One of the country’s most important industrial companies says the United States is not a good place to manufacture and it will continue moving its assets offshore.
The federal government is “doing everything in [its] manpower [and] capability to destroy U.S. manufacturing,” says David Farr, chairman and CEO of Emerson Electric Co., in a presentation at the Baird 2009 Industrial Conference in Chicago Ill., on Nov. 11. In comments reported by Bloomberg, Farr added that companies will continue adding jobs in China and India because they are “places where people want the products and where the governments welcome you to actually do something. I am not going to hire anybody in the United States. I’m moving. They are doing everything possible to destroy jobs.”
In his Powerpoint presentation available on the Emerson Electric Web site, Farr notes that the federal government is damaging prospects for U.S. economic growth with a $1.41 trillion federal deficit (10 percent of GDP); $12 trillion in government debt that will grow to $20 trillion in 10 years; a policy of printing money; a “non-targeted $800-billion stimulus”; bailouts for Wall Street and the automobile companies; the prospect for cap and trade legislation; a “government takeover” of health care to the tune of more than $1 trillion; increasing taxes and regulations; and a “lack of U.S. $ support” for manufacturing. The global stimulus “soon will fade,” says Farr.
What does it mean for a company like Emerson? “We continue to increase our international and emerging market presence,” says Farr. The company has increased its emerging market sales by 19 percentage points over the past 10 years, from 13 percent of total sales in 1999 to 32 percent in 2009. It is now generating 55 percent of its sales from overseas operations, a figure that will grow to 60 percent by 2014, with 40 percent of total sales coming from emerging markets.
“Emerson’s investment in emerging markets is continuing to pay off with sales growth,” say Farr. In 1999, the company generated $12.4 billion in annual sales from mature markets and $1.9 billion from emerging markets. By 2009, sales from mature markets grew to $14.2 billion, while sales from emerging markets more than tripled to $6.7 billion.
Hat Tip: Patriot Room Blog