts. 

Now, some of them are being outsourced thanks to WikiLeaks, 

et cetera, but we have to find a way to deal with all of this. 

Co-Chair Hutchison, I just had a long meeting with cybersecurity 

folks, and they like the approach we’re taking, but it’s very complicated for them, because they’re all of different sizes, but they 

bought the concept that if you wanted a government contract, 

therefore, you have to have security, cybersecurity protection which 

is up to the standard, and if you don’t have that, you probably don’t 

get the government contract. And they like that. 

Senator HUTCHISON. Yes. 

The CHAIRMAN. Because they said you have to incent people 

sometimes in a negative way to get things going. 

Jobs are just slipping away all the time, and we know it, and it 

hurts so many people. The truth is that manufacturing workers get 

higher pay and more generous benefits than Americans in nonmanufacturing jobs, and these jobs have one of the largest multiplier effects in our economy. It’s estimated that two-and-a-half additional jobs come from every one manufacturing job. People say 

that. Nobody pays any attention. It’s tremendously important. It’s 

like health care. The multiplier effect is huge. 

I don’t think people appreciate that manufacturing is this country’s principal source of R&D and innovation. Manufacturing firms 

perform approximately 70 percent of U.S. industry R&D, while accounting for only about 11 percent of the economy. 

Disturbingly, the R&D could be going on here, but isn’t because 

it’s being shipped overseas as well. Now, I don’t mind that if somebody from South Korea comes here to get his Ph.D. It used to be 

they’d stay here, or India or Japan or Brazil or some other place, 

get their Ph.D. and they’d stay here and then they’d be a part of 

our innovation machine. 

Now, they go home because they want to build their countries. 

I can’t argue against that. That’s what they ought to be doing in 

a sense, but the loss hurts whether it’s virtuous or not. 

R&D—I think we had 57,000 factories that have been closed in 

the last 10 years, and where factories go, so does innovation. If we 

still want people to believe that they can make it in America, we 

can’t let manufacturing become a relic of the past. 

I’m heartened that manufacturing activity has increased over the 

past several months as our country makes it out of the recession. 

3 

I don’t think we’ve quite done that, but the month-by-month numbers keep going up. 

It’s just that there are still so many people unemployed it doesn’t 

make any difference, and still fewer people are unemployed and 

kind of know it, because they see that happening in their neighborhoods, not just them, but they’ve got to feel it, see it, get a sense 

of the momentum. 

So we have to do more. Industry, labor and government have a 

responsibility to work collaboratively to make sure that the manufacturing sector is stronger in the short term and in the long term. 

To this end, the Committee has worked supporting science, technology, engineering and math in the famous reauthorization of the 

America COMPETES Act, which Kay Bailey Hutchison and I sort 

of did in the center aisle of the U.S. Senate floor, all by ourselves, 

with help from Lamar Alexander, and then it passed by unanimous 

consent. See, bipartisanship can work. And it was fun, wasn’t it? 

I know that we have very hard choices to make, how Federal dollars are spent. And this is where I get into turmoil on the whole 

budget thing. The calls for slashing the budget have broad and 

often troubling implications for some of the hardest-working Americans. 

Infrastructure investment is essential to promoting growth and 

creating jobs. You can’t do anything if, like in West Virginia, over 

half of your bridges were built 50 years ago. Bridges are only 

meant to last, at the maximum, 50 years. 

There’s no substitute for education and workforce training programs or for helping small manufacturers and exporters find new 

markets. Indiscriminate and unthinking budget cuts seeking a 

short-term improvement in our deficit will leave the country’s economic power at the mercy of the rest of the world’s economic power. 

I’m not sure we come out a winner on that, and that would hurt 

this country for years to come. So everything is hard around here. 

Today, I want to hear from our witnesses on what more we can 

do to help America’s manufacturing sector and create more goodpaying jobs, and, as I say, this is Kay Bailey Hutchison’s and Jay 

Rockefeller’s main agenda item for this 2-year period. 

And I now call on my distinguished friend. 

STATEMENT OF KAY BAILEY HUTCHISON, 

U.S. SENATOR FROM TEXAS 

Senator HUTCHISON. Thank you. Thank you, Mr. Chairman. 

I, too, am very concerned about America’s manufacturing base. 

While we are still the major manufacturing country of the world, 

we have lost market share, and I think we do need to stay on top 

of that kind of a trend and do what we can to assure that America 

is continuing to be competitive. 

I would say a couple of things are important. One is that we are 

looking now for a highly skilled workforce, and I think the bill that 

the chairman just mentioned is essential to assuring that we are 

valuing the STEM courses, making sure that we have technology 

training and the most advanced computer capabilities that are possible. 

And I think our committee has done a great job, and Congress 

passed the COMPETES Reauthorization of 2010, and we now have 

4 

more research and more STEM education incentives for teachers to 

get teacher certificates along with their major being in science, 

technology and math. 

Yes, thank you. 

Second, I believe that we’ve got to aggressively open our markets. 

We have free-trade agreements that have been languishing that 

could add to our export capabilities and add to the opportunities for 

other countries to buy our products. 

So I certainly hope that we will look to ratifying free-trade agreements that are in our country’s best interests that are already in 

play. 

The last thing that I would just want to mention, before we go 

to our witnesses, is that a stable regulatory environment is very 

important to keeping manufacturing in America. 

When I talk to a CEO that does international business and I will 

inevitably say, Why did you put your manufacturing operation in 

another country rather than here? They will cite higher taxes. The 

corporate tax rate in America is among the highest in the world. 

And, second, the unstable regulatory environment. 

Now, that is a terrible thing to say about America, and I think 

we ought to have that in mind as we are passing laws and restricting the capability for our manufacturers to compete in the global 

marketplace. 

I would just say that in the state arena, the states that have 

right-to-work laws also have a competitive advantage where people 

have a choice whether to join a union and are not forced to, 

and—— 

Mr. GERARD. Not forced to anywhere. 

Senator HUTCHINSON. Well, your definition of forced and mine 

might be different. 

Mr. GERARD. Because I understand mine. 

Senator HUTCHINSON. Sir, I want to say that I understand as 

well. 

And for their right-to-work laws, besides right-to-work laws is 

tort reform, and we must have a litigation environment that is reasonable and fair is also important for our competitiveness in the 

global marketplace. And maybe you would argue, but I would not, 

that we are litigious society and that hurts our competitiveness. 

So, with that, Mr. Chairman, I thank you for having this hearing 

and hope that we can come to agreement on goals that would benefit our competitiveness in the global marketplace. Thank you. 

The CHAIRMAN. Thank you, Senator Hutchison. 

We have three distinguished witnesses. Dr. Stephanie Burns, 

who’s Chairman and CEO of Dow Corning Corporation, which has 

a pretty big presence in the state of West Virginia; Leo Gerard, 

International President—Leo, this is going to take a long time to 

read all—— 

Mr. GERARD. Don’t read it all. 

The CHAIRMAN. No, I’m going to read them. 

International President, United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers 

International Union. I didn’t even mention steelworkers, did I? 

5 

OK. And then Mr. Mike Rowe. I’m very curious, Mike, about you 

and what you’re going to say. Creator and Executive Producer and 

Host, Discovery Channel’s Dirty Jobs. 

And why don’t we start off with you, Dr. Burns. 

STATEMENT OF STEPHANIE A. BURNS, PH.D., CHAIRMAN, 

DOW CORNING CORPORATION 

Dr. BURNS. Good afternoon. Thank you, Chairman Rockefeller 

and Senator Hutchison, for inviting me to join you this afternoon. 

I very much appreciate it. 

It is an honor and a pleasure to join you today to share some 

thoughts on how to grow domestic manufacturing in a way that increases our nation’s exports, in the near- and long-term, while reducing our trade deficit and strengthening America’s competitiveness in a rapidly changing global marketplace. 

I should note at the outset that much of what I want to share 

with you today is not targeted specifically to this committee. Instead, I hope to articulate a suggested framework for thoughtful 

policymaking in the areas of manufacturing, exports and jobs creation. 

As you know, Dow Corning is a Midland, Michigan-based company that has become one of the world’s leading providers of silicon-based materials that enhance the products of such industries 

as clean energy, automotive production, personal care products, 

construction—including the areas of green building and energy efficiency—electronics and health care technologies. 

I am proud to say that Dow Corning has more than doubled its 

sales since 2003. Last year, our sales increased by about a billion 

dollars to nearly $6 billion, and our net income was 45 percent 

higher than in 2009. We are seeing record growth. We are exporting, and we are creating jobs. 

We have achieved that growth in part because we believe that 

you can only export what customers around the world want to buy. 

And, to sustain this growth, we know that we must not simply 

cater to the markets of today. We must also anticipate the shape 

and demands of the global marketplace of tomorrow. 

We study the trends—we call them megatrends—that will shape 

the world’s economy and humankind in the decades to come, and 

we unleash our innovators to find products and solutions that will 

meet the needs and challenges posed by these megatrends. 

The innovation necessary to meet these emerging global demands 

leads us to invest 5 to 6 percent of our sales every year in research 

and development. Then we risk the capital to manufacture those 

solution-based materials. 

I applaud this committee for taking the time to explore the root 

causes of the loss of U.S. manufacturing muscle and the ways that 

government and industry can work together to strengthen manufacturing so more American workers can enjoy the well-paying, 

family supporting jobs that making things provides. 

But I would urge this committee to thoughtfully consider, as 

well, the linkage between the profound and long-term trends that 

even today are shaping the world in which we live and the companies and industries that are innovating daily to meet the needs of 

this world. 

6 

I should tell you that my company traditionally has thrived in 

a culture of quiet innovation. We’ve only recently joined the public 

discussion because we know that the power of a vibrant manufacturing sector is critical to maintaining and enhancing the quality 

of life in our Nation. We know that forward-looking government 

policies are essential to encouraging innovation, eyes-on-the-future 

companies to take risks necessary for success. 

At Dow Corning, we are convinced that one path to future success will meld good business practice with meeting the needs of the 

billions of people in the world who are not sharing in the lifestyles 

that we have come to see in developed countries. 

An estimated three billion people lack access to sustainable and 

affordable modern energy. A billion of our global neighbors do not 

have access to safe drinking water, and every day, 200,000 people 

move to big cities, many of which are already overwhelmed by the 

demand for housing and other essentials of dignified life. 

Our executive, our research, engineering and marketing teams 

see opportunities in these megatrends to do good while exploring 

what we think is the unlimited potential for solutions hidden in the 

silicon atom, all the while creating jobs for Americans and making 

a profit for our owners. 

So what are these megatrends to do with what I have been referring to? At Dow Corning we are focused on the following: 

First, energy scarcity and the need for clean energy solutions. 

Our materials enable solar and wind energy generation, energy efficiency and energy storage. 

Second, the rapid urbanization of the developing world. Our 

green buildings and energy efficiencies technologies are complemented by high-performance building materials. 

For example, we make glass more resistant to fire, vibration and 

impact, and new technology insulations by squeezing more protection from the elements into fewer inches, allowing architects to add 

square feet to urban dwellings. 

And, third, aging populations and the corresponding challenges 

related to provision of health care. We are innovating our materials 

to enable improvements in wound care and transdermal and topical 

treatments to enhance patient comfort through aging. 

I’m sure other companies are exploring these and other 

megatrends through the lenses of their competencies and business 

plans. I am also sure that companies that play into, and not resist, 

these trends will be the job engines of the coming decades, if the 

United States is to be home of these kinds of companies and industries, these innovators. That means having a competitive corporate 

tax structure and regulatory regime, as well as incentives for investment in innovation and growth. 

But it also means having smart, forward-looking policies that invite investment from manufacturers poised to meet challenging 

global demand. 

Take, for example, the challenge of energy scarcity and the 

unabated global demand for renewable energy. About 2 years ago, 

we proposed a four-point plan for accelerating America’s adoption 

of solar energy. This plan focuses on solar power, because, as one 

of the world’s largest producers of these materials, it is among the 

technologies that we know best. 

7 

But our suggestions, nevertheless, also address many of the manufacturing, legislative, regulatory and workforce-related factors 

that influence America’s ability to develop a thriving advanced 

manufacturing base. 

First, we are encouraging Congress and the administration to 

enact Federal policies and regulations that will increase domestic 

consumer demand for renewable energy, for energy efficiency and 

manufacturing of those products here at home. 

Not surprising the solar supply chain wants to be where the market is. So growing demand for solar is key to realizing the enormous jobs potential that the growing market will create here in 

America. 

Other nations have adopted aggressive policies to support growth 

for renewable energy, and, not coincidentally, during the past 12 

years, the U.S. global market share for solar manufacturing has 

dropped from 45 percent down to 7 percent. 

Meanwhile, other nations are aggressively courting solar manufacturers, specifically, China, Germany, India, Malaysia and the 

Philippines. Luring manufacturers with roughly 40 percent manufacturing tax credits, high demand markets, the U.S. risks losing 

this growth industry unless it puts into place strategic, short-term, 

demand side incentives. 

Second, we are advocating increased Federal funding for research 

and development, as the government does for many other industries, to accelerate technology innovation and advanced manufacturing capabilities. Making the R&D tax credit permanent is critical. 

Third, we support training and education to develop a green collar workforce. We won’t have exports without manufacturing. And 

we won’t have manufacturing without a ready workforce. 

Other nations have undertaken massive expansions of educational assets in recent years, some nearly tripling their share of 

GDP devoted to education. These countries are ramping up the construction of colleges and increasing the number of college students 

as much as five fold to accelerate their manufacturing development. 

We applaud the efforts of the Science, Technology, Engineering 

and Mathematics Education Coalition. It is doing the important 

work of supporting training for teachers and students through activities of the U.S. Department of Education, the NSF and other 

agencies. Rigorous education is essential to developing an American workforce that can compete in the global marketplace. 

