FRANK CUSUMANO
TRUSTEE MACOMB COMMUNITY
COLLEGE DISTRICT

CANDIDATE FOR  GOP 
NOMINATION
13th District County Commission
Your Subtitle text
Action Plan &
Priorities and Values

THE ECONOMY AND JOBS

JULY 19, 2010
ROMEO TEA PARTY SPEECH


MICHIGAN MANUFACTURING INITIATIVE

There are many avenues to grow our manufacturing sectors. For example, why do Michigan citizens finance the development of technologies at our universities for the benefit of foreign manufacturers? Yes, this is occurring.

Americans and Michigan citizens continue to be the creative and innovative genius of the world, yet manufacturing and production of these technological innovations, whether in the fields of transportation, bio-medical, or you name it, are invariable transferred overseas. Our research universities, supported by our tax dollars and ever increasing tuition fees to our children, are the incubators for these innovations. The University applies for the patents and licenses these intellectual property rights for a relatively small fee which is payable directly to the university.

If elected, I will propose that if the technologies have been developed at one of Michigan's research universities be for the benefit of the Michigan citizens that have financed these developments instead of the enrichment of a few insiders and a small benefit directly to the university.

This is a fundamental change in "business as usual." The people of the State of Michigan should be the beneficiaries of any patents, intellectual property rights, licenses, or contracts, not the few insiders who use the resources of the People of the State of Michigan and get a "free ride." If the businesses accessing these innovations transfer the manufacturing of production overseas or outside Michigan, then the businesses concerns should pay fair and commensurate amount in royalty fees directly to the People of the State of Michigan. If manufacturing and production is located in Michigan, then the royalty fees could be waived or abated.

Why has this been allowed to occur for so long? I believe it is because most legislators don't even know it is occurring and lack the intellectual curiosity to find out, get the facts, and formulate a policy. If I am elected I will change that mentality and challenge my fellow legislators to step up and find creative solutions to grow our local economy and manufacturing base.

Targeted Sales Tax and Exemptions

There are a number of thing we can do immediately to help grow our economy. Initiatives include suspension of certain taxes targeted specifically towards job growth in the green economy.

Additionally, in the short term, targeted sales tax holidays will bring relief to distressed industries and cash strapped consumers. For example, suspension of sales tax on the resale of after market items, including cars and other big item purchases, would help distressed consumers, and results in more money staying in the local economy.

Michigan needs to lead, not follow other states in this area.

Sales Tax Holidays
ACCURATE INFORMATION ON MICHIGAN FINANCIAL PICTURE
NOTE DECLINES IN PRIVATE SECTOR INCOME
State Budget Presentation 011310

EDUCATION REFORM

I support world class public education in Michigan - WORLD CLASS. There needs to be standards to judge academic performance in the global economy. Detractors rely on myths and misinformation to challenge certain undeniable truths.

As an endorsing partner, I support the Common Core State Standards Initiative in its mission to ensure every American student graduates high school with the skills and knowledge needed to thrive in the 21st century. I agree with the goal of the Common Core State Standards Initiative to produce a common core of voluntary state standards across grades K-12 in English/language arts, math, and eventually science that are:
o Aligned with college and career expectations;
o Internationally benchmarked against high performing nations;
o Reflective of vital cross-disciplinary skills such as critical thinking, problem solving, logical reasoning, communication, and team work;
o Fewer in scope and deeper in meaning; and
o Clearly written and user-friendly to educators.
Funding of Public Education and Efficiencies

On the issue of education funding. The Public Schools need to know from the Legislature what the funding levels will be. These levels must be inviolate and cannot be cut once established for the prospective school year. Proposal A funding was, in the short term, an adequate funding source, and since the decline in the overall economy has proved to be a disaster. It was and is a failed experiment in social engineering. As a conservative, I opposed Proposal A. I could see no reason why, when arguing against central control (a long associated hallmark of socialism) so-called conservatives would sign onto and vote for such a measure. However, our then Governor Engler embraced this Proposal along with Deborah Stabenow. Localities, as a result, lost control and can no longer control the funding of their K-12 education in their own backyards. We must extricate ourselves from the briar patch of Proposal A. To the extent that certain districts are unable or unwilling to fund their own district K-12 education, "Big Brother" in Lansing should not be responsible for redistributing the resources. Parents of school age children must accept the responsibilities of citizenship and funding of the education of their children. Control ultimately must be returned to the local school districts.

