[Congressional Record Volume 154, Number 161 (Friday, October 3, 2008)]
[Extensions of Remarks]
[Pages E2227-E2228]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                           HON. FRANK R. WOLF

                              of virginia

                    in the house of representatives

                        Friday, October 3, 2008

  Mr. WOLF. Madam Speaker, I want to share with our colleagues a 
commentary from the recent edition of Manufacturing & Technology News 
by its editor Richard McCormack. He writes that manufacturers in this 
country know about economic collapse because that sector of our economy 
has been on the downward slide for years and that their experience 
should be a lesson for this Nation's leaders who are trying to find a 
way to turn around the economy. His article follows:

       [From the Manufacturing & Technology News, Sept. 30, 2008]

      Commentary: Manufacturers Know All About Economic Collapse 

                         (By Richard McCormack)

       It is sad what has happened to the United States.
       For years, as editor of Manufacturing & Technology News, I 
     have heard dozens of domestic manufacturing company CEOs talk 
     about an impending ``collapse'' of the U.S. economy. These 
     were the men who were in the unenviable position of having to 
     close their companies or shut down factories and watch as 
     most all of their competitors did the same thing.
       These were the men who implemented Six Sigma, lean, ISO 
     9000, and the Baldrige National Quality and Shingo Prize 
     criteria. They were leaders who agonized over having to move 
     the world's most efficient production capacity from the 
     United States to Mexico and China in order to stay in 
     business, because no matter how good they were, it wasn't 
     good enough to survive. They could compete with other 
     companies, but they could not compete against other 
     COUNTRIES--countries that cheated in every way imaginable.
       These manufacturing company CEOs were men who loved their 
     employees. Who grew up with their employees. Who knew their 
     families. Who knew in their hearts the economic, cultural, 
     moral and physical destruction that was being wrought upon 
     their communities.
       U.S. manufacturing company CEOs died many deaths, watching 
     as Wall Street mavericks and their economic ideological 
     apologists in the U.S. federal government, in Congress and 
     their high-paid agents in Washington, D.C., forced 
     hundreds of thousands of dedicated, hard-working Americans 
     into the street, to fend for themselves in a game that was 
     rigged against them.
       Has the financial class driven through the heartland of 
     America lately? Have they not taken AMTRAK between New York 
     City and Washington, D.C., passing through the industrial 
     back lots of Baltimore, Wilmington, Philadelphia, Trenton and 
     Newark? Have they not seen an American landscape stretching 
     for thousands of square miles that looks like it has been 
     bombed out?
       There are places in America that are ``healthy,'' but these 
     places are even worse: shopping and strip malls located on 
     the edges of America's deteriorating towns and cities, lined 
     with vast parking lots and national chain stores: Applebees, 
     Home Depot, Wal-Mart, Wendy's, Days Inn, Outback Steak House. 
     They are soul-less places--``Anywhere USA''--as depressing as 
     the crumbling inner city cores of hundreds of American cities 
     and towns. This is what has become of America. Wall Street 
     had a lot to do with this. As part of the financial bailout 
     bill, they needed to include a provision on teaching ethics 
     and civics.
       The heroic men running companies that made durable goods 
     wept on the phone when I called to ask about why they closed 
     their factory after it had been in operation for 80 years or 
       These people were not selling financial paper or making 
     products that were obsolete and no longer in demand, like 
     buggy whips. And yet when I speak with economists about 
     manufacturing, they invariably rationalize the loss of 
     America's wealth-generating sector by claiming the companies 
     that are dying are making ``buggy whips.'' It is wrong and it 
     is infuriating. We're talking about the United States 
     economy, which has just suffered a massive financial heart 
       I remember writing about the manufacturing job situation in 
     early 2004. It was the 35th consecutive month of 
     manufacturing employment layoffs, with the latest BLS figure 
     coming in at 135,000 production workers being told to go home 
     and not ever come back. This was a crisis. I wondered why in 
     the hell not a single person in the Bush administration and 
     only a handful of people in Congress cared about the collapse 
     of the wealth-generating sector of the American economy. As 
     is happening with the financial sector today, manufacturing 
     five years ago was being disassembled in front of their eyes. 
     There were no bailouts--manufacturers weren't looking for 
     them--there weren't even bromides.
       I remember thinking as Bush invaded Iraq that it was 
     America's last great hurrah. As America's military hardware 
     was being shipped to the Middle East, America's industrial 
     base was being shipped in the opposite direction to China. 
     The war was happening at the same time that ``outsourcing'' 
     became a big story in the media. But the business press got 
     bored and started covering the incredible run-up of housing 
     prices. ``Whoopee,'' said all the journalists and economists. 
     ``Who needs industry when we've got finance and housing!''
       But the manufacturing industry's plight continued. I wanted 
     to rename my publication ``One Outrage After Another.'' I was 
     constantly questioning whether I should continue writing all 
     the stories of companies dying, of industries leaving, of 
     workers being laid off, of trade deficits skyrocketing, of 
     China cheating, of the perverse reaction among Washington 
     elites to rationalize the destruction. I wondered if I was 
     the problem. If being Irish meant fixating on the negative. 
     But I had covered manufacturing through the 1990s, and the 
     story wasn't depressing. I even wrote a book about U.S. 
     companies' adoption of the Toyota Production System and lean 
     manufacturing and the good it was doing. It was not me. It 
     was the story that could not be ignored.
       I got to know other people who couldn't sleep at night 
     fretting over what was happening to the United States 
     industrial base. These were patriotic people who started to 
     coalesce around these issues, who were utterly perplexed by 
     the federal government's total unwillingness to act on behalf 
     of American producers and their workers.
       The government knew what was going on. But its political 
     appointees made nonsensical ideological arguments concerning 
     ``free trade'' and ``free markets.'' ``We've got a war going 
     on, we can't support U.S. manufacturing'' was a refrain I 
     heard over and again by political appointees at the 
     ``Commerce'' Department and White House.
       Manufacturers weren't looking for a hand out or a bailout. 
     They only wanted one thing: for the United States government 
     to put the interests of American producers

