Council on Jobs and Competitiveness Meets in Durham, NC

Uploaded by whitehouse on 16.06.2011

Jeffrey Immelt: Okay, Mr. President, let's get started.
Before we get started, I want to introduce everybody.
Chris, would you stand up, Chris Che?
Chris is joining the group, runs a small business in
Dayton, Ohio, $40 million business.
Doubled about every three years, right, Chris?
So he's going to be a great member representing
small business.
Great to have Chris --
President Obama: Just keep that going, man.
Jeffrey Immelt: -- join the group.
So he's done a great job.
So, Mr. President, just to kick it off,
we've been busy at work the last three months.
I think congrats to the team.
Really everybody has come to play.
You know, we think the economy is getting better,
but there is still volatility.
Growth isn't fast enough for any of us.
I know you recognize that, as well.
Jobs are both important to both the economy but also for the
confidence of the country.
The team has really had a very narrow focus on
jobs and competitiveness.
It is non-partisan.
I think our sense is that the private sector has to drive it,
but we need to work with government to facilitate it,
and that's really the attitude we've taken.
What you're going to hear today is kind of a market intelligence
update from the team, so just give you an update on what's
going on in the world.
Then Ken is going to outline -- we're really doing a
sector-by-sector jobs plan that is outcomes oriented,
very focused on results, and really what we want to make sure
we're doing is building a sustainable jobs plan.
Then you're going to hear a series of presentations
that are really focused on supply and demand.
How do we get people to work fast?
Through training, financing, education,
the things that we can move the needle on quickly,
and we'll talk about a few longer term ideas,
like getting 10,000 engineers and doing things on improving
the grid, IPO's, things like that.
And then at the end, Mr. President,
I'll give you an update on the next 90 days,
but we plan to keep this thing going.
I think there's no one silver bullet on job creation.
This is going to be dozens of programs that have metrics and
accountability associated with it,
and that's really the spirit with which we're taking this.
So I'd say everybody here has come to play.
You know, we have our challenges,
but we're all kind of products of this country.
We're all products of the system.
We all owe something back to the system.
And we're all optimists about the long term health
of the country.
So that's where we are so far and I'll turn it to you.
President Obama: Well, listen, first of all, I just want to thank everybody for
the seriousness, the diligence that you've displayed already
on this Jobs Council.
When we formed this, we understood that we had averted
the worst possibilities of a great depression.
We had gotten the economy growing again.
We had stabilized the financial system.
So we had made great strides from where we had been in 2008,
but we understood even though jobs were being created,
they were not being created fast enough.
And I've said this before, I will say it again,
I wake up every single morning thinking about how can I make
sure that anybody who wants a job is able to get a job,
and that's what I think about when I go to bed at night.
And I am absolutely confident about America's prospects for
the 21st century, but we do have some challenges,
and these challenges predated the financial crisis that we
had in 2008.
If you look at what had happened between 2001 and 2008,
job growth was slow even when the economy was growing at a
pretty good clip.
So we've got a combination of factors, as Jeff said,
that come into: How do we create jobs?
I cannot think of a better group of people to help us tackle it
than those who are sitting around the table.
A couple of -- just points that I would make so far.
Over the last 15 months we have seen over 2 million jobs created.
And prior to this month, we had seen job growth at a pretty good
clip for the previous three months,
so we had some good reports.
This last one showed that job creation has not moved
as quickly as we'd like.
Now, there's some headwinds that all of us are aware of.
High gas prices, I think, had a depressing affect
on consumer confidence.
It is something that I think was offset to some degree by
the payroll tax cut that we initiated in December.
That's made a difference in helping families to absorb it,
but when you're reminded every single day that your costs are
going up, that's going to constrain how you think about
spending and investment and so forth.
So that's been a challenge.
Europe is still uncertain, and what's happening with respect
to the situation with Greece, that's something that's created
a headwind for some businesses.
And I also know that Washington getting its act together and
making sure that we've got a credible plan for not simply
raising the debt limit but also medium and long term deficit
reduction is going to be something that's critically
important, and we're spending a lot of time focused on.
The other thing that we had heard in the last meeting was
the question of regulation and regulatory uncertainty,
and I took this very much to heart.
As I've said before, I'm a big believer that it's important for
us to have core regulations that help protect consumers
from being taken advantage of; that protect our air and water.
I think everybody here around this table recognizes that
having a smart regulatory structure can actually enhance
market competitiveness, but it's also important to make sure that
these regulations are serving a purpose and that the benefits
exceed the costs.
So what we've done is to initiate a full scale regulatory
review, not just of pending regulations but actually looking
back for the first time at all existing regulations.
And I have to tell you, I just did an address on this where I
was sitting next to a stack of federal registers where all the
regulations exist, and it was a pretty high stack,
and it was a reminder that very often Washington passes laws but
doesn't do what every business around the table does,
which is to look back and see, did what we do in the past still
make sense in the current operating environment.
Cass Sunstein has been leading this process,
and we released an initial report where we've got scores of
regulations that we are prepared to eliminate because they no
longer apply to current situations.
We think it is going to be able to save billions of dollars for
businesses, just in terms of compliance costs over the next
several years, and this is an example of how ideas that
were generated from this Jobs Council we're going to act on.
Sometimes we can do it administratively;
we don't neat legislative cooperation in order to
make it happen.
Sometimes we are going to need legislation, and where we do,
having a group like this that can reach a bipartisan
consensus and then push congress to act, I think,
can make an extraordinary difference.
So, overall, we are feeling optimistic about how this
council can help drive our agenda over the next
12 to 18 months.
I want to thank in particular Penny,
who has been doing some great on skills training and how we
get community colleges linked up with businesses
more effectively.
We had a terrific event just last week with the national
association of manufacturers.
One of the things that I think we're all aware of is that we're
going to have to up our game when it comes to how we train
people for the jobs that actually exist and design
credentialing training programs, apprenticeship programs,
so that people know if they complete this work,
they're prepared to work at an Intel or a GE or any of
the businesses that are represented around this table.
A couple of other things that I'll just mention very quickly,
I know that one of the things that people may be wondering
about, at least the press who have traveled with me as opposed
to the folks who have been down here for the last day is,
why are we here at Cree?
This is an example of the kind of company that I think all of
us want to see being promoted all across the country.
This is a company that is specializing in LED lighting,
has been extraordinarily effective in driving down
the costs of high efficiency lighting that is over time,
I think, going to make a huge difference not just
for businesses who use the technology,
but also for a country that needs to figure out how do
we operate in a more energy efficient way.
They've been adding jobs.
They have trained their workers.
They've got a terrific relationship with the
surrounding community, as well as the institutions of higher
learning in the area.
And so this is a good example of entrepreneurship focused on
technologies of the future, linking up with training
American workers for those jobs, and my understanding is not only
are we focused on the domestic market,
but we're also focused on the export market and competing
internationally, which is going to be extraordinarily important.