Exploding the Myths

Critics of public education, or any governmental entity, implicitly and sometimes explicitly, attack the unionization of the employees. Implicit in this argument is that the unionized employees are not worth what they are being paid or that they receive too many benefits, such as pensions and health insurance. Obviously, if there isn't the revenues, some adjustments must be made, and many have been made. These are rarely reported. The myth that is most disturbing is that these unionized employees are substandard, bad or inferior workers and rely on their unions to maintain their employment. Usually proponents of this view point to the corruption of the Detroit Public Schools as evidence of this seriously flawed theory.

I would like to point out that there are just as many if not more examples of hard working, conscientious, and dedicated unionized teachers and employees. In other words, doesn't it seem a bit ridiculous to assert that because an employee is in a union, that they are undeserving of wages and benefits negotiated and agreed upon pursuant to a contract? Where is the responsibility of the the government entity that negotiated that contract? The issue is, and should be about results. I often use the example of the Utica Community Schools (UCS). Those teachers and employees are represented by various unions and their results are indisputable. Their achievements are exemplary:
  • Some 95 percent of last year’s senior class indicated plans to pursue post-secondary education. In addition, 376 of the graduates were named UCS Academic Scholars, having maintained a 3.67 or higher grade point average in a rigorous academic program throughout high school while taking part in extracurricular or service activities.
  • On the 2009 Michigan Merit Exam, the standardized high school achievement test, UCS led all 21 Macomb County School Districts in every subject. The MEAP were results were also excellent and the results are available online.
  • On the 2009 American College Test (ACT) exam, the four UCS high schools, Eisenhower, Ford II, Stevenson, and Utica - were first, second and third (tied) of all high schools in Macomb County.
Results matter, and teachers and the administrators in the UCS seem to work well together and achieve real results. When I ask principals and administrators about making UCS the best in the State they respond to bring on the challenge. How much would you be willing to pay to have the number one academic performing school district in the State? In the Country? What would that do for your home's value? Think about it, because that is where, if I am elected, our school district and State Public Schools are heading. No. 1, and nothing less. UCS proves that teaching and test performance are not mutually exclusive goals.

The point is that the results are what matters and unionized employees don't suddenly transform because the receive a union card. They are our fellow citizens, responsible members of the community and the single biggest influence on our children outside their parents. We need leadership that sets the highest goals, and accept nothing less. Look at results, not rhetoric. Under Proposal A - you finance districts which don't produce results. That is the fundamental flaw of Proposal A.

The next issue is whether the monetary resources expended in education are producing commensurate results. This issue is subject to legitimate debate. I land on the side of the results that I see in the education of my children in the UCS, and focus on increasing private sector wages which have steadily declined over the past 15 years. Others may have legitimate concerns which are subject to fair and honest debate. Therefore, all exact information on the UCS teachers contract, unvarnished, is provided below.

UTICA COMMUNITY SCHOOLS TEACHER CONTRACT SUMMARY
Utica Teacher Contract

 How Decisions on "Free Trade" in Washington, D.C.
effect Michigan's economy


We need to speak with one voice to our elected representatives in Washington, D.C. The empty job creation promises of "Free Trade" are now evident. If export jobs are so good, then why does Mr. Griswold of the CATO Institute tout back and forth between the "service economy" job creation and back again to "export jobs" creation. It's is really an elaborate smokescreen and misdirection. Free trade is really about cheap foreign labor and little if any environmental controls. Foreign countries such as Mexico and the so-called "Asian Tigers" cannot be given competitive advantage over Michigan Manufacturers by using political slave labor, and child labor. They cannot be allowed to pollute the global environment scot-free, and use dangerous and illegal chemicals and components in their manufactured goods, and other unfair trade practices. You can't have a truly competitive global economy where one player refuses, consistently, to play by the rules.