And, last, we urge our government, at the Federal, state and 

local levels, to lead by example. If the designers of new government 

facilities incorporate renewable power options, the change in the 

landscape would remind our citizens, in big cities and small towns, 

that renewable energy has arrived in our lives. 

My company is doing its part to encourage a climate of collaboration, creativity and commitment to greater energy security. We 

know it is fundamental to protecting our nation’s competitiveness 

in the decades to come. Generations of future Americans deserve 

nothing less than our best effort. 

8 

At Dow Corning, we look forward to working with each of you as 

we enter the marketplace that is full of incredible opportunities for 

American manufacturing. 

Business and government must work together to lead the economic transformation to a growing and exporting manufacturing 

base. We should play to our strengths. For U.S. manufacturers who 

channel the human capital and R&D that emanates from our world 

class universities, that means opening markets that are currently 

closed to U.S. goods and services. Emerging economies offer unbridled opportunities to those companies who have access to those 

markets. 

I take this position not only as the head of an American company 

selling to the world, but also as a member of the President’s Export 

Council. The 20 private sector members of the council, whose companies represent a large swath of the American manufacturing and 

service sectors, have urged President Obama to prepare and submit 

to Congress as soon as possible pending free-trade agreements. 

Leaders on both sides of the aisle know that free trade can play 

a major role in our nation’s economic recovery and the revitalization of our manufacturing sector. 

And, finally, I applaud the administration for making a case for 

trade in his State of the Union address when he announced his National Export Initiative, which seeks to double U.S. exports within 

5 years. 

Innovative, flexible, strong, courageous and collaborative publicprivate partnerships can lead to a recovery that creates engaging, 

well paying and worthwhile work for Americans, as well as exports 

that serve an increasing demand in our global neighborhoods for 

products that enhance the quality of their lives. 

I’m confident that if we were to share these ideas with the people 

in coffee shops and diners from your communities, they would 

agree. 

Thank you for your attention. 

[The prepared statement of Dr. Burns follows:] 

PREPARED STATEMENT OF STEPHANIE A. BURNS, PH.D., CHAIRMAN, 

DOW CORNING CORPORATION

Good afternoon and thank you Chairman Rockefeller and Senator Hutchison for 

inviting me to join you this afternoon. 

It is an honor and my pleasure to join you today to share some thoughts on how 

to grow domestic manufacturing in a way that increases our Nation’s exports—in 

the near- and long-term, while reducing our trade deficit and strengthening America’s competitiveness in a rapidly changing global marketplace. I should note at the 

outset: much of what I want to share with you today is not targeted specifically to 

this Committee. Instead, I hope to articulate a suggested framework for thoughtful 

policymaking in the areas of manufacturing, exports, and jobs creation. 

As some of you know, Dow Corning is a Michigan-based Company that has become one of the world’s leading providers of silicon-based materials that enhance the 

products of such industries as: 

clean energy, 

automobile production, 

personal care products, 

construction—including in the areas of green building and energy efficiency, 

electronics 

and health care technologies. 

9 

I am proud to say that Dow Corning has more than doubled its sales since 2003. 

Last year, our sales increased by about a billion dollars to nearly $6 billion, and 

our net income was 45 percent higher than in 2009. 

We are seeing record growth; we are exporting; and we are creating jobs. 

We have achieved that growth in part because we believe that you only can export 

what customers around the world want to buy—and, to sustain this growth, we 

know that we must not simply cater to the markets of today . . . we must also anticipate the shape and demands of the global marketplace of tomorrow. 

We study the trends—the megatrends that will shape the world economy and humankind in the decades to come—and then we unleash our innovators to find the 

products and solutions that will meet the needs and challenges posed by these 

megatrends. 

The innovation necessary to meet these emerging global demands leads us to invest 5 to 6 percent of our sales every year in research and development. Then we 

risk the capital to manufacture those solutions-based materials. We take great pride 

in the fact that 10 to 15 percent of our silicone sales are from products and services 

less than 5 years old. 

I applaud this Committee for taking the time to explore the root causes of the 

loss of U.S. manufacturing muscle and the ways that government and industry can 

work together to strengthen manufacturing so more American workers can enjoy the 

well-paying, family-supporting jobs that making things provides. But I would urge 

this Committee to thoughtfully consider, as well, the linkage between the profound 

and long-term trends that even today are shaping the world in which we live and 

the companies and industries that are innovating daily to meet a changing world. 

I should tell you that my company traditionally has thrived on a culture of quiet 

innovation. We’ve only recently joined the public discussion because we know that 

the power of a vibrant manufacturing sector is critical to maintaining and enhancing the quality of life in our Nation. We know that forward-looking government policies are essential to encouraging innovative, eyes-on-the-future companies to take 

the risks necessary for success. 

At Dow Corning, we are convinced that one path to future success will meld good 

business practice with meeting the needs of the billions of people in the world who 

are not sharing in the lifestyles of what we have come to call ‘‘developed’’ societies. 

For example: 

• An estimated 3 billion people lack access to sustainable and affordable modern 

energy. Many live off the electricity grid in the darkness of energy poverty. 

• A billion of our global neighbors do not have access to safe drinking water. 

• Every day, 200,000 people move to big cities, many of which already are overwhelmed by the demand for housing and other essentials of dignified life. 

Our executive, chemistry, engineering and marketing teams see opportunities in 

these megatrends to do good while doing well by exploring what we think is the unlimited potential for solutions hidden in the silicon atom—all the while creating jobs 

for Americans and making a profit for our owners. 

So, what are these megatrends to which I have been referring? At Dow Corning 

we are focusing on the following: 

• First, energy scarcity and the need for clean energy solutions. Our materials enable solar and wind energy generation; energy efficiency and energy storage. 

• Secondly, the rapid urbanization of the developing world. Our green building 

and energy efficiency technologies are complemented by high-performance building materials—that, for example, make glass more resistant to fire, vibration 

and impact—and new-technology insulations that—by squeezing more protection from the elements into fewer inches—allow architects to add square feet 

to urban dwellings. 

• And, third, aging populations and the corresponding challenges related to the 

provision of health care. We are innovating our silicones, for example, to enable 

improvements in wound care and transdermal and topical treatments to enhance patient comfort and care. 

I’m sure other companies are exploring these and other megatrends through the 

lenses of their competencies and business plans. And I am also sure that companies 

that play into—and not resist—these trends will be the jobs engines of the coming 

decades. If the United States is to maintain its global economic leadership it must 

strive to be home to these kinds of companies and industries . . . these innovators. 

To be sure, that means having a competitive corporate tax structure and regulatory 

regime, as well as incentives for investment in innovation and growth. But, it also 

10 

means having smart, forward-looking policies that invite investment from manufacturers poised to meet changing global demand. 

Take, for example, the challenge of energy scarcity and the unabated global demand for renewable energy. 

About 2 years ago, Dow Corning proposed a four-point plan for accelerating America’s adoption of solar energy—with a key plank of that program dedicated to the 

need for tax incentives to stimulate manufacturing investment and create muchneeded jobs in recession-ravaged places like our home state of Michigan. 

Dow Corning’s plan focuses on solar power because, as one of the world’s largest 

producers of the base material needed to convert the sun’s energy into clean and 

sustainable electricity, that is among the technologies we know best. 

But our suggestions, nevertheless, also address many of the manufacturing, legislative, regulatory and work force-related factors that influence America’s ability to 

develop a thriving advanced manufacturing base. 

First, we are encouraging Congress and the Obama Administration to enact Federal policies and regulations that will increase domestic consumer demand for renewable energy, energy efficiency products and the manufacturing of those products 

here at home. Not surprisingly, the solar supply chain wants to be where the market is. So, growing domestic demand for solar is key to realizing the enormous jobs 

potential that the growing market for solar promises. 

Other nations have adopted aggressive policies to support the growth of their renewable-energy marketplaces, and, not coincidentally, during the past 12 years, the 

U.S. global market share of solar manufacturing has dropped from 45 percent of the 

total to only 7 percent. 

Meanwhile, other nations are aggressively courting solar manufacturers. With 

China, Germany, India, Malaysia, and the Philippines luring American manufacturers with roughly 40 percent manufacturing tax credits and high demand markets, 

the U.S. risks losing this growth industry unless it puts into place strategic, shortterm, demand-side incentives. But it is also time to uncap the 48C advanced manufacturing tax credit to stimulate immediate manufacturing investments here in the 

U.S. 

Second, we are advocating increased Federal funding for research and development—as the government does for many other industries—to accelerate technological innovation and advanced manufacturing capabilities. Making the R&D tax 

credit permanent is critical. 

Third, we support training and education to develop a ‘‘green collar’’ work force. 

We won’t have exports without manufacturing. And we won’t have manufacturing 

without a ready workforce. Other nations have undertaken massive expansions of 

educational assets in recent years—some nearly tripling their share of GDP devoted 

to it. These countries are ramping up the construction of colleges and increasing the 

number of college students as much as five fold to accelerate their manufacturing 

development. 

We applaud the efforts of the Science, Technology, Engineering and Mathematics 

Education Coalition. It is doing the important work of supporting training for teachers and students through activities of the U.S. Department of Education, the National Science Foundation and other agencies. Rigorous education is essential to developing an American workforce that can compete in the global marketplace. 

Fourth, Dow Corning urges our government—at the Federal, state and local levels—to ‘‘lead by example.’’ If designers of new government facilities incorporated renewable-power options, the change in the landscape would remind our citizens in 

big cities and small towns that solar energy has arrived in our lives. 

My company is doing its part to encourage a climate of collaboration, creativity 

and commitment to greater energy security. We know it is fundamental to protecting our Nation’s competitiveness in the decades to come. Generations of future 

Americans deserve nothing less than our best effort. We hope Congress will continue 

to do its part by enacting policies and incentives to encourage private sector investment. 

At Dow Corning, we look forward to working with each of you as we enter a marketplace that is full of incredible opportunities for American manufacturing. 

Business and government must work together to lead the economic transformation 

to a growing and exporting manufacturing base. So, let’s play to our strengths. For 

U.S. manufacturers, which channel the human capital and R&D that emanates from 

our world-class universities, that means opening markets that are currently closed 

to U.S. goods and services. 

Emerging economies offer unbridled opportunity to those companies that have access to those markets. 

I take this position not only as the head of an American company selling to the 

world but also as a member of the President’s Export Council. The 20 private sector 

11 

members of the Council, whose companies represent a large swath of the American 

manufacturing and service sectors, have urged President Obama to prepare and 

submit to Congress as soon as possible the pending free trade agreements. 

Leaders on both sides of the aisle know that free trade can play a major role in 

our Nation’s economic recovery and the revitalization of our manufacturing sector. 

Finally, I applaud President Obama for making the case for trade in his State of 

the Union address when he announced his National Export Initiative, which seeks 

to double U.S. exports within 5 years to support an additional 2 million American 

jobs. 

Innovative, flexible, strong, courageous and collaborative public-private partnerships can lead to a recovery that creates engaging, well paying, worthwhile work 

for Americans . . . as well as exports that serve the increasing demand of our global 

neighbors for products that enhance their quality of life. 

I’m confident that if we were to share these ideas with the people in the coffee 

shops and diners of your communities, they would agree. 

Thank you for your kind attention. 

The CHAIRMAN. Thank you very much, Dr. Burns. 

I should point out that any member’s statement is a part of the 

record. All of your statements are automatically a part of the 

record. 

So all kinds of questions, Dr. Burns, I have for you. 

Leo Gerard. 

STATEMENT OF LEO W. GERARD, INTERNATIONAL PRESIDENT, UNITED STEEL, PAPER AND FORESTRY, RUBBER, 

MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND 

SERVICE WORKERS INTERNATIONAL UNION (USW), AFL–CIO 

Mr. GERARD. Thank you very much, Chairman Rockefeller and 

members of the Committee. 

I’m here on behalf of the 850,000 members of the steelworkers 

union, but also on behalf of the 121⁄2 million members of the AFL– 

CIO, and we want to tell you that American manufacturing is currently in dire circumstances, and we believe its future is in jeopardy, as is the economic and national security of the United States 

at risk. 

America’s economic recovery remains fragile, as you pointed out 

earlier. Unemployment, underemployment, wage stagnation, foreclosures, they all paint a grim picture of a people and an economy 

that’s still in terrible, terrible straits and is struggling to recover. 

There’s too many, and there have been too many shuttered factories. Forty-four thousand of those factories closed during the first 

8 years of this decade. Close to 3,000 more factories closed as a result of the Wall Street economic meltdown. 

Now, less than 10 percent of America’s GDP comes from manufacturing, where just 20-something years ago, close to 23 percent 

of America’s GDP came from manufacturing. 

And despite, as you pointed out, Mr. Chairman, the small uptick 

in manufacturing, employment and production that occurs against 

the backdrop of a long-term decline and devastation, let me say to 

you and to members of the Committee that real wealth is not created by creating collateral debt offerings and phony financial bubbles. Real wealth is created when we take raw material, ingenuity, 

engineering, energy and people’s creativity and add value to that, 

and that’s what manufacturing does. 

The details of the backdrop are outlined in the AFL–CIO’s industrial council report, ‘‘Manufacturing Insecurity: America’s Manufacturing Crisis and the Erosion of the U.S. Defense Industrial Base.’’ 

12 

And the report has been submitted as support for this testimony. 

[This report can be found at http://www.aflcio.org/Issues/Jobsand-Economy/Manufacturing/Manufacturing-and-U.S.-Security/ 

Manufacturing-Insecurity-America-s-Manufacturing-Crisis-and-theErosion-of-the-U.S.-Defense-Industrial-Base.] 

My written testimony makes four key points, Mr. Chairman: 

The nation’s technical, innovative and industrial capacities are 

essential to our economic and national security, as is the rebuilding 

of our nation’s infrastructure. 

