Deputy Secretary Porcari at The Manufacturing Innovations 2011 Event

Ladies and gentlemen, once again, Roger Kilmer. [ Music ] Everybody enjoy lunch? It's pretty good again. Partnerships have always been at the heart of the MEP's mission and structure, partnering is in our name, it's in our DNA. Last year for the first time in 23 years, MEP was called to a meeting at the U.S. Department of Transportation. It was a meeting that we were delighted to attend. I walked away from the initial meeting knowing that we had in just a few short hours laid the foundation for a long-term MEP-DOT partnership. I knew because during the course of our meeting our next speaker repeatedly stressed the importance of DOT's commitment to make targeted investments in transportation projects that will require American ingenuity, innovation, and the entrepreneurial spirit that make our nation more competitive globally and strengthen our economy here at home, in short we talked about manufacturing. We talked about the unique capabilities of American manufacturers and their role in DOT's future plans. It is with great pleasure that I introduce you to John Porcari, the 19th United States Deputy Secretary of Transportation. As Deputy Secretary, Mr. Porcari is the Department of Transportation's chief operating officer with the responsibility for the day to day operations of ten modal administrations and the work of more than 55 thousand DOT employees nationwide and overseas. He has focused on transportation's key role in economic development and providing the foundation for America's future prosperity. Mr. Porcari received his BA degree from University of Dayton and holds a Master of Public Administration from the State University of New York at Albany. He, his wife, Heidi, and their five children live in Cheverly, Maryland. Please help me welcome Deputy Secretary Porcari. [ Applause ] Thank you Roger, and most importantly thank you all for being here today. You know, by now you've all heard about President Obama talking about winning the future, well, let's talk a little bit today about what winning the future means. The president says we have to outeducate, outinnovate and outbuild the competition, and when you cut through everything that's why we're here today. The Manufacturing Extension Partnership staff and network are helping America do all three of those things right now. I've been Deputy Secretary of DOT for almost two years now, and I've learned a few things in that time, probably not as much as I should have, but I've learned that there's some things that we can do in Washington. We can set the agenda, we can fund projects, we can bring people together to work toward a common cause, but when it comes to the real action--designing and building the projects that form literally the foundation of our future prosperity--that happens at the local level in communities all across the country. All of you help make that happen, and our nation is stronger because of you. The way we see it, transportation is about more than getting people from point A to point B, it's a reflection of who we are. As a country always in motion, always innovating, and always boldly moving into the future, Transportation is not an end in itself, it's a means to an end for economic development, for a better quality of life for our children. And today, with our economy recovering but still struggling in some sectors, transportation is one of the best catalysts for job growth and economic growth in the near, medium, and long term. For starters, every dollar that we invest in major projects like high speed rail gives the economy an immediate boost. I was reminded of this last Thursday when I visited a company called American Seating in Grand Rapids, Michigan. They manufacture, you guessed it, seats for buses, trains, and street cars. Like many manufacturers in the Midwest, American Seating was slammed when the recession hit. They were forced to lay off workers, and it got to the point where the future of this 125-year-old company was in serious jeopardy. But today, with major investments in our nation's transportation network, American Seating has rehired 40 workers and the future looks brighter than ever. And, by the way, the Recovery Act, the stimulus money, were about 8 percent of that company's revenues in 2009 when they needed it most. We're seeing the same thing happen all across America--transportation is creating jobs. In the medium term, we're already seeing major transportation projects create an economic ripple effect. That's what's happening in the small city of Normal, Illinois, where construction of improved rail service has brought more than 200 million dollars in private investment to its downtown, putting many tradesmen back to work. Companies like the Bank of Illinois have responded by relocating near the Amtrak Station. Normal, Illinois's new conference center has made it a premier destination in central Illinois for meetings and conferences, bringing visitors to spend money in the downtown shops-- shops that now boast a 100 percent occupancy rate. All this new development has also given rail ridership an even greater boost. This is a town of 52,000 people. It now boasts the fourth highest rail ridership in the entire Midwest--that's what rail can do. Think about this: If Normal, which is currently served by five round trips per day, can see that type of growth from Amtrak service, imagine what's possible in larger markets, and what's possible in a nationwide network. You know, there are some who say American's manufacturing days are behind us, but we disagree. In fact, we're seeing small and large companies investing in new facilities and better utilizing existing capacity to handle new transportation-related projects. That's why at the Department of Transportation we're so committed to Buy America, we believe that if we're going to build a world- class transportation network, it will be built and installed by American companies and American workers. [ Applause ] You can even think of it as recycling. We're going to recycle every tax dollar here in America with American companies and American jobs. And that's really where our partnership with the Manufacturing Extension Partnership comes in, MEP provides us with market intelligence about U.S. manufacturing suppliers, their capabilities, and in their interest in addressing the challenge, and in turn MEP connects U.S. manufacturers with DOT opportunities. I'd also like to point out a larger partnership that's out there with the Apollo Alliance, and I know Brian Lombardozzi is here today. We have a great partnership where we're working with the Apollo Alliance that represents manufacturers, unions and others around the country in promoting U.S. manufacturing. The relationships with manufacturers of all types across the nation, as well as the commitment to help these manufacturers diversify and to grow new customers and new lines of business, makes for a perfect fit. The partnership that we have with MEP is already showing results. Just take a moment and think about this. Imagine this, executive branch agencies working together seamlessly for the American people. I think that's our mission statement. As we started, Roger mentioned, as we started our first meeting with MEP, it was clear that they could help us meet the requirements for Buy American on high speed rail and many of our other modal administrations as well, on land, sea, and air. And as we work with MEP we discovered that they're already doing something similar to what we envisioned with other departments: defense energy and others. We can build a bigger partnership. We're really just getting