NAFTA, CAFTA and Michigan Manufacturing
and Chinese Manufacturing


A Michigan jobs creator pays more in workers compensation per diem than a 14 or 15 year old worker in China makes in an entire 12 hour day at $0.60 per hour. China Rising Television Series. This is not "free trade" and to maintain otherwise: that this skewed playing field has not devastated our State belies common sense and totally discredits its proponents. Reports to the Department of Labor by Judith Bannister (former head of International Programs Services, U.S. Census Bureau) indicate an average of $0.57 per hour in total manufacturing labor compensation per Chinese worker. Full report linked here. Manufacturing Compensation and Employment in China (2005).

Total manufacturing labor cost compared to the United States is 3% of what it is in the U.S. The 2000 census indicated that 58% of the Chinese manufacturing workers reported working 6 or 7 days a week the previous week. (p.38). During peek production periods (which lasts up to 8 months) most work 60-80 hours per week. Taking into account the variations in currency and buying power a Chinese worker could purchase about what an American worker could buy with take home pay of about $3 per hour. (p.40) These numbers are usually under reported since studying conclude almost all Chinese employers and employees under report income and keep "two sets of books." (p.34) Despite deficient and non-existent enforcement of patents and copyrights (p. 51), American corporations continue to export manufacturing jobs to China. China's official data showed 83 million manufacturing employees in 2002, but that figure is likely to be understated; the actual number was probably closer to 109 million. (Manufacturing employment in China, Monthly Labor Review, July 2005) By comparison, there are 14 million manufacturing workers in the United States and 53 million in the G-7 countries combined.

Meanwhile corporate defense contractors are exempting themselves, with approval from Congress, from the Buy American Act (1933) which required parts purchased by the Department of Defense be sourced from U.S. suppliers and manufactured in the U.S.. Now Department of Defense suppliers and contractors can purchase parts and finished weapons systems from overseas manufacturers. American Soldiers' lives now depend on equipment manufactured by the lowest bidder worldwide, and not manufactured in the United States. Congress quietly revises 'Buy America' rule for Defense materials (2007) Aside from the ludicrousness of giving our actual technology and weapons systems to potential enemies (communists by the way), should a military crisis develop, what are our options?

All these actions have jeopardized our national security and devastated the economy of Michigan, the former "Arsenal of Democracy." Pat Buchanan wrote in his book, "The Great Betrayal" published in 1998:
"Now the grandsons of the soldiers of the [WWII Japanese] army work at high paying manufacturing jobs once held by the fathers of ten-dollar-an-hour retail clerks in Macomb County. (p.8)... I grabbed his hand and told him who I was; he looked up, stared me in the eye, and said in an anguished voice, "Save our Jobs!" It went right through me... What are we doing to our own people? I asked myself. Ever since, I have become convinced that America's elite is oblivious to what is happening to our country, as an older, better America - where we were a community, a nation, a people - slowly dies." (p.19)
Abraham Lincoln, a lifelong proponent of high tarriffs, said that if it were up to him, the only things that would be allowed into the country as imports were things we did not make here. If we did not grow coffee here, that’s OK, bring the coffee in. But if we made steel here, don’t bring steel in. Lincoln was an ardent protectionist his whole career.  In a February 15 1861 speech in Pittsburgh, Pennsylvania, Lincoln stated that: "The tariff is to the government what a meal is to the family."

"There is a widespread belief among our people that under the methods of making tariffs which have hitherto obtained the special interests are too influential. Probably this is true of both big special interests and little special interests. These methods have put a premium on selfishness, and, naturally, the selfish big interests have gotten more than their smaller... [T]he real difference between the cost of production, which is mainly the difference of labor here and abroad... Our Constitution guarantees protection of property, and we must make that promise good. But it does not give the right of suffrage to any corporation. Theodore Roosevelt. Letter published NY Times Feb, 20, 1912. Full article/letter linked here.

