From The Fort Worth Star-Telegram, “Documentary about natural gas field debuts on CNBC,” announcing tonight’s premiere of Haynesville, a documentary film that tracks the lives of three people affected by the big Haynesville Shale natural gas field in Louisiana and East Texas.

The full title is Haynesville: A Nation’s Hunt for an Energy Future. The film outlines potential economic benefits of the field and shale gas development in the U.S., as well as concerns of residents it could directly affect.

The three “stars” of the film are Kassi Fitzgerald, a single mother and community activist who tries to help secure a favorable gas lease agreement and environmental protections for the rural area where she lives; Reegis Richard, a pastor who uses drilling proceeds to benefit his growing church and expand education and recreation opportunities for youths; and Mike Smith, a self-described “country boy” and lover of the outdoors who marvels at his new millionaire status while trying to keep his rural-oriented life on an even keel.

Haynesville will premiere tonight 9 p.m. Eastern on CNBC. The one hour documentary will repeat at 10 p.m., midnight and 1 a.m.

The movie’s website is www.haynesvillemovie.com. We’re already awaiting the sequel, Marcellus!

Thank you to Kathy Snyder, President and CEO of the Maryland Chamber of Commerce, for inaugurating what we intend to become regular reports on state issues from business and trade association leaders. We’re adapting the early blog category, “Report from America,” for these interviews and soon, we hope, podcasts.

We turn first to Annapolis. The Maryland General Assembly adjourned a week ago Monday, completing a legislative session that avoided tax increases and other additional government spending and programs that could have damaged the state’s business environment. In this 12-minute interview, Kathy highlights key developments during the sessions, such as a compromise that kept the state’s unemployment fund solvent while not adding permanent new costs to business. Another top issues included relief from new storm-water management rules that were unnecessarily burdensome.

Given the state’s slowly recovering economy and the upcoming elections, lawmakers were on good (restrained) behavior, the Chamber President reported. The concern is that 2011 may be different, and the Chamber is already working to prevent a new rush to taxes in the next session of the General Assembly.

The Chamber has posted its legislative recap here. You can also follow the association’s work at its blog, here.

And again, the interview is here, a 12-minute .mp3.

After spending two weeks in Oregon, we leave still puzzled at the state’s inclination to make it hard for people to live there. With all its natural resources and human talent, Oregon could be a growing, thriving place, but instead too many of its leaders work to make it poorer.

Oregon’s unemployment rate stood at 11.1 percent in November, and yet two measures on the Jan. 26 ballot would raise taxes on individuals and corporations and make the state even more inhospitable to employers. Measure 66 increases the state income tax on individuals making more than $125,000 annually, while Measure 67 establishes a minimum business tax and raises the tax rate on some corporations by 1.3 percent. The additional tax revenues would go to the state general fund budget to be allocated by legislators, but advocates — including the teachers and nurses’ unions — are selling the measures as a tax increase on the wealthy for schools and health care. Theirs is an unusually explicit message of class warfare.

The Oregonian’s editorial board, generally moderate to liberal, was sharply critical of the politics that led to the measures. In the paper’s Sunday lead editorial, “Wrong time, wrong tax hikes: Vote no on Measures 66, 67,” the editors wrote:

The two referrals on the Jan. 26 special election ballot — Measure 66 and Measure 67 — insist that Oregonians pick a side, to accept one lousy, harmful choice or the other. No, we won’t do it. You shouldn’t, either.

It didn’t have to come to this. The Democrats who control the Legislature could have approved a modest and mostly temporary package of business tax increases with the full support of the Oregon Business Association, which represents many of the state’s largest and most public-minded corporations.

Instead, Democrats bent to the demands of the most liberal members of their House caucus and approved an unwise and ill-timed package of corporate and personal tax increases that has infuriated virtually every business group and commercial sector in Oregon.

The invidious politics is bad, to be sure, but the effect on the state’s employers, start-up companies and multinational firms alike, is most troublesome. As Bob Wiggins of Mount Hood Equity Partners argued recently, contrary to what the advocates claim, the increases would undermine Oregon’s existing tax advantages that attract business and effectively give Oregon the highest corporate tax rate in the country. It’s an excellent analysis reposted at ThinkOregon.

The Oregonian was not exaggerating when it noted the united business opposition to Measure 66 and 67. Just take a look at the lists of organizations and businesses backing Oregonians Against Jobs Killing Taxes. Manufacturers are well represented among the members.

