Administration uses Obama's Michigan trip to hype stimulus

President Obama will use his speech on Thursday at the groundbreaking of a battery factory in Holland, Michigan to once again make the case that the Recovery Act is creating jobs in the high-tech and green energy sectors.

The president will speak at the groundbreaking of the $300 million Compact Power plant in Holland, which will produce batteries for the Chevrolet Volt and the Ford Focus. Compact Power is a Michigan-based subsidiary of the South Korean firm LG Chem, which received $151 million in stimulus funds from the Department of Energy to build the factory.

According to the White House, the factory will employ 300 construction workers at the peak of the project and then provide 300 full-time jobs for Michigan residents once completed. The plant is the ninth of nine new advanced battery factories to start construction as a result of the $2.4 billion in stimulus grants for advanced batteries and electric vehicles.

The White House said the stimulus money would propel the U.S. from making two percent of the world's advanced vehicle batteries to producing 20 percent by 2012 and 40 percent by 2015.

"We're creating a new industry in this country," said White House communications director Dan Pfeiffer, adding that the groundbreaking in Holland would not have been possible if critics of the stimulus in Congress had won out.

On a conference call with reporters Michigan Governor Jennifer Granholm said 16 companies are set to begin manufacturing batteries in the state of Michigan, which is expected to generate 62,000 jobs over the next decade. In total she said Recovery Act grants for green technologies will create 82,000 jobs in the next ten years. Michigan has lost almost 800,000 jobs over the past decade. Granholm, whose term runs out in January, took office in 2003.

Granholm has championed the alternative energy industry as a replacement for the auto industry, but she admitted that the battery industry alone would not replace the number of jobs lost. She said Michigan, because of its dependence on the auto industry, has been hit "seven times harder" than the rest of the country during the recent recession. Michigan had the second highest unemployment rate in the country in June at 13.2 percent, a 0.4 percent decrease from May.

Pfeiffer said the White House is making a big deal of the trip because the factory's opening signifies important progress for Holland and the state of Michigan. Holland, a center for auto parts manufacturing, boasts one of the highest unemployment rates in the state.

Granholm said the Recovery Act grants represent a blueprint for how America can compete with low-cost Asian manufacturing: by providing state and federal government funding so American companies have incentives to manufacture domestically.

"Long-term investments will be critical for Michigan's plan to move from Rust belt to green belt," Granholm said. "We believe this partnership with the federal government is how you crack the code to manufacture in the U.S."

She said other countries are making similar pledges, pointing to a recent $30 billion investment by South Korea into its