So, in conclusion, let me just say how appreciative
I am of all of you.
As soon as all this press clears out of the way,
we're going to be having a more open conversation,
I think, as I understand Jeff, you guys are going to give me
some reports in terms of what the current environment is out there.
As Jeff said, ultimately, job growth is going to be driven by
the private sector, but we can make some smart decisions to
encourage businesses to feel like this is the right time to
invest and that America is the right place to invest,
and that's what we want to find out from you is,
what are you hearing out there, what can we do to make sure that
we're boosting job growth, not just over the next year but over
the next 20 years.
All right?
Jeffrey Immelt: Thanks, Mr. President. Thank you.
President Obama: Thank you, everybody.
Jeffrey Immelt: We never had this at our meetings, but...
So we're going to start with just a couple market
intelligence updates, and the first one we thought it would
be great to hear from Joe Hansen.
Just an update on how you see the world, Joe,
and kind of from the view of labor.
Joseph Hansen: All right, thank you, Jeff, and thank you, Mr. President.
I look at the work of this council as an effort to look
at primarily non-legislative approaches to address the plight
of the millions of unemployed and underemployed workers in
this country.
And I believe we need to play to our country's strengths.
And while this will not be as sexy as some of the things
you're going to hear today, one of our country's strengths is
agriculture, and it's directly employing over
2 million Americans.
And when you add related processing,
distribution and retail jobs, that job number
grows to almost 4 million.
My union, the UFCW represents over 300,000 workers in food
manufacturing, mainly in the meat and poultry processing.
The U.S. meat and poultry industry directly employees
1.8 million people and pays $45.5 billion in
wages and benefits.
An estimated 580,000 people have jobs in distribution of meat and
poultry products, and one in a quarter million more retail jobs
depend on the sale of meat and poultry products to the public.
So the meat and poultry industry is a growing industry with
growing employment.
But exports are a significant and increasingly important
driver of this job growth.
For every $1 billion in beef exports,
over $12,000 are created.
For every 1 billion in pork exports,
over 13,000 jobs are created.
And for every 1 billion in poultry exports,
over 11,000 jobs are created.
Industry economists believe that a focused governmental effort to
address barriers to United States meat exports in Asian
countries has the potential to add thousands and thousands of
jobs in the U.S.
Secretary Vilsack, and Ambassador Kirk have done
important work in this area, and we have already begun
to see results.
China has started to recognize that it is in their self
interest to address their domestic food situation
by cracking open their import door to U.S. meat.
As a result, food exports to China are growing strongly.
Right now, we have additional opportunities with Russia.
Since Russia is looking to join the World Trading Organization,
it is important to get their commitment to drop their various
schemes to block U.S. meat imports.
I know Ambassador Kirk, and his team,
are well aware of these issues, but I wanted to take this
opportunity to stress the impact these issues
have on U.S. jobs.
I also wanted to take this opportunity to stress another
issue, along with the meat export issue,
and that's the importance of traditional defined benefit
pensions and the economic health of this country.
Virtually all economists agree that the U.S. economy
needs to be rebalanced.
We need more national saving, investment,
and new business formation, and we need less debt fueled consumption.
The continuance of defined benefit pension plans needs
to be part of that rebalancing.
In 2007, public and private defined benefit pension plans
had nearly $9 trillion in assets, and in the aggregate,
these plans were almost fully funded.
Obviously the downturn of the financial markets reduced many
of the plans funding, but there is a consensus among labor and
employers that there is a need for relief.
Not to change the requirement for fully funded pensions,
but to extend the time frame for achieving such funding.
Defined benefit plans have made significant investments in the
infrastructure in support of job generation in the U.S.
We cannot afford to lose this source of funds which
help create jobs.
I think a well thought out program of federal government
guarantees and other financial incentives directed at pension
investors could encourage such plans to invest even greater
allocations to rebuilding America's infrastructure.
We hope that the administration and congress can work to achieve
these goals.
And finally, Mr. President, I want to thank you for keeping
America's unemployed at the top of your
administration's priorities.
I look forward to continuing working with the committee to
help you to continue to create job opportunities
for American workers.
Thank you.
Jeffrey Immelt: Great, Joe. Thanks.
President Obama: Let me just make one, two quick comments.
First of all, the point Joe makes about exports from the
agricultural sector, I mean, this is an area where we
traditionally run a big surplus, and we've got to continue to
build on that surplus.
And you're absolutely right that the Korea Free Trade Agreement,
Columbia, Panama, the three free trade agreements that we're
putting forward, actually emphasize opening up these
markets when it comes to agricultural products,
and I think that can make a significant difference.
So that's point number one.
And with respect to Russia, we're very mindful,
and we have at least the appearance of getting resolved
the issue of poultry going into Russia.
There's been some back and forth, I know,
on some of the details of it, but we know that
this is something that can make a very big difference.
Second point you make, you know, we're going to be working
closely with congress around the whole issue of pensions and a
lot of the companies represented around this table probably are
also concerned about how that ends up being resolved and
handled, and we know that this is something we're going to have
to work with everybody on, labor and business,
to make sure we get a smart resolution to that.
Jeffrey Immelt: Great. Gary sees millions of consumers every day.
Gary, what is how you've seen it?
Gary Kelly: Well, thanks, Jeff, and it's a pleasure to be here,
Mr. President, and thank you so much for your leadership during
really tough times.
What I thought I'd do, Jeff, is maybe talk a little bit
about the industry and then Southwest more specifically,
because I think there are some differences.
I think we all know how important transportation
is to the economy, how important aviation is to the economy.
If you look at the domestic air travel over the last decade,
there are fewer jobs, fewer flights, fewer passengers,
fewer airplanes.
All the way around, the domestic airline industry has shrunk.
And there are theories as to why that is.
I think one very clear reason is because costs
are so much higher.
That's including fuel, of course,
but also taxes and the burden of regulation.
There is a different story at Southwest Airlines,
and I think it helps illustrate that point.
We've actually been able to grow Southwest over the past
decade by almost double, and it's because we have remarkably
lower costs, and we've been able to offer much lower fares and
continue to see a very significant shift within
the domestic industry away from our competition.
Current trends are much better than they were,
but we're still -- we're celebrating our 40th
anniversary, by the way, on Saturday.
This is the slowest growing period that we've experience
in our history, because we're dealing with much higher gas
prices, as you mentioned, Mr. President.
So, the benefit is very clear of having lower costs.
It's something that's passed directly through to consumers.
Every new market that we go into where we are able
to lower fares, we see an exponential growth in travel.
Right now the trends are improving with business travel.
We're a lagging indicator in the economic cycle.
We're the last to see softness.
We're the last to see some improvement.
So it is very encouraging to see that business travel is returning.
The domestic industry overall, business travel is still below
prerecession levels.
At Southwest I think be have recovered and are in
an expansionary mode right now.