The health of our manufacturing base and our defense industrial 

base are inextricably linked, and they are both currently in critical 

condition. 

Our trade, tax, investment, procurement policies, the globalization of production and the failure to have a national manufacturing 

strategy helped create this situation. 

Probably no one expects me to quote one of America’s great manufacturers, one of America’s great capitalist families, but Bill Ford, 

the chairman of Ford Motor Company, said, on more than one occasion, not having a plan is not a plan. And I’m happy to quote him, 

and I agree with him. 

It doesn’t have to be this way. I think that we must act now. The 

Senate, the House of Representatives and the administration need 

to act now with a strategic plan and employment-linked policies, 

investments and incentives to start revitalizing America’s industrial base. 

Mr. Chairman and members of the Committee, I could spend my 

time today on an ongoing basis describing problem after problem 

after problem, but I believe all of you understand it. So let me further identify what I think needs to be done to address it. 

Before I do this I want to quote specific policy approaches. Let 

me make two overriding points. I believe that there is a fundamental and growing gap between the interests of multinational 

companies and Wall Street and the national interest. 

Our companies in the financial sector are simply interested, most 

of the time, for most of them, in short-term profits wherever and 

however they may be achieved. Their interests are not naturally in 

the creation of economic growth and opportunity here at home, and 

we have to recognize that and deal with it. 

Americans are interested in where we stand in the world and 

where their kids’ opportunities for good jobs will come from. They 

know that our leadership on human rights, democracy, freedom 

and internationally recognized workers rights depends on our economic and military strength. 

They aren’t interested in being number two or number three, and 

we shouldn’t accept decline as being inevitable, although we are 

number one in accumulated trade deficits. 

For those that are the die-hard free traders, let me give you two 

quick facts. Since NAFTA, America has accumulated a $7 trillion, 

ongoing trade deficit, year over year over year. 

Since the passage of PNTR with China, we’ve accumulated a $1.7 

trillion ongoing trade deficit with China. That is nothing more than 

a wealth transfer from America to China. 

So it’s important that we get our trade house in order and enforce our laws, aggressively enforce our trade laws. We need to adVerDate Nov 24 2008 13:26 Mar 12, 2012 Jkt 073231 PO 00000 Frm 00016 Fmt 6633 Sfmt 6601 S:\GPO\DOCS\73231.TXT SCOM1 PsN: JACKIE
13 

dress China’s trade violations and establish our own strategic priorities and policies. 

We should view success not as the number of trade agreements 

we can pass or that are signed, but by the results they achieve in 

creating jobs. Our trade agreements should be designed to lower 

our massive trade deficit, not to add to it. 

We also need to empower workers to share in the fruits of their 

labor, enable them to enter the middle class with respect and compensation for their efforts. 

We need to invest in infrastructure, and, Mr. Chairman, I want 

to compliment you for your advancement of an infrastructure bill. 

The nation can no longer live on a legacy that we need—and we 

need the jobs now. We need to start investing trillions of dollars 

over time, the 21st century infrastructure, from roads to rail, from 

clean technology and to the rest of our infrastructure. 

Let me give you a fact that you may already know. More than 

50 percent of the schools in the United States are more than 60 

years old. If we care about our kids, one of the things we could do 

is start helping our cities and municipalities to modernize our 

schools. 

Buy America laws ensure that we actually make the things we 

are building and installing. An improved America is the legacy we 

should leave our children and grandchildren, not a decrepit and 

falling infrastructure. 

Taxes that support domestic manufacturing. We should eliminate 

tax incentives and loopholes that encourage financial speculation, 

rather than investment, outsourcing and off-shoring production, 

and we should enact tax incentives for companies that produce domestically. 

Innovation for American manufacturing. We must protect our nation’s innovative leadership. Doing so requires that we maintain 

strong intellectual property protections here and abroad. 

We must ensure that increased R&D investment results in American jobs in American workplaces. 

We need to train and educate America’s workers. Revitalizing 

manufacturers requires workers equipped to meet the skills and 

the needs of this century and the next. 

Congress must increase access to training funds for people unemployed as well as those seeking to enhance their skills. Ultimately, 

a high skills workforce must be one whose rights on the job and 

ability to speak are protected and thus made real through strong 

labor laws and strong unions. 

And we should make sure that we revitalize and strengthen TAA 

for those workers that have unfortunately lost their jobs through 

bad trade deals through no fault of their own. 

Our nation’s future success, the reclamation of the American 

dream, depends on the revitalizing of our manufacturing sector. 

And the steelworkers union and the AFL–CIO stand ready to work 

with Congress in the interests of the future. 

And let me make one other point, Mr. Chairman. There are those 

that would want to try to blame the labor movement, as I heard 

at the start of this, and let me put something on the record. Consider Germany, which has high rates of unionization, an hourly 

compensation in manufacturing that averages $48 per hour. But 

14 

* [This report can be found at http://www.aflcio.org/Issues/Jobs-and-Economy/Manufacturing/Manufacturing-and-U.S.-Security/Manufacturing-Insecurity-America-s-ManufacturingCrisis-and-the-Erosion-of-the-U.S.-Defense-Industrial-Base.] 

Germany has more—a bigger percentage of its GDP in manufacturing that we ever had in our lifetime. Germany has a world lead 

in exports. It has a balanced trade agenda with China, so that let 

me make it clear: Of the more than 5.5 million jobs that were lost 

during the first 8 years of this decade, those jobs were lost in every 

sector of the economy, in every region of the country, including the 

south, including Mississippi, Louisiana and Texas, in the East and 

the West and the North in almost every sector. 

But one of the most important facts is more jobs were lost in 

non-union facilities than union facilities. 

Well, thank you very much for the opportunity to testify, Mr. 

Chairman. 

[The prepared statement of Mr. Gerard follows:] 

PREPARED STATEMENT OF LEO W. GERARD, INTERNATIONAL PRESIDENT, 

UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY, ALLIED

INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION (USW), AFL–CIO 

Thank you, Chairman Rockefeller, Ranking Member Hutchison and members of 

the Committee. I welcome the opportunity to be here today to testify on behalf of 

both my own union, the United Steel, Paper and Forestry, Rubber, Manufacturing, 

Energy, Allied Industrial and Service Workers International Union—the United 

Steelworkers (USW) and the entire AFL–CIO whose affiliate unions represent some 

twelve and a half million working men and women across the United States. 

The focus of today’s hearing is exactly what this Nation needs to do but the truth 

is American manufacturing is in dire circumstances and its future is in jeopardy. 

The American economy remains fragile and uncertainty reigns. Unemployment, 

underemployment, wage stagnation, foreclosures all paint a grim picture of an economy still struggling to recover. For American manufacturing communities, this recession has been just one more big wave in a decade of economic tsunamis that have 

devastated workers, employers and communities. 

We believe that the decade long decline of the American manufacturing base is 

a crisis that has undermined our economic security and is a direct threat to our national security. The question before us is, what has happened to that prosperity and 

security and what must we do to strengthen the Nation’s industrial base? 

The erosion of America’s manufacturing base is a clear and present danger. The 

details of this threat are in a report commissioned by the AFL-CIO Industrial Union 

Council, entitled Manufacturing Insecurity: America’s Manufacturing Crisis and the 

Erosion of the U.S. Defense Industrial Base.* This report has been submitted in support of this testimony, and it documents these concerns in detail. 

My testimony makes four key points: 

(1) The nation’s technical, innovative and industrial capacities are essential to 

our economic and national security. 

(2) The health of our manufacturing base and our defense industrial base are 

inextricably linked. They are in critical condition. 

(3) Our trade, tax, investment, procurement policies, the globalization of production and the failure to have a national manufacturing strategy helped create 

this situation. 

(4) It doesn’t have to be this way. We must act now with strategic and employment linked policies, investments and incentives to revitalize our manufacturing base and ensure our national security. 

The Current Situation 

It is dangerous to assume that the 250,000 increase in manufacturing employment over the past year, the first increase since 1997, signals a major recovery. Yes, 

it comes as welcome news, but occurs against the backdrop of how far we have fallen. More telling is new Department of Commerce data that shows companies cut 

their workforces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million. The technical and industrial capacity offshored 

15 

quickly became imported goods and a major contributor to our crushing trade deficits. 

Between 1998 and 2010 we lost approximately six million manufacturing jobs 

with over two million of these occurring from 2007–2009. At the same time some 

57,000 manufacturing facilities closed. The loss of these skilled workers, engineers, 

designers, scientists and more has eroded the Nation’s working middle class and 

dangerously undermined our technical, industrial and innovative capacity. This nation will not be able to double net exports, reduce our trade deficits substantially 

nor meet our economic and security needs unless we produce more of what we consume. Our nation’s future success, the reclamation of the American Dream, in fact, 

depends on revitalizing our manufacturing sector. 

Manufacturing Insecurity 

It is a myth to think that the manufacturing base and the defense industrial base 

are independent of one another. A National Research Council study has noted, the 

boundaries between the defense industrial base—the set of industrial and military 

facilities devoted to the production of defense-related products—and commercial industry has become blurred. Workers see this on a daily basis as they produce commercial goods and technology that are used or modified for defense purposes. 

The Manufacturing Insecurity report we have submitted by Dr. Joel Yudkin documents the dangers the Nation faces from this erosion. There has been a continuous 

weakening in manufacturing value-added output, acceleration in manufacturing’s 

steady decline as a share of U.S. GDP, stagnant and even negative growth—the first 

time in seven decades—in industrial capacity, and the substantial drop in capacity 

utilization since 2000. In addition there is the shocking growth in trade deficits and 

import penetration that have led to the loss of millions of U.S. jobs. Increasingly, 

our Nation’s corporations are picking up stake and moving their production overseas, scouring the globe for the lowest cost location to produce—in the short-term— 

no matter what the long-term cost to our economy and our people. Congress’ role 

is to decide what’s best for our people, not the corporations whose only allegiance 

is to short-term profits and rising compensation for their management, directors and 

returns to their shareholders. 

Another new report by the Information Technology and Innovation Foundation, 

The Case for a National Manufacturing Strategy for the United States, offers startling evidence that the rosy published industrial output and productivity figures are 

grossly overstated. The truth is far more troubling. From 2000 to 2008 (pre-Great 

Recession), fifteen of nineteen manufacturing sectors accounting for 72 percent of 

manufacturing output saw absolute declines. Dr. Susan Housman of the Upjohn Institute estimates that manufacturing productivity figures for the past decade have 

been overstated by 20–50 percent because they failed to account for imported elements. Bad data has been used to gloss over the reality of what has occurred in 

critical industries. The data, however, can not mask the pain that has been, and 

continues to be felt, all across this Nation by unemployed workers and those that 

live in hollowed out manufacturing communities. 

Losing Critical Industries 

America’s manufacturing sector continues be the largest, most productive and 

technologically advanced in the world. But its lead in a number of industries vanished years ago, and many of its remaining areas of strength are facing powerful 

challenges. 

The pattern of decline in key sectors such as semiconductors, printed circuit 

boards, machine tools, advanced materials, and aerospace is apparent. It can be 

seen in defense critical technologies where domestic sourcing is endangered in products ranging from propellant chemicals to space qualified electronics, power sources 

for space and military applications (batteries and photovoltaics), specialty metals, 

hard disk drives, and flat panel displays (LCDs), to name but a few. 

It can be found in critical materials like rare earth metals and magnets where 

the Chinese purchased U.S. manufacturing facilities and closed them, such as at 

Magnaquench in 2004). China now holds a monopoly on the rare-earth minerals 

used in the manufacturing of missile magnets, computers, wind turbines, lithium 

ion batteries and hybrid engines. In fact, advanced manufacturing is dependent 

upon rare earths. 

Another critical indicator of the erosion of U.S. manufacturing competitiveness is 

the Import Penetration Rate (IPR), the share of the U.S. market held by imports. 

According to the 2010 U.S. Business and Industry Council (USBIC) study of Import 

Penetration Rate (IPR)—in 2008, 69 of the 114 capital and technology intensive industries examined lost share of their home U.S. market to imports, and their aggregate import penetration rate increased from 34.30 percent to 36.23 percent. 

16 

The broad domestic and global economic trends and import penetration rates reflect a sustained and dangerous erosion across nearly all manufacturing industries, 

including many that supply products, components, and technologies that the Pentagon considers important to defense. The capacities required for national security 

needs rest upon a defense industrial base embedded in, the Nation’s overall domestic manufacturing base. 

As the commercial industrial base globalizes, the loss of domestic production facilities can also lead to the loss of innovation capabilities. 

Specifically, the acceleration of manufacturing offshore is associated with the following trends: 

• Weakening innovation capabilities of domestic industrial sectors; 

• The transfer—deliberate and unwitting—of cutting-edge technologies and knowhow to economic rivals and potential military adversaries; and 

• Foreign countries establishing industrial and technology policies aimed at enhancing their technological capabilities relative to America’s. 

Tomorrow’s Industries 

The United States has long been—and remains—the world leader in most materials-related technologies, but during the first half of the 2000s decade, the National 

Research Council (NRC) warned that this leadership was eroding. This is reflected 

in the doubling of the U.S. advanced materials industry’s global trade deficits between 2002–2006, according to the U.S. Census Bureau’s Advanced Technology 

Products (ATP) trade data, as foreign competitors made inroads into U.S. markets. 

The NRC found that: 

• Domestic materials production is disappearing and moving offshore. Materials 

subsectors have consolidated significantly since 2000. Plant capacity and employment both have declined, and production of critical materials, such as specialty steels, advanced ceramics, and magnesium, has been moving offshore. 

• Materials R&D and innovation is following production offshore. The migration 

of materials producers and users has harmed domestic advanced materials R&D 

by inducing many U.S. companies to shift materials R&D overseas. It has weakened U.S. R&D capabilities in several materials technologies vital to national 

security, including night vision systems, lanthanides (rare earth elements), and 

specialty metals. 

