Biden's blue collar pitch: Factories Now, Jobs Later


Biden's blue collar pitch: Factories Now, Jobs Later

President Joe Biden believes he’s got the U.S. on the verge of a boom time for American manufacturing.

He just needs to convince voters to keep him in office long enough to see it through.

In swing states and factory towns, Biden is making a resurgence in domestic manufacturing central to his reelection pitch. He’s highlighting a surge of investments across the nation as evidence that an economic agenda centered on reviving the country’s industrial core is just starting to pay off.

But 10 months out from the election, those new factory projects remain in their early stages — and have yet to generate an anticipated wave of manufacturing jobs. And after a pandemic-era rebound, industry hiring overall has turned stagnant: Manufacturers added just 12,000 jobs in 2023 amid an extended business slowdown.



The lull has threatened to complicate the White House’s depiction of an economy that's entered a manufacturing renaissance, feeding fears that Biden is losing ground among voters in key battleground states — even as he advances policies aimed squarely at boosting their communities in the long run.

“The messaging is challenging — people actually need to see the results for themselves,” said Rep. Dan Kildee of Michigan, where recent polls show Biden trailing GOP frontrunner Donald Trump. “We’ve got our work cut out for us.”

Biden is spending the first weeks of 2024 trying to make headway on that front, foreshadowing a campaign that will increasingly make the argument that his industrial strategy is poised to succeed where Trump and others before him failed.

Enticed by a range of new subsidies and tax breaks, manufacturers have poured roughly $220 billion into manufacturing construction on Biden's watch. New factories will eventually make the car parts, computer chips and construction materials that the U.S. has long relied on foreign countries to provide.

And in trips over the last month to Wisconsin, Pennsylvania and North Carolina, Biden has vowed that the new investment will ultimately create a rush of jobs.

“What we’re doing here in North Carolina is just one piece of a much bigger story,” he said Thursday in Raleigh, North Carolina. “There’s a lot more work to do, but there’s no question our plan of investing in America and the American people is working.”

The president’s core economic achievement, the Inflation Reduction Act, included a slew of tax credits designed to spark private-sector investment in electric vehicles, batteries and other clean energy components. The CHIPS and Science Act, passed separately around the same time, created nearly $53 billion in grants to aid the U.S.-based production of high-tech semiconductors.

The early returns have been encouraging. Companies rushed to break ground on new factories in hopes of winning those federal incentives, driving industry spending on construction to record heights. And politically, Democratic advisers said, the building frenzy provides signs of progress that Biden can point to in nearly every state.

“By the end of the election, every voter in battleground states is going to hear this story about what he’s done to invest in America’s economic future,” said John Anzalone, the founder of Impact Research and a longtime Biden pollster. “That is just not a message that Trump has.”

Yet central to Biden’s story of a manufacturing comeback is the prospect of thousands of new jobs spurred by his new laws — and so far, those have been slow to materialize. While Biden often touts the nearly 800,000 manufacturing jobs created during his presidency, the vast majority came prior to passage of the IRA and CHIPS, when Americans’ surging demand for goods during the pandemic drove a rapid industry recovery.



Since then, hiring has stalled as the economy evened out, with manufacturing-centric swing states like Michigan, Wisconsin and Pennsylvania actually losing factory jobs in 2023.

Those conditions have left Biden selling a manufacturing jobs boom that may not arrive in full force until well after November. Most companies that broke ground after Biden’s economic bills became law in August 2022 won’t have their new plants up and running until later this year — at the earliest. In high-profile setbacks for the White House, chipmakers TSMC and Intel have both signaled plans to delay production at their newest U.S. factories until 2025.

Commerce Department officials charged with evaluating hundreds of semiconductor subsidy applications, meanwhile, have made just two preliminary awards totaling less than $200 million to date.

“These are the types of problems that present themselves for industrial policy, and I think that kind of thing will continue,” said Michael Strain, director of economic policy studies at the right-leaning American Enterprise Institute and a skeptic of industrial policy he described as overly reliant on the government to drive growth. “There are a million things that make these sorts of policies so complicated, and it takes a long time for the money to even get out the door.”

A Commerce official said the department expects to make more awards in the coming months that carry “much, much higher dollar amounts,” but stressed that the overriding priority is to carefully vet applicants so that taxpayer money goes only toward companies primed to succeed. That emphasis reflects the department's decision to treat its CHIPS awards like long-term ventures — and a tacit recognition that subsidy programs can be doomed by one Solyndra-like investment.

Biden aides who worked on the administration’s broader industrial strategy acknowledged as well that its design means the effects will be measured in years, rather than months.

“These are envisioned as long-term investments that are about the next 10 to 15 years,” said Elizabeth Reynolds, a former Biden National Economic Council official focused on manufacturing and economic development. “It’s important to remember that the challenge the U.S. has had in recent years has not been about creating new jobs. Our challenge has been the quality of jobs.”

For Biden, a more immediate task is selling voters on those plans to revitalize their communities, even if much of the proof remains under construction. In aDecember focus group of swing state Democrats and Independents run by Navigator Research, few said they’d even heard of the CHIPS Act, or knew how Biden’s broader economic investments stood to benefit them.

The White House argues voters won’t discount the pandemic rebound, noting it represented the first full post-recession jobs recovery in modern history. But over the next several months, senior aides said, Biden and his allies will need to make a concerted push to boost Americans’ awareness of all the work underway — and connect that early progress to the broader vision the administration must execute on in a second term.

“I don’t think the answer to that question is particularly tricky,” said Jared Bernstein, chair of Biden's Council of Economic Advisers. “We have to get out there and make sure we’re showing and telling folks what we’re up to.”



Biden officials plan to highlight growing construction employment, which has hit record highs. They’ve also stressed the secondary benefits that communities at the center of the revitalization effort are likely to attract.

“Manufacturing and manufacturing jobs come with ripple effects that help the broader community grow,” said Joelle Gamble, the deputy director of the National Economic Council. “It’s not just about one investment, it’s about the entire community turning around.”

Within the Biden campaign, aides believe Biden’s manufacturing policies can be paired with attacks on Trump, with ads comparing new factories and swing state investment over the past couple years with jobs losses and factory closures that occurred during Trump’s term.

But officials said much of the effort will hinge on Biden. The president is expected to step up his travel schedule, putting himself in front of the new factory construction and clean energy projects that define a strategy the administration is hoping voters will believe in once they see it first.

“If you notice, they’re feeling much better about how the economy is doing,” Biden said in Allentown, Pennsylvania, earlier this month. “What we haven’t done is let them know exactly who got it changed. … And that’s my job and our job to make sure people know.”

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By: Adam Cancryn
Title: Biden's blue-collar pitch: Factories now, jobs later
Sourced From: www.politico.com/news/2024/01/19/biden-manufacturing-factory-jobs-00136473
Published Date: Fri, 19 Jan 2024 05:00:00 EST

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