The consumer has been a bright spot for us,
and again it ties in very closely with our low fares
and our low fare brand.
With respect to jobs, we are growing this year.
We're growing at about a 5% clip.
The way our business works, it's a pretty long lead time
to put orders in with the Boeing Company.
We're an all Boeing airline with all GE engines on them,
which are the best in the world, by the way.
But orders today would probably be delivered in
2013 to offer perspective.
I don't know what gas prices will be then.
I don't know what the economy will be like.
We don't know what the tax burdens will be,
the regulatory environment.
So we want to grow.
We want to buy airplanes, buy more engines, create more jobs,
but right now we're just not generating sufficient profits
in order to make those kinds of investments.
I think there's a couple of things that we're recommending
to the Jobs Council that we focus on.
We must have a modernized air traffic control system.
My best estimate is that it costs us 15% in terms
of additional fuel consumption, which is obviously not climate
friendly either.
We do not fly our airplanes as the crow flies.
We route them according to 1930's weigh points that are
established on the ground with ground based radar systems.
So it is horribly out of date and very expensive
to continue to maintain.
The other thing, of course, is the continued development
of alternative fuels.
There's a lot of focus on that.
Unfortunately, I think, it's going to be many years away
before they're commercially viable to have a real impact,
but it's something that I think we must continue to invest in.
Something that's, I think, closer is the continued
development of aerospace technology.
GE has a new engine that Jeff can certainly speak to,
but we're hoping that it becomes commercially available over the
next several years.
It alone could reduce fuel consumption by 15%,
plus or minus.
So we're looking at the Boeing Company to make commitments to
this next generation airplane, take advantage of new generation
engines and, but that too could be many years away
before we see that.
In the meantime, we're hopeful that we'll continue to see
supportive policies so that there are additional regulatory
and tax burdens, like a carbon tax, for example.
The best way for us to participate in climate
is to seek a new air traffic control system that's more fuel
efficient, as well as new aviation technology that
would be more fuel efficient.
President Obama: Gary, let me just ask you.
First of all, I hope everybody, because I know that it's being
live streamed, and also we've got some press back there,
I just want to emphasize what Gary just said.
15% potential fuel savings in the industry as a whole if we
just got a more efficient air traffic control system in place.
So this is an example of the kind of smart investment where
we will recoup our money as consumers and as taxpayers,
but we've got to get started, because we've been talking
about this now for --
Gary Kelly: Thirty years.
President Obama: -- 30 years.
We have an outdated system, and it is causing not only you guys
to pay more for gas, for fuel, but it also is a
huge contributor to the delays that make people
irritated at airports.
I mean, I understand TSA may have something to do with it,
as well.
So this is an example of a smart investment,
and as we are moving forward, knowing we've got to reduce
our deficit, knowing we've got to get a handle on our debt,
distinguishing between smart investments and
dumb investments, smart spending and bad spending,
is absolutely critical, and a lot of times that is not how
these things are couched in the public debates.
So I just wanted to highlight that.
With respect to -- you mentioned carbon tax specifically.
Gary, are there other things on the regulatory side or on the
tax side that stand out or is it just generally, you know,
businesses get frustrated with taxes and regulation?
Gary Kelly: Well, first of all, we certainly applaud your leadership to not
only scrutinize new regulations but to look at the regulations
that we have on the books.
We do chuckle in the airlines, because we were supposedly
deregulated in 1978, but I don't think that that's
really been the case.
So it's -- I would say the things to look at would be
regulatory burdens that truly don't add to safety or to the
customer experience, and there are a host of those
that we could recommend.
And we have new regulatory burdens coming online now
that are requiring, as a very quick example,
us to completely rewire our systems as to how we
display airfares.
And in this particular case, it's inconsistent with the way
virtually every other product or service is advertised or sold,
and it just, it causes one to ask, well, what is the purpose?
President Obama: So presumably the rationale is making sure increased
transparency for consumers in terms of what they're paying?
Gary Kelly: Yes, sir.
President Obama: What we'll do is we'll follow up with Ray LaHood,
and let's find out, let's take a look at that list
and see what makes sense.
Jeffrey Immelt: Good. Let's get an update on small business. Monica?
Monica Lozano: Sure, thank you, Jeff.
And Mr. President, it's great to be here,
and I would say that for the first time in the past
few years, we are seeing real optimism in the small business
sector, and it's demonstrated tangibly in two very direct
ways: One, in small business formation.
Small business formation is actually up.
And of course we lost almost 150,000 businesses themselves,
small businesses, between 2007 and 2009.
2010, for the very first time, we actually saw small business
growth, and that's important because these are small
entrepreneurs that are putting themselves on the line,
their families' income on the line,
and they're actually seeing this vital segment of the
economy coming back into play.
So, small business formation is up.
More importantly, I think, is the optimism that you
see amongst small business entrepreneurs.
Every indicator shows that people feel much
more optimistic, they're enthusiastic,
they see signs of recovery, they're looking at this year
and the next 12 months as years of tremendous growth.
And so those two factors combined,
small business for making with a sense of great optimism,
I think, for the first time is really fueling a sense that we
have come out of the dip, and I would say that businesses are
now much more confident that they're going to grow and are
compelled to invest in that growth.
And I would just say, excuse me, as an operator,
as an owner of a medium-sized consumer facing company,
we see it in a number of the indicators that
we track ourselves.
So our advertiser base is comprised of close to 10,000
small businesses located typically in urban environments.
What we're seeing 2009 to 2010, we saw a 12% decline in small
business, in small businesses, the number of advertisers that
we had during that one period of years.
What we're seeing in 2011 is not just a recovery where we have
actually seen growth, but this is the area that are actually
stimulating the greatest revenue growth for us.
So these are small businesses that are
operating on the ground.
Mom and pops transportation, hospitality, retailers,
the fact that they're back in the market advertising and
marketing themselves also demonstrates to me that they're
ready to get back in business and are actually prepared to
act on that optimism that we saw.
Of course you mentioned gas prices,
concern around consumer confidence,
but at least for now we're seeing, as I said,
business formation and optimism around this sector.
But demand for investment by small businesses, you know,
you've been out of the market, you've retrenched,
you've restructured, you've downsized,
it's time to grow again, and people want to act
on that optimism and get back in, and unfortunately,
we're still seeing a climate where capital is just not
available to small businesses.
This is probably the number one concern.
So you see, all of this enthusiasm,
and yet only about half of all small businesses say that they
have the necessary financial resources to successfully
execute on their plans.
Loan demand is up, but unfortunately banks have
denied almost 60% of all loan applications,
and of course we understand why.
They take a look back, your cash flows,
your top line revenue growth, and because these past few years
have been so difficult, we're seeing, as I said,
almost 60% of all bank loans to small businesses
had been denied.
Angel investors are back in the market,
but they've only backed about 4% of all the business plans that
they see, and venture capital and private equity is only
funding about 1% of all the business plans that they see.