• The margin of U.S. leadership in advanced materials R&D is eroding and increasingly challenged by other nations. The largest U.S. advanced materials 

trade deficit is with Japan, whose imports into the United States grew steadily 

over the decade, more than doubling in the years between 2002–2008 ($417 million to $948 million). However, China is also aggressively seeking to develop its 

own technological and production capabilities in this area. Our escalating advanced technology deficit with China and their recent actions to control rare 

earth exports reflect their strategy. 

The net result is the erosion of U.S. leadership in advanced materials R&D. The 

following illustrations from the NRC reports for the National Academy of Science 

highlight this trend: 

• Metals. Research into the production, processing, and development of metallic 

materials in the United States has been declining since 1998. 

• Superalloys. Superalloy R&D has declined significantly over the past decade. 

Attracted by lower costs, superalloy manufacturers increasingly are locating 

their production offshore. 

• Composites. Composites are a critical technology used in major defense systems. 

Once unchallenged, other countries in several areas have supplanted U.S. leadership in composites. U.S. defense and commercial programs—the Joint Strike 

Fighter and Boeing’s 787 Dreamliner—are outsourcing production and supporting R&D in composites overseas. 

• Electronic and Opto-Photonic Materials. These are critical technologies for 

maintaining leadership in semiconductors. This industry and its material supply chain are moving toward a global processing and manufacturing infrastructure that is taking some of its R&D capacity with it. 

Building Other Nations’ Research & Development 

The flip side of the migration of U.S. innovation capabilities offshore is the buildup of other countries’ R&D capacity. The strengthening of foreign technology capability does not always result from market forces and commerce-facilitating progress 

17 

in communications and transportation. Instead, this development often results from 

multinational companies taking one of three tacks: 

— Actively exploiting the business environments created by U.S. trade policy—for 

which they have lobbied hard—that encourage them to supply the U.S. market 

even for highly sophisticated manufacturers from low-cost foreign facilities; 

— Responding to foreign government carrots and sticks; or 

— Formulating various investment strategies synthesizing these two approaches. 

The carrot-and-stick approach by foreign governments is a direct reflection of a 

broader strategic and tactical approach to capture markets and technological dominance in specific sectors. The recent announcements by Intel, Applied Materials and 

other advance technology firms of multibillion dollar investments in research and 

production facilities in China show how aggressive and successful the Chinese government has become at this game. 

Trading Away Jobs 

Our trade deficit, especially with China, is symptomatic of the challenges we face 

in maintaining our industrial base. Although the overall trade deficit is down by a 

quarter from the record levels of 2008, the 2010 U.S. goods trade deficit with China 

broke all previous records. And, the reduction in our trade deficit largely resulted 

from the economic crisis our country faced, not a long-term change in the trend. 

Through the decade our goods trade deficit with China soared, tripling since WTO accession—from $84 billion in 2001 to a record $273 billion in 2010. China’s share 

of the U.S. trade deficit in manufactured goods rose continually from 28.5 percent 

in 2002 to 75.2 percent in 2009. In 2010, we ran a trade deficit with China in advanced technology products (ATP) of $94 billion, while with the rest of the world; 

we ran an ATP surplus of $10 billion. The U.S. trade imbalance with China in ATP 

should be a clear warning signal that our overall trade relationship is severely imbalanced in ways that are detrimental to our economic potential and future. 

U.S. foreign direct investment (FDI) in China has jumped, especially in manufacturing. FDI in China is all about new production and job creation, unlike in the 

United States where new FDI tends to signal a change of ownership, not new production. The Economic Policy Institute has estimated that the growth in the U.S. 

trade deficit with China from 2001 to 2008 has displaced about 2.4 million American 

jobs. 

Perhaps even more disturbing than the aggregate growth in the U.S. trade imbalance with China is the composition of our imports and exports. Our top fifteen exports to China (by 4-digit HTS code) include five categories of waste products (ferrous scrap, paper scrap, copper scrap, aluminum scrap, and offal); two categories of 

raw materials (soy and polymers), and at least three categories of parts. In contrast, 

all of China’s top fifteen exports to the United States are manufactured products 

or parts. 

More than 50 percent of China’s exports to the U.S. come from foreign-invested 

enterprises. Many U.S. corporations supported Permanent Normal Trade Relations 

claiming that they wanted to serve China’s vast market. Some may have had honest 

intentions. But the reality is, far too many of our companies have offshored their 

production using China simply as an export platform replacing U.S. jobs and production. 

This is the result of concerted strategic interventions, starting with currency 

intervention, by the Chinese government over many years—and inaction by our 

own. With an explicit export strategy targeting key industries, sectors, and technologies, China has captured a growing share of U.S. and world markets. It has 

used a wide array of unfair trade practices, including currency manipulation, export 

subsidies, widespread suppression of worker rights and wages, and tariff and nontariff barriers to exports, to support this strategy. 

The financial crisis has proved to be another opportunity for the Chinese government. By controlling access to its market in crucial sectors with indigenous innovation, the Chinese government buys time to build dominant industries and technology powerhouses that will have a clear competitive advantage over their lagging 

counterparts in other countries. This is already underway in the clean energy sector, 

where these trade-distorting polices work in concert to ensure market control. The 

301 clean energy manufacturing trade case filed by the United Steelworkers union 

and the currency legislation passed by the House last fall are aimed at stemming 

these practices. 

It always baffles me why we don’t believe the Chinese when they say they want 

to dominate certain industries, why we don’t believe what they publicly announce 

as part of their ‘‘five-year plans’’. They outline to the world what their intentions 

are, but too many of our policymakers simply don’t want to believe them. Our nation 

18 

is being victimized by free trade ideologues and policymakers who want to discuss 

theory, rather than recognize reality. 

Innovation Is Key To Our Future 

President Obama is right to focus on innovation as key to our economic future. 

But, innovation does not mean changing course, as America has been, and continues 

to be a leading innovator. And, no sector is more important to leading innovation 

than manufacturing, which generates more than 60 percent of all patents. 

Many people continue to have an outdated image of manufacturing as companies 

with belching smokestacks and rusted buildings. Today, at a modern steel making 

facility, you will find most people working in air conditioned rooms at computer keyboards. Auto factories are replete with robot welders and workers controlling activities at ergonomic workstations. Fiber optics, carbon fiber composite materials and 

countless other advanced materials are produced by our people. 

But, these operations are at risk. The policies of our competitors, and some failures in our own system, have resulted in more and more research and development 

being moved overseas. Our competitors understand that R&D and manufacturing 

are inextricably linked—engineers, scientists and other innovators want to be close 

to the action, so that they can test their creativity and ensure its success. 

Our first priority must be to make sure that our intellectual property protection 

regime maximizes our ability to innovate, produce and create jobs for the future 

here at home. Congress is hard at work on patent reform legislation that, hopefully, 

will achieve these goals. For the last several years, organized labor has been an active participant in the legislative process and is optimistic that the legislation that 

passed the Senate, and is now working its way through the House will achieve those 

goals. Our ultimate desire is to ensure that companies that innovate can reap the 

rewards of their efforts and deploy the fruits of their innovation here at home in 

American plants and by creating American jobs. Strong intellectual property protection is the foundation upon which we can build a 21st century manufacturing base. 

The linkage between innovation, research and development, and production is 

clear and powerful. Engineers, scientists and innovators want to be close to the action, to deploy their creativity and refine its application. Investing in research and 

development is critical and, as noted, once created, it must have a robust legal 

framework of legal protections. 

But, we must do more. An activist approach is necessary. Other nations recognize 

the importance of investments in this area: we need to do the same. It’s vital not 

only to the quest to develop the products of tomorrow but, to ensure that we produce 

them as well with the skills and hard work of our people. China, is actively seeking 

to develop its own innovative capacity—either by subsidizing its own indigenous development, or by incenting and coercing foreign companies to create R&D facilities 

on its soil. Hundreds of millions of dollars of investments in new R&D facilities are 

occurring by U.S. multinational companies in China. With it, today, and in the future, will go the manufacturing facilities to produce the products of those investments. 

We need to permanently extend the R&D tax credit, but need to ensure that the 

innovation is applied here at home to reinvigorate our manufacturing sector. We 

shouldn’t be subsidizing R&D expenditures by our companies only to find that their 

innovations are deployed offshore. Other nations recognize the value of investments 

in this area, and the need to spur domestic opportunity . . . so should we. 

Undervalued Currency Subsidizes Exports and Investment 

Through systematic and one-sided intervention in currency markets, the Chinese 

government has kept the renminbi approximately 40 percent undervalued with respect to the U.S. dollar for many years in support of its export strategy. The undervalued Chinese currency serves the government’s strategy of building powerful export markets rather than boosting its own domestic consumer market. Undervaluation takes market share and jobs from the United States by penalizing our exports. 

It subsidizes imports into this country while encouraging outward investments into 

the Chinese economy. 

This is not free trade, nor is it the way the major economies of the world have 

agreed to behave. And the Chinese government’s actions influence the monetary 

policies of other countries compounding our trade problems. The U.S. Treasury biannual currency reports acknowledge the fact that other nations mirror the Chinese 

government’s behavior. Indeed, South Korea has been manipulating it’s currency— 

the won—yet we have failed to respond and the soon-to-be-considered Free Trade 

Agreement with that country failed to include provisions to address this critical 

issue. 

19 

While addressing the Chinese government’s currency manipulation is one of the 

highest priorities for workers and employers in the manufacturing sector, it is time 

to recognize the broader impact of China’s practices. Lost manufacturing jobs lead 

to lost tax revenue and higher budget deficits that limit our ability to invest in our 

future. This puts substantial pressure on Federal, state and local budgets, resulting 

in layoffs of teachers, police and other emergency responders. And it has undermined our future by undercutting the array of career choices and educational opportunities, especially in science, engineering and the technical occupations needed for 

a vibrant innovative manufacturing economy. 

Taking action to end currency manipulation will generate jobs and investment in 

the U.S. economy. Nobel laureate Paul Krugman estimates an end to the manipulation would produce a net export gain to the United States, Europe and Japan 

amounting to about 1.5 percent of GDP, increasing growth in the U.S. economy by 

about $220 billion. The Peterson Institute and the Economic Policy Institute agree 

that a 25 percent to 40 percent revaluation in the renminbi would reduce the U.S. 

trade deficit between $100 billion and $150 billion per year, adding between 750,000 

and 1 million jobs to American payrolls. 

It is time for Congress and the Administration to act decisively to end currency 

manipulation and other illegal trade practices. 

Strategy Matters 

The U.S. needs to recognize that all our major global competitors have national 

manufacturing strategies. Advanced developing nations like China, India and Brazil 

all have one. The leading developed nations like Germany, Japan and the Scandinavian nations all have them. We do not and it is killing us. 

The differences in approach are dramatic. Our competitors consciously seek manufacturing as a critical jobs and prosperity strategy for their nations. Our blind free 

market approach theorizes seeking cheaper prices for consumers is better than good 

jobs and income. They target industries and technologies seeking to generate competencies and opportunities. We do not. Economic success is not measured simply 

by the price of a flat-screen TV, but how well one can feed, clothe and house their 

families, how they can have access to health care and education, how they can look 

forward to a secure and dignified retirement. On that basis, we are falling further 

and further behind. 

Other nations align their tax policies and government investments to achieve 

their goals and objectives. Out tax polices encourage offshoring and we quibble over 

Buy American policies that are less broad than our competitors own domestic procurement laws. They invest in training and education linked to their employment 

and economic strategies. We invest in training and education without clear employment strategies or goals and, unfortunately, as an after-the-fact sop to those most 

injured by free trade agreements. 

Last week, one news organization highlighted the potential for Congressional consideration of corporate tax reform legislation. In the article, it identified that the 

Administration was looking to reduce tax rates, and would make up the revenue lost 

from rate reductions by ‘‘closing loopholes and slicing exemptions.’’ It only identified 

two examples: the tax deduction for domestic manufacturing and accelerated depreciation for capital equipment. Those are mechanisms vital to revitalizing our declining manufacturing base. Why on earth would we want to attack those key economic 

engines? Not one of our competitors would take such a short-sighted and self-destructive approach. If those changes take effect, our competitors will be laughing 

themselves silly as they skip to the bank. 

Some, like the Chinese government, engage in illegal activities in support of their 

manufacturing strategy such as currency manipulation, illegal subsidies, repression 

of workers’ rights, weak environmental and wage and hour laws, intellectual property theft and more. These actions should be fought aggressively but for too many 

years we have been lax in the enforcement of our own trade laws. And, we find the 

same U.S. corporations and financial institutions that take advantage of the situation in countries like China to produce goods for export to the U.S. are the same 

ones fighting trade enforcement and changes to the tax laws. 

There is another way. Other nations clearly recognize their national interest. It 

is time to recognize ours. America has an economic and national security interest 

in a vibrant manufacturing base. It is time to do something about it. 

A Strategy for the Future 

The USW and the AFL–CIO recognize the critical steps government has taken to 

stabilize the economy by helping ensure the survival of a domestic auto industry, 

investing in needed infrastructure and a diverse efficient clean energy economy, seVerDate Nov 24 2008 13:26 Mar 12, 2012 Jkt 073231 PO 00000 Frm 00023 Fmt 6633 Sfmt 6621 S:\GPO\DOCS\73231.TXT SCOM1 PsN: JACKIE
20 

curing jobs from those investments with Buy America requirements, and putting 

critical financial reforms in place. 

This work is far from finished. But, today we see Congress mired in a specious 

debate that we can somehow downsize our way to success. The economy doesn’t 

work that way. 

