WASHINGTON, D.C. — U.S. Senator John Thune (R-SD), Ranking Member of the Senate Committee on Commerce, Science, and Transportation, delivered the following prepared remarks at today’s “The Role of Manufacturing Hubs in a 21st Century Innovation Economy” hearing:

Mr. Chairman, I want to thank you for holding this hearing on efforts to promote U.S. manufacturing and advance our innovation economy. 

There is no question that manufacturing is critical to our nation’s economy and our global competitiveness. We see evidence of this in each of our states. 

In my home State of South Dakota, more than a thousand manufacturing firms support more than 41,000 jobs, or roughly 10 percent of the state’s workforce. Manufacturing comprises 9.4 percent of South Dakota’s economy, contributing $4 billion to the state’s GDP. And in 2012, as reported by the Governor’s Office of Economic Development, South Dakota had the fifth largest increase in manufacturing among the 50 states. 

I would add that South Dakota is a great partner when it comes to providing low costs for doing business. In fact, CNBC ranked South Dakota as the top state for business in 2013. This is attributable not only to the low tax burden – no individual or state income taxes and low sales and property taxes – but also to the low utility rates and favorable legal and regulatory climate.

South Dakota, like most of our states, also participates in programs managed by the Department of Commerce to promote domestic manufacturing. For example, in January of this year, the Manufacturing Extension Partnership, or MEP, run by the Commerce Department’s National Institute of Standards and Technology, awarded cooperative agreements of $400,000 to South Dakota Manufacturing and Technology Solutions to support the first MEP center in the state in 10 years. The new center is based at the University of South Dakota in Vermillion, and is part of its Small Business Development Center network.

So, I appreciate that the federal government has a role to play in promoting U.S. manufacturing. Today we’ll begin an examination of what that role should be, with a particular focus on the administration’s proposal to create a network of manufacturing hubs – a proposal that is largely embraced in legislation recently introduced by Senators Brown and Blunt.

I welcome Senator Brown to the committee today. I look forward to hearing from him and our colleague on the Committee, Senator Blunt, about their legislation, which enjoys the support of groups like the National Association of Manufacturers and the Semiconductor Equipment and Materials International. I also welcome Secretary Pritzker back to the committee for her first appearance since being confirmed. And, I look forward to the perspectives of our impressive panel of industry witnesses – several of whom are experienced at turning cutting-edge research into commercial products.

I hope that, as we examine the issue of how best to ensure U.S. leadership in advanced manufacturing, we will do so with an eye towards maximizing value for the taxpayers and avoiding duplication with the host of existing government programs. Also, while perhaps outside the scope of this committee’s jurisdiction—if we admit any limits to our jurisdiction—we should acknowledge that there are several policies that may hold even greater promise for incentivizing innovation and manufacturing. These include eliminating barriers to free trade and enacting meaningful tax reform, including a competitive territorial tax system that will strengthen the ability of U.S. companies to compete with global competitors – not to mention the long-overdue need to reinstate Trade Promotion Authority that, until recently, hasn’t been a priority of the Obama administration. 

We also cannot ignore the importance of regulatory reform when it comes to our competitiveness in manufacturing. Just two weeks ago, the National Association of Manufacturers announced that our former colleagues Blanche Lincoln and George Allen will co-chair the Manufacturing Competitiveness Initiative, an effort aimed at examining and highlighting the competitiveness challenges facing manufacturers. Among the first issues this bipartisan initiative will address is the impact of unnecessarily burdensome regulations on U.S. manufacturers. 

With that said, Mr. Chairman, I thank you again for calling today’s hearing and thank our witnesses for their testimony.

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