And of course the head of the SBA is with us,
and they've just revealed that bank loans outstanding
to small businesses actually declined in this last year.
So this is the counterpart.
You've got great optimism.
You're got interest in growth and investment.
People want to invest in technology, new product designs,
new marketing strategies, and access to capital continues to
be the greatest concern.
Having said that, I would also say that the focus by
this council on the small business sector is actually
very gratifying, and as opposed to having a stand-alone set of
initiatives around small business,
the leadership of the council and all of the workgroups are
actually looking at very specific ways in which we
compare large companies with small companies.
We're developing a mentoring program focused on exports,
because we know that actually small businesses are the
greatest number of exporting and producing businesses in
the country, and then certainly evaluating
the regulatory burdens.
So I would say overall for the first time,
and I as a small business owner, medium-size business owner,
feeling very optimistic about the prospects,
want to get back into business and want to grow our businesses,
still lots of concern about access to capital,
and I think the work that we're doing here
about removing barriers, eliminating regulations,
focusing on exports and high growth,
we'll be able to see real success, I think,
in the next 12 months.
President Obama: With respect to capital, we have had sort of an ongoing series of
conversations among cabinet members and those who are on
the economic side of our work, looking at what the continuing
barriers to getting capital are for small businesses.
Obviously, Karen has been leading the charge on this.
Part of what makes this a challenge is we've got a lot of
independent regulatory agencies with oversight in the banks,
and, you know, having a conversation with them that
doesn't tip over the line and encroach on their independence
but, you know, those who are in the financial sector and the
banking sectors, you know, I'll be interested in hearing from
you guys what you're saying.
A lot of small businesses rely on smaller banks to access their
capital, and I think community banks I've been getting a lot of
reports are still having trouble,
partly because they were overinvested in real estate that
is still very weak, but part of it may be that there's been an
overcompensation when there was over-exuberance
pre-financial crisis.
Now people have pulled back and haven't been willing to
loosen up enough to capture the enthusiasm that you're
talking about.
Monica Lozano: Yeah, and I would just say, banks are lending.
So you see greater commercial loans, you see industrial loans.
What you're not seeing is small business lending,
and certainly the SBA back loans are there.
Small businesses can't access the capital market,
so this continues to be the most important issue.
President Obama: Right.
Monica Lozano: Thank you.
Jeffrey Immelt: This is the place we're going to stay focused in terms of
where the council goes in the next 90 days,
because we hear it consistently enough.
President Obama: Good.
Jeffrey Immelt: Maybe, Roger, you wrap up us with a look at the markets?
Roger Ferguson: Sure. Obviously the markets are reflecting exactly what you only
understand, which is that the economy continues to
grow but there's some volatility for sure.
And I would say the markets are also clearly focused in not just
domestically but internationally,
because there are international capital markets these days.
So the earlier point you made about uncertainty around Europe
is actually playing through the markets for sure, no question.
I would also say the markets are waiting for something that is
going on in Washington, which is to understand how the debt
and deficit talks unfold.
At this stage I would say things are relatively quiescent,
but obviously as we get closer to that August 2nd date that the
Secretary of the Treasury has put out there,
markets are going to become much more focused in,
and my expectation is that they'll have to be a lot of
activity much before that point, as you well understand,
because of the limited amount of time that
Congress is in session.
So at this stage I would say markets are, roughly speaking,
supportive of growth.
They're reflective of the ups and downs and volatility and
always being forward looking.
Two big questions: How things unfold in the global economy
and how things unfold here domestically.
If I could add one other thing, because, as you know,
I represent or work with a number of individuals
and their savings, and we're clearly seeing,
as I said to you the last time in our phone calls and others,
folks at the lower end of the spectrum are still looking to
tap into the savings in various different ways.
Those who have jobs are feeling moderately more confident if I
can sort of impute some psychological outcomes
to some of the calls that we are getting.
So it's a very interesting, ongoing dynamic in the U.S. economy.
President Obama: Well, the point about deficit and debt and how
this gets resolved relative to debt limit, obviously,
is going to be consuming over the next several weeks.
The thing I want to emphasize is that we need to solve our medium
and long-term debt and deficit problems not for abstract
reasons but because they are a concrete impediment
to growth and jobs.
So, you know, the American people need to know that over
the next month as we focus on making sure that we have
a balanced, thoughtful resolution to this problem,
this isn't to the exclusion of worrying about jobs but is
actually in service of making sure that businesses have enough
confidence about the investment environment that they can start
getting off the sidelines and putting more money to work,
and hiring more people, and building more plants,
and building more equipment.
One thing that I do think is important is making sure that
we are keeping our eye on the need to accelerate the recovery
as part of the overall package that we agreed to.
You know, I've long believed that coming out of as bad of a
recession as we've been in that it's important for us to focus
on, what are the real drivers of our debt and deficit problems,
and that's not, you know, the day-to-day spending.
It's the structural problems that we have between sending
too much money out and not bringing enough money in.
And the steps that we take don't have to create a sudden drastic
cliff in 2012 or 2013 while the economy is still recovering.
We've got a 10 year time horizon and a 20 year time horizon that
we can operate off of, and I think that can -- that gives us
a little bit of room to continue to do some smart things like the
payroll tax cut that we initiated in December,
while still keeping our eye on the ball in terms of the
long term, so.
Jeffrey Immelt: We're going to shift gears now.
President Obama: Let's do that.
Jeffrey Immelt: Talk about the jobs plan and some of the activities of the
council, and maybe Ken is going to start it off just to give you
an over the top sense of jobs plan that we're putting together
as a council.
Kenneth Chenault: Good. Thank you, Mr. President, for your sense of focus and
urgency on job creation.
And we also know that this goal has to be integrated with the
overall objective of growing our economy.
So the assignment for this working group has been to
produce a jobs plan and really a framework for all the work
across the Jobs Council, and I think we have had excellent
collaboration across the council on this.
We obviously want to bring a sense of urgency to this
challenge, but we want to do it in a way that's both
focused and comprehensive.
So what I thought I would do is just go through some
of the principles we're following on the council.
The first is we want to look at everything through the lens of
job creation.
We want to look at every proposal we consider through
the lens of job creation.
If we do this, what will the impact be on job creation?
How quickly will it have an impact?
What are the actions or resources necessary to
implement the proposal?
And as a result, we've done a bottoms up analysis and
attempted to quantify the job creation opportunities by sector
and industry and identify the job growth potential
of each proposal.
Second, we've got to take a comprehensive approach.
And we're not focused exclusively on any
particular sector or income group or geographic region.
Instead, we want to move down a number of tracks at the same
time exploring multiple proposals for potential
job creation.
And we looked at this potential in different
ways across multiple axes.
For example, across individual sectors and industries of the
economy, what is the potential for job creation,
and what are the problems facing different sectors
of the economy?
We also looked across different regions of the country.