started here. We started with waiver requests on Buy America and using MEP's network to find American manufacturers as an alternative. We've moved on from there. Recently, DOT's Federal Transit Administration teamed up with MEP to find domestic manufacturing capacity for girder rail in the United States. We have 60 cities throughout the United States that are either in planning, design or construction for street cars. It's kind of back to the future, these are they street car networks that most of those cities enjoyed 75 or 100 years ago. Girder rail, which is the rail the street cars and light rail run on, is not made currently in the U.S. It's used throughout the U.S., it's all foreign manufacturers today, what we're working with MEP on is quantifying the demand for the next several years to give American manufacturers the confidence to enter this market. That's really what the partnership is all about. We're talking, by the way, about hundreds of million of dollars of business in that transit arena alone. MEP conducted an analysis for us that showed that several U.S. manufacturers were capable of...had the technical and logistical capacity to produce girder rail. Our next step is to meet with those manufacturers, show them the market, and give them the confidence to build this product in America. It also showed in a larger sense that U.S. manufacturing capabilities throughout the transportation network are really underestimated. Quite frankly, we haven't worked hard enough to find domestic manufacturers for all the components in our transportation network. It's...what we're doing on girder rail is a model for what we want to do going forward. We want to match project needs with domestic production capabilities. I want to talk for just a moment about high speed rail. You've heard the President and Secretary LaHood talk about high speed rail, we have awarded 10.5 billion dollars so far around the country for high speed rail projects. The President's budget calls for 53 billion dollars of high speed rail over the next six years. In the awards...the billion dollars of awards that were announced last week, for example, we have 336 million dollars for a shared equipment pool. There's rail service providers, states in regional rail authorities throughout the Midwest that have to buy their rolling stock separately. It's an extremely inefficient way to do it. It's also one that makes it tough to enforce the Buy America components. What we did with this grant last week was we awarded it as a shared-equipment pool where the states would be buying this together, so we can raise the Buy America percentage on that. We did it with open architecture, where the rolling stock is literally an open design, so any U.S. component manufacturer can compete for it rather than propriety designs. That's the pattern for the future. And our modest goal for high speed rail and American jobs is to capture that entire value chain. People focus on final assembly, it's the most visible part of the process, it's very important. As you all know better than anybody else, the real dollars are in the rest of that pyramid, the entire value chain, we want the paint, the glass, the wheel bearings, the propulsion systems. We want to make sure that we have 100 percent American content if that's at all possible. So, here's kind of the grand bargain. We owe U.S. manufacturers consistency and predicability, that would best be served, by the way, with a long-term surface transportation reauthorization that shows them for at least the next six years what's going to be happening. In return for providing that consistency and predictability that you can make investment decisions on, we're saying, U.S. tax dollars should be spent in America on American jobs. So, we see this virtuous cycle that is happening throughout the U.S. with manufacturers, large and small, where as we enforce Buy America and make it very, very difficult to get waivers to the Buy America requirements, it allows more and more component manufacturers to get into the game. This is true in all of our modes: roads, railways, runways, and waterways, our shipbuilding program as well. Leveraging MEP's knowledge of U.S. manufacturing capabilities, we know will open up enormous opportunities for domestic manufacturing for creating jobs and helping our economy grow. So we are really just scratching the surface on how this partnership can work, we really look forward to your input and your suggestions on it. This is just common sense writ large, ladies and gentlemen, this is how we should have been working in the past. The bottom line, again, is transportation is economic development. It's that foundational investment in America's future. That's why President Obama is so focused on winning the future by outbuilding the rest of the world. If you wonder why we feel a sense of urgency about our transportation network and how it ties into American industry, I'd urge you to think about this, in 2050, 39 years from now, that's kind of the day after tomorrow in transportation planning terms, 2050 they'll be 100 million more Americans. We're going to go from a little over 310 million citizens to well over 410 million and that's like adding California and Texas and Florida and New York to our current population. And think about the transportation network we have today and the congestion, and that congestion can be in the air, it can be on our highways, it can be on our rails. Add in 100 million people, and then you start to see the challenge that we have together to rebuild, reinvent, and reinvigorate the transportation system that we have. MEP and you are going to be critical partners in this, but we think the only way to sustain a world-class economy in the United States is to have that foundation of a world-class infrastructure, including transportation infrastructure. This is not going to happen overnight, we didn't get ourselves into this overnight, but this partnership that I briefly described between MEP and DOT is here to stay. We're doing this, by the way, because we know that the big, tough transportations projects and challenges aren't easy to do, that we need all the help we can get, that the reward if we solve today's problems tomorrow's possibilities are even better. One of the great things about America is each generation has had the foresight to invest in big ideas. And think about this, wherever you're from when you get home look at the transportation infrastructure around you, and look at it carefully, and if you're honest with yourself you know that it was designed, it was conceived and designed and built and paid for by your parents, and your grandparents, and, in many cases, by your great grandparents. Then you need to ask yourself, are we doing the same for the next generation? Are we making those kinds of investments for the next generation that will allow them to live the standard of living and quality of life that we have? And I think, again, if all of us are honest with ourselves we know that's not the case. So that's our challenge. We know it won't be easy. We know it needs to be done, we know that when President Obama talks about winning the future, that's exactly what he means. He means the physical infrastructure. He means the outeducating the infrastructure of the mind and he means RND those are the three pillars of winning the future. We know we can roll up our sleeves and make this work. We are very much focused on this. We couldn't be happier than the partnership that we have. We look forward to building it even broader, strengthening it, and we look forward very much to working with all of you. Thank you very much. [ Applause ]