‘Not enough, no plan’ to reverse the decline of US manufacturing
US manufacturing is still the most important component of the US economy, but the outlook for its recovery has become a bit cloudy, with some experts suggesting it is a “crisis in disguise”.
The outlook has shifted from an expected recovery to a “sustained contraction” for the next few years, with a combination of rising commodity prices, falling consumer confidence and a global economic slowdown weighing heavily on the US manufacturing sector, said Paul Volcker, the US Federal Reserve chairman.
“The question is, how much more does it have to go before the economic recovery can be sustained?”
Mr Volcker told the BBC.
“I would say that it is not enough, there are no plans to reverse it.”
The US manufacturing industry is not the only one struggling.
The Dow Jones industrial average fell nearly 4 per cent in 2016, as the Trump administration’s budget proposals hit the industry harder than expected.
“It’s a real problem, the government is making it worse,” Mr Volker said.
“And they’re doing it with a little bit of a wink and a nod.
They know what the result will be.”
The Trump administration has already cut funding for key agencies and is also cutting billions of dollars from the Federal Reserve.
The US Federal Trade Commission is also taking aim at President Trump’s administration.
The agency is also working to block the Keystone XL Pipeline, a controversial pipeline that would transport tar sands oil from Canada to the Gulf of Mexico.
As part of the deal, the commission is expected to hold hearings on the pipeline this week, while a separate hearing on the Keystone pipeline is scheduled for next month.
In the meantime, the Trump budget also includes a proposed $20 billion cut to the National Institutes of Health.
It has been estimated that the proposed cuts could result in the loss of $2.8 billion for the NIH, according to the NIH’s budget director, Dr David Goldston.
US President Donald Trump shakes hands with US Secretary of State Mike Pompeo (L) at the US Embassy in Havana, Cuba, on December 19, 2017.
Photo: AFP”There is not a lot of money coming out of NIH,” Dr Goldston said.
“That’s a good thing.”
Dr Goldston told the ABC that the Trump White House had put its hopes in a $15 billion increase in the Department of Homeland Security’s budget.
However, he warned that the budget was not “a silver bullet” to solve the US’s manufacturing woes.
He said the proposed budget cuts were “very disruptive” to US manufacturing.
“We are seeing a lot more of a decline in the size of the U.S. manufacturing base,” Dr. Goldston added.
“We are not seeing the kind of recovery we need.”
“It is very important to recognize that we are not going to be able to maintain our manufacturing base for very long.
It is not sustainable.”
If you are going to have a recovery in the manufacturing sector you have to have some pretty significant reforms to our economic policy to keep up with the pace of change.
“US President Joe Biden delivers a statement during a meeting with business leaders at the White House in Washington, DC, on February 12, 2021.
Photo by Chip Somodevilla/Getty ImagesThe budget plan also proposes a $6 billion cut from the Department for International Development.
That includes the end of the so-called “bilateral assistance” programme, which allows the United States to give money to countries for projects including infrastructure and education.
Mr Trump has previously proposed a $1 trillion tax cut for the wealthy, but critics have criticised the plan for not making enough of a dent in the budget deficit.
The budget would also eliminate the Export-Import Bank, a central bank of the United Nations, which Mr Trump has threatened to scrap if Congress does not act.
Its closure would hit the United Kingdom’s export industries particularly hard, according a report by the Economic Policy Institute, a think tank.
Under the proposal, the Export Import Bank would cease operations and the US would “cut $10 billion from the Overseas Private Investment Corporation, which provides foreign direct investment to the US”.
The US has already said it will not be renewing the Export Imports program, but it is unclear what the fate of the bank will be.
At the same time, Mr Trump’s budget proposal includes $1.5 trillion for a massive infrastructure plan that includes $400 billion in infrastructure spending, $20bn for a new border wall and $50bn for roads, bridges, ports, airports and other public works projects.
He also plans to increase defense spending by $100 billion over the next decade.
Some analysts have suggested that Mr Trump will not meet his promised budget promises.
President Donald Trump speaks during a press conference in the Oval Office of the White, House in White