The Congress needs to complete efforts begun last year when the House passed 

a series of bipartisan bills that included a National Manufacturing Strategy, currency, rare earth and other manufacturing legislation. This year the Administration 

has proposed needed new investments in small business, research and development, 

clean energy manufacturing, and infrastructure. 

Democrats in the House of Representatives recently announced their Make It in 

America Agenda that identifies steps that should be taken to revitalize manufacturing and job creation here at home. It’s an important foundation both parties embraced last year. It should not be a partisan issue in this Congress and we hope 

that Republicans will embrace the effort and join in promoting policies that will enhance national and economic security. 

All of these provide a start but much more needs to be done at scale. The policies, 

investments and incentives we enact must be strategic and employment linked. Essential to a comprehensive program to restore domestic manufacturing are the following elements: 

The USW and the AFL–CIO call on our government to aggressively address the 

Chinese government’s trade violations, as well as to establish our own strategic priorities and policies. We believe a healthy and robust manufacturing sector is central 

to a sustained economic recovery and to our national security. 

The following elements are essential to a comprehensive program, a national manufacturing strategy, to restore domestic manufacturing: 

• Get our trade house in order and enforce our laws: Aggressively enforce our 

trade laws. We need to address China’s trade violations and establish our own 

strategic priorities and policies. We should view success not as the number of 

trade agreements that are signed, but by the results they achieve. Our trade 

agreements should be designed to empower workers to share in the fruits of 

their labor and enable them to enter the middle class with respect and just compensation for their efforts. 

• A re-commitment to investment in infrastructure: America’s infrastructure 

needs—energy, roads, transit, bridges, rail, water, etc.—are huge. We have a 

$2.2 trillion infrastructure deficit, according to the American Society of Civil 

Engineers. Not only will spending here employ people right away, it will lay the 

foundation for economic growth in the future. Funding for infrastructure must 

be built on a foundation that aggressively promotes Buy American policies. 

Americans want to know that their tax dollars are being used to create American jobs. And there is no conflict between more spending now and efforts to 

address fiscal imbalances down the road. Indeed, an improved America is the 

legacy we should leave to our children and grandchildren. 

• A tax structure that encourages manufacturing investment: Eliminate tax incentives and loopholes that encourage financial speculation rather than investment, outsourcing and off shoring production, and enact tax incentives for companies that produce domestically. 

• Investment in a 21st Century Energy Infrastructure: Enact measures to encourage the deployment of renewable energy, advanced automotive technology and 

other clean energy technologies. This can be accomplished by expanding funding 

for 48(c), industrial efficiency projects, and other policies to encourage development of renewable sources of electricity and by providing higher loan authority 

and additional funding for section 136, the Advanced Technology Vehicles Manufacturing Incentive Program. These efforts must be coupled with expanded utilization of domestic supply chains. Clean and green jobs must become a reality: 

America must not cede leadership of this industry to other nations. We must 

invest in these 21st century infrastructure technologies on a similar scale to our 

investment in replacing the failing infrastructure of the last century. And, 

again, investments in this area must support and promote domestic job creation 

and supply chains. 

• Innovation for American Manufacturing: The United States continues to be the 

world’s engine of innovation, but that lead is declining. There is a direct correlation between R&D and production and we must protect our Nation’s innovative 

leadership. Doing so requires that we maintain strong intellectual property protections to ensure that companies have the incentive to make investments in 

plant and equipment here at home. We must also increase efforts to fight the 

21 

intellectual property right violations of competitors that seek to profit from the 

creativity of our people. Increased support for research and development in the 

United States, coupled with support for testing and deployment of those new 

technologies in our factories, will ensure that our manufacturing capabilities expand. R&D investments financed with public dollars (grants, tax credits, etc.) 

must be accompanied by employment accountability requirements. 

• Workforce development policies: America continues to have the best and most innovative workers To stay ahead of the competition, however, we must constantly upgrade our skills and training Revitalizing our manufacturing sector 

requires that we make investments in our people to ensure they are equipped 

to meet the needs of industry Now is the time to renew and expand investments 

in our people Congress must increase access to training funds for people who 

are out of work as well as those seeking to enhance their skills Ultimately, a 

high-skills workforce must be one whose rights on the job and ability to speak 

up are protected and thus made real through strong labor laws and strong 

unions. 

While the economic crisis that began in 2007 has done massive damage to our 

country, the truth is our problems run far deeper and none is more fundamental 

than the catastrophic decline of U.S. manufacturing which has occurred over a long 

period. The health of the economy, the success of our people and our national security are inextricably tied to a vibrant and innovative manufacturing sector. We must 

revive U.S. manufacturing as a clear centerpiece of our Nation’s economic and security strategy. 

This Congress and the Administration have the opportunity to take steps to restore our Nation’s manufacturing capabilities. The USW and AFL–CIO are committed to working with you to do so. 

The CHAIRMAN. Thank you, Mr. Gerard, President Gerard, very 

much. 

And Mike Rowe is the Creator and Executive Producer and Host 

of Discovery Channel’s Dirty Jobs. 

Mr. ROWE. That’s true. 

The CHAIRMAN. My wife thinks you’re terrific. 

Mr. ROWE. Your wife has excellent taste, sir. Thank you. Give 

her my regards. 

[Laughter.] 

The CHAIRMAN. I will. 

STATEMENT OF MIKE ROWE, CREATOR, EXECUTIVE 

PRODUCER AND HOST, DISCOVERY CHANNEL’S DIRTY JOBS 

Mr. ROWE. And thank you, officially, for having me here today. 

It really is a thrill and an honor. 

One small thing, the credits for the show are very kind. In truth, 

I’m more of a guest. I assume the role of an apprentice on Dirty 

Jobs, and for the last 7 years or so I’ve traveled to every state and 

worked in just about every industry with people you would otherwise never get a chance to know. They’re anonymous folks, many 

times, in small towns you wouldn’t find on a map, who do the kinds 

of jobs that make civilized life possible for the rest of us. 

In the history of TV, it’s probably the simplest show ever, but 

there are some very big themes that run through Dirty Jobs. And 

over the last 6 or 7 years, I’ve personally had a front row seat and 

I’ve watched the headlines catch up to a lot of those themes. Thus, 

the simplest show in TV has become interesting in a way that I 

never anticipated or intended. 

I could talk, certainly, at length about any of the people I’ve met 

in the show, and I’m tempted to, but I’d rather take a small portion 

of my 5 minutes and tell you about my grandfather, because he’s 

the reason, ultimately, that I decided to come here today. 

22 

His name was Carl Knobel, and he made his living in Baltimore 

as a master electrician. He was also a plumber and a mechanic, 

mason, carpenter. Everybody knew him as a jack-of-all-trades. And 

I remember him mostly as a magician. 

For most of his life, my granddad woke up clean and he came 

home dirty, and, in between, he accomplished some things that 

were nothing short of miraculous to me. Some days he might reshingle a roof or rebuild a motor, run electricity out to our barn. 

He helped build the church that I went to as a kid and the farmhouse that I grew up in. 

Basically, he could fix or build anything, but to my knowledge he 

never once read the directions to anything. He just knew how stuff 

worked. 

I remember one Saturday morning when I was twelve, I flushed 

the toilet in the same way I had been flushing it for 12 years. The 

toilet, however, responded in a way that was completely out of 

character. There was a rumbling sound, followed by a distant gurgle, and then everything that had gone down reappeared in a rather violent and spectacular fashion. 

Naturally, my granddad was called in to investigate, and within 

the hour I was invited to join he and my father—who’s right behind me there—out in the front yard for about 12 hours of forced 

labor. You know, there was pipe welding and there was picks and 

there was shovels and there were blisters and laugher, and maybe 

some questionable language. 

But, by sunset, we were completely filthy, the new pipe was installed, the dirt was back in the hole, and our toilet was back on 

its best behavior, and it was one of my favorite days ever. 

Thirty years later, in San Francisco, my toilet blew up again, and 

this time I didn’t participate in the repair process. I just called my 

landlord and I left a check on the kitchen counter and I went to 

work. 

When I came home, the mess was cleaned up and the problem 

was solved. As for the actual plumber who did the work, I never 

even met him. It never occurred to me to meet him. 

What did occur to me that day was the fact that I had become 

disconnected from a lot of things that really used to fascinate me 

growing up. I no longer thought about where my food came from 

or how my electricity worked or who fixed my pipes or who made 

my clothes. I didn’t think about who made anything. There was no 

reason to. I was less interested in how things got made, in fact, and 

more interested in how things got bought. 

Well, at this point, my granddad was well into his eighties. After 

a long visit with him 1 weekend, I decided to do a TV show in his 

honor. 

Today, Dirty Jobs is still on the air, and I am here before you 

guys, hoping to say something useful. So here it is: I believe that 

we need a national PR campaign for skilled labor, like a big one, 

something that addresses the widening skills gap head on and reconnects the country with the most important part of our workforce. 

Right now, American manufacturing is struggling to fill 200,000 

vacant positions, I’m told, and there are 450,000 openings today in 

23 

trades, transportation and utilities. The skills gap seems real, and 

it’s getting wider. 

In Alabama, a third of all skilled tradesmen are now over 55. 

They’re retiring fast, and there’s really nobody there to replace 

them. 

Alabama’s not alone. A few months ago in Atlanta, I ran into 

Tom Vilsack, our Secretary of Agriculture. Tom told me about a 

Governor he knows who was unable to move forward on the construction of a new power plant. The reason, I thought, was fascinating. It wasn’t a lack of funds or a lack of support. It was a 

lack of qualified welders. 

In general, people are surprised that high unemployment can 

exist at the same time as a skilled labor shortage, but they 

shouldn’t be. We’ve pretty much guaranteed it. In high schools, the 

vocational arts have all but vanished and we’ve elevated the importance of higher education to such a lofty perch that all other forms 

of knowledge are now labeled as alternative. 

Millions of parents and kids see apprenticeships and really valuable on-the-job-training opportunities as vocational consolation 

prizes, best suited for those not cut out for a four-year degree. And 

still, we talk about millions of shovel-ready jobs for a society that 

doesn’t really encourage people to pick up a shovel. 

In a hundred different ways, I think we’ve slowly marginalized 

an entire category of critical professions, reshaping our expectations of a good job into something that no longer looks like work. 

A few years from now, an hour with a good plumber—if you can 

find one—is going to cost more than an hour with a good psychiatrist, at which point, we’ll all be in need of both. 

I wanted to come here today because guys like my granddad are 

no less important to civilized life than they were 50 years ago. 

Maybe they’re in shorter supply today because we don’t acknowledge them the way we used to. We leave our check on the kitchen 

counter and hope the work gets done. That needs to change. 

My written testimony includes the details of several initiatives 

designed to close the skills gap, all of which I’ve had the privilege 

to participate in—Go Build Alabama, I Make America, my own 

modest efforts through Dirty Jobs and mikeroweWORKS. 

I’m especially proud, though, today to announce Discover Your 

Skills. It’s a broad-based initiative from Discovery Communications 

that I think can change perceptions in a meaningful way. 

I encourage you to support these efforts, because closing the 

skills gap doesn’t just benefit future tradesmen and the companies 

who are desperate to hire them. It benefits people like me and anyone else who shares my addiction to paved roads, reliable bridges, 

heating, air conditioning and, of course, indoor plumbing, something for all of us to consider, perhaps, during the next bathroom 

break. 

The CHAIRMAN. I have a smart wife. 

[Laughter.] 

Mr. ROWE. Thank you. 

[The prepared statement of Mr. Rowe follows:] 

24 

PREPARED STATEMENT OF MIKE ROWE, CREATOR, EXECUTIVE PRODUCER AND HOST, DISCOVERY CHANNEL’S DIRTY JOBS 

Chairman Rockefeller, Ranking Member Hutchison and members of this Committee, my name is Mike Rowe, and I want to thank you all very much for the opportunity to share a few thoughts about our country’s relationship with manufacturing, hard work, and skilled labor. 

According to the credits, I am the creator, executive producer and host of a TV 

program on the Discovery Channel called Dirty Jobs with Mike Rowe. In truth, I’m 

more like a perpetual apprentice. 

For 7 years, I’ve been traveling around the country, working alongside the people 

who grow our food, provide our energy, tend to our infrastructure, and manufacture 

our things. To date, I’ve completed nearly 300 different jobs, visited every state, and 

worked in just about every industry. A less flattering assessment might suggest that 

I’ve been fired 300 times in less than 7 years. Either way, my current resume has 

more to do with trying than succeeding, and my opinions should not be confused 

with those of an expert. 

Dirty Jobs is first and foremost an entertainment program. It does however, have 

a mission statement, and every episode begins the same way. ‘‘My name is Mike 

Rowe, and this is my job. I explore the country looking for people who aren’t afraid 

to get dirty. Hard-working men and women who do the kinds of jobs that make civilized life possible for the rest of us.’’ 

For years, no one paid much attention to this mission. But in 2008, the recession 

made Dirty Jobs relevant in ways I never envisioned. As unemployment became a 

dominate topic, and my own dirty resume continued to expand, reporters were suddenly interested in my take on all sorts of work-related issues. Labor disputes, free 

trade, currency devaluations, outsourcing, student loans—I was invited to weigh in 

on lots of issues for which I had no real expertise. 

For the most part, I pleaded ignorance and kept my mouth shut. But when a writer from The Wall Street Journal asked me to ‘‘reconcile soaring unemployment with 

an ever-widening skills gap,’’ I felt compelled to say something. So I referred him 

to the mission statement of the show and added, ‘‘once upon a time, our country 

was filled with people who weren’t afraid to get dirty. Times have changed. The definition of a ‘good job’ has changed.’’ 

I went on to suggest that the skills gap might not be a ‘‘problem,’’ but rather a 

symptom of something much more fundamental; a societal disconnect with work, 

brought about by the rapid transformation of a manufacturing-based economy into 

one dominated by financial services and technology. 

