Call Center Repatriation Act 2011

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    There are reasons for providing the right incentives for economic growth. Senator Warner and Representative Wolf have decided to ignore those and compete with the third world using the lowest common denominator: labor. Their proposal for a federal jobs “bounty” is seriously short sighted. It is existential in the extreme.

    What we need is commitment and nothing spells an economic commitment like capital investment in manufacturing infrastructure. Their proposal supposedly rewards job creation by offering low-interest “forgivable loans” to companies building new facilities employing at least 50 full-time people if they establish “high-value manufacturing jobs” in needy areas of the United States. They are off the hook for the loans after 5 years. This is a disincentive for long-term capital investment and innovation.

    …We must focus our prowess not on manufacturing commodities, but rather on becoming innovators and specialists in new types of high-value manufacturing.

    America must move toward manufacturing in new and “magical” ways – such as nano-assembly, chemical or bio mechanisms. Remember Arthur C. Clarke’s aphorism: “Any sufficiently advanced technology is indistinguishable from magic.” – Jim Pinto

    Is that how Warner and Wolf see “high-value manufacturing jobs?” And these are going to spring up in “needy areas of the United States?” Are these blue collar jobs? Are there 50 jobs required in any such manufacturing facility? One can only conclude they don’t actually mean “high-value manufacturing jobs.” But it is a nice term that infers well-paying jobs.  Infers.

    “Workers also would be paid hourly wages that are higher than the average hourly pay in the county that is getting the new positions.”

     

    The Warner/Wolf proposal:

    • Creates a competitive grant program for states to provide up to $5,000 in forgivable loans for each new manufacturing job created and maintained for at least five years within a rural or economically-distressed region of the country.
    • Works with employers to develop training and education programs for the specific jobs available at area businesses, strengthening those programs which provide an industry-recognized credential for workers in the advanced manufacturing and information technology industries;
    • And expedites federal financing to allow certain qualifying companies to increase export capacity.

    Representative Wolf apparently doesn’t want to admit that the horse is out of the barn and long down that road. While he decries the fact that we have been slow responding to our international economic competitors in the era of global markets and competition, his solution sounds more like reactive protectionism rather than an incentive to innovate. Though he says we should be a smarter competitor in the global economy, he offers nothing more than the common mantra of bringing jobs back. Easier said than done.

    “As somebody who is deficit-obsessed,” (Warner) said, “we’re not going to create a jobs program that isn’t paid for.”

    “This is a real jobs bill,” said Wolf, who is introducing similar legislation in the House. “It’s a repatriation.”

    Repatriation. Wolf’s more accurately titled Bring Jobs Back to America Act is specifically aimed at jobs that have relocated overseas in the last two decades. We are going to get the call centers back? Maybe. But we are not going to get the heavy industrial manufacturing facilities for a long, long time, if ever. While we may flirt in the cheap labor market, there is nothing we can do to change the fact that the relatively recent substantial investment overseas required for the jobs Warner and Wolf would have us imagine will repatriate takes 40 or more years to walk away from. They simply continue us down the path of devaluing labor.

    Liz Povar of the Virginia Economic Development Partnership was a bit more forthcoming in her assessment of the bill. She pointed out that while the economic incentive is a strong tool, the more important issue when companies are seeking a new location is the quality of the workforce. “Quality of the workforce”…which “quality” would that be?

    While Senator Warner’s proposal might have merit if it focused on long-term investment, training, and innovation, blending in Representative Wolf’s nostalgic quest for an economy that no longer exists extinguishes any hope for an effective initiative. This proposal is not one of those proper incentives that will result in economic growth.  

    • Elaine in Roanoke

      I predict that the only businesses that will take advantage of the program will be those that were going to add workers temporarily to fulfill a contract or those who already had expansions in the works. It certainly won’t “bring jobs back to America.”

    • even watched a few minutes of Warner and Wolf droning on about it, found it utterly uninspiring at best, futile and costly corporate welfare at worst.  No thanks.