Still, much more is at stake than just the bottom line for business.  Hasso Hering at The Albany Democrat-Herald made two critical points in an October editorial:

• “Every working person in Oregon depends on the state economy, and if the increases slow the economy or keep it from accelerating soon, everybody in the state will suffer, not just the 2.5 percent targeted by the hike in the personal income tax.”
• “Out-of-state corporations are not generally known to be benevolent outfits that bill their shareholders or CEOs for added expenses in Oregon. If Oregon adds to their expenses, as the legislature wants to do, they force their Oregon operations to pay the bill. More layoffs are the likely result.”

Last week I had the good fortune of visiting Calgary Alberta to speak at an event hosted by the Royal Bank of Canada and the NAM’s sister organization Canadian Manufacturers & Exporters. 

During my visit, I also had the opportunity to tour two manufacturing companies in Calgary:  Plains Fabrication and Supply and Toromont Energy Systems.  Visiting manufacturing facilities is one of the great perks of my job.  Seeing first hand the skill, ingenuity and talent of manufacturers making things is always an amazing experience.  Here is what I saw:

Plains Fabrication and Supply is a steel fabricator the builds, among other things, huge steel vessels that are used by the petroleum and natural gas industries to clean water (the process of cleaning the water actually incorporates the use of walnut shells!) used in the process of energy extraction for reuse.  These vessels vary in size but some are more than 15 feet in diameter and 50 feet long.  At first glance, it appeared to me that Plains was a submarine manufacturer.  This gives you some perspective on how big these vessels are.  Plains Fabrication produces its products for customers in Canada and as far away as Pakistan!  Started more than 20 years ago by four guys, the company now employees over a hundred people and is currently building a brand new manufacturing facility.

Toromont Energy Systems designs and manufacturers modular systems in Canada and the United States that are used in the natural gas, chemical and petro-chemical industries across the globe.  Rather than manufacturing on site, Toromont builds equipment in modules in their factory.  These modules are then transported to their customers and sometimes packaged together into a final product.  Due to severe climate conditions of their final destination, some of these systems are enclosed in what appear to be little houses.

While these companies make different products, two similarities that both companies share are (1) customization: every product that is manufactured by these companies is unique.  The expertise of design and the skill of their workers make both companies world leaders in their respective products; and (2) going global: both companies sell products in markets across the globe.  Going forward, it will be more important than ever for manufacturers both in Canada and in the United States to expand their customer base outside North America. 

I just got back from a productive visit with our friends with Arkansas Manufacturing Solutions (AMS) in Little Rock, offering a talk about the importance of manufacturing to our economy and the challenges we face. The AMS is one of many Manufacturing Extension Partnerships (MEPs) around the country that work with small manufacturers to help them acquire modern technology, have access to professional advice, obtain funding and export their products abroad. The MEPs are a profound blessing to manufacturing and our economy, so of course the bean counters in the Office of Management and Budget try to zero out the minimal federal funding they receive each year, and every year we (the NAM) fight to get it put back. But every dollar that goes to the MEPs generates many more in economic growth, new jobs and exports.

I don’t have space to recount all of the information I picked up down there. But a couple of stories stand out. Timothy J. Grant, Chairman, President and CEO of Actronix, described how his company brought production back to the U.S. from China, primarily because of concern about quality. Lee Morgan, President of Farr Air Pollution Control, described how his company almost went under and attributed much of the credit for their survival – and expansion – to the AMS. There was lots of talk about, and interest in, green manufacturing. And everyone there was grateful to Rep. Marion Berry (D-AR) for his ardent support of the MEP program.

Many thanks to Dan Curtis and Tovia Chan of the AMS for arranging this great meeting and inviting me to speak. I had a wonderful time, and as always happens on these trips, I came back wiser than I left.

Innovation can be elusive. What is it exactly and how can a community nurture and encourage it? One thing is certain: innovation is the foundation of successful manufacturing and those firms that devise new processes and products are more competitive over the long-term.

The business and civic community in Chattanooga, Tennessee has hit on the right formula for identifying what innovation is within their metro region and–better yet–how to recognize and encourage it. More towns should follow their lead.

Every year at this time, the Chattanooga Area Chamber of Commerce announces the winner of the Kreusi Award for Innovation at its Spirit of Innovation Awards Luncheon. This year’s local winner was TR Automation; here’s a good synopsis from the local Chamber of Commerce about why TR Automation was selected.

Chamber President and CEO Tom Edd Wilson presented the Kruesi Award to Jerry Tyman Jr., TR Automation general manager, for developing a revolutionary approach to robotic work station manufacturing.