The reporter wanted to hear more so I kept talking. I told him about my grandfather, a modest man with an eighth grade education that went on to become a 

plumber, a mason, a mechanic, a carpenter, and a master electrician. A revered 

craftsman who could build a house without a blueprint. A man who today, would 

be mostly invisible. 

I talked about the subtle and not-so-subtle ways we marginalize work in today’s 

culture. In the media, our portrayals of working people rarely surpass one-dimensional stereotypes and predictable hyperbole. Best-selling books like ‘‘The Four-Hour 

Work Week’’ fly off the shelves, a testament to short-cuts, and a growing belief that 

technology (or something) can somehow replace hard work. I talked about the way 

colleges have become ‘‘institutions of higher learning,’’ while all other forms of 

knowledge are relegated to ‘‘alternative education.’’ I suggested a PR Campaign for 

skilled labor might be in order, and concluded by saying this Administration’s goal 

of creating three million shovel ready jobs might have a better chance of succeeding 

if our society still respected the people willing to pick up a shovel. 

When the article came out the flood gates opened. On Labor Day of 2008, I 

launched mikeroweWORKS.com, my own modest PR Campaign for hard work and 

skilled labor. Its primary purpose is to challenge the notion that a career in the 

trades is some sort of ‘‘vocational consolation prize,’’ handed out to workers unfit for 

a four-year degree. 

Fans of Dirty Jobs helped collect and assemble thousands of links to trade schools, 

apprenticeship programs, community colleges, on-the-job-training opportunities, and 

other resources that might be of use to anyone considering a career in the skilled 

trades. I set up a foundation and began to raise money for the purpose of tool scholarships and farming initiatives. Mostly though, I tried to encourage a bigger conversation, and challenge my partners to get behind this message in a significant 

way. I wanted mikeroweWORKS to function as a kind of connective tissue for other 

companies and organizations, and to that extent, I’m happy to say it’s working. 

Ford, Caterpillar, Kimberly-Clark, Lee, Master Lock, and other large corporations 

are all working with mikeroweWORKS in some capacity, and are highly motivated 

25 

to change perceptions about skilled labor. A few weeks ago, Alan Mulally at Ford 

pulled me aside and said, ‘‘Mike, this issue is nothing less than the soul of America. 

Our country’s future is at stake, and this is a battle we cannot afford to lose.’’ 

Aside from major corporations, other like-minded initiatives have begun to use 

mikeroweWORKS as a resource for their own purposes, and I’ve been honored to 

speak on behalf of several campaigns that have already been deemed successful. 

Last August, mikeroweWORKS partnered with ‘‘Go Build Alabama,’’ an education 

and recruitment campaign designed to bring new people to the commercial and industrial construction industry. I appeared in a series of advertisements that called 

attention to the fact that one third of all skilled tradesmen in the construction industry are over the age of 50 and retiring fast, with no one to replace them. The 

campaign drives people to GoBuildAlabama.com, where potential employees can 

learn more about skilled trade careers and find information about training programs. 

In this same spirit, I was also proud to join forces with Caterpillar and The Association of Equipment Manufacturers for the launch of ‘‘I Make America,’’ a national 

grassroots campaign to promote U.S. manufacturing jobs through infrastructure investment and the passage of export agreements. 

I would also like to commend the White House initiative called ‘‘Skills for America’s Future,’’ which is designed to reduce the skills gap by working with employers 

and community colleges to make sure the education students receive will translate 

directly into the marketplace, increasing their chances of finding and keeping a good 

job. 

The fact is, there are many initiatives out there making a difference. The problem 

that so many encounter though, is a tendency to ‘‘preach to the choir.’’ With respect 

to issues like the skills gap, we too often speak only to the people directly involved, 

the employers, desperate to hire skilled talent, and the unemployed, woefully untrained for the task at hand. To really make a difference, we need to change the 

perceptions of a much larger audience, and challenge the prevailing definition of a 

‘‘good job.’’ Americans need to see these workers for what they are—the key to civilized life as we know it. And that means a campaign and a message that reaches 

everybody. 

Toward that end, I’m pleased to help launch a broad-based initiative sponsored 

by Discovery Communications that will reach millions and millions of people. Discovery’s goal is to empower both unemployed and underemployed Americans with 

access to critical resources that will assist them in obtaining marketable job skills. 

TV personalities from across Discovery’s networks will participate in this campaign which will leverage Discovery’s position as the top nonfiction media company 

reaching more than 780 million cumulative subscribers across our 14 U.S. networks 

and Discovery Education’s unparalleled reach into schools across the country. Participating on-air talent have been chosen because their distinctive skills are particularly valuable and needed in today’s marketplace, and because they are credible to 

viewers interested in similar professions. 

As the leader in both nonfiction programming and broadband-delivered educational content and services to U.S. schools, Discovery is uniquely qualified to deliver this message to a mass audience, and to provide meaningful support on a national level. The people you see on Discovery’s air are not only real people, but are 

also successful professionals working in critical areas of the economy. 

To be clear, I support the efforts of Congress and the Administration to create 

three to four million shovel-ready jobs. But obviously, it’s no longer enough to merely create opportunity. If that were the case, we wouldn’t have 200,000 vacant positions in the manufacturing sector, or nearly 500,000 openings for tradesmen, transportation, and utility workers. We need to create respect for the work itself, and for 

the people still willing to do it. 

As the host of a TV show about hard work, people often assume I speak for 

tradesmen and skilled workers. In reality, I don’t. I can only speak for myself and 

anyone else who shares my addiction to paved roads, reliable bridges, heating, air 

conditioning, and indoor plumbing. The tradesmen I know don’t need a spokesman. 

It’s the rest of us who need to worry. Because a civilization without skilled labor, 

is not a civilization at all. 

Along with Discovery, I am ready, able, and eager to partner with the Federal 

Government to help reconnect our country to the importance of manufacturing and 

skilled labor. 

The CHAIRMAN. I failed to announce that there is a vote at three 

o’clock, which is very unchairmanlike of me and I apologize. I’m 

26 

going to miss it and stay here, so that we can keep things going, 

and others probably should go vote. 

Senator KLOBUCHAR. Yes. 

The CHAIRMAN. Yes. And then come back, if you can. OK? 

Mr. ROWE. I’ll vote. 

The CHAIRMAN. Can’t. 

Mr. ROWE. No. 

The CHAIRMAN. Can’t. You can try, but you can’t. 

Dr. Burns, you all talked basically about the same major problems. We take people for granted. You can’t get Americans to pick 

up a shovel. You know, you’re right. 

And I don’t know what has happened to the American psyche 

which has made us less sort of aggressive about our own lives and 

the homes and circumstances around our homes that we don’t. 

I mean, everybody says we’re hard working. We are hard working. West Virginians work like crazy, but the skill set problems 

that you talked about, Dr. Burns, and Leo, what you were talking 

about, what you already talked about is just monumental. 

And the discourse in this world is about the tragedy of that, and 

then we don’t do anything about it, which is then compounded by 

that really sad story—which probably has a good explanation—of 

those three billionaires or trillionaires who’ve been giving all this 

money to education, and they’ve all sort of stopped doing it, and 

it was in the area of people who needed exactly the kind of assistance you’re talking about, and they gave up doing it because it 

wasn’t working. 

Now, I haven’t read the details as to why it wasn’t working, but 

there’s obviously not just a problem, but there’s a state of mind in 

America, both in the public body and in the private body and in 

the home, that grasp for reward, which then usually prices hard 

work at basic levels out of the market. 

I don’t know if any of you have a comment on that. I just worry 

about that about our country, that we’re waiting. 

I mean, I just came from a group of people that were waiting for 

the—had to do with cybersecurity, which is kind of dangerous— 

were waiting for the government to do something. And we have 

somehow become like that, but we’re not like that. That’s not how 

we came to be what we are, and yet we’re not—neither as a public 

or as a private society—being aggressive in addressing this. 

Yes, we have a lot of technical schools. Yes, some of them do 

very, very good jobs, but it’s not enough. And so I just want to 

worry about that for a moment with all three of you. Why are we 

in this situation? 

If you’re losing jobs, then you ought to get more excited about it, 

all of us, get more urgent about it. We’re not. 

Dr. BURNS. Well, I’ll try. You know, I don’t know if I have the 

answers as to why. I can tell you that, on both sides of this coin, 

the skilled workforce that’s required to operate our facilities, it’s a 

critical need for us, and, for us, partnering at the local level seems 

to be the most effective. 

We have facilities in Michigan and Tennessee and Kentucky, 

and, for us, partnering with the local community colleges or 4-year 

schools, putting skilled workforce programs in place, where we help 

develop the curriculum, where we fund pilot facilities, so these stuVerDate Nov 24 2008 13:26 Mar 12, 2012 Jkt 073231 PO 00000 Frm 00030 Fmt 6633 Sfmt 6601 S:\GPO\DOCS\73231.TXT SCOM1 PsN: JACKIE
27 

dents can get in and use the manufacturing apparatus that they’re 

going to use in their jobs, that seems to help. We’ve done this at 

Delta College in Michigan. We’ve done it at Austin Peay University 

in Tennessee, and it’s working. 

The other partnership that we’re very excited about is partnering 

with the military and with the veterans as they want to enter the 

workforce, and we’re encouraging the veterans, particularly down 

in Tennessee coming from the Army base in Kentucky to enter into 

the skilled workforce programs and develop the skills. 

Leo knows this very, very well, the operators that we have in our 

facilities, they’re making very advanced materials, and we are more 

and more building into these operations very critical high-tech decisions that these operators make on the spot, decisions about the 

quality of the product, products that go into health care applications or electronic applications. 

There’s in-line testing that they need to understand and make 

decisions about the quality of the product. There are decisions that 

they are now making about the reliability and the maintenance 

needs in these operations. 

So we need a skilled workforce that can understand all these 

challenges and respond to it, and it is a constant challenge for us 

to continue to fund these training programs, work with the local 

communities. And it seems to work more effectively—at least for 

us—at the local level. 

Mr. GERARD. Senator Rockefeller. 

The CHAIRMAN. Yes. 

Mr. GERARD. I want to agree totally with Dr. Burns about that, 

and a lot of her workforce are our members, and they’re extremely 

skilled. And one of the things that worries me a lot is the public 

denigration of manufacturing. 

The hair on the back of my neck tingles when I hear people talk 

about the Rust Belt. If you’ve ever been in a modern steel mill 

where material is put in at one end and comes out at the other 

end, never touched by human hands, within one-ten-thousandth of 

an inch of variance, or a modern paper mill that is the same way, 

these aren’t rust belts. These are high-skill, technologically advanced, meaningful jobs where people make strategic and important decisions on the fly as it’s running, and they’ve got to be absolutely well informed and knowledgeable. 

In the steelworkers union, we created, as you may know, some 

20 years ago, the Institute for Career Development, because we 

had to take an existing workforce and make sure that they had the 

opportunity to enhance their skills. So, like Dr. Burns said, we’ve 

made alliances with community colleges in areas where we have 

major manufacturing in steel, in aluminum, in tire and rubber. 

We’re now trying to do the same thing in paper, where our existing workforce can go in and enhance their skills as the world 

around them changes. 

I made the reference to Germany. German workers get lifelong 

learning. They get the opportunity to get paid while they go back 

to school to enhance their skills, so that they can be the most productive workers in the world. We’re a long ways from that in America. 

The last thing I’d say is that—— 

28 

The CHAIRMAN. Could you explain that further? I mean, they get 

it when they’re 22 and they get it when they’re 49. 

Mr. GERARD. They get ongoing, lifelong learning that every—and 

I don’t want to say it’s universal, but in most of their major industries, their technologically advanced industries, they get the opportunity to go back to school or the school comes to them. 

That was the basis on which we tried to create the Institute for 

Career Development. That’s the basis on which Dr. Burns makes 

these alliances with community colleges. 

The problem is, in our case, it’s done by the private sector or it’s 

done by an individual union or an individual company, whereas, in 

Germany, it’s done by the society. 

Let me make this last point, because I know that people have to 

go do their votes. It’s about time that we started telling elected officials that we need more chemical engineers, we need more mechanical engineers, we need more aeronautical engineers, and we need 

less financial engineers. 

We’ve had nothing but financial mishap after financial mishap 

for the last 15 years, while, at the same time, we’ve watched our 

manufacturing industry get denigrated. And I think once we 

change the language, kids will start to want to go to vocational 

school, kids will start to want to be able to work with their hands 

the way Mike said. 

And the reality is if my grandson got a job in a steel mill, I’d 

be happy. My grandson doesn’t have to be a financial engineer to 

make me happy. He can earn a good living in a steel mill. That’s 

honorable work. 

Mr. ROWE. Language really is important, you know. Metaphors 

are even more important, and that’s what I meant to suggest earlier when I said that the way the headlines have caught up to this 

little TV show was really interesting to watch. And Leo’s talking 

about, you know, more people talking about it. Obviously, that’s 

huge. Having a conversation is the whole point. 

The challenge is who are you talking to, and, from what I’ve 

seen, there’s so much preaching to the choir that goes on with 

these topics—infrastructure, manufacturing, currency devaluation, 

the definition of a good job. I mean, we all kind of talk to each 

other, and I’ve been to a lot of those places. 

Jim Ryan is CEO of a company called Grainger, and a couple of 

years ago—It was Jim who really brought to my attention the really unique challenge the skills gap meant for his company, because 

not only was it something he was concerned about for the country, 

his customer base was just getting smaller and smaller and smaller 

year after year, and fewer electricians, fewer carpenters. 

And so he was the one that really impressed upon me, there’s not 

much new to say. We just have to find a way to say it to a much 

bigger audience. And, ultimately, in my view—I’m certainly not an 

expert—but it seems like the real conversations have to be between 

parents and kids at kitchen tables when they’re sitting down trying 

to figure out what to do with the rest of their life and in their 

heads is an image of what a good job is, and I would imagine in 

most parents’ minds is this hope that there’s going to be something 

better for their kids. 

