[Congressional Record Volume 149, Number 84 (Tuesday, June 10, 2003)]
[House]
[Pages H5092-H5093]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  INNOVATION, MANUFACTURING, AND JOBS

  The SPEAKER pro tempore. Pursuant to the order of the House of 
January 7, 2003, the gentleman from Michigan (Mr. Smith) is recognized 
during morning hour debates for 5 minutes.
  Mr. SMITH of Michigan. Mr. Speaker, I rise this morning to talk about 
the danger of losing good-paying jobs and our strong economy here in 
the United States.
  Manufacturing has been America's economic strength. For 3 decades 
now, manufacturing productivity has increased more than any other 
sector of

[[Page H5093]]

our economy. The average manufacturing worker produces four times as 
much per hour as the average worker did 50 years ago. As a result, 
manufacturing has been one of the most important parts of the economy 
and has produced higher living standards for Americans as those 
products from American manufacturing have become cheaper and better and 
wages in manufacturing have risen. But now we are losing our 
manufacturing base as we tend to move towards a service economy.
  With manufacturing suffering in recent years, other industries such 
as the service sector have offered alternative employment. The trouble 
is that manufacturing cannot be simply replaced by insurance companies 
or the legal profession or retail trades. There are only four economic 
sectors that generate material wealth. Only four. And they are 
agriculture, where they produce things; mining, where they produce 
things; manufacturing, where they produce things; or construction. And 
those are the four. Of those, only manufacturing is not limited by 
natural resources and is capable of export.
  We need innovation to produce better products at competitive prices 
to regain our manufacturing leadership. We cannot pay American-level 
wages unless we can still be competitive. That means innovation for 
quality products and increased productivity. Innovation starts with 
basic research, followed by application and commercialization.
  As chairman of the Subcommittee on Research under the Committee on 
Science, I am familiar with the government's efforts to find and 
promote basic research, mostly through the National Science Foundation. 
NSF has seen substantial increases in recent years, and we need to 
ensure that this money is spent in ways that research discoveries can 
have the greatest impact in terms of promoting innovation and practical 
application for United States businesses. The development of basic 
research for industrial use has generally been the province of 
businesses which undertake these efforts to create new products. 
Unfortunately, according to witnesses at a recent Committee on Science 
hearing, application is the hardest part. Companies facing intense 
competitive pressure find it difficult to set aside sufficient 
resources, money, to develop new products, especially if the results 
cannot be anticipated before 5 or 6 years. So we are having a gap. 
Government is now the substantial payer of basic research; and having 
that research with tech transfer and to apply that research for better 
and more products and efficient ways of manufacturing is what we are 
lacking.
  Development also suffers from low prestige. The academic community 
and Federal grants generally reward those who seek knowledge for 
knowledge's sake rather than those who do the necessary development 
work. Some foreign countries spend their research dollars monitoring 
our government funding basic research and then spend the rest of their 
government money to apply that research for commercial products ahead 
of our getting that application in the United States.
  Another problem we face is the shortage of math and engineering 
talent. The United States has long lagged far behind other nations when 
it comes to producing top-notch engineering and research talent. Let me 
just give an example of China. China produces 10 times as many 
engineers as we do in the United States. This cannot continue if we 
expect to continue a strong economy in the United States. It cannot 
continue to go on without erosion of our international competitiveness. 
That is why I have pushed NSF to do a better job of promoting math and 
science careers to students. We need more capable math and science 
students for research and business and for our future.
  In summary, Mr. Speaker, the decline in manufacturing employment is 
something that we ignore at our peril. Over the long term, we cannot 
hope to have a healthy and growing economy unless we make lots of 
tangible goods that people want to buy both in the U.S. and overseas 
markets. Government needs to support not only basic research but to 
provide incentives for American business to develop applications to 
ensure continued economic health.

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