News flash: The state of Michigan is
losing manufacturing jobs. Actually the whole country is. In fact
Michigan alone has lost about 170,000 manufacturing jobs in the
past three years.

Kate Green

This probably explains why Gov. Jennifer Granholm decided to
hold a manufacturing summit Monday to figure out how to strengthen
the state’s manufacturing base.

The problem is that Michigan has been losing manufacturing jobs
for decades, but instead of focusing on how to get them back,
leaders such as former Gov. James Blanchard worked to create new
jobs — better jobs — to replace them.

Tomorrow Granholm is going to switch gears and open the
“Creating Cool” conference — a conference named
by someone who is without a doubt not cool — with a special
guest speaker, Prof. Richard Florida of Carnegie Mellon University,
best known for advocating the importance of a city having a large
gay community and a creative young workforce.

The governor may be trying to cover all the bases that make up
her Democratic political base, from unions to Ann Arbor and
Birmingham liberals, but it seems that she either can’t make
up her mind on these economic matters, or she enjoys the political
benefits of vagueness at the expense of sound, comprehensive
policy.

First of all, it’s not exactly clear what Granholm means
when she talks about manufacturing. She could mean high-skilled
jobs that require a great deal of decision-making, training and
innovation. Jobs like these don’t fit the mold of the
traditional assembly-line production that Michiganders familiar
with Henry Ford often associate with manufacturing. What Granholm
refers to as “advanced manufacturing” could be the type
of work that’s done using advanced computer-design software,
in which case a number of College of Engineering graduates will
likely become advanced manufacturers after they graduate.

On the other hand, — now I sound more like an economist
than a columnist — Granholm may wish to focus on retaining
and attracting lower-skilled manufacturing jobs. These are the
kinds of jobs the state is losing and that prompted the governor to
hold the manufacturing summit in the first place. If she plans to
keep the low-skilled manufacturing jobs that have been on their way
out of the state, then Granholm is up against unconquerable forces,
and she’s going to waste a lot of the state’s money in
the process .

Part of Granholm’s waffling lies in the reality of
today’s Democratic Party. In the ’90s, when the economy
was zipping along, new Democrats like Bill Clinton and the pre-2000
Al Gore were able to push free-trade agreements that were good for
the aggregate economy, but caused job losses in outdated sectors.
Now, almost all the Democrats running for president are pushing
their protectionist credentials, arguing over who opposed the North
American Free Trade Association first. During this time, Granholm
happens to be the governor of a traditionally strong union state.
She’s smart enough to know that this is probably not the time
for her to sound like Milton Friedman.

Keeping this in mind, it’s not surprising Granholm is
calling a business summit a manufacturing summit. It’s
actually a clever way for her to push a pro-business agenda. The
budget deal she and Republican leaders announced yesterday includes
tax cuts for businesses to help pay for health care costs. At the
summit Granholm discussed streamlining the process for businesses
to get licenses and permits, worker-retraining measures,
overhauling the single business tax, improving education (although
some money would be nice) and reducing health care costs. She has
also created the Michigan Department of Labor and Economic Growth,
which combines commercial and labor responsibilities into one
department. She even has the environmentalists nervous, which is
not necessarily a good thing, but it shows her pro-business
tilt.

To be sure, not all of what Granholm wants to do will be great
for the state’s economy, but it’s pretty good
considering the political context. I wish she would fund the
state’s universities at higher levels, but there’s no
money for that. I also wish she would talk less about
manufacturing, but if manufacturing is a code word for small
business, I’ll give her a pass — for now at least.

Pesick can be reached at
“mailto:jzpesick@umich.edu”>jzpesick@umich.edu.

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