[[Page E2228]]

     above the interests of foreign countries, foreign producers, 
     importers and the multinational companies that were taking 
     advantage of mercantilist practices in China. American 
     manufacturers wanted the U.S. government to put the interests 
     of American producers ahead of the law firms representing 
     foreign shipping companies, the lobbyists representing Wall 
     Street and, again, the multinational companies that were 
     swimming in record profits by sending their production 
     offshore; all while the critical manufacturing sector was 
     left for dead. ``Good riddance,'' said the financial elite 
     and its power structure: ``those jobs sucked anyway.''
       Those same free-market, capitalist, anti-government, anti-
     regulation ideological zealots are now begging--demanding--
     that taxpayers give them a trillion dollars for destroying 
     the American economy.
       I never once reported about the dire warnings of an 
     economic meltdown--about the inevitable financial catastrophe 
     being caused by the asymmetrical global trade imbalances that 
     were mounting by the day. I had my own 401k to worry about 
     along with three older children, and I was not going to be a 
     reporter who stoked the possibility of economic Armageddon.
       I guess I was wrong. I guess I should have been reporting 
     on the impending collapse because President George Bush, 
     Treasury Secretary Hank Paulson and Federal Reserve Chairman 
     Ben Bernanke sure haven't had any such reservations about 
     scaring the bejesus out of us.
       What strikes me as particularly sad, however, is the clear 
     FACT that in all of the discussion about bailing out the 
     financiers and their agents who killed the American economy, 
     there has not been one mention of the real reason for 
     America's collapse, nor of what is needed to start the long 
     process of restoring the country back to some semblance of 
     economic health.
       The housing bubble and sub-prime loans are only part of the 
       The real culprit is the fact that almost everything 
     Americans buy is made somewhere else. The country continues 
     to ship all of its wealth overseas. Did the economic policy 
     makers not watch the opening ceremony of the Olympic Games in 
     Beijing? Have they not seen the 200-story skyscrapers going 
     up in Dubai?
       The core of America's economic problems stem from the trade 
     deficit and the elimination of tens of thousands of factories 
     and millions of jobs that were creating the wealth the 
     country needed to pay for everything. Without that wealth, 
     the financial sector invented playthings and the nation 
     borrowed until it could borrow no more.
       Oh, but wait! The answer to the problem is to borrow more 
     to bailout the people who over borrowed. The Paulson 
     proposal, unexpectedly defeated on Monday September 29 in a 
     harrowing live television broadcast, was to allow the U.S. 
     government to payoff bad debts by going deeper into debt. It 
     did not sit well with anybody.
       September 29, 2008, will be an important day in the history 
     of the American Republic. It is the day the American era 
     ended. Watching the live pictures on CNBC of the traders in 
     the pits watching the television monitors above their heads 
     as the vote on the House floor was tallied was like watching 
     New Yorkers standing in horror as they watched the burning 
     World Trade Center towers in 2001. The congressional vote 
     count was simulcast with the Dow, and they were crashing in 
     unison. There was shock in the eyes of the traders, and a 
     panic among the CNBC broadcasters, who couldn't believe what 
     they were witnessing. These men and women are consummate 
     professionals and are not prone to panic. But there they were 
     barking out: ``What's happening with gold?'' ``Look at the 
     oil markets!'' The market did what the towers did and what 
     our President predicted: it collapsed. For the second time in 
     seven years, the energy was visibly drained out of Lower 
     Manhattan and the country at large, as it realized a scary 
     new era had begun.
       Yet, there is still NOT ONE mention from anyone in power--
     especially not the two presidential candidates, nor of a 
     single congressional leader--of what is really needed to 
     bailout the United States.
       The only way out of this mess is for the United States do 
     everything it can to make the country what it was until 30 
     years ago: a nation that valued manufacturing.
       The U.S. economy long ago collapsed around domestic 
     manufacturers. Now it's collapsing around the financial 
     wizards who either forget or didn't know that their 
     livelihoods depended on a robust industry and workers making 
     livable wages.
       As someone who works in Washington, attends press 
     conferences, government meetings, congressional hearings and 
     who asks questions of the power elite, I can assure you from 
     first-hand experience that the United States government did 
     not do a single thing--nothing--to re-set the global ground 
     rules to allow U.S. industry and its millions of workers to 
     be competitive. In fact, all the rules were changed to favor 
     the foreign and financial interests. The country is now 
     paying the real price of saving a few bucks at Wal-Mart.
       The United States government and its elected reprsentatives 
     long ago stopped representing the interests of American 
     workers and American producers. If there is any silver lining 
     in the historic House vote on the Bailout Plan on September 
     29, it is that maybe Congress has woken up to the power of 
     the people. Unfortunately it was the wrong time to wake up. 
     ``The people'' must now pay the consequences of their elected 
     representative's somnambulance. They must now prepare to 
     confront the ``dire'' consequences caused by decades of Wall 
     Street's short-term focus on quarterly profits at the 
     exclusion of everything else.
       The country has a lot to learn from American manufacturers 
     and their workers, and it will not like what's coming one