Called SuperCell, the innovation boosts productivity because the robot or robot group is working 95 percent of the time. The advance—particularly applicable to the automotive and aerospace industries—reduces floor space, improves the quality of parts manufactured and achieves a 30 percent reduction in production costs. TR Automation was selected from seven finalists, including Accurate Automation Corporation, Andersen Flaps, Inc., Astec Industries, Inc., Cleveland Tubing, Inc., EnWaste Recovery Systems and Transcard. All of these companies exhibited their innovations at the Convention Center event

The Chattanooga awards program always draws top speakers and a very large turnout of the regional business community. Tennessee Governor Bredesen spoke and Roger Staubach gave the keynote address.

Full disclosure requires that I let you know that I’ve been honored to be a Kreusi Award judge for the last several years. Chattanooga has drawn a wide range of judges from manufacturing and business to evaluate the nominees. It’s a hard choice, because there are so many excellent examples of successful innovation in the region.

Other candidates included Astec, which has developed a new method to make asphalt that reduces fuel use by 14 percent and reduces emissions as well. If used in the New York metro region, for example, it would save nearly 19 million gallons of diesel used in conventional asphalt making. Accurate Automation was another finalist, which has developed and implemented an unmanned ocean racer with artificial intelligence. This craft can be operated remotely and serves as a patrol boat that can thwart terrorist attacks on ships and oil platforms.

Congratulations to the Kreusi family for supporting this initiative and to the Chattanooga business community for finding a way to shine a light on those firms that are thinking outside of the box and creating new generations of products and processes.

Harley-Davidson motorcycles, with their distinctive chrome styling and rumbling sound, are as American as apple pie.

But NAM employees who went on a tour of the company’s sprawling York, Pa., plant this week found out Harleys are going worldwide. In fact, tour guide Dave Spangler said Harleys have become a “status symbol” in Japan, a nation that is no slouch when it comes to motorcycle manufacturing.

Harley-Davidson Inc. shipped 13,300 motorcycles to Japan in 2006, up from less than 5,000 in 1997 when Japan dropped some regulatory barriers that had throttled sales, said Wayne Curtin, Harley Davidson’s government affairs director.

A matter of fact, Curtin said opening foreign markets is a top priority for Harley Davidson. The Senate is scheduled to vote on a Peru trade pact today, which could help boost motorcycle sales there, Curtin said.

It’s also important the U.S. also approve trade deals with South Korea, Panama and Columbia because these deals would also make Harleys more affordable in those countries, Curtin said.
“The free trade agreements take tariffs of 8 percent to 20 percent and takes them to zero,” he said.

The 40-or-so NAM employees who took the tour of Harley-Davidson’s ultra-modern manufacturing floor, which featured robotic pressers and laser cutters, found out some more facts about the 104-year-old company.

Take our quiz. The answers are in the extended entry of this blog entry:

1. Harley-Davidson ships about 330,000 motorcycles a year. How many go to foreign countries?
A: 50%
B: 20%
C: 5%
D. 30%

2. Which president has not visited the Harley-Davison plant in York, Pa.?
A. Bill Clinton
B. George Bush
C. Ronald Reagan
D. Jimmy Carter

3. How fast can workers build a Harley-Davidson motorcycle?
A. 4 hours
B. 12 hours
C. 2 hours
D. 24 hours

4. Harley-Davidson offers a motorcycle paint color called “Jake and Elwood” blue. Who was this shade named in honor of?
A. The Blue Angels
B. Two plant workers
C. The Blues Brothers
D. St. Louis Blues hockey team members

(continue reading…)

I just returned from a business trip to Idaho where I had the distinct honor to address the 61st annual meeting of the Associated Taxpayers of Idaho, an audience comprised of probably one third business leaders and two-thirds legislative leaders.

While I was in Boise, I had the good fortune to visit the Amalgamated Sugar Company facility just north of town in Nampa. From afar, you can see this plant and its white cylindrical drying towers which have been landmarks here since World War II. If you looked just superficially at this plant, you’d think not much had changed in the past sixty years. And that of course is where you would be dead wrong. And you would have little understanding of how over 200,000 acres of sugar beets are processed at this facility every years–veritable mountains of big white-fleshed sugar beets.

Inside, technology and innovation are afoot as they are at most successful manufacturing facilities. Plant manager Kent Quinney, like many of the employees, has been there for well over a decade because it pays a very good salary and the work is challenging and rewarding. What struck me in my two and a half hours at the plant that much that used to be back-breaking work is now mechanized by machines and even robots. A case in point is a high-speed packaging line where 50 lb bags of finished sugar are handled. Previously one man could fill two, 50 lb. paper bags in a minute. Now, a new high speed packager fills 28 polybags in the same time. That’s a great picture of productivity if ever there was one.