29 

Problem is we just haven’t defined what better is, and we’re assuming that it’s clean. I’m all for clean, but the idea of Dirty Jobs 

is to sort of tap the country on the shoulder and remind people, 

look, once upon a time, dirt was a badge of honor. Now, we’ve 

somehow found a way in popular culture to make an enemy out of 

it. 

And so, to your earlier question, I just think we’re confused 

about what a good job looks like today. And I think we don’t have 

a good toolbox as educators and parents. We’re just celebrating a 

different kind of thing than we used to. 

And so—look, it’s so immensely complicated. There’s so much policy. There’s so much politics. I just feel like sometimes when these 

issues come up we didn’t look at the headline, you know, the country didn’t look at the headline. And the big conversation about 

what’s worthwhile in terms of encouraging your kids to do, that 

hasn’t happened, and that’s what I believe ought to be happening 

contemporaneously with all of these other conversations. 

The CHAIRMAN. Mike, thank you, but I need to go directly to Senator Hutchison. 

Senator HUTCHISON. Well, thank you. I am going to go vote, but 

a couple of things. First, I do agree with you, Mr. Rowe, that we 

need to do so much more to elevate the importance of these very 

good paying jobs, middle-class income jobs, that are going wanting 

because we have somehow said if you don’t get a college degree, 

then your job is not worth something. 

I visited a manufacturing facility in my state, and I saw row 

upon row upon row of welders who were welding, and I said, what 

do they make? And the manager said, between $80,000 and 

$100,000 a year. And I said, where do you train them? And they 

have an agreement with the junior college in that area that does 

the training with them. 

And I thought, good heavens, I mean, that’s fabulous to be able 

to have that kind of solid, steady job, and they were very fully employed. And that happens everywhere, but I think we are underutilizing our community colleges and our technical and vocational colleges. 

And I believe that the importance of computer training in our 

lower and middle schools is so important, and our high schools, because there’s not a plumber, an electrician, a worker of any kind 

that doesn’t have to have a computer to do their jobs, to keep up 

with the inventory, to make their buys, whatever it is. So it’s not 

low-level work. It is a technically proficient necessity for that kind 

of work. 

So I think maybe—I mean, there are many ways that we could 

address this, but I certainly think the vocational training and talking about it in the right way is important to give these people the 

chance for those good jobs. 

Let me ask a question of Dr. Burns. Would you comment on the 

importance of the stability of the regulatory environment on what 

you can do in America? And if Dow Corning is doing work in other 

countries how would it compare? 

Dr. BURNS. Yes. I guess, first of all, I would say that regulations 

are important. I don’t think anyone wants to live in a society where 

good regulations are not in play, because they are critical. 

30 

I applaud the administration, and being a member of the President’s Export Council, we’ve actually submitted letters to the President recommending, and it is obviously being acted on, for a 

streamlining of regulations looking at which ones are the most effective, the most critical, looking at regulations that add cost, but 

do not necessarily achieve the outcome that they’re designed to 

achieve. And we’re available and support any relationship to help 

with that streamlining here in America. 

It is a burden. I think it’s more of a burden for small companies 

and small businesses who really don’t have the internal infrastructure to deal with regulations. You know, we’re fairly capable in this 

respect, but it is a burden even on us, and I think anything we can 

do that can allow us to innovate faster, move quicker in the marketplace, grow, grow our business, create jobs in America is a good 

thing. 

Senator HUTCHISON. In your capacity with the Council, where do 

you see the most in need of change or reform regulations? And 

where do you see the most that are—the cost-benefit analysis is 

skewed the wrong way? 

Dr. BURNS. Yes, you know, it’s fairly broad-based. Certainly in 

the solar value chain, in working with our customers in the solar 

industry, a lot of it is in the permitting processes and the ability 

to move quickly with the installations, a lot of them being utilityskill installations. 

In our manufacturing facilities, it’s mainly around environment, 

EPA regulations. We know there are a lot of regulations yet to be 

enacted by the EPA, and we just ask that they be smart regulations, fact-based, science-based regulations with a strive toward 

streamlining as much as possible, so that we can be efficient and 

so that the regulatory bodies can evaluate our compliance sufficiently. 

Senator HUTCHISON. Thank you. I’m going to go vote. Thank you 

very much. 

The CHAIRMAN. Thank you, Senator Hutchison. Thank you. Well, 

you’re a fast walker so you’ll make it. She’s a power walker, five 

miles an hour. 

I asked some time ago for GAO, because of the German factor, 

also the Australian factor, they’re keeping their manufacturing. 

And I asked them to do a report, which is coming shortly, on what 

they do that we don’t, but, more importantly, what can we learn 

from them that we should be doing. 

And it’s interesting to me because it’s so easy to ask for a GAO 

report, you know, and the time goes by, and that slips into the 

hole. But, on the other hand, they tell you stuff that you really 

need to know. 

And then the question is are you going to be able to act on that 

or get a consensus on that in a year where we almost have no votes 

during the course of a week because everything is stopped, all legislation is stopped. 

We vote on judges. We do that once a day. You can count on us 

to vote for a judge every day or against a judge every day. But we 

don’t really get much substantive work done, just because of the 

nature of the Congress right now, which reflects, in some way, the 

31 

nature of the people—the anger, the hostility—which goes to your 

point, in a way, Mike. 

And I mentioned it in my opening statement, but not as well as 

you did, that you say the word manufacturing and it doesn’t engage 

people’s interest. And that’s crazy, because that’s where, as I say, 

so much of our R&D comes from. I mean, you’re doing carbon capture and sequestration in West Virginia in the Kanawha Valley, 

which is taking 90 percent of the carbon dioxide out of your emissions. 

I don’t know why you decided to do that, but you decided to do 

it, and it’s working and potentially is a salvation for a much-despised product, which, in fact, I think is the only place that the Nation has to go, ultimately, to get its—have this electricity on all day 

long. 

But the whole psychological concept of how we talk about manufacturing, how we talk about everybody has to go to college, and 

then everybody has to do graduate work, and everybody has to—— 

You know, I was in New York City last night, and I didn’t want 

to live in New York City. I went to West Virginia, I’m much 

happier. But people talk a lot about their bonuses. They talk a lot 

about the size of their apartments or where the next apartment— 

what street is it going to be on? Is that an upgrade or a downgrade? And that’s a superficial thing to say, but, frankly, it’s a 

money culture. 

And there’s a lot of manufacturing in New York, I’m sure, but 

the kind I think about, which is the kind all three of you not only 

talk about, but do, how do we enter that into the American psychology? 

And I don’t know, maybe we want to rename manufacturing and 

call it surviving or something, but it doesn’t make sense, or we 

throw money at things, at the vocational technical schools. I mean, 

those are working in some places, and they’re not working in some 

places, because they’re not always juxtaposed to the places that are 

likely to need workers. 

And in some cases—West Virginia being one of them—this is 

ironic, too, people want to work close to home. 

On the other hand, we have a Japanese motor company there, 

which employs only Americans, and all of their profits stay in this 

country, and they are taxed in this country. And they came in and 

built a plant, set out ads for applications for 300 jobs, and they got 

25,000 responses. 

And I said to myself and I checked later on—this is absolutely— 

of course, they were from Ohio and Kentucky, too, and I understand that. I said, well, that must be from former coalminers who 

have been unemployed, but who had the kind of skills that could 

be applied, for example, in the highly sophisticated world of automobile manufacturing. 

It turned out only three of those 300 who were accepted had 

backgrounds in coalmining of any sort. And in fact, they were people from 27 of our 55 counties who had enormous drives to work, 

or they probably just stayed in motels for the week, but they were 

mostly rural people. They were mostly in their 20s and 30s. They 

wanted to work. They had no alternatives in their own commuVerDate Nov 24 2008 13:26 Mar 12, 2012 Jkt 073231 PO 00000 Frm 00035 Fmt 6633 Sfmt 6601 S:\GPO\DOCS\73231.TXT SCOM1 PsN: JACKIE
32 

nities, and they took a chance on this brand name, which you’ve 

got for your company, Dr. Burns, and went to work. 

And they’re all happy and they call themselves team members, 

and there are no special CEO parking spaces and no CEO lunch 

spaces, and everybody treats everybody very well. 

And I was kind of stunned by that, because they’re not—and 

Toyota trains them. Well, maybe that’s OK. You see? They send a 

lot of them to Japan for several weeks and they get trained. 

But Toyota has never stopped expanding in West Virginia. Since 

1997, they’re in their sixth expansion, and they employ well over 

1,000 employees. So those kids see something. 

And so I go back to my question: Why are the rest of us missing 

this engagement with very good employment, very good wages, 

very good benefits and a very stable present and future? Why are 

we doing this, please? 

Dr. BURNS. Can I try? 

The CHAIRMAN. Yes. 

Dr. BURNS. It seems to me like what is missing is engagement 

with the public in understanding the connection between manufacturing, education and innovation. 

And I think we thought 15 or 20 years ago that manufacturing 

can go. You know, it can go to Asia. We can still innovate. We can 

still have highly-educated people and that we’ll have a service 

economy and that everything is going to be fine. 

You can’t separate those three. If the manufacturing goes, the innovation is going to go, and if the innovation goes, you’re not going 

to have jobs for educated people either in manufacturing or in discovery research. So I think what’s missing is the understanding 

that those are so linked now to our economic future, and we don’t 

have an overarching manufacturing strategy. 

If I go to an Asian country and I say I want to build a plant here, 

I am surrounded by people who are going to make that happen. 

Whether it’s government officials, whether it’s banks, they are 

going to make it happen, and they have figured out to serve and 

attract that investment. 

I have heard from Asian companies trying to come to America 

the frustration that they don’t even know where to start. Do they 

go to the state? Do they go to the Federal Government? There is 

no one-stop shopping for, you know, help me make my investment 

decision. You get that in Asia. If I want to put a research facility 

in Singapore, they’ll make it happen next week. So we’re missing 

this overarching priority on manufacturing and this understanding 

that they’re so linked together. 

And I can tell you, if we lose manufacturing, the innovation is 

going to go with it, because you want to innovate close to where 

you’re going to scale up materials, where you’re going to experiment with materials, and you want to be close to the customers, 

and if the manufacturing is there, so goes the innovation. 

Mr. GERARD. Senator, I don’t disagree with very much that Dr. 

Burns said, but I want to build on it about the discussion we’ve 

had about words matter and strategy matters and having a position matters. Let me give you a couple of examples. 

A well known steel company that has facilities in your area and 

our area, the Pittsburgh area, wanted to build a brand new coke 

33 

battery, had to go to the market for capital. The capital wanted to 

treat them differently and charge them a premium. 

This is a company that’s over 100 years old, that’s been profitable for almost 100 years. Wanted to charge them a premium on 

their capital, so they could get the capital to build the brand new 

coke battery that would have made it much more environmentally 

efficient. It would have almost guaranteed the productivity of those 

mills for another 20 or 25 years. 

Yet, if I wanted to go to the market and borrow some money for 

some harebrained idea in high tech, they’d give it to me for next 

to nothing. There’s something wrong with that when you look at 

the concept of America not having a plan, an America worrying 

about national security. 

Why should we have to rely on foreign oil to be the driver of our 

energy on our Air Force bases, on our military bases, on our Naval 

bases? Why don’t we look at renewable energy on those Air Force 

bases and military bases and Naval bases? Why don’t we look at 

wind turbines? Why don’t we look at solar? 

If we were to say that we’re going to power our military bases 

with renewable energy over the next 20 years and have 5,000 wind 

turbines on military soil, there’s all kinds of steel companies that 

would invest in new plate mills and make more steel. There’s 200 

tons of steel that goes into a wind turbine. 

If we were to use solar panels, Dr. Burns’ facilities could expand, 

because there’d be a plan that over the next years we’re going to 

do this. She can’t meet the requirement now, so she’s got to invest, 

and she wants to invest close to the market. We don’t have any 

plan. 

DOD is one. DOE was going to—remember all the scuttle about 

building nucs? They were all going to be Korean nucs until the 

union interfered and said, if you’re going to try to build Korean 

nucs, this is what we’re going to do. And all of a sudden that toned 

down a bit, and, now, we’re having a more civilized discussion. 

But it’s all because we have no plan and everything happens sort 

of hit and miss. Somebody comes up with a policy, we’re going to 

give this tax break for that. Give this tax break for that, and she’s 

left there with no plan, you know. 

And so I think it’s all about how we change the culture, and for 

25 or 30 years here we’ve had a culture of denigrating manufacturing. And Dr. Burns says if we lose it—we’re on the verge of losing it. We’re down to below 10 percent of GDP. There’s more people 

unemployed today from manufacturing than there are employed in 

manufacturing. 11.2 million people are employed in manufacturing. 

And unless we grow that back to a number, we’re going to be losing 

our innovation. 

And an interesting part—I’ll just close on this—an interesting 

part a few weeks ago was on ABC where they went through a 

house and took out everything that wasn’t made in America. The 

only thing that was left was the kitchen sink and a Yankee candle. 

That same day on Meet the Press, a senator who’s well known 

who ran for president got on and that senator said, Well, if they’d 

have checked for computers they would have seen that the iPad 

and computers are made in America. 

34 

Well, guess what, they were invented in America, but they’re not 

made in America. They’re made in China. 

We need a plan. 

The CHAIRMAN. Senator Ayotte, I welcome you. I’m glad you’re 

here, and you haven’t had a chance to hear the testimony, so you 

can question away. 

STATEMENT OF HON. KELLY AYOTTE, 

U.S. SENATOR FROM NEW HAMPSHIRE 

Senator AYOTTE. Thank you, Mr. Chairman. 

