Jobs and the Economy - C4 Highlight with Drew Greenblatt

Wednesday, July 29, 2011


1090 AM - WBAL.com 97.9
C4 Highlight 7-27-2011 Drew Greenblatt


Drew Greenblatt, President of Marlin Steel, a Baltimore-based manufacturer, Executive Board of the National Association of Manufacturers and, Chairman of the Regional Manufacturing Institute, accompanied Martin O'Malley and other Maryland officials to Asia in June. Drew explains why the trip was a startling eye opener for him.

WBAL: >> Joining us now is Drew Greenblatt. He is President of Marlin Steel, a Baltimore-based manufacturer. He's also on the executive board of the National Association of Manufacturers and Chairman of the Regional Manufacturing Institute. How are you doing Drew?

DREW GREENBLATT, President of Marlin Steel >> Hello, good afternoon.

WBAL: >> Thanks, I appreciate you joining the show. Look, one of the things that we've lost track of, kind of, in the last few weeks or month is the fact that we need to create jobs in this country. We past 9.2% unemployment and you went on this trip abroad and came back and decided that there are some things that we can do to create jobs, right?

DREW GREENBLATT, President of Marlin Steel >> Absolutely. I mean if we make some changes to our policies, I think that we can really create a lot of jobs in the near future. This is the kind of thing that if we are serious about it and we get to work, we can really have a big impact and get that unemployment much lower.

WBAL: >> One of the things you write in here, a lot of people don't realize that just because you don't hear people talk manufacturing, we wonder if we still make anything in this country. Manufacturing jobs pay $73,000 a year on average, plus benefits and usually we need more of these jobs. You lay out some steps that we could take to try to do that. One of them has to do with the patent process.

DREW GREENBLATT, President of Marlin Steel >> Exactly. Right now, it takes about a year, sometimes a year and a half to get a patent. So for really innovative, slick ideas, we've created at Hopkins or Baltimore, it takes a long time for you to have this protected by the government. The problem is that other countries could try to steal that idea. What will happen is, our great innovations are hard to capitalize on. The other issue is that since it takes so long, it costs more money. It defeats us from having a lot of good ideas protected.

WBAL: >> Drew, the other point you bring up which to me is critical, when we have so many people from foreign countries coming here to our great learning institutions to learn science, engineering and everything, we lose them because they go back home and what you say is that we need to find a way to keep them here in this country.

DREW GREENBLATT, President of Marlin Steel >> Exactly. What we're doing is we're training and teaching the smartest people from our economic adversaries. Then, we send them home with the best education possible and then they start companies in their country and they hire locals in their country. I think that's backwards. I think what we should do is encourage them to stay here, give them a visa, have them get a job here, have them come up with creative, innovative ideas here and maybe they'll start a company and then they'll hire people locally. I want to get the best and brightest to live in America, not to go back home after we train them.

WBAL: >> Now Drew Greenblatt, here you go, trying to protect all these rich fat-cats. You were talking about lowering the corporate tax rates. How dare you Drew. (laughing) How dare you talk about lowering, but really, when you look at our 35% corporate tax rate, we're not competitive with the rest of the world.

DREW GREENBLATT, President of Marlin Steel >> Exactly. We have a factory here in Baltimore City where we make Wire Baskets and we export them to 35 countries. One of the countries we compete with is Canada. We had a big job, we shipped a quarter-million dollars worth of baskets to Canada in March. The client wanted to order another $800,000 worth of baskets. They ordered from a local supplier. I think the reason why they did it is because his tax rate is half of what mine is. My tax rate's 35%. His tax rate's at 18%. So I'm going to get beaten. What happens is, when I lose, my guys don't run overtime. My guys don't get those hours of work. The local steel mill doesn't get an order from me. All these bad things occur because I didn't get that order. The reason why is because I had to factor-in my taxes when I give a proposal for that $800,000 job. The Canadian loves it when he competes with an American because he knows that I'm from a high-tax country.