It’s hard to describe the technology at work in the plant. It’s way over my head and I could never do it justice in the same way Kent Quinney explained it. But they are inventing new ways to get more out of each sugar beet and have identified new byproducts that are popular in Japan and Europe, leading to export markets for this staple crop that is used in thousands of ways in baking, candy-making and food processing. Engineers are needed to keep this big operation underway. Large centrifuges are used in the final stages and it is truly magic to watch the yellowed sugar be literally spun white right before your eyes.

While in Boise, I also visited the Darigold milk processing plant. This facility is super clean as you can imagine and the 200,000 gallons of milk that are brought in each day in stainless steel tanker trucks are eventually sent out the door in plastic milk jugs. They plant also processes soy for beverages and it was that line that was underway when I was there, boxing up three large gallon packages for special sale at Costco.

Every batch of milk that is unloaded is sampled for purity and then a similar sample is sent on to company headquarters, in dry ice, for a retest. This is only the start of meticulous testing of the milk product. It’s done over and over again in this plant as the milk is separated, cleaned, processed, pasteurized and packaged. After a batch of milk is finished, the plant uses multiple chemicals to clean the pipes and stainless steel tanks so that there will be no remnants of the previous milk left in the system.

The Darigold facility is heavily regulated–the Food & Drug Administration, EPA, state EPA, clients who have product made there visit frequently, OSHA, etc. While it is different in this way from the sugar beet facility, they are the same in that they have harnessed high-tech innovations to provide customers with the lowest-priced, highest quality known anywhere. And they have helped build food processing into the largest sector of U.S. manufacturing.

It has been twenty years since I was in this state in the upper northwest and I was not prepared for what I found here, as the keynote speaker for the 61st meeting of the Associated Taxpayers of Idaho (ATI). The ATI meeting was a unique mix of state legislators and business people and Gov. “Butch” Otter joined the ATI meeting for lunch and as the featured luncheon speaker. All in all, an impressive assemblage of men and women interested in the future of this state.

I wasn’t prepared to find a state economy that is red hot and one of the top growth economies in the United States. Idaho ranks first in so many important measurements of growth, innovation and entrepreneurialism, that it is hard to know where to start:

It’s first in the nation with its investment in manufacturing.

It is first in the nation in the number of patents issued on a per capita basis.

And it’s only 5th among the states that show a high start-up rate among new businesses.

It’s the #2 state in terms of non-agricultural employment growth and has the fifth lowest cost of doing business.

Its exports have increased by 55 percent, ranking it 7th in the nation.

And it has greater percentage of workers in “high-tech” than even California.

Did you know all this was going on up here?

A state known for great skiing and potatoes has become a LOT more. West of the state of Missouri, only three states obtain as much as 12-13 percent of the state economy from manufacturing and those three are Texas, Kansas and–you guessed it–Idaho. I had the distinct pleasure to visit two of the states major food processing plants while I was here. The Amalgamated Sugar facility in Nampa, just north of Boise. And the Dairlygold milk processing plant in Boise.

Did you know that food processing and manufacturing is the largest single sector in U.S. manufacturing? Bigger than autos. Bigger than chemicals. Bigger than electronics. And Idaho has a commanding lead in many ways within this industry and is carefully laying the basis for further growth within this sector. Hewlett Packard is here and Micron Technologies was born and raised here. But the blog entry that I’ll finish up with tomorrow looks at food manufacturing and the amazing things going on with simple products like milk and sugar beets.

I was pleased for the opportunity to address the combined 79th Annual Meeting of the Arkansas State Chamber of Commerce and the Associated Industries of Arkansas in Little Rock yesterday. It looked like about 200 people, maybe more, turned out to hear U.S. Chamber of Commerce President Tom Donohue and yours truly of the National Association of Manufacturers.

Tom was his usual feisty self throwing rhetorical rocks at labor unions and left-wing activist groups that are advocating higher taxes and bigger government. I focused mainly on the story of manufacturing – that the U.S. remains the world’s greatest manufacturing nation, that manufactured exports are vital to our economy, and that it is high time our political leaders made competitiveness a priority. Tom and I were singing the same tune in our advocacy of a sensible energy policy, reducing corporate taxes, upgrading our infrastructure, reforming health care, bringing sensible balance to our legal system and promoting international trade.

It was my first visit to Little Rock. I was duly impressed with the beautiful city and wonderful people I met there. I extend sincere thanks to Hugh McDonald, Chairman of the Arkansas State Chamber, Benny Baker, Chairman of the Associated Industries of Arkansas and all of the others who made my visit such a pleasure. I hope to see you again.