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.
President 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