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Rep. Ro Khanna's case for making the U.S. a leader in manufacturing again

ANDREW LIMBONG, HOST:

Rebuilding the American middle class is something politicians in Washington, both Democrat and Republican, have been promising on the campaign trail over the last few election cycles. And while they don't always agree on specifics, the general idea is that the U.S. should do more to restore its status as a manufacturing powerhouse, like bringing back jobs from overseas. But what would that actually look like?

Congressman Ro Khanna, a Democrat from California who represents a district in Silicon Valley, has a few ideas. In a recent article in Foreign Affairs, he argues that the U.S. government and businesses should be doing more to boost manufacturing here - you know, bringing back jobs from places like China - and once again become a leader in manufacturing. But with gridlock in Washington and polarization on, well, everything, how likely is that to happen? To discuss this, we've called Congressman Ro Khanna. Thank you for joining us.

RO KHANNA: Thanks so much for having me on.

LIMBONG: All right. So before we get into your piece, you know, we got to talk about the drama over electing a speaker of the House. How do you respond over what went down last week? What do you think it tells us about what's ahead for this term in Congress?

KHANNA: Unfortunately, I think it tells us it's going to be very hard to govern. I mean, look, democracy is messy, but Kevin McCarthy had two months from November to January to make the deals and get the support. The fact that they were unable to do that, the fact that they kept misjudging the vote count, the fact that it was as chaotic, suggests that it's going to be a tough two years. I mean, becoming speaker is actually an easier vote than a lot of the governing votes.

LIMBONG: Let's talk about your piece to help us get a sense of the problem. You write, quote, "Since 1998, the widening U.S. trade deficit has cost the country 5 million well-paying manufacturing jobs and led to the closure of nearly 70,000 factories. Society has grown more unequal as wealth has been concentrated in major coastal cities, and former industrial regions have been abandoned."

All right. So real quick, if you can, how did things get to be this way? I think your piece puts a lot of the blame on our relationship with China, right?

KHANNA: Well, certainly our trade deals are part of the problem. But the reality is we just stopped caring about production. We said it didn't matter who produced things, and we watched, for decades, as so much of our industry went offshore. I think in the pandemic, people realized how much of a problem this was. They realized we didn't make enough baby formula in America. We didn't make masks in America. And it was a mistake - a mistake by policymakers, a mistake by corporations. We've got to restore production. It's a source of wealth generation and jobs for the middle class and working class.

LIMBONG: In your piece, you call for a new economic patriotism. Briefly, can you outline what you mean by that?

KHANNA: It means that we need business, government, labor, educational institutions working together to make things in America. What would it mean from government? It would mean capital grants and financing so that we can take on building new factories. It would make major investments in new technology because to compete against cheaper labor overseas and less regulation overseas, we need the new technology, the Internet of Things, innovations in manufacturing processes to be competitive. And it would mean massive investment in the workforce. One of the things this country has really done poorly is think about education for those who are not going to get a college degree and the type of skills we need to have a manufacturing base. We've allowed a lot of that to atrophy.

LIMBONG: You write that a new economic patriotism would be a rejection of the kind of state-run capitalism that's prominent in China. But you write, quote, "It should work with China to prevent competition from erupting into war. And the two countries should cooperate on issues of mutual interest, such as climate change, global food security and arms control."

Now, that's a pretty tall order, given the tensions between the two countries. So how do we, like, prioritize ordinary Americans without stoking the flames with China diplomatically?

KHANNA: It's a great question. I think the largest source of tension is that our jobs went there. I was in Pennsylvania, and one of the cab drivers said, Washington sold my father's steel mill job to China, and I'm never going to forgive Washington. If we bring back production, if we rebalance trade with China - it's gone from 70, 80 billion trade deficit to almost 400 billion trade deficit. If we rebalance that, then I actually think it's not just good for jobs here. It's not just good for Americans, but it will reduce the tensions between the two countries, lessen the likelihood of war. Of course, there are major issues with Taiwan and other strategic interests. But at the crux of the anger and resentment towards China is this fundamental imbalance, this fundamental sense that they are insisting on selling us everything and not buying our products.

LIMBONG: I think you probably know this better than anybody since you represent parts of Silicon Valley, but the U.S. economy is very, like, tech driven, right? And a lot of younger people are eager to work in tech. You know, it's a decent job and not because of just the pay, but it just, like, looks like the future. How do you convince a young person - you know, 14, 15 - to say, like, look at manufacturing as a viable economic prospect?

KHANNA: Because the manufacturing jobs are the tech jobs. There's an inner connection. I mean, what is a car today other than a computer on wheels? I mean, the young folks who want to build tech gadgets could also be building those gadgets to send new spaceships or to build new types of industry. The modern factory is all about technology. And that's what actually makes it possible to bring back manufacturing - the Internet of Things, which allows manufacturing to be so much more competitive, where you basically have robots talking to each other, sensors talking to each other. It is what's going to allow America to bring some of this industry back. So these are exciting new jobs. And what I would say to young people is, especially if you want to build things, make things, you can be part of a very exciting process of a production renewal in this country.

LIMBONG: It's clear that this will take some time. So what's going to be your metric of success over the next year? And do you really think it's possible to create that kind of change, knowing what we know about the makeup of Congress?

KHANNA: Well, I do. I'm biased because I helped co-write the CHIPS Act, but that is working. It brought semiconductor production back to the United States. I think the implementation of that is going to be a key metric. Can we increase production of semiconductor chips from 12% to a goal of 20%? And then can we start to do that in other industries? I mean, let's be blunt. Not every American factory town is going to have a semiconductor chip factory. We need to bring back the production of auto parts, of textiles, of steel, of aluminum. Ultimately, I think the metric with China, as I lay out in the piece, is to lower the trade deficit by 10% every year. The last time America had a trade surplus was 1975. I am not a protectionist. I'm not a mercantilist. But I also don't think running structural trade deficits for decades is the answer for American productivity or American preeminence in the economy.

LIMBONG: That was Democratic Congressman Ro Khanna of California. His article "The New Industrial Age: America Should Once Again Become A Manufacturing Superpower" is in the current issue of Foreign Affairs magazine. Congressman Khanna, thanks so much for your time.

KHANNA: Thank you so much. Transcript provided by NPR, Copyright NPR.