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Posted: 6:00 a.m. Friday, April 5, 2013

Future spending by corporate America will drive economic growth

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By Clark Howard


Corporate America is sitting on nearly $1.5 trillion in cash that's on the sidelines and waiting to be deployed.

Back in 2011, I first brought up this stat and at that time the cash on reserve was $1 trillion. Now just about two years later, that figure has risen by half a trillion among corporations, according to Moody's.

Once businesses have the confidence to unleash that money, you'll see a slew of new offices, branches, restaurants, stores, new equipment, new automation and so much more. All of it will improve our competitive position in the U.S. and go a long way to improve our national wealth.

I have had a lot of pushback when I talk about the recovery in manufacturing here in the United States. America is once again back as a manufacturing powerhouse, but the return of manufacturing on our shores has not equaled the return of jobs.

Today's factories are highly automated and need just a fraction of the workers they once did. So we are in a messy, technologically driven transition period. Make no mistake about that. But I believe it will all lead to great national wealth and more opportunity.

Think I'm crazy? Just look at American history. Farms used to employ 97% of all Americans. When mechanization of farms came about, there were fears that permanent and severe massive unemployment would result.

But we all know how that played out!

Today, farm employment is a fraction of one percent of the U.S. workforce and farms produce more food than ever. The jobs simply came from other places in an increasingly less agrarian society. That's going happen again.

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