After a long and contentious debate, Congress recently passed last-minute compromise legislation to avoid default and reduce the deficit. While not perfect, this bipartisan agreement avoids default, reduces the deficit by $2.7 trillion, rejects attempts to dismantle Medicare, and beats back efforts to undermine Social Security and other lifelines for middle-class Ohioans.
Members of Congress -myself included- have returned to their home states and districts to meet with constituents, visit small businesses, tour factories, and attend roundtables with senior citizens and retirees. But when the House and Senate are called back into session in September, there is no doubt that we must turn our attention back to the top concern for most Americans: job creation.
Ultimately, the debate about the budget deficit should be a debate about job creation. There are millions of Americans who would rather be working or paying taxes than collecting unemployment insurance, Medicaid, or foreclosure assistance from the federal government.
But we will never solve our larger budget problem if we don't solve the jobs problem. And if we want to spur a sustained economic recovery in Ohio and across the country, bolstering our manufacturing sector is critical.
Over the past three decades, financial services jumped from about 11% of our GDP to about 21.5%. Meanwhile, manufacturing has gone from 25% of GDP to 11%. Ohio has lost hundreds of thousands of manufacturing jobs in the last decade.
Why does this matter? First, manufacturing jobs pay 20% more on average than service jobs and have strong multiplier effects, supporting jobs in other sectors of our economy. Wealth begins when you make it, when you mine it or when you grow it.
It is hard to see how we have a strong economy without a vibrant manufacturing base. Since the beginning of the recession, we've seen profits at large financial institutions and other service firms increase, while our nation's unemployment rate hovers around 9%.
Unlike wealth created by complex financial products, wealth created by expanded manufacturing production requires a bigger work force, greater supplier networks, and an entire web of upstream and downstream workers.
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