Advanced Manufacturing: America’s Economic Revival?

For decades, the US manufacturing sector has shriveled, but President Obama now envisions it as an engine of a revived US economy. The basis of his optimism may be hopes for ‘advanced’ manufacturing.

U.S._Dollar_Blue_Eagle_SmallPresident Obama has made support of US manufacturing an important part of his plan to further an economic rebound. The Administration is making manufacturing a key part of its economic strategy for 2012, and possibly beyond. It is asking Congress to remove from the tax code the deduction for moving expenses when a company transfers jobs overseas. At the same time, it’s proposing an expansion of the deduction for manufacturing and a doubling of the deduction for advanced manufacturing technologies – from 9 percent to 18 percent.

The administration is also proposing a new “manufacturing communities tax credit,” which would provide $2 billion per year in incentives for three years to companies that build in a community that has suffered a major job-loss event, such as a plant closing. The opening of a large manufacturing plant has a big ripple effect in a community: Builders erect new housing, more restaurants open, and more tax dollars come in that can be spent on providing services.

Mr. Obama covered these points at a January 25 rally at Conveyor Engineering and Manufacturing, a growing manufacturer of giant augers in Cedar Rapids, Iowa. “We’ve got to stop rewarding businesses that ship jobs overseas [and] reward companies like Conveyor that are doing business right here in the United States of America,” Obama said.

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Source: Ron Scherer | The Christian Science Monitor