over 400,000 in the last two years, which is the strongest increase in manufacturing jobs that we've seen since the late '90s. part of the reason we supported this timing for dealing with our deferred maintenance in our bridges around highways and schools, is there is 17.1% unemployment in construction workers and those are middle class jobs that are important to people. so again, we accept and embrace the idea that we should be doing much more and the president spent the entire fall fighting for that. what i want to say that comes right from the president's state of the union and is particularly interesting and i think is a reason for greater optimism about the next few years for us, could really be seen when the

president did his insourcing form for the state of the union. we had about 40 companies there. they weren't our supporters, no reason for any of those people to be there other than they were companies that had decided to bring jobs back to the united states. or when they had jobs in mexico, china, et cetera. and if you listen to why they were bringing jobs back, you heard both business leaders and labor leaders saying that they think the united states is more competitive for location now than it has been in a couple of decades. and it was interesting some of the things that they talked about that would be helpful. one, i think, and you heard this a lot from the president's job council and something we believe in, which is that the united states should be caring about how strong it's manufacturing and particularly its advanced manufacturing base is beyond the 11 million jobs.

it's clear that manufacturing punches above its weight economically. it's absolutely essential for an innovation economy. 90% of the patents, 70% of private sector research, 60% of exports come from manufacturing. there's an excellent article in the harvard business review in 2009 that talks about when you let manufacturing decline because of recession or because of a particular trade imbalance, that the problem is you lose your innovative and skilled workforce necessary to take leadership in the next new thing in manufacturing. so one of the things we're doing is making a strong push to strengthen manufacturing to make it more competitive for people who locate here.

you have consultants telling people if you look at the next ten years as opposed to the previous ten years, you'll find that the united states workers, per productivity and salary are going to be more competitive just from a cost basis than location in china. and what many of them said were important was, one, the degree that you were encouraging manufacturing. the degree the united states was doing things like we're doing a select usa, we're making it easier for people to figure out how to invest, locate here, encourage foreign direct investment. there was a big push on the community college side. several companies said when they looked, they're looking for where they have a skilled workforce. so college completion, high school completion, the particular skills were important. but several said in the absence

of that, the commitment of a community college to gear up and to help insure that they can fill that workforce was essential in their location decisions. so i think that we as a country could have a major commitment to infrastructure, which would be good for our long-term productivity and growth. but would be very helpful for getting some of those middle class workers back into the economy, back on the job. i think the commitment on manufacturing, on rnd extension, on not just the general skill increases but more specific where communities have the ability to figure out where their skill and job needs are with their major employers and orient not ten years from now but right now how to fill those jobs gives -- was really at the heart of the president's state of the union speech. it was giving a blueprint, not just for the next 20 years and not to just get out of crisis, but what we can do in the next few years to bring the good jobs

back and making sure that our workers have the skills to fill them. >> so what are you going to do about gas prices, what can you do? >> we would prefer that they went lower than higher. >> okay, because we weren't clear. >> that was a fairly district answer, no hedging. obviously, you know, for families who are still struggling, having to pay that extra amount at the gas pump is for them a head wind they would prefer to be without. but i will say, you saw this president fight, refuse to go on vacation or let anybody else go on vacation until he extended the payroll tax cut. at that moment, gas prices were at $3.29. now they're $3.80. the futures market would suggest

they'll go a bit higher. the $1,000, the $80 a month that people get is probably about double what most people are paying in extra gas prices. so i think it is important that the things that senator harper voted for and others to pass the payroll tax cut is a cushion and a buffer for families who are dealing with higher gas prices and provide some cushion and buffer for the economy. we also have a situation now where while that's discouraging for families, you also have more positive things happening at the same time, the strengthening of the job market, some families starting to see their pension value going back to where it was prior to the crisis. so it is a head wind that we face, but it's a head wind that

we face in the mix with other things that seem to be clearly in the right direction. in terms of what we're going to do, as the president says, all of the above. you have to seize moments like this to make people realize how economically insane it is for our economy to be so dependent on the global -- on global crude oil prices. when those global crude oil prices are themselves so dependent on so many different security issues in some of the most fragile parts of the world. so this is a moment for people to seize things like what the president has called for with his car rule, which seeks to get to 54.5 miles per gallon by 2025, something that could reduce our dependence on oil by 2 million barrels of oil per day. it's a reason to do more, whether it's on the drilling

