Testimony of Jeff Faux, Distinguished Fellow, Economic Policy Institute in a hearing before the subcommittee on National Security and Foreign Affairs, Committee on Oversight and Government Reform, US House of Representatives.

Mr. Faux’s testimony discusses de-industrialization and national defense.

That the nation’s industrial base is vital to our national security was for most of our history a core assumption of American economic policy. The manufacturing sector had been a driver of our prosperity, a guarantor of our independence, and the basis
of our rise to world leadership. Had the United States not had the capacity to become the “arsenal of democracy,” the Second World War might well have ended differently.

The war’s end left the U.S. as the dominant manufacturing power in the world for some three decades. Our ability to provide our military with the most advanced weaponry and our civilians with the most advanced consumer goods were two sides of the same policy coin—with both sides crucial to the United States prevailing in the Cold War.

But, as we all know, over the last several decades the American industrial base has dramatically weakened. Economists debate the exact causes, but the decline in U.S. manufacturing has been thoroughly documented, and widely acknowledged by
both policymakers and the public. We have been running trade deficits in manufacturing for over thirty years, relentlessly off-shoring production and steadily losing ground in our capacity to produce cutting edge technologies.

Yet, the threat to our national security has not been reflected in our economic policies, or the way in which we are organized to meet the national security challenges of the future.

Click on the link below to read Mr. Faux’s complete testimony.
 EPI Testimony