What are the areas that have the highest unemployment and
what skills are needed for the jobs of the future?
And third, we wanted to consider the needs and opportunities
across different income segments.
We really want to create jobs across all income levels.
Finally, and we think this is very important;
we want to focus on outcomes.
This is really core.
One million jobs within two years.
And we believe we need a relentless focus on execution.
Now, as we put together the jobs plan,
we begin by focusing on high-priority segments
with the potential for immediate job growth.
And what we wanted to do was define what I would call
low-hanging fruit areas where the private sector or the
executive branch or both could accelerate short-term job
creation without the need for major legislation from Congress
or actions that would require a long runway.
Now, you're going to hear some of these ideas today from my
colleagues on the council, but you'll also hear ideas
that impact the moderate to long-term job creation as well.
However, given the sense of urgency,
we wanted to have a significant short-term goal,
so we assembled a list of proposals that could
create one million jobs over the next two years.
And we believe by taking a series of actions across one
million jobs that it could end up being, as I would call it,
a significant down payment on job creation
over a longer horizon.
So let me just give you two examples.
Travel and tourism is a growing sector globally,
but the United States is losing market share and
has been for years.
We believe that the executive branch in business must
accelerate a range of initiatives from speeding
the process of getting a visa to strengthening promotion programs
in order to once again make the United States a leading
destination for the international traveler.
This will position the travel industry for further
growth and create hundreds of thousands of jobs in the U.S.
There are also other important examples,
some of which you'll hear about today,
where the private sector can take the initiative without
any action by the federal government,
especially in the area of training.
And Penny Pritzker and her team have been working on that,
working with colleges and various vocational schools.
Employers around this table are moving ahead on a range
of programs that will train more workers who can fill
jobs in manufacturing and create a new generation of
healthcare professionals.
Now, this will not only equip our workers for today's jobs.
It will strengthen and make us more competitive
in the global marketplace.
I think as Jeff said, there is not one silver bullet to
accomplish this job creation goal.
Many actions are required in the coming months,
and we will continue to look at a broad range of ideas,
some of which we hope will be big ideas.
I think that we're approaching the challenge of job creation
across multiple timeframes.
And we recognize that our report today is only a beginning.
The approach we're taking is to focus on the short,
the moderate, and the long-term, as we believe this is the best
way to create jobs in a sustainable way.
Ultimately, we believe we must take fundamental steps to build
and ensure that this country is more competitive in the global
marketplace and that we have a long-term strategy for
sustainable job creation in the United States.
Jeff Immelt: So, so far, we've got probably 30 ideas the
council is working on.
Ken, and some of the rest of the team,
is presenting it at places like the Business Roundtable,
NAM, places like that.
So we're reaching out to all of our business colleagues to
get everybody in the game.
And that's the way, I think the only way we can approach this,
is step by step, multiple ideas across multiple segments.
And we're going to leave behind a full out jobs plan.
So a couple of the ideas -- Steve is going to kick
off and talk about really one of the financing streams and how it
can work for small business.
Steve Case: Jeff, about a month ago, decided to create a new
committee of this group called Focus on High
Growth Entrepreneurship.
And the reason it's so important is while small business really
is the foundation on which we built America,
it's these high growth companies that create all the jobs.
The Kauffman Foundation research suggests 40 million
jobs have been created over the last 25 years from
high-growth companies.
And they account for all the net job growth.
So if we want to get this nation moving,
want to get unemployment down, want to get the economy moving,
want to ensure national competitiveness,
getting entrepreneurship right is critical.
It really is the secret sauce that's built America.
Companies like GM or IBM -- it's now celebrating
its 100th anniversary -- are really started by entrepreneurs.
This is a nation built by entrepreneurs.
And cities like Durham were built by entrepreneurs.
We really got to get it right.
Unfortunately, we had some challenges.
I work up this morning and read the USA Today.
On the front page, it says weakest start up
since the early 1990's.
So there's work to be done to get this back on track with
your leadership and Jeff's leadership.
There's four particular initiatives I wanted to
give you a quick update on.
The first is this new committee of the Jobs Council is working
on a roadmap for entrepreneurship.
We're working with McKinsey.
And we've talked to dozens of groups and assembled all the
best ideas from inside the administration of Congress,
from business groups, from other groups,
trying to gather them all together,
run some analytics against them in terms of where the real
leverage is, and come back at the next meeting with really a
roadmap, a specific prescription to get this moving again and
help to build bipartisan support for a plan that
would be 6, 7, 8 items.
That's number one.
The second, tomorrow, under the leadership of Secretary Locke,
the National Advisory Council on Innovation and Entrepreneurship
is meeting.
And they will be discussing a report with eight items that
focus on access to capital, some early-stage capital,
some late-stage capital.
I think some important work has been done with that group.
The third, the Startup America initiative that you helped us
launch about four months ago is off to a good start with
corporate commitments to give entrepreneurs great resources as
well as focusing on building up regional ecosystems.
You'll be pleased to know.
I still think you should think about Hawaii as your home.
We did launch Startup Illinois a few weeks ago,
and there are many of these other regional efforts that
are being developed.
And finally, as part of the jobs plan,
with the leadership of Karen Mills at the SBA,
over the last three months, there have been eight
roundtables, Reducing Barriers Roundtables,
all around the country.
Two hundred thirty different suggestions were made in terms
of streamlining access to SBA resources, loans, and so forth.
So we're working with the SBA to try to put a specific plan
in place to essentially get people access to these resources
that already exist but they don't necessarily know how to
navigate through a complicated system to do that.
So the combination of this jobs plan, I think really,
the roadmap for entrepreneurship,
the access to capital work NASI's [phonetic] done,
the early efforts of Startup America which seem to be
building some momentum, and looking at ways to streamline
the SBA, I think we can get this back on track,
as Jeff said and Ken and others.
There's no quick fixes here.
It's going to take a lot of work over a sustained period of time.
But I think focusing on entrepreneurs and celebrating
them as American heroes and looking at ways to reduce
barriers and to really get more people to start up companies,
more people to ramp up companies,
in particular unleashing these high-growth speed ups is very
important for the nation.
And we appreciate your leadership.
Jeff Immelt: Penny has an update on getting construction workers back to work.
Penny Pritzker: Thank you, Jeff.
Mr. President, in February, you asked the council to help lead
the Better Buildings Initiative.
And the Better Buildings Initiative's goal is to
save American businesses $40 billion a year on energy bills
by employing new technologies and adopting energy renovations
in America's buildings.
So we support this effort, not only because of its role in
reducing our energy independence but also because this initiative
is estimated to create $114,000 new jobs over
the next two years.
That figure comes from an independent study by the
Political Economy Research Institute of the University
of Massachusetts at Amherst.
And the BBI job creation can begin today.
In addition to new jobs, BBI and the council are promoting steps
that will support the market with better information and
less paperwork.
And it can affect what a building is worth.
