Dollars For 'Little Guy' At Risk

Steve Jordon, Omaha World Herald Overland Products Co.'s metal-stamping business in Fremont, Neb., has beefed up its ability to compete with foreign manufacturers over the past five years with about $30,000 in federal Trade Adjustment Assistance for Firms. It doesn't sound like a lot of money given the size of the federal budget, but Overland co-owner and CEO Bill Ekeler said the funds went a long way to uncover ways for his company to compete more effectively in an industry with lots of foreign competitors. "We wouldn't have spent the money otherwise." Now that program is at risk of losing its funding in mid-2012 unless Congress acts. Nine other Nebraska businesses and 16 in Iowa take part in the program, among about 1,000 companies nationwide that employ about 100,000 people altogether. Overland's products have been on the international scene for years. The company made a news splash when it manufactured components for the 15,000 torches that were used to carry the flame from Greece to the 2002 Winter Olympics in Salt Lake City. Ekeler said the 100-employee company isn't in danger because of foreign competition. But the company used the federal money to pay half of a consultant's fee to devise a computer system to track the 100-employee company's manufacturing performance with the logic boxes — computers that use mathematical "logic" to monitor finished products, waste and other factors. A second project paid half the cost of an intern to devise a way to save energy and waste. The efficiencies help Overland compete in its domestic market as well as in the five foreign countries where it exports products. "It really does make an impact, and these are some dollars out there for the little guy," Ekeler said. "If it goes away, it would definitely be a negative for us." TAA for Firms is a small part of the larger Trade Adjustment Assistance program that is at risk because its authorization expired in February. Reauthorization is imbedded in the South Korea Free Trade Agreement, which awaits ratification by Congress alongside similar agreements with Colombia and Panama. In the meantime, TAA continues with year-by-year appropriations, extending so far through June 2012. The program has three parts: TAA for Workers run by the Department of Labor, costing about $975 million in 2010; TAA for Firms, run by the Department of Commerce and costing about $16 million; and TAA for Farmers and Fishermen, run by the Department of Agriculture, costing about $90 million. Joni Waddell, deputy director of the regional TAA for Firms office in Boulder, Colo., said there's a backlog of companies wanting assistance. The objective, she said, is to keep import-threatened manufacturers in business so their employees don't lose their jobs. According to an analysis by program officials, 95 percent of the companies taking part in the program continue operating. After completing TAA-assisted projects, the businesses and their employees pay more than 10 times as much federal and state taxes in a year as the tax money spent per employee. "We're actually on the front line of saving jobs that have been affected (by trade agreements) and helping stem the off-shoring of U.S. manufacturing jobs," Waddell said. Small manufacturers often lack the resources to improve and remain competitive. "Our role is to try to help them revamp their product development, their customer service, improve their productivity and build a much stronger foundation for solid growth into the future," she said. U.S. firms can't compete in the global economy only on price, she said. "They compete on higher tech, more bells and whistles, more customer service, more competitive angles that provide better products, higher-end products to their consumers." But foreign trade issues are "extremely, extremely political," she said. TAA for Workers is "a big labor program, and anything that is labor-related is bad with certain groups, and anything that's free-trade agreement-related is bad with other groups." For example, in a May 2011 letter, 41 senators asked President Barack Obama not to send the free-trade agreements to Congress until after Congress agrees to reauthorize the assistance program. All 41, including Iowa Sen. Tom Harkin, were Democrats, but Obama sent the combined proposal to Congress without separate action on TAA. Congress' struggle with the federal debt ceiling and budget pushed the free-trade agreements off the front page, but the issue is expected to resurface, possibly when Congress returns in September. Curtis Ellis, executive director of the American Jobs Alliance, said the White House's decision to put TAA within the proposed trade agreement was an attempt to "patch together a majority in both houses. ... It's a very cynical ploy to put them together and make one hostage to the other. These programs should stand or fall on their own merits." Ellis said he isn't opposed to the TAA program itself, although he isn't sure how effective its worker-training efforts have been in qualifying workers for jobs equivalent to the ones they lost to foreign countries. His independent, nonpartisan lobbying group has about 20,000 members and gets its support from individuals and businesses opposed to free-trade agreements. TAA's 49-year existence proves that trade agreements destroy more jobs than they create, he said. Opponents estimate the South Korean Free Trade Agreement would cost 250,000 American jobs through lost production, but supporters say it would create other jobs by adding as much as $12 billion to the annual U.S. economy and boosting exports by $10 billion. Read original post here.