An assembly of Maine companies urges federal officials to act now to save the industry.
LEWISTON – Eight representatives of Maine’s beleaguered manufacturing sector delivered a unified message to the federal government Thursday: Maine’s manufacturers need relief and they need it now.
“Stop studying the issues and deal with them,” implored Thom Labrie, president of Auburn Machinery, an equipment manufacturer for the wood products industry. The company went out of business in June, due in part to unfair trade practices, according to LaBrie.
He testified before Sen. Olympia Snowe, who as chairwoman of the Senate Committee on Small Business and Entrepreneurship, convened a congressional hearing in City Council chambers to discuss small business manufacturing in a global marketplace. In addition to the local manufacturing representatives, two federal officials testified as well: Grant Aldonas, undersecretary for International Trade, U.S. Department of Commerce, and Pamela Olson, assistant secretary for tax policy, U.S. Department of Treasury.
Many of the remarks were directed to Aldonas, who is preparing a report on global competitiveness for the Commerce Department and President George W. Bush. Bush announced a President’s Manufacturing Initiative in March to reverse the losses for U.S. manufacturers.
Aldonas and Snowe got an earful. Among the testimony:
• Labrie cited a need for more access to R&D funding and investment capital in general, but was especially peeved about the lack of intellectual property protections that allow for cheap foreign knockoffs of his products. He said at a trade show in Atlanta, there were Chinese competitors in his booth less than 10 minutes after he unloaded his equipment. In Richmond, one Chinese competitor distracted the Auburn Machinery representatives while an engineer inspected the company’s new recovery technology.
• Randy Cousineau, owner of Cousineau Inc., a lumber mill in North Anson, was taking his son to a dentist appointment last week and passed six tractor-trailers full of logs on their way to Canada, which subsidizes its lumber industry. On the same day, he had to shut down his mill because they had run out of logs to process.
The mill had already gone to a four-day work week. Those six loads would have provided work for his 40 employees for a full day. Additionally, Cousineau said his largest customer in California is now bringing birch lumber in from Russia at a savings of 60 percent. The reason? The Russians are paying their workers $4 a day.
• LoLisa Bonney, chief financial officer of Winderosa Gaskets in Dixfield, had to lay off two people in July because the company lost its customers in Singapore and Malaysia to the Chinese. A few years ago, the gasket market was flooded with products from Italy, which turned out to be inferior and of poor quality. But it took years for the transportation industry to recognize that, and even longer for machinery to be retrofitted with better gaskets, she said.
“We need action now to withstand the threats to our markets that are happening now,” she said.
Action is what Snowe is looking for. She cited statistics that reflect the threat many of the witnesses mentioned. Since 1993, 18,900 manufacturing jobs have been lost in Maine, with 17,300 occurring in the last three years.
A recent ruling from the World Trade Organization is forcing the United States to repeal tax incentives for manufacturers who export goods. If counter measures aren’t taken, manufacturers are looking at $50 billion in additional tax burden over the next 10 years.
“We can’t predicate people’s lives and livelihoods on hope,” said Snowe, addressing her remarks to Aldonas. “What do you expect for action?”
Aldonas made two guarantees: one, that he would finish the draft of his report as soon as he leaves Maine; and second, that the scope of the report won’t be limited to things that only the Commerce Department can do.
Several witnesses said there’s a need for better coordination among federal agencies, especially among Commerce, Treasury and Labor departments. And existing help – in the form of programs offered through the Small Business Administration and Maine Manufacturing Extension Partnership – need better promotion. Only one witness had used SBA services among the witnesses.
“We need to do a better job” getting information about resources to the manufacturing community, said Snowe. “These programs are useful.”
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