Energy performance is often not a factor in real estate
appraisals today because of lack of information, awareness,
and transparency.
So today that's changing.
The Department of Energy and the Appraisal Foundation are
launching a collaboration to educate appraisers.
This effort will make sure that appraisers across the country
have the required information and guidelines to make energy
performance a recognized part of appraisals.
We're also proposing to make the existing business tax deduction
for energy efficiency work better.
Businesses today have told us that it costs more to document
the current deduction than it's worth.
And so today, the Department of Energy launched a new online
tool that makes it simpler to use the deduction without
compromising quality.
So the right incentives in an efficient market
will make American business more efficient and more competitive.
Next, the community colleges are going to help meet the need for
building industry professionals who can support clean energy
technologies and renovations.
On October 15, the National Institute of Standards And
Technology, working with the Department of Energy,
will announce $1.5 million in competitive grants for community
colleges to train workers.
And this will fulfill your commitment to launch a new
commercial building technology extension partnership.
So we're building momentum in the Better Buildings Initiative.
We want to realize the full promise of the 114,000 new jobs.
And lastly, we're working with former President Bill Clinton on
the Better Building Challenge, which is an effort to build
public/private partnerships to create private sector
energy leadership.
The Better Buildings Challenge is where building owners will
commit to upgrade the energy performance on all types of
buildings; whether it be office buildings, schools, hospitals,
this effort cannot only cut cost over time,
but also create jobs today.
So we have a lot of momentum behind this.
The Administration, in various departments,
has done really terrific work and we're very excited
about this.
President Obama: I think the potential on this is enormous.
And it's something I've been discussing with my team,
trying to figure out how to structure all these various
components over the last couple of years.
We know that this is our low-hanging fruit when it
comes to energy efficiency, environmental quality,
climate change, job creation.
And the question is, just how do we get
all the pieces fitting together?
Penny helped educate me on, for example,
even if a building owner knows that they're going to get their
money back for making these investments,
if you've got complications between the lessor and the
lessee, then the person who's initially putting in Cree lights
may not recoup their money.
And so as a consequence, their attitude is, well,
we'll put the low efficiency lighting in initially and we'll
let whoever comes in after us change the lighting if
they want.
But of course the problem is, potentially LED lighting,
for example, could last for ten years.
So if you could figure out a way to build that in from the start,
then everybody wins.
But the incentives right now are skewed across various aspects of
the real estate market.
And so the work that's being done on this, I think,
has enormous potential for job creation,
even as it helps us become more energy efficient.
I'm very exciting about it.
Jeff Immelt: It's low-hanging fruit, it could be privately financed.
We'll stick on it to get it done.
Penny Pritzker: And there's enormous enthusiasm in the building owners.
Jeff Immelt: So next is Matt.
Matt has been working on regulatory -- streamlining
permanent cycle time and all the things that are near and
dear to big and small business.
Matthew Rose: Mr. President, two of the six focus areas,
regulatory and infrastructure, have a common intersection.
And that's around project permitting.
Over the past 60 days, we've held numerous listening sessions
with people from the business community,
the environmental community, and a number of others as well.
I want to share with you some of the thoughts that we've come up
with thus far around some recommendations as well.
My railroad, BNSF, announced this year
record capital spending.
And a large part of that capital will go
to building new projects.
And some of it will go to buy new locomotives.
But let's just stay on the building stuff to begin with.
We see firsthand what happens when you try and permit a
project in this country.
And it can delay things from months to years.
And in many cases it can cause the project to be abandoned.
I'm sure that when you implemented the Recovery Act,
your staff briefed you on many of the challenges of
the permitting process and the impact on putting
Americans back to work.
And that's exactly what we see in the American
business as well.
President Obama: Shovel ready was not as shovel ready as we expected.
Matthew Rose: So many others have found the place that we're in
today and have tried to do things over the years.
Specific legislation was passed in the next highway bill that
really went quite far to help this process.
Specific states: the state of Minnesota has passed a specific
law to help the permitting process,
in this case permitting a new steel factory,
a new steel plant.
We've heard testimony from experts who have been studying
this among other developed countries, not just China.
We always hear the story: Oh, China can do this in 60 days.
This is benchmarking among developed countries.
And there's some very constructive best practices
that our country can learn from, from countries such as Australia
and our neighbors to the north, Canada.
And we want to understand those better,
and we will be doing that.
Let me assure you from the outset though,
this is not at all about eliminating the review process.
It's really about speeding up the process.
And we think it can have significant impact to jobs.
I've got five recommendations, but before I start with those
five, let me just spend a minute on NEPA,
because you hear a lot about NEPA.
And all of us who are involved in the building trades
understand that NEPA really, in my opinion,
needs to be reformed.
It's a process statute, not a decision statute.
And in essence, what's happening is that projects
get pocket vetoed through delay.
You'll hear that only about 3% of the projects
face the full EIS.
But that comprises about 70% of the dollar value
of the federal projects.
And those EISs can take three to five years.
And AASHTO tells us that a project can take,
from planning to implementation, 10 to 15 years.
Now, again, I know that we're not China,
but I think we can do better than that.
So we've got five areas of focus that I would
like to recommend to you.
First, we don't, as a country, even know how many projects are
in the federal pipelines, much less where they sit.
And we would like to ask you to require all agencies to collect
and consolidate the permitting data from all the federal
agencies and make that information transparent
and available.
Federal agencies should ensure that reviews are completed in
a timely manner and that the public has visibility in the
progress of a permit.
Right now, that is just unknown totally.
Secondly, there are high priority projects that can
have a significant impact to job creation.
And those projects ought to be given top priority
for those review.
Third, we need accountability for job creating projects,
which means monitoring and controls by somebody whose
entire mission it is economic development.
This means empowering executive offices not only to coordinate
but if necessary to make the final decisions under
the deadlines that the administration
sets for decision.
In essence, we want the White House to play the role of
quarterback where necessary.
There's a couple other challenges that you're going
to need a little bit of help from your friends in Congress,
but these are really important.
First -- or fourth issue is really that many state processes
can be at least as stringent as the federal processes.
And those should be allowed to satisfy the federal processes.
Projects should not be subject to duplicate state and federal
reviews where states are in a better position to consider the
project and are committed to devoting the resources.
And then fifth, finally, permit litigation is one of the biggest
levers against project construction.
State holders should certainly have their day in court,
but the opportunity to challenge projects must be shortened.
I clearly get that the politics of all this is very,
very difficult.
But I also know that you have a desire to improve both the
environment as well as your commitment to economic growth.
And I think that you're uniquely situated to bridge
these two issues.
I really do believe that -- and I think if you ask everybody in
this room, if we adopted these five recommendations,
that you would see a significant impact to job creation,
American competitiveness, and something else you speak about
a lot; it's just good government.
That's it.
President Obama: Well, look. I think that's a terrific presentation.
Let me just make a comment.
