California Congressman Mike Honda Discusses American Manufacturing
Recently, I was invited to cover Congressman Mike Honda’s visit to Hunter Technology Corp, in Santa Clara, CA, which was arranged through the IPC’s “Meet the Policymakers” program. The Congressman spent several hours touring the facility, meeting the employees of Hunter Technology, and answering their questions.
After the tour, I sat down with Congressman Honda, who represents District 17 in the Silicon Valley, and talked with him about American manufacturing, infrastructure, education and some of the current thinking in America.
I also invited IPC Vice President of Governmental Relations, John Hasselmann, and Joe O’Neil, president of Hunter Technology, to share a few thoughts about the program.
John Hasselmann, Vice President of Government Relations, IPC:
“IPC places a high priority on government relations because it is directly related to helping its members thrive in a global marketplace. IPC advocates for policy initiatives that promote innovation and advanced manufacturing and provide broad-based economic growth and competitiveness.
“One of IPC’s advocacy strategies is to cultivate relationships between IPC members and their elected officials. IPC does this through its “Meet the Policymakers” program, in which IPC government relations staff arranges opportunities for IPC members to host elected officials at company locations. This program provides the opportunity for elected officials to hear how the policies they are considering will help or harm businesses and their employees in their states and districts. In 2014, IPC coordinated the visits of 12 members of Congress to IPC member companies all across the country.
“Congressman Mike Honda’s recent visit to IPC-member Hunter Technology Corp. in California was one of these scheduled visits and part of a nationwide effort to educate policymakers on legislative and regulatory issues that affect the electronics manufacturing industry.”
More information about IPC’s government relations efforts can be found here.
Joe O’Neil, President, Hunter Technology:
“I’ve worked with Congressman Honda and his staff, both in his district office and in Washington D.C., for nearly 10 years now. I sincerely appreciate his support of business in the Silicon Valley, most recently through his backing of the Revitalize American Manufacturing Innovation (RAMI) Act.
“The greatest impact that I observed during Congressman Honda’s visit to Hunter was with our employees. Congressman Honda took time with a number of employees throughout the factory to learn who they are, what they do for Hunter and how they go about their jobs. This was an outstanding opportunity for citizens to connect with their elected representatives within their daily environment. This interaction helped demonstrate that representatives are indeed normal people, people who are working to make everyone’s lives better. I believe events like this help to create ties to the political process which can at times be viewed as out of reach to the average citizen.
Competing on a global scale within the United States has its challenges and having those challenges understood by our Representatives is critical. As we continue to expand by hiring new employees and developing those which are already on our team, it is important that the impact of tax changes, insurance costs, research and development tax credits as well as hundreds of other decisions being made in Washington that directly effect on those hiring decisions is fully recognized.
Barry Matties: I've been in publishing in this industry for 30 years. I started here in the Bay Area with my Mac Plus, with no hard drive, and began a desktop publishing company.
Congressman Mike Honda: I remember those days. But you saw the future!
Matties: That's really what we have to pay attention to. We’re all living in the moment, but we have to plan for tomorrow. Seeing you here at a manufacturing facility, it’s been great listening to the questions you’ve been asking. I’m just curious what you thought of the tour? What is your takeaway from Hunter Technologies?
Honda: I have a couple impressions, and one is that it is well thought out and systematic. It’s providing a way for end-users to not worry about inventory, because I think the thing that kills a lot of companies is that overabundance of inventory. But this provides the on-time, real-time and immediate production of the pieces that people need in order to keep producing their products. Also, the job of the workforce here is pretty diversified. I asked a question earlier about the necessary educational level. They said that they basically train everybody at the get-go, and that’s something that community colleges can start looking at to come in and help these kinds of companies to provide that kind of education, too.
Then there are the guys here wearing the blue jackets—the engineers—who probably help a lot of clients by having their eyes and ears on site and with the overall quality control or quality assurance process. Those are the kind of things that if you don’t ask the questions you just think, ‘Oh, there’s a lot of activity here.’ But you don’t really know what function each person has. If you ask the questions you start to understand that it’s almost like a marketplace.
Matties: One of the things you mentioned when a large team of Hunter’s employees were here was that the labor cost offshore may not be as appealing anymore. When I look at a country like China it seems they have a national strategy for manufacturing. And when we look to America, do you think we have that kind of national strategy in mind?
Honda: No, I don’t think there is a national strategy—there’s a national call for an initiative and President Obama has said that. That’s why we wrote a couple bills like the America COMPETES Act and a couple things that were related to STEM education.
Matties: I did notice the information about STEM education on your website.
