Foreign markets, workers critical for Wisconsin’s economy
There are a lot of ways Washington can screw up Wisconsin’s economy.
The Obama administration’s horribly ill-conceived Clean Power Plan (CPP) immediately comes to mind. If implemented, CPP will punish our coal dependent manufacturing-based economy by mandating billions of dollars of new investment that will have to be paid for by dramatically raising residential and commercial electricity rates, which will make Wisconsin a more expensive place to live and a less competitive place for business.
Another bad idea that could be coming Wisconsin’s way, depending on the results of the presidential election, is trade protectionism. Republican presidential front-runner Donald Trump and Democrat/Socialist contender Bernie Sanders have both said they want to wall off the U.S. economy from the rest of the world.
Trump and Sanders claim that protectionism will save American jobs, but the data shows the exact opposite is true. For example, 95% of the world’s consumers live outside the U.S. By 2050, only 4.1% of the world’s population will live in North America. Most of the planet’s population and middle class wealth will expand in Asia, which is why exports are so critical for a manufacturing and agricultural state such as Wisconsin that makes, grows, and processes things.
If the U.S. rejects international free trade agreements then Wisconsin products will be cut off from the world’s most lucrative markets and good-paying jobs will be lost.
If Trump and Sanders were worried about losing American jobs to foreign competition then the far better policy response would be to support common sense reforms that make our nation’s business climate more globally competitive. A good place to start is to cut the U.S. corporate income tax rate, which at 35% is the highest in the industrialized world.
Reversing the expansion of the regulatory state and tapping into America’s plentiful domestic energy resources would also lower the cost of doing business and spark more economic activity and job growth. And the looming economic threat of the $19 trillion national debt and trillions more in unfunded entitlement obligations should be commanding more attention from all presidential candidates.
Wisconsin companies also need comprehensive federal immigration reform. About 70% of state business leaders from all sectors report that they are having trouble hiring employees. Wisconsin’s worker shortage is projected to get much worse in coming years because there just aren’t enough generation Xers and millennials in our state to replace the baby boomers who are at or reaching retirement age.
One critical solution is to attract legal foreign immigrants, as we have done in Wisconsin since the 1840s. But Trump’s anti-immigration rhetoric would wall off our state from much needed workers in the same way he wants to wall off our products from foreign markets.
When unshackled from bad federal policies, the U.S. economy and the American worker can out-compete any other nation on Earth. But the U.S. and Wisconsin economies can’t prosper as an island. We need foreign markets and we need foreign workers. I hope the candidates for president come to that realization.
Kurt R. Bauer is president/CEO of Wisconsin Manufacturers & Commerce, the combined Wisconsin Chamber of Commerce, Manufacturers’ Association and Safety Council. WMC represents 3,800 employers.
Click here to sign up for the free IB ezine – your twice-weekly resource for local business news, analysis, voices, and the names you need to know. If you are not already a subscriber to In Business magazine, be sure to sign up for our monthly print edition here.