Michigan's Mixed Messages on Trade With China

The Granholm administration "was not supportive at all" of attempts to recruit Chinese businesses, according to the former managing director for the state of Michigan's China office. Yvonne Warmbier-Ramp came out publicly with her criticism after a recent exchange between Gov. Jennifer Granholm and WJR talk host Frank Beckmann.

On his Oct. 15 show, Beckmann asked Granholm, who had went on a trip to France and Sweden, why she never went to China.

Granholm told Beckmann: "We haven't had the people on the ground there to identify quickly the jobs to bring back to Michigan."

Warmbier-Ramp served eight years in China under the watch of the Michigan Economic Development Corporation. She called Beckmann days later on his show. Warmbier-Ramp told Beckmann: "We had Chinese ministers of commerce come into Detroit and would like to speak to the governor about doing deals. She had to be at the tulip festival."

In a e-mail, Warmbier-Ramp wrote: "If the Govenor would have come to China with assistance of the State's China Office (my office) or with an MGP Global Partnership annually since 2006 when China started to allow outbound investment, she could have probably attracted much more than $100 million."

However, Harry Whalen, the former MEDC director of international development from 2001-2009, said the state was successful recruiting Chinese businesses.

The MEDC went on six trips from 2004-2008 and brought in 41 Chinese companies that established operations in Michigan, according to Whalen. He said he led five of the six trips to China.

"I think that was fairly successful," Whalen said. "There are 350 Japanese companies in Michigan. That level of investment was built up over a 30 year period."

Granholm spokeswoman Liz Boyd stated in an e-mail:

"MEDC and its predecessor agencies have maintained economic development activities with China going back at least to 1986.  Due to budget considerations, our approach has changed over the years.  We maintained an office there, in Hong Kong from 1986 - 1997, then Shanghai from 1997 - 2009. The office in Shanghai was closed when in consultation with our contractor we decided that she could be more effective working from here, where she could be better integrated with MEDC staff and local partners, with periodic visits to China. This model has been effective with our personnel who work the European and Japanese markets," Boyd wrote. "During the Governor's tenure, we have also participated in Michigan Global Partnership missions in conjunction with local governments and economic development organizations, bankers, utilities and business people. Jim Epolito as president and CEO of MEDC traveled to China and MEDC staff have traveled there a number of times to seek out economic development opportunities. Michigan was the only U.S. state with its own booth at Auto Shanghai in 2007. The Governor met with five Chinese automotive OEMs when they exhibited at the 2008 NAIAS in Detroit."

Michigan no longer keeps overseas offices.

But while the Granholm administration trumpets the benefits of international trade when bragging over its solicitation of Chinese investment and job creation in Michigan, the governor and her campaign aides have been severely critical of the flipside of international trade.

During her 2006 campaign for re-election, the Granholm campaign and the Democratic Party ran TV commercials slamming GOP rival Dick DeVos because his Michigan-based company invested in and created jobs in China. This year, Democrat Congressman Mark Schauer of Battle Creek and Democrat nominee for governor Virg Bernero have used similar themes to blast their Republican rivals over issues of economic exchanges with China. 

Yet, James Hohman of the Mackinac Center for Public Policy questions the value of scapegoating Chinese trade. He recently noted that China is behind only Mexico and Canada in its purchase of goods and services exported from Michigan. This literally makes Chinese consumers one of the very largest international creators of jobs and wealth for the economically-beleaguered Great Lakes State.

Ken Braun is a policy analyst for the Mackinac Center for Public Policy and the managing editor of Michigan Capitol Confidential. He has written about the negative consequences for Michigan's economy that result from demonizing trade with other nations.

"When you put out TV commercials trashing your customers and would-be investors in Mexico, China and elsewhere, there is a price you pay and some of our economic troubles are the result of that" said Braun. "Michigan taxpayers may be paying for Jeff Daniels commercials offering businesses to come here and get the 'Upper Hand,' but that message sounds very hypocritical when our politicians keep slapping them with the back of the hand."

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See also: 

Should China Stop Buying From Michigan?

Living Here in Allentown

Automotive Production Expands - Elsewhere

Michigan Exports to China Grow