Maybe this was in some briefing materials that you guys have
prepared, or maybe I just read it somewhere else.
I think we've been rated 27th at this point in the speed of
actually being able to construct something.
Now, that's not very good.
And as you point out, I think there's a way for us to maintain
our environmental standards, make sure that communities
that are being affected by construction have a voice,
but not just add layer upon layer of bureaucracy that is
slowing projects up.
Now, somebody told me -- I think it may have been Steve Jobs at
Microsoft where, in China, you could start building the factory
and they would allow people to start working in it while the
upper floors were still being constructed.
We're probably not going to do that,
but I think that the recommendations that
you put out are ones that we should take very seriously.
One of the bigger challenges, obviously,
has to do with coordination between various state, local,
and federal jurisdictions.
That's actually the thing that I'm most concerned about because
it's not something that I have direct control over.
If there's construction involving a federal project
on federal lands, then potentially, we can cut
through red tape to make decisions quickly.
But the Smart Grid is a classic example.
At the beginning of this recession, when I first came in,
one of the projects we wanted to move rapidly on was the issue of
Smart Grid.
And I was rapidly informed that the problem wasn't actually
capital, that we could actually get private financing for most
of the Smart Grid, the problem was this patchwork of local
jurisdictions and NIMBY, and you know all the typical problems in
terms of siting.
So one of the questions -- you offered in your
list one solution, which is federal deferral to states
in some circumstances.
That may, in some circumstances, be appropriate.
But my instinct is what we're going to have to figure out is
can we get a state/federal/local agreement,
almost like the unified commercial code or something,
where everybody buys into a particular model approach,
a particular standard that a lot of different states apply,
that the federal government applies so that people aren't
having to guess how to approach these problems,
depending on which jurisdiction they're in.
But I'm very excited about this.
We're going to get on it.
Jeff Immelt: Lots of jobs here. Paul's got an update.
Paul is leading the team to get us more engineers in the country
every year, which is an important aspect as well.
Paul Otellini: Thank you, Jeff.
Mr. President, our committee is looking at the significantly
increasing availability of qualified engineers and
technicians in the workforce.
The reason for this is self evident.
Obviously for a knowledge based economy and an innovative
economy, you need these people.
But also near term, there are five times as many openings as
there are qualified people in this country.
So this is a near-term way to really start filling the
job pipeline.
Longer term, if we don't solve this,
those jobs aren't going to be here.
We all understand that.
So in going through this, our committee came up with
three focus areas.
And I'll talk about the first two,
and Darlene will talk about the third.
The first one is on immigration.
And I think you are well aware that if you look at the graduate
degree programs in the United States Masters and PhDs in STEM,
about 50% of those people are not U.S. born citizens
and they don't have the right to work here when they graduate.
In fact, at Columbia School that I think you're familiar with,
the graduating class this year was 85% were foreign born,
of the PhD in engineering.
So we came up with a couple of ideas in this area that
are focused on short term and long-term deliverables.
Short term, the criteria was what can the Administration do
through regulation or just changes in administrative
policies without Congress?
And we've submitted a dozen ideas to the White House staff
in this area.
They have to do with early filing of Green Cards,
Premium Processing, regenerating the National Interest Waiver,
those kinds of things.
And I think there seems to be very good receptivity to this.
And I saw some of them showed up in your speech in the southwest
when you made that.
In the long-term, of course, Congress has to pass some
legislation here.
We're buoyed by the fact that Jeff Lake has a nice bill on
stapling a Green Card to every PhD in STEM.
Zoe Lofgren is working on increasing the total number.
And Lamar Smith is focusing on changing the per country limit
so that we can allow for the importation or accreditation
of mostly Chinese and Indian engineers as opposed to waiting
for the rare finish engineer that wants to work here.
And those all look very good.
The impact on jobs is big.
Every one of these people we can bring into the workforce because
of their skill set, their ability to create companies,
create patents and so forth, generates five jobs around them.
So for every one of these, we get five.
This is a big deal.
That was immigration.
Any comments on that?
President Obama: I'm with you.
But I want to emphasize the point you made because
sometimes this gets posed as immigrants taking jobs.
If we have an immigrant engineer who's coming here and starting a
company that's creating jobs, if we have an immigrant engineer
that is providing a skill that is in short supply and,
as a consequence, the business decides to locate here as
opposed to in India or in China, that's creating jobs.
So obviously, my biggest priority,
which I'm assuming is going to be next on the list,
is making sure that all our kids start studying engineering
because there's nothing -- we used to have the best engineers
and the most engineers.
And there's nothing inherent in our kids' studying Math and
Science and getting advanced degrees in engineering.
So the whole STEM education agenda is one that we've really
got to ramp up.
And so I don't want to steal your thunder.
I'm assuming you're going to talk about that.
Paul Otellini: That's next year. Perfect segue.
President Obama: That's my goal.
Paul Otellini: So as you're aware, only 14% of our undergraduates are enrolled
in STEM programs.
Worst than that though, of the 14%,
40% drop out in the first year, and 60%
in the underrepresented groups.
So these are kids that got the jazz in high school,
were qualified to get into engineering degrees or STEM
Programs, and we lose 40% of them in the first year.
So we decided to look at why.
And it turns out there's a number of schools in this
country that have a very good retention rate.
Michigan for example retains 98% of the freshmen that start in
engineering and get them a degree.
President Obama: Why is that?
Paul Otellini: They have a program that looks at a number of things.
They have high-touch mentorship.
They have an internship program, and they have a
jobs reach out program.
So we're going to steal that.
We're quick to steal that and expand it.
We're recruiting a number of schools that have similar kinds
of problems but not the solution that Michigan does.
And this is mostly private sector focused.
We do have one action item we're going to ask you about,
but we want to have direct engineering engagement,
the mentorship program.
We want companies around the table,
and generally in Technology, to commit to first and second year
internship so that people can see how exciting hands-on
engineering is, and then third, somehow recognize the schools
that do this, through some kind of schools of distinction or
technical seal of excellence program where we recognize
schools that get their graduation rates up in these
programs with some kind of presidential recognition or
maybe something at the White House at some point in time.
This will take some money.
We can do it with private money.
The corporations that we've talked to are willing to chip
in and commit to internships, to jobs,
and maybe even some seed money to feed the high-touch
mentorship that has to happen in the first year.
And our goal is -- there's 120,000 graduates per year
in engineering today.
We think we can lift that by 10,000 a year per year over the
next several years.
That's not enough.
We have a 5x deficit.
So we have to more than triple the number of graduates over the
next ten years to come anywhere close to doing this,
even if we fix immigration.
President Obama: My working assumption though, Paul, is that if we can get the
snowball rolling, then it can build exponentially.
Now, part of this is going to be changing our culture and me
using the bully-pulpit to talk about why this is so important.
The number of young people who, during the 90's and the last
decade, went into high finance who could have profitably gone
into engineering is in part because that was what was
focused on.