Honda: Right, I try to refocus everybody’s activities in STEM for two reasons: One is to add an A and call it STEAM, because you need the arts. We need to pay attention to the arts because through arts you can teach science, technology, engineering and math. Because when you do a lot of these things there’s an arts aspect embedded in all of them. Arts usually are the place where all these things come together anyway. Whether it’s composition of music or the creation of a building through architecture, the arts is where this all has to come together. The second thing is focusing not on fifth or sixth grade for starting with STEM. They say we need more minorities and women or more youngsters from the poor communities. But you can’t start in the fifth grade; you should start with preschool, and as a teacher I know that we can teach youngsters these things at that younger level.
We can teach them that the things they do every day at home, with their parents or in the garage, have scientific implications. But we don’t translate their daily lives into scientific terminologies for a lot of these kids. Kids who grow up in Cupertino with parents who are astrophysicists or computer engineers hear these terminologies all the time, so there’s a very little jump for them when they go to school. For youngsters who don’t have that environment it’s not through lack of desire, but a lack of preparation. But it doesn’t mean that these kids cannot learn. So paying attention to that as a teacher and as a community we can give them that head start and give them the extra things that other children have available to them.
Matties: That leads me to my next thought. I’m wondering what you think could be done to improve our current infrastructure to help support businesses become more competitive in the world. It could be transportation, Internet, etc. What should we be focusing on in terms of improving it?
Honda: In Congress, ever since I've been there , a lot of the leadership under Bush started to actively collect monies in areas of research and we had to keep fighting them. So I used earmarks to supplement the lack of funds in those areas. Then, we got rid of earmarks, so we had to get real creative in finding other ways to fund some of the projects that we cared about. I sat on the Transportation and Infrastructure Committee with Ray LaHood and Jim Oberstar, and Oberstar always tried to increase the funding for the trust funds so that we could get monies from sales of gas in order to build bridges, maintain freeways, etc.
Norman Mineta was secretary of Transportation, and in his proposal every year he would tweak it and increase the number of cents that we needed to gather for the trust fund, but it would always get pulled out. So it’s not through lack of effort by some, but a very cautious effort of cutting these funds. I just don’t understand it and I wish people would get more upset. Like when the bridge fell in Minnesota; we fixed it in three months. Why do we have to wait for something to fall?
Matties: You know if I were to run for political office, and I have no desire to do so, I would be making a strong case that what the government should be doing is really focusing on how we create an environment so our businesses can thrive through great infrastructure. And you’ve keyed in on some of it—STEM for example—that’s all part of the infrastructure equation. If we can build an incredible environment that supports our businesses, we have an amazing workforce in America that can be a dominant force.
Honda: But it is business that is sometimes responsible for slowing it all down until they can control it. Because when digital came into our lives and we had cell phones, we talked about global harmonization. Remember that phrase? And yet we can’t do that because all the companies, here at least, will sell you a phone with a SIM card in it that limits you to a certain area. So when you go overseas you have to take your SIM card out. In Asia, you can buy a phone and gain access to anywhere. Their benefit is they don’t have to go through the costs of building infrastructure in the digital world. Here we had an investment in wires and cables, telephone poles, undergrounding, and all the stuff we put into the system. I think the way we see things is still old-fashioned and people don’t want to change because I think they feel they will lose money.
Matties: You’re in a unique district for sure, District 17, in the heart of Silicon Valley. What do you do to help modernize the thinking? How can you create change?
Honda: There are two things I’m trying to do. One is to change the understanding of education. Everyone in this country tries to do something new and innovative to get people to learn, but we seem to have limited success. Then we do things like vouchers and charters and everything that seems to go against what I consider supporting public schools and moving public education forward. We are stuck in the ways that we were taught. We never looked at the history of our educational system and how we are embedded in that system. If we just understood that, we could step out of that box and really grow. The initiative I’ve gotten started is called “Educational Equity for Each and Every Child,” not “Equal Opportunity for All Children.” The two phrases are different. They sound the same but they’re different, and they suggest different solutions. When you say “all children” you look for ways to impact a cohort. If you say “each and every child,” your cohort is obvious—each child at a time. When you deal with each child at a time you can get them all, but the profiles in terms of the needs become more precise for each child as well.
Matties: Now, interestingly, Sal Khan of Khan Academy, who’s done some work with the Los Altos School District, which is using his online training model, has really flipped the role of the classroom around to where you’re not necessarily doing homework at home anymore. It’s really making for an incredible education and I think Bill Gates’ kids were using this (free) service as well, and they can afford pretty much any education out there. But I think this guy is really on to something big. Do you see online solutions like that for education?
Honda: I think that what technology offers us is the democratization of education because it opens up information. Access to information is critical—how you access it and your ability to get it. He’s trying to make that universal. We should look at how you make it universal so that your income is not the barrier.
Matties: The nice thing about his is that it’s free.