WBAL: >> Now Drew, what about the argument that a lot of these companies aren't actually paying 35%? I made the argument with GE, the fact that they paid nothing in taxes. There would be some to make the argument that you respond to, that a lot of companies aren't paying 35% right now.

DREW GREENBLATT, President of Marlin Steel >> I am in favor of having low tax rates but more people paying, less loopholes. I'm okay with that, like the ethanol subsidy; that's nuts. I don't think there should be subsidies for ethanol. I'm in favor of having less loopholes, less of these deductions, but having a lower rate because I just need a fair way to compete against Canada. Their cheaper tax rate, and Japan, cheaper tax rates in England, cheaper tax rates in France. These are all my economic adversaries. I you want me to win more jobs, which obviously is good for my city, then I have to have a fair, level playing field. When you're taxing at twice my competition gets taxed, I'm going to lose.

WBAL: >> Well Drew, one of the things that we've talked about on this show for the longest period of time, it really wouldn't cost the government anything, is the fact that we have a regulatory environment that is a maze; you know better than me, it's almost impossible to negotiate. However, you can't get government to to listen to the Drew Greenblatt's of the world to say, look we need to reduce some of this regulatory madness we have out there so we can create jobs.

DREW GREENBLATT, President of Marlin Steel >> I agree. The income tax code is 8 million words long. Can't we get away with 100,000 words? Couldn't we get away with 20,000 words? What's happening is, we've come up with a great ways to hire a lot of accountants and a lot of tax lawyers. It's insane. It would be so much better for me to hire an unemployed steel worker rather than paying huge accounting fees. The reason why I pay huge accounting fees is because I'm so scared I'm going to make a mistake when I file my tax return. That's why I pay $40,000 a year for my tax return. It's a crazy use of money. It would be much better for Baltimore City if I were to hire an unemployed Baltimore City steel worker.

WBAL: >> Now when you talk about the regulatory environment, there are folks who will say, all you want to do is make the water dirtier, make the air dirty. We have regulations in place. You know what the arguments are for a reason. How do you respond to those saying we have regulations in order to keep the quality of life we have decent to some extent?

DREW GREENBLATT, President of Marlin Steel >> I want clean water. I swim with my kids on the weekends in the Chesapeake Bay, I eat crabs, so I want good, clean Chesapeake Bay water. The question is, I think we have enough regulations now and we should pause on creating new regulations. I think we have enough. I don't think the problem is not enough regulations right now, I think the problem is we don't have enough jobs. I'm tired of us creating all these great ways for new accountants, new tax lawyers, let's come up with clever ways so that we can make American factories very viable and prosperous so that we can hire locals and get this economy rockin' and rolling again.

WBAL: >> Drew, we have more government jobs in this country now than all the manufacturing jobs. How can we turn this around?

DREW GREENBLATT, President of Marlin Steel >> Again, if you have less regulation, then you're going to have less people needed in the government level inspecting all these companies and all these factories. I think our focus should be on private sector jobs because that's how the country creates wealth and that's how we're going to pay for this security, that's how we're going to pay for Medicare. That's how we're going to pay for the schools. It's from private jobs and private entrepreneurship.

WBAL: >> Drew Greenblatt, your piece impressed me. I think a lot of people should go to WC4 page wbl.com and read how to manufacture jobs because right now we're talking debt limit, but at the end of the day, we need to create jobs Drew. That's what it's all about.

DREW GREENBLATT, President of Marlin Steel >> Amen. If we create a lot of jobs, it will cure the recession, it will cure our deficit problems.

WBAL: >> Thank you Drew for your time, I appreciate it. You take care. How To Manufacture Jobs Wednesday, July 27, 2011 Drew Greenblatt, The Baltimore Sun I accepted an invitation from Governor MOM to accompany him and other Maryland officials and business leaders to Asia in June. This trip was a startling eye opener for me. I came home shocked with how...


C4 Highlight 7-27-2011 Drew Greenblatt - WBAL Radio - wbal.com