Dr. Burns, I wanted to follow up on something you had said 

about if you go to Asia and they want to put a plant up, they make 

it happen tomorrow. 

Well, one of the things I wanted to hear your insight on is I come 

from a small-business family. My husband has a landscaping and 

snowplowing business. So I actually did have to help him shovel in 

the beginning. So there’s a little shoveling in my family. 

But one of the concerns I’ve heard from a lot of small-business 

owners across our country, many of them that do so much of the 

important work to help the rest of us, is the regulations that they 

see that are passed by our government really make it difficult 

whether you want to start your own business, whether you want 

to expand, whether you’re involved in a particular trade. 

You know, we come up with a lot of ideas here in Washington 

and we think they’re well-intentioned, and then people have to go 

out in the field and implement them, and I think so many times 

they make us less competitive. 

And I wanted to get your thoughts on as we look forward and 

make ourselves more competitive in a regulatory context, how 

could we make it better for our private sector businesses? And a 

lot of them are just small businesses, a couple of people getting together and trying to provide services for other people. 

Dr. BURNS. Yes, exactly. I spoke just briefly on this. You know, 

I started by saying I think regulations do matter and they’re important, but they need to be smart regulations. And, frankly, I 

think there’s a huge opportunity to streamline our regulations, to 

look at the cost of adhering to the regulations and the intended 

benefit of the regulation, and really just take a thorough look at 

what we’ve got with the intent to streamline. 

And I know the administration is supporting that. The President’s Export Council has recommended that we do this, and I do 

agree. I said earlier I think it’s more a burden on the small company than a large company because we end up getting a regulatory 

machine that is geared up to it. It is a cost, and it does hurt our 

competitiveness. But I think when it hurts a startup or an innovative company trying to get going, that’s where a lot of jobs get created. 

Senator AYOTTE. And just as a follow-up, one of the things that 

you mentioned is the need for us when we’re passing regulations 

to really look at the cost-benefit analysis of them. Would you agree 

with that, that that’s got to be in the component? 

Dr. BURNS. Yes, absolutely. Absolutely. 

35 

Senator AYOTTE. So I very much appreciate that. I hope that we 

take that to heart here, and a lot of times cutting through the red 

tape to make it easier for us to—the private sector to thrive. 

Mr. Rowe, really appreciate your being here, and I have a 6-yearold daughter, Kate, who is one of your biggest fans. So—— 

Mr. ROWE. What’s she do for a living? 

[Laughter.] 

Senator AYOTTE. You know, I’m not sure what she’s going to do, 

at this point, but she loves the show and is an avid watcher. So 

I’m going to be her hero now that I can tell her that I’ve met you. 

But I wanted to follow up. You’re traveling around the country. 

You must have interacted somewhat with—in terms of interaction 

with state, Federal Government, what impression you have on this 

issue of what we’re doing on the regulatory end that makes it more 

difficult. 

Mr. ROWE. Yes, it’s—I mean, again, that was not one of the reasons we wanted to do the show. I mean, the show is first and foremost a celebration of work, but, you know, the network kept ordering more and more, and we kept going further and further and 

doing some things we didn’t anticipate doing. 

And by the second or third season, when we got around 200 of 

these jobs, it was really interesting, in the sense that—well, in 

terms of the nomenclature of the town—you know when you guys 

are running for office, you spend a lot of time connecting with regular people, and I suddenly realized—though I’m not running for 

anything except possible renewal—I was out there working with a 

lot of different types of people in a lot of different types of industries. 

And, to your point, we began to stop looking for big, municipal, 

state-run jobs, because the red tape that we had to go through from 

a production standpoint was really instructive. 

Now, certainly, we’ve done a lot. I mean, I’ve built bridges in 

Mackinaw, and the Army Corps of Engineers has endless opportunities to get dirty and learn stuff, and that’s great fun. 

But the obstacles to actually shooting with them are probably on 

par with the compliance issues that you’re talking about that they 

deal with internally, and it’s really fascinating. 

I mean, if somebody was doing a show about this show, to watch 

us, for instance, working with some coal miners in West Virginia, 

which we’ve done, versus, say, a family run maggot farm in Idaho, 

which is wildly profitable, by the way. People have no idea of the 

money that’s in maggots. 

Mr. GERARD. The oil industry does. 

Mr. ROWE. You would see the difference, you know, in how those 

industries play out, and conversely. 

I mean, I could go down the list, but the short answer is there’s 

a huge, huge cost of regulation and compliance, and, obviously, it’s 

necessary, as Dr. Burns said, but there’s no extra credit for going 

beyond what you need. 

And my sense, from working with a lot of people in a lot of industries, is a real frustration with policies that essentially force them 

to spend a lot of their day doing things that simply don’t translate 

straight into the task at hand. 

36 

What that actually means in terms of total lost revenue, way 

past my pay grade. I don’t know. You should ask your daughter. 

[Laughter.] 

Senator AYOTTE. Probably. Yes. 

Mr. ROWE. She might know. 

Senator AYOTTE. She’s—well, I don’t know. Maybe she’s going to 

take up this maggot farming—— 

Mr. ROWE. Maybe she will. 

Senator AYOTTE. She appreciates every one of your shows, so—— 

Mr. ROWE. Well, you know what, here, share this with her, too, 

because I was just listening to—as Leo was talking about the way 

manufacturing has shrunk in terms of a composite part of our 

GDP, if there were such a thing as a dirt index—and I believe 

there should be. 

I mean, there’s a misery index. There’s a poverty index. We have 

an index for everything in this town it seems. We ought to have 

a dirt index, and if we did, I bet if we looked back at the last 100 

years or so in terms of how our GDP was composed, we would see 

a really consistent level of the country’s relationship with dirt. 

Certainly, in our agrarian past, our farmers were role models, because they woke up clean and came home dirty. And we understood 

that the dirt and the work and the profit and the need were all 

wrapped together in much the same way as innovation and manufacturing, but it just all made sense through the lens of dirt. 

As we evolved from agrarian into industrial, well, the work 

changed, but the relationship with work didn’t. In the same way 

farmers were on the front line of agriculture, now, we have tradesmen on the front line of manufacturing in the middle part of the 

last century, and our relationship with dirt was still great because 

tradesmen were heroes, ergo, my granddad. 

But, then, in terms of the GDP—and it’s just a theory, I’m just 

making stuff up—but for the first time, suddenly, manufacturing 

and industry isn’t dominant. Farming is not dominant. Less than 

2 percent of the workers in this country are feeding 300 million 

people. It’s financial services and technology. That’s dominating the 

GDP. But what is the dirty relationship—at least visibly—with finance and technology? 

That’s what I meant before when I was talking about the changing look of a good job, because as you look at what the country is 

making and our collective relationship with the traditionally dirty 

face of work, the dirt’s been scrubbed off, and what’s left is clean 

and green, and that’s all nice, but it’s sent a weird confusion and 

a kind of disconnect. 

And not to beat a dead horse, but reconnecting—reconnecting, 

not your industry specifically, but with the people who watch my 

show, you know, the 300 million-or-so people who are simply going 

about their day and not thinking about these things, we’ve got to 

reconnect them to the dirt index in some way. It’s got to be fun, 

you know. Work can’t be portrayed constantly as drudgery. It isn’t 

drudgery, you know. 

I hope one of the reasons your daughter likes my show—and 

your wife, senator, enjoys it—is because we find humor where we 

have been conditioned to expect drudgery. And the people I know 

and the people I’ve met on the show have a wonderful sense of 

37 

humor, and infusing that back in to the conversation and back into 

the practical reality of doing the job strikes me as key. 

Senator AYOTTE. Thank you. 

Mr. Gerard—if I may follow up briefly, Mr. Chairman—wanted 

to get your thought on one issue, and, then, Dr. Burns, if you have 

any comments on it. 

I heard from—wanted to get your thoughts on repatriation. 

Mr. GERARD. I didn’t hear. 

Senator AYOTTE. Repatriation. This week, I heard from a number 

of large companies who argue on the tax code that we’re not competitive and that they’re anxious to bring jobs and manufacturing 

plans and revenue back to this country, but they have a 35-percent 

corporate tax rate that does not make them competitive. So they’ve 

got a greater incentive to keep the revenue overseas than to bring 

the jobs back here. 

So what do you think we need to do in terms of what are your 

thoughts on the corporate tax rate issue and encouraging—making 

us more competitive to encourage the larger global companies to 

come back to the United States? 

And if Dr. Burns has any comments on that, I’d appreciate it. 

Mr. GERARD. I’ll confess, off the bat, that I don’t think I’m technically informed enough to talk about the tax code. I know that the 

tax rate isn’t necessarily the tax paid. Some of the most profitable 

companies in America paid no taxes, like General Electric. 

We’ve been giving tax handouts to the richest corporations on 

earth, the oil industry. I think we ought to quit giving them those 

subsidies and use those subsidies to provide computers to kids in 

schools. 

The other thing that I think is tremendously important is that 

we don’t give tax breaks to companies that move jobs offshore, 

which we’ve been doing. And if either you or the senator, Senator 

Rockefeller, can jog my memory, I think that that issue came up 

in the Senate and there was a proposal to incent companies to 

bring jobs back where they would get an incentive to bring jobs 

back and we would remove the incentive that we were giving them 

when they moved jobs overseas. And I think that got defeated on 

a party-line vote, I think, with not an ability to overcome a filibuster. So that’s the little bit that I know about that. 

But I do believe we ought to sit down and have a rational discussion to incent those companies that want to bring jobs back to 

America to do that, but take away the incentive for shipping jobs 

overseas. 

And I actually think we ought not get too wrapped up in the tax 

code until we find out what the real taxes that are being paid. As 

I said, General Electric paid nothing, in fact, and got a multibilliondollar tax rebate. 

Senator AYOTTE. Well, I’m just—If we look at the rates, where 

we are, we have the second highest corporate—we may end up 

being the highest if Japan decides to move theirs. So just as a matter of comparing numbers, we’re not competitive. So I just was curious—— 

Mr. GERARD. Well, let me just pick that up, because I don’t think 

that Japan has the issue of their multinational corporations not 

bringing their industry back. They don’t have that problem. We 

38 

seem to do, for some reason. So I don’t think it’s about the tax rate. 

I think it’s about the taxes paid. And, as I said, I’m not technically 

qualified, but from a distance, that’s what I see. 

The CHAIRMAN. I have to interrupt. Senator Ayotte, I apologize 

to you, but we have to be at the White House in 10 minutes. 

Mr. GERARD. When are we going? 

The CHAIRMAN. No. 

[Laughter.] 

Mr. GERARD. I tried. 

Dr. BURNS. I hope you talk about manufacturing. 

The CHAIRMAN. I know. And we’re going to talk about the budget, so that’s going to be a lot of fun. 

Mr. GERARD. Manufacturing and the budget, senator. 

The CHAIRMAN. I know. So let me just say that it’s not like we’re 

moribund in this. This has been a—had a bit of a wandering in it. 

But I’m OK with that, because we’re a little bit wandering in the 

desert as to what we need to do, and we need to talk about it, and 

we need to prove to ourselves that we’re good at talking about it, 

but not very good at doing much about it. 

There are some things going on. I’m working with Steny Hoyer 

on a Make-It-In-America concept, which he’s very aggressively pursuing, and which I am. And one of the things we have in that is 

one-stop shopping, that industry would just be able to go to one 

place. 

Now, I hear that in my mind and I say, yes, that’s just a great 

thing for the government to be doing, and then watch the war of 

the turfs as to who gets the one-stop. But I can’t think that way. 

In other words, what happens so much in this country is if you 

bring up a subject of substance people will then bring up, oh, what 

about regulation? What about EPA? What about this or what about 

that? 

And what it does—it’s totally fair to do it and often right to do 

it—but it keeps us away from the subject. It keeps us away from 

the subject. We’re really good at getting away from discussing what 

manufacturing really means. 

And the thing that we ought to be thinking about, and virtually 

the only thing, is that 70 percent of all innovation and research 

and development takes place in manufacturing, even though 

they’re a very small part of our GDP. We’re not going to move forward without manufacturing. We’re not going to do it. 

So we’re going to continue to work away at this, and, hopefully, 

we won’t have a lot of budget meetings at the White House. But, 

on the other hand, I’m very afraid of what’s going to happen, very 

afraid of what’s going to happen. 

But I will tell you that we have the five biggest oil companies 

before us tomorrow at nine o’clock in the Finance Committee. I’m 

looking forward to that. And if you have nothing else to do—— 

Mr. GERARD. I might come and watch. 

The CHAIRMAN. No, you just pay somebody tonight to stand in 

line and keep your seat. All right? 

Mr. GERARD. Senator, if I could, just for a moment, I really 

want—— 

The CHAIRMAN. Can’t actually. 

39 

Mr. GERARD. I just want to congratulate you on your infrastructure investment fund. I really think that’s important—hopefully, 

you’ll get bipartisan support. 

The CHAIRMAN. Yes, yes, and that’s $340 billion a year for the 

next number of years to get back to where we need to be. 

Mr. GERARD. Terrific. 

The CHAIRMAN. On infrastructure. 

Dr. BURNS. We support it, too. 

The CHAIRMAN. And so where do we get the money? 

Look, I totally thank you. Huge subject, hard to get one’s arms 

around, but we’re just going to work at it until we do. That’s what 

we’re doing for the next year-and-a-half and beyond, but certainly 

for the next year-and-a-half. 

So I thank you very much, and—I really do. I mean, you know. 

Dr. BURNS. Thank you. 

Mr. GERARD. You’re welcome. 

Mr. ROWE. Thank you. 

The CHAIRMAN. I wish I could talk more about that CCS thing 

and why you did that, but I can’t. Got to go. 

Hearing adjourned. 

[Whereupon, at 3:41 p.m., the hearing was adjourned.] 

Æ