side, but not just for renewable energy, for the advanced car vehicle proposal that the president did. and obviously it is a moment when you have such high prices to make sure that you're not weakening your cops on the beat who watch whether there is any manipulation or price gouging anywhere in our economy. that's why the president has had a very strong funding for things like the cftc. it's why in dodd-frank, some of the reforms were to make sure they had the tools to limit the position the amount any one trader can control in the future market. it gave them power to deal with margin requirements under extreme circumstance. those are all things that the president has proposed and passed that give us more tools to at least insure against illegal manipulation of oil and

energy prices everywhere. and those are things we're fighting every day to keep them from being defunded from lobbyists from weakening it or challenging those measures in court. >> steve has us on a tight leash, so i'm going to ask one more question. the question is, we were joking about obama-clinton comparisons. but listening to you talk, particularly about how you think about jobs and job creation, you were a clinton guy, you were a hillary clinton guy when you joined this administration. you've been portrayed about economic policymaking, including this new book, as having advocated what wound up being losing fights for being tougher on the banks during the bailout, seeking more stimulus early, successfully pursuing the social security tax cut.

now you're at the center of policymaking of this administration. so i'm wondering have you changed or has the president changed? >> you know, i think number one, when this president ran, his focus overwhelmingly was on the trends in our economy, in globalization, and other measures that were creating insecurity for the middle class and greater income in equality. when i met him and started talking to then senator obama in '05 and he asked he to look at a chapter of his book at that time, he was as thoughtful as any political figure about the structural challenges our country faces. the one thing president clinton and president obama will say, when you're president, you fundamentally have to deal with the hand you're dealt and he was

dealt the worst financial crisis since the great depression. and i think that this president has come on from the beginning with a comprehensive strategy. we inherited the worst job market, the worst financial situation, the worst deficit that you have probably ever seen. and it is difficult and it is the challenge he inherited to improve all of them. and at times, you have to focus like a laser beam on one particular thing. that's just the nature of our system. so the president focused on getting the recovery act and the financial stabilization, because if we didn't prevent our economy from going into a great depression, none of the other goals were possible. i refuse for even one second to in any way accept or tolerate the notion that this president has not been bold and aggressive and courageous on job growth or deficit reduction.

i think -- i read on my vacation "the lords of finance." i look at what happens in europe right now. what leader has done more to immediately upon taking office do the most difficult things, most politically unpopular things, like which accounts for everything in the financial stabilization, as quick and with such force and speed as president obama did. we just take for granted he passed an $800 billion stimulus less than one month taking office. the financial rescue was in place within three months of taking office. you take those things for granted. so when the president, when we face a debt limit crisis, and we're engaged in a fiscal -- an

effort to get a fair and balanced grand compromise on fiscal discipline, people say you weren't focused on jobs. it is true when you're locked in negotiations, you have to finish the thing you're doing. it doesn't mean that our plan or strategy for '09, '10 and '11 was to bring back this economy and create the confidence in investment that comes from insuring that nobody thinks the united states is headed for a debt crisis. those are not contradictory goals. they are as complimentary as good hitting and pitching is to a good baseball team. it's the right recipe, boldness on jobs at the same time you're giving confidence that your long-term fiscal situation will be improving. so i think this president has had a consistent vision and what's been difficult is the circumstances he inherited. >> let's go to the microphone.

>> lloyd wood with the american manufacturing trade action coalition. we represent a significant percentage of the u.s. text tile industry, producing napery, everything else that you can use. two short questions -- >> can you make it one, sir? >> one, why isn't the obama administration include communist -- [ inaudible ] if you're for free trade? >> i think if you look at our record, this president has been very aggressive in taking action to ensure we have a level playing field with china. this president was the only president who has used the 421 escape authority that was part of the china wto agreement, and he has taken more trade, more wto actions against china than

his predecessor. you've just seen us file a very important case on china rare earth. you've seen the success of the tire case. you've seen the president just put forward a new inner agency trade enforcement task force to make sure we have the capacity, the language skills to bring more significant cases against our -- against competitors who are not playing by the rules. so i think this president has taken a very aggressive approach, much more so than his predecessor in leveling the playing field with china, and you've seen that consistently and you've seen it over the last two months. we do agree that their currency should be market based. it has improved under president