That was what was considered sexy as an occupation.
And you know, I want that whole pocket protector to be sort of
the new sex appeal.
And we've seen this happen before.
I mean, this is what the space program did.
A whole generation of young people got attached to the
idea of making stuff and creating new technologies.
It was the most noble of endeavors,
and we've got to get back to that.
So all the ideas that you're talking about,
we want to fully support, figuring out how we can
build a movement behind this.
I think it would be really important,
making this as high-profile as possible.
Paul Otellini: Great. And then the third one Darlene is going to talk about,
which is advanced manufacturing.
Darlene Miller: Good afternoon, Mr. President.
First of all, I would like to really applaud you on your new
initiatives for the Skills for America,
especially the industry recognized credentials.
I think that's going to be really successful in helping
develop the manufacturing sector which really ties in nicely to
what I think is a good solution is a pilot program to expand
advanced manufacturing workforce.
The problem as I see it today is U.S. manufacturers
are encountering difficulties hiring technicians,
skilled trade workers, IT, and individuals with
significant technical training to work in these advanced
manufacturing positions.
Pulling currently indicates 14-52% of prospective employers,
particularly small businesses, are really concerned about the
lack of skilled job candidates to fill this specialized
manufacturing slot that require a degree of training.
And small businesses really have no incentive to risk bringing on
people that don't come in as value-added or to put their
high-tech manufacturing equipment into the hands
of unskilled people.
Small businesses is, as we know, are the countries' engine room
for job growth.
Thirty million small businesses account for
64% of the net new jobs.
And small businesses created 70% of the jobs in the last ten years.
So a solution, we urged the creation of a nationwide jobs
training pilot program geared toward advanced manufacturing.
And this proposal would include two 8-week training sessions
with a private/public partnership involving
companies that seek employees with these skills and knowledge.
Skills that include: computer, numeric controls,
foundations of technical math, computer aided machining and
design, CNC machining, and manufacturing processes,
and other similar aptitudes.
The key to this program is that the employers would help
coordinate the actual programs so that it would be fitting for
the jobs that are currently out there.
Half-way through this course work,
we would have these students intern at our respective
companies in available positions.
The fabricated metal industry is an industry sector composed of
60,000 establishments, which includes 2600 companies in the
high-tech precision machining arena,
of which the Precision Machine Products Association is a part
of and would be the targeted employers.
The Dunwoody College of Technology is a non-profit
technical institute of higher learning that is preparing a
course of study for this pilot.
This college has the equipment, which is very expensive capital
equipment, to help train these people.
And that is what we have found has been a real issue,
the cost of capital equipment at a lot of schools prevent
the real training that we really need.
The pilot concept would need to be spread to other colleges,
since Dunwoody is only one of three nationwide private schools
that actually have advanced manufacturing
skills for workers.
Over the longer term, we would urge consideration of training
of advanced manufacturing workforce being added as a
depreciable expense under Section 179 of the Tax Code.
Currently, equipment itself can be treated as a deductible
basis, but improving our human capital is just as important to
the Tax Code.
And so this would help incentive specialized training as well.
The impact that this would half on the jobs,
assuming the pilot program could be undertaken in a half a dozen
states with appropriate learning institutions,
the first year I estimate our job growth would be 2,000 and
the following year 4,000.
If the Section 179 incentive were enacted,
I'm really confident that there would be substantial business
community interest in this tax adjustment.
I'm optimistic that this could spur the growth of jobs for
small businesses rapidly, plus keep high-tech manufacturing
strong, competitive, and recognized for
quality in the U.S.
Thank you, and I look forward to continuing to work on this
project and with the Small Business Council.
President Obama: Thanks, Darlene.
Jeff Immelt: Mr. President, I think we've run a little bit over on time.
I think you get a sense for the projects we're working on.
We were going to have Lew and John give you an update today,
but I think we've run over.
And we'll find another way to give you an update
on those projects.
President Obama: I'll call them up.
Jeff Immelt: What I would say, the next 90 days,
we're going to keep doing what you've seen today.
Three new focus areas.
I think, infrastructure -- we're really trying to get a private
financed infrastructure momentum building,
so we plan to really focus on infrastructure over the
next 90 days.
Small business financing and creation,
I think that's going to be a key area of focus.
And the third is, you know, the country has closed the gap from
a cost standpoint versus India and China and other countries
around the world from a manufacturing
of software standpoint.
We're really going to try to reach out broadly and see if
there's ways we can get more forward direct investment or,
as importantly, companies to really look at locating
key jobs here.
So those are the three big thrusts.
I think you can get a sense that the team is committed
to the task, and we want to build a jobs plan.
And, you know, we want to make a difference.
President Obama: Well, look, I am enormously impressed with the presentations
that have been made.
And I promise you we are going to act on a range
of these recommendations.
I think that it's important to note that wisely,
the focus of a lot of your recommendations are areas
where we can execute.
Either the private sector can execute on its own or
the executive branch can execute on its own.
I do think that sends a message to Congress though.
We shouldn't have to work around Congress.
They should be part of this process.
And it indicates the degree to which,
regardless of whatever political camp you're in,
there are some common sense ideas that we can all embrace
to make ourselves more competitive that should
not be subject to the usual political gamesmanship.
And this job council, I think, is highlighting a
whole host of those.
So I just want to make sure, Valerie,
that this stuff gets to me as quickly as possible.
So as soon as you guys have put something together,
I want it on my desk.
I want the relevant cabinet people to meet with me and
figure out how are we implementing as
quickly as possible.
The last point I'll make, in addition to just saying thank
you, is the optimism that's projected around this table,
I think, is important.
You know, we've gone through a very difficult time over
the last couple of years.
But every time I look at the data,
every time I look at all the formidable challenges that are
before us, I'm always struck by the fact that these are all
solvable problems.
These are not areas where we don't have good ideas;
we don't know what to do.
And you know, I think that if you look at the reporting that's
been out there just over the last week or two,
it's important for us to not be Pollyannaish.
It's important for us not to pretend like we fully recovered
in the way we need to.
There are a lot of people who are still hurting out there.
But it's also important to remember we've got
enormous assets.
We've got everything that's going to be required to make
these structural adjustments to ensure that we're competitive.
It doesn't require radical changes.
It requires just some common sense approaches to problems.
And I think the more that those of you around this table in
business leadership are pointing that out,
that the sky is not falling, the question is,
are we going to build on the strengths that we've got and
are we going to eliminate some of the weaknesses that
are holding us back.
There's no reason why the 21st century can't be the American
century, just like the 20th century was.
And you guys can amplify that, probably even more effectively
than I can because when I say it, well, you know,
I'm an elected official.
I'm a President.
He's supposed to say that.
So sometimes it may get discounted.
But I know this is something that you
guys believe in deeply as well.
So Jeff, thanks for your leadership.
Great job.
Jeff Immelt: Thanks. Thank you very much. Thanks.