Honda: It’s free, but you still have to access it. Accessing it is key. The democratization of energy is solar, where every home can become its own generating plant. If you can imagine how much money people can save just by eliminating reliance on the grid and creating their own source through a solar system—they could save maybe 80% of their energy bill and redirect that money elsewhere. We should be able to apply that technology to developing countries. But developing countries are still dependent upon petroleum. If you see any country that is 100% dependent upon petroleum for energy you’ll find that that country is pretty poor. So, why aren't we applying that technology and offering that technology to these countries that need it? It’s like holding back water from people. We need to rethink how we’re going about it. I think the International Monetary Fund (IMF), the International Bank or the World Bank should start looking at their own business plans differently. Rather than investing for a return, the return should be in other arenas, but we’re not doing that. Solar energy, water--especially pure water--is important here.
Then going back to telecom and the ability of accessing information, like Mr. Khan’s concept, we still have to be clear on how youngsters can access that information. Because, like you said, it’s free, and he’s developed the curricula. It’s like when we said we wanted to wire every school, and we set up some monies to be available to schools so they could be wired. But what we didn’t do was offer the ability for them to connect to the Internet. So yes, you had a school that was wired, but it couldn’t access the Internet.
Matties: Isn’t that what plagues America, those kinds of gaps in our thinking in general?
Honda: It’s engaging people that know the stuff to help write the laws. That’s why I think Silicon Valley’s presence in Washington, D.C., is important to help policymakers and agencies and bureaucrats to understand how to think better. We had a bill called EIR, which sounds like environmental impact report, but it is Executive in Residence. This is where Michael Dell had a program that had senior scientists or administrators, each embedded in different parts of the government, come back to teach them how people think here in Silicon Valley. At the same time they’d also bring back how they think in Washington D.C. so that people here could become a little more astute at working with the government. I haven’t been able to move that bill, but it’s a bill that doesn’t cost anything because it’ll be at the cost of the companies who lend an executive to an agency for two years.
Matties: That should be easy to pass through, I would think.
Honda: Yes, although sometimes they’re intimidated by having someone come in. But we should welcome that because it helps us become more efficient in our delivery of services as a government.
Matties: I’m curious about what you think the government can do, specifically in this local area, to really help manufacturers improve their business. What in your mind would be that critical component?
Honda: There are a couple of things. Since 9/11, our State Department has really stiffened our ability to allow people from overseas to come in and visit, whether for schooling or just to exchange information, and that hasn’t changed a lot since then, but it should change more in the future. Immigration has become hardened because of 9/11. They use that as an excuse and we focus on the southern border when really the folks came over from the northern borders. So there are a lot of asinine things going on in government by politicians that affect manufacturing and business, and when folks around here understand that I think they will become more adamant, more engaged and more outraged. But Silicon Valley is very innovative so they’ve learned to get along without them. As a result, the research and development monies and the access to that have dropped because they’ve depended upon themselves. We’re not pushing for it. New York is the city that has the largest amount of R&D money, and it’s critical for a robust economy and for companies to become successful.
I think we need to better understand the relationship between policymakers and the impact we create, as well as the barriers we set up. Like sequestration; it was the dumbest thing that we’ve ever done and it created a big impact on the economy here. They slowed down the establishment of a U.S. Patent Trademark Office. I wrote the criteria by which the Department of Commerce will choose where three PTOs will be established. I got that wording through the appropriation bill and I sold the Department of Commerce to use the criteria that I wrote, because the criteria I wrote was to describe this place. So this region became one of the places where they said they wished to place a USPTO. Then the struggle to have it placed in a certain city became apparent and necessary, but what was more necessary was to get them to say it was in this area. Well, once sequestration happened the OMB said there’s not really any money in the budget that we can sequester. It’s all money that comes in through fees, and the USPTO is basically run by fees so they stopped that. We then had to learn to look and anticipate what would happen and build firewalls around things that we cared about so that they wouldn’t be impacted by federal legislation.
Matties: Congressman, thank you so much for your time today. Are there any closing thoughts that you want to share with the electronics industry?
Honda: I think there has to be more talk about the supply chain process. The supply chain is ubiquitous, but it’s underground and I think that we need to expose this so that people understand that companies and their products are dependent upon the supply chain groups. Whether it is here in California or in other parts of the state, it’s all encompassing. The policies we pass and the things we do in D.C. that negatively impact our economy...a lot of those guys who don’t support some of the positive things we want to see happen don’t really understand that it impacts their districts, their social services, health and business.
If these legislators know that it's an issue and has an impact, then we have to expose them and let the local folks know that their legislator’s vote impacted their jobs, their economy, and their education and livelihood because of self-interests.
Matties: Congressman Honda, thank you so much. It’s been a great pleasure speaking with you.
1. IPC is a U.S.-based, global industry association dedicated to the competitive excellence and financial success of its 3,500 member companies, which represent all facets of the electronics industry. IPC is a leading source for industry standards, training and certification, market research and public policy advocacy, while supporting programs to meet the needs of an estimated $2 trillion global electronics industry.