Today’s Organization for Economic Cooperation and Development’s Composite Leading Indicators signal demand abroad is on a path of improvement for 2010, but the American economy is not keeping up. Broad based growth sent the OECD higher in October for the eighth consecutive month, and above its long-term average of 100 to 101.4 in October from 100.4 in September. The October rise was driven by solid gains in Europe as well as milder increases in Asian economies. Economic conditions in the United States also are improving but at a slower pace than most of the other OECD nations. Stronger growth abroad along with a more competitive value of the dollar will continue to propel the recovery in U.S. exports that began in May.

Separately, the Commerce Department reported today that retail sales rose by 1.3 percent in November,  slight acceleration from the increase in October. However, 42 percent of last month’s rise was due to increased sales at gasoline stations, which were mainly driven by higher gasoline prices. Outside of purchases at gasoline stations, retail sales rose by only 0.8 percent in November, which was a deceleration from October.

Today’s reports show that while economic momentum is building abroad, the U.S. economy is not keeping pace. The American consumer is reluctant to spend, at least in part because of fears about job security.

While job creation remains a focal point in Washington these days, one of the most effective ways we can do that is to increase exports by approving pending free trade agreements. We know that 95 percent of the world’s consumers are overseas and they have money to spend. In both the near term and long term, an aggressive export campaign is going to be key to job creation.

We wouldn’t go as Canada’s The Financial Post, which proclaims, “U.S. manufacturing rises from the ashes,” but certainly acknowledge good news:

With the global economy expanding and the U.S. export sector getting an additional boost from a sliding greenback, “Made in USA” stocks are looking attractive, even for currency-obsessed Canadian investors.

“Conventional wisdom does not appreciate the strength of U.S. manufacturing,” said Marc Chandler, global head of currency strategy at Brown Brothers Harriman in New York. “It remains the world’s largest manufacturer and it achieved this with an absolute and relative decline in the share of labour it commands.”

The Post uses the peg of Alcoa’s surprise profits announced Wednesday.

Along those lines, the Department of Commerce today announced that U.S. exports increased by 0.2 percent in August to $128.2 billion since July 2009. Imports declined 0.6 percent to $158.9 billion.

The NAM’s chief economist, David Huether, commented:

As the U.S. domestic economy continues to struggle to recover from the deepest recession in the post-World War II era, we are seeing more signs of improvement. Today’s report brings welcome news of a recovery in exports. U.S. manufacturers have become more globally engaged over the past several decades, and this positive trend continues. Clearly, export growth will be an increasingly important ingredient in our economic performance. (continue reading…)

Or maybe not. From AFP:

OECD hikes US growth forecast, sees UK recession

PARIS (AFP) — The Organisation for Economic Cooperation and Development on Tuesday raised its forecast for US economic growth this year but cut its estimates for Japan and the eurozone, and said Britain faced recession.

The OECD, the Paris-based grouping of 30 developed countries, said the US economy would expand 1.8 percent in 2008, a sharp upward revision from a prediction in June of 1.2 percent.

As the OECD’s news release states, “Weak activity to continue throughout 2008 – Interim economic assessment.” But weak growth IS growth, and with the United States leading the way among the industrialized countries, the relentless downgrading by some of the U.S. economy starts to appear fantastical and damaging and even malicious.

The reliably dispassionate Robert Samuelson took a closer look at the data in his Washington Post column today, “The Real Economic Scorecard.” He observes:

Though echoed by policy wonks, pundits and politicians — last week, Bill Clinton — the conventional wisdom is wrong or, at least, misleading. Here’s a more accurate assessment. For most Americans, living standards are increasing, albeit slowly, over any meaningful period. But rising health spending is eroding take-home pay, and immigrants are boosting both poverty and the lack of health insurance. Unless we control health spending and immigration, the economic report card will continue to disappoint. Unfortunately, neither Obama nor McCain seriously addresses these problems.

So here’s the real situation: The economy grows, mostly, and people are doing better, mostly. And here’s what we know, most definitely: Raising taxes, increasing regulations and sticking it to employers neither spurs growth nor addresses the immigration and health care issues that Samuelson identifies.

The global competitive environment keeps getting tougher. Nine key trading partners cut their rates in 2007.

From the Tax Foundation’s Tax Policy Blog:

New Study: U.S. Corporate Tax Rate 50% Higher than Economic Competitors

by TF Staff

Tax Foundation President Scott Hodge this morning released the latest Tax Foundation Fiscal Fact in response to a new study from the Organisation for Economic Co-Operation and Development (OECD). The OECD study shows that for the 17th consecutive year, the average rate of corporate taxes in non-U.S. countries fell while the U.S. corporate tax rate stayed the same.

As a result of the U.S. failure to lower its corporate tax rate for more than two decades while other major trading nations lowered theirs, the U.S. corporate tax rate is now 50% higher than the OECD average. Nine key trading partners cut their rates during 2007.

Said Hodge:

Continued failure by U.S. tax policymakers to keep up with our top global economic competitors means that we’re solidifying a trend that will result in our children and grandchildren not seeing the economic growth we’ve seen in our lifetimes. There’s a real-wallet impact for Americans as we continue to sit idly by while other countries improve the way they do business, and we should be very concerned about jobs, capital, and investments moving from high-tax countries to low-tax countries.

Click here for the Tax Foundation Fiscal Fact. Click here for the press release.