Duncan Hunter (Republican Congressman, California) summed it up in an interview: " I'm a Ronald Reagan trader...let me quote you Ronald Reagan on trade. He said,
'To make the international trading system work all must abide by the rules." He further said, "When governments assist their exporters in ways that violate international laws, then the playing field is no longer level and there's no longer free trade.'
Right now...when we compete with China, China starts with 74 points on the scoreboard before the opening kick-off. They get a 17% rebate...to their exporters; they're exporting to the US. Basically they're allowed to operate tax-free. Then they put in place a 17% penalty on our importers. That creates a 34% disparity in the world's competition. Then they de-value their currency by 40%, through currency manipulation. So they start with 74 points on the scoreboard before the opening kick-off. That disparity is so great that you now have lots of financial advisers who are walking into the boardrooms of companies throughout America telling their people that even if they have a more efficient labor and production rate than the Chinese in their particular industry, that it makes sense from a tax and tariff standpoint to move their jobs from the US to China. So we have actually...acquiesced to a system that doesn't allow the most efficient trader to win. It allows the subsidized trader to win and the effect of that is that you have businesses which pay high wages throughout this country -- not based on labor rates but based on the way government has set the rules and set the competition in this arena called trade, that are contemplating moving to China. ...Let me give you an example. I was in South Carolina. Nucor Steel in Charleston has 800 workers. They produce as much steel as... a Chinese plant which has 17,000 workers. They beat the Chinese 20 to 1 for labor efficiency and they pay their people an average of $75,000 a year. Labor cost is not a major issue with them because they're so highly efficient and they are so leveraged with technology and yet, they see now China which is expanding its steel production this year by 130 million tons which is more than the total steel production of the US. That's not fair; that's cheating and that causes aberrations in the trade system and it moves massive amounts of income of what otherwise would be American revenues off-shore." (Link to full interview here)

This is not a conservative or liberal issue. It is an American citizen issue.

WALL STREET vs. MAIN STREET
DON RIEGLE v. ALAN GREENSPAN 1992





Riegle was talking about the trade deficit with Japan in 1992. Here is the deficit with China since 1990.


Here is the chart for the total US trade deficit which is similar to the chart Riegle showed. This deficit is a direct result of manufacturing being out sourced overseas and then imported into the US.



Don't Pollute Here - Pollute Overseas and the Entire Planet


In another stark example of selective conscience, it is an ignored free trade issue that China is poisoning the global environment. American corporations are encouraged to transfer production overseas, where there is little if any regard for the environment. Well, some say, dumping sulfuric acid from American car batteries in an open pit in China and other disgraceful practices in China can't effect us here in the US. Wrong.  Many practices of these ecological crimes effect the entire world.

Americans can only eat no more than one can of tuna per week, and pregnant women not at all without risking birth defects and other mercury poisoning problems. Few, if any, ask why? The reason is because China has, since the 1980s, pumped into the global atmosphere millions if not billions of tons of mercury compounds. As a result, the clouds and water cycle of the atmosphere has rained mercury and contaminated the entire world's oceans and their ecosystem. This is not reported in the main stream press. Michigan manufacturers must install scrubbers and dispose of the toxic waste related to all these manufacturing processes. Some of the toxic waste is actually shipped to China to be dumped. China has been given a free ride, and is poisoning the entire world's food supply from the oceans.

PAT BUCHANAN ON FREE TRADE AND
"TOYOTA REPUBLICANS"



Likewise, the southern states competing with us for manufacturing jobs are less strenuously regulated than Michigan. Michigan workers who move into these states face serious health and safety threats, however, they must do so or face endemic unemployment in Michigan. Either there is uniform regulation, or there should be none at all. That is the choice, unless the People of Michigan are satisfied with the results of the policies thus far.

We need a level playing field for the future generations of Michigan residents.
Website Builder