FAIRLY or unfairly, President Obama gets blamed for economic disappointments on his watch. By the same token, he gets to crow when things go well whether he deserves credit or not. So he was entitled on Wednesday to trumpet the fact that US manufacturing employment grew by 334,000 jobs over the last two years the strongest two-year growth since the late 1990s.... But let's put the celebration in context. US manufacturing is hardly asweak as it is sometimes portrayed. In 2009, US manufacturing output was equal to that of Germany, Italy, France, Russia, the United Kingdom, Brazil and Canada combined, according to the United Nations. In 2010, US manufacturers produced nearly $1.8tr in goods (in constant 2005 dollars), about $100bn more than China did.

. .Of course, in many areas even the most productive US firms could not beat China's low wages. That has begun to change, as companies return production to the US from China and other low-wage countries.... Again contrary to much rhetoric, outsourcing, painful as it was for US workers, was not a nefarious corporate plot. Most of it was a rational response to market incentives.... As recent reports from the Boston Consulting Group show, the return of jobs to the US from China is also due to market forces: specifically, China'scomparative rise in labour costs. This may mean that insourced manufacturing jobs will not pay the high wages that US factory hands enjoyed during the 1950s and 1960s....Still, the jobs are welcome. Mr Obama claimed that his policies helped bring them back. His decision to aid and restructure General Motors and Chrysler pre-served those companies and the US plants of foreign carmakers too. However, the Federal Reserve'sultra-low interest rates, and the cheaper dollar they engendered, probably did far more to improve the international competitiveness of Us products than, say, the administration's National Export Initiative did. The White House briefing paper that accompanied the insourcing event attributes much of the rebound in manufacturing to the boom in domestic natural gas production, made possible by new ... technologies.

The federal government didn't do much specifically to promote [these technologies].

Yet [they have] dramatically cut the price of gas, a key industrial input, and led to spin-off employment in related industries. The White House notes that more of such development, appropriately regulated, could have 'substantial' benefits [for] the US economy. Even in a polarised Washington, everyone should be able to agree on that.— (Jan 13)