obama's watch and urging, but not enough. but if you look at the overall policy towards china, it has been one that has been very tough. it has been one that is essentially saying to them that as you are -- as you are playing a big role in the global economy, you have to play by the rules and that we are willing to use the rule based structure of the wto to enforce that. >> let's go over here, please. >> is this on? >> yes, it. >> i have to tell you, i think you've done a brilliant story of telling what i call the obama story. but i don't think -- occasionally obama does it, but i would say most of us have no idea what an extraordinary job he's done because somehow you're not getting the story out. i felt this from the -- >> can you please move to a question. >> i want to ask why they

haven't been more aggressive about getting the story out, because it's been so good. >> well, we're going to put you on the road. [ laughter ] look, you know, i'm going to give a serious answer, which is i think that, you know, any white house lays out, tries to show the count try you're focusing on a specific thing, one at a time, getting that done, making sure everybody understands the pros and cons. when you inherit a crisis, when you inherit a potential economy that could be going into a depression, you don't have that luxury. you have to come with overwhelming force and overwhelming speed on so many different areas. i remember so well, i was at treasury those first two years, and i was most importantly at treasury the first six months.

what was happening, the things we were dealing with from the stabilization to the recovery act to chrysler to gm to aig, i mean, it was just overwhelming. so that's not a communications strategy. that's an economic crisis strategy. and you have to do what you can. and i do think that people will see that story, and i think -- i mentioned the automobile industry. i think that is the most clear aspect. that was something the president did in march of 2009, which his political advisers will tell you they knew was going to be enormously unpopular, and he did it because it was the right thing to do. i don't think there's anybody anywhere, unless they have a very, very specific and calculated political agenda, who does not recognize what a difference that's made. not only for the comeback of the american auto industry, not only for the perhaps million jobs that were saved or more, but for

what that has done to our manufacturing base and our economic future. >> i'm afraid that is all we have time for. gene, thank you so much. [ applause ] >> gene, thank you so much for joining us. thank you both. it's an honor to have gene sperling with us today. now we're going to move to the last two quadrants. i'm interviewing and introducing the next panel. i was just talking to laura tyson. we decided we're going to brief it up. there are a few things i want to prod dr. tyson about, and then we're going to have a bit more time for questions than we've had from some of these panels. i also want to thank our viewers. there was a lot of live programming today on cnbc, bloomberg, c-span all day. we have a lot of people watching on different blogs.

i'm steve clemens, and as you can hear in my voice, i can't wait till we get to the and i w moderating this panel. the way i know laura hochberg is that she was president clinton's economic adviser and now on a key adviser on the bord of economy for jobs for president obama and i want to start with your days at brie where we read your book on basically how to manage an economy back then and you were, and i see bernard schwartz here in the front of the room, and you were not i would say, bernard schwartz was a acolyte in that sense because you were talking about infrastructure and to some degree industrial policy, and i want to start out with the question of wra we are today and

what your experience is today with the clinton and somewhat the obama administrations even though you are an adviser and not an official of the obama administration. what do you think that you wouldn't have thought or given at bre given the government experience. >> of course, nobody in the audience knows what i wrote there so to frame it in a way that relates to what we are hearing today, i was involved early on really in the definition of competitiveness. competitiveness as a term was not commonly used believe it or not a quarter of a century ago which is about how long i have been working on it, and actually a foreign concept to economists who might think of something like comparative advantage, but those of us thinking about competitiveness as countries to make themselves foundations to be a competitive place to locate

and essentially high value business. so we were worried at the time about investing in the foundations of public, the public foundations of competitiveness, infrastructure, research, education and very much of the mind that other countries were beginning to pay attention to this, and the time as the global super power in the world economy was actually limited. that we would face tougher competition, and may as well recognize that and may well have those kinds of investments and think carefully of not just those investments in competitiveness, but also what kinds of activities we wanted to be engaged in. so, i had heard several speakers today talk about the importance as we go forward of the energy s

sector. so that is, you could call that an industrial policy. you look at the sectors of the economy that you say, hmm, this is a sector that has all kinds of effects on the rest of the economy, and we don't want to be strategically dependent on a resou resource that comes primarily from politically unstable countries, many of which are not our allies. so that would be a kind of strategic industrial policy. >> from that time, do you think that we need that industrial policy today, and before you answer, let me share an neck dote, late last year i heard dominic barton who is the managing ceo of mckenzie speak at a conference in france, and he gave a remarkable talk in which he said that their biggest clients were clamoring and wanted an industrial policy in america. that they felt that these are large-scale multinational corporations for which those two words were about as anathema as

you could have. i remember tweeting him at the time to have the high priest of mckenzie to compound on my door for misquoting the guy, but they stood by it. when i talked to the folks at the white house and people involved in the auto bailout and also looking at the strategic sectors and albeit, one of the individuals whom i can't name said we can't say the words industrial policy inside of the obama white house, and maybe those things have changed, but you sit on the inside of those meetings and you are al leleged pounding on the table telling him what to do, so is industrial policy back? >> well, there has been no pounding. >> well, mike splainer said he pounded once. >> i'm on the president's jobs council and he had the volcker

commission, and i was pleased to serve on that and the basic focus was infrastructure and you have heard it again and again and maybe i will underscore it once. amazing bipartisan labor/management around the country, around the country support for the idea that in order to enhance our future competitiveness, a long term goal and in order to create jobs for construction workers now, and in the next few years, the best thing that we could do given the interest rate through the government phases is a major infrastructure policy. the estimates are that we could spend an extra trillion dollars in the next five years on high return projects. the estimates are that we are spending about half of what we should be spending on our infrastructure on transportation alone. so, this is an area where you don't have the talk about industrial policy. you can just talk about a linchpin of competitiveness and

i know the ceos who talk about looking at places around the world, and that is at the top of the list. another thing that is at the top of the list by the way is tax policy. we haven't talked about that a lot here, but the president did just issue a framework for a business taxation. it suggests that we actually should gof aft after a lowerer corporate tax rate and suggests that we should go after broadening the base. there are controversial parts of that and i don't agree with everything that he said, but the notion in order to be competitive as a location, in order to promote certain activities and where does the industrial policy enact? well, the president said in his business tax framework that there should be special treatment for manufacturing and even more special treatment for advanced mfing. he was advancing saying as a general principle that he wanted

to broaden the base and take away a lot of the preferences, but, but he felt that given the spillover benefits of manufacturing for innovation, for exports, and what do we export? we export manufactured products, and what do we import? manufactured products. yes, the services are growing, but there is no way to get out of the trade deficit or improve the current account deficit without a significant increase in exporting manufacturing exports, and you will hear that later from fred. you can basically call it industrial policy or manufacturing policy, but what the administration has concluded is that for spillover benefit reasons, there are lots of things that policy can do with the small adjustment that will give some preference to manufacturing. that is one area where i have seen the industrial policy, and let me give you another area. from small companies how they came together to talk about what

they viewed to be the important source of job creation in the near term and in that case, we focused on things like increasing the speed of visa process i processing or increasing the speed of getting an infrastructure project already funded out the door to actually start getting the people on the job right away. and the things that you can do quickly. the last report focused on competitiveness, and there we were actually focusing on things like setting up an infrastructure bank in a multi-year infrastructure plan, setting up what gene referred to the way that the president talked about it, some additional funding for the community college, because again, i listeneded to most of the presentations today, and repeated theme is a significant number of jobs in the united states right now are unfilled because of a lack of adequate skills. and that, you know, the estimates are all over the map, but say that 5% of manufacturing

jobs, and that is a large number. surveys suggest that i can't fill certain jobs. i don't have the talent, and that is of course one of the things that steve jobs said in that famous last interview with president obama when he said that the jobs were not coming back. he also said one of the reasons that the jobs weren't here is because we didn't have an adequate supply of the kind of intermediate kind of process somewhere between a community college degree and a very, very good technical training program. we have let that language in the united states, and we need to go back to invest. but what i want to say about the industrial policy is that this group also said, and remember, that this is a group diverse sectors, business leaders that the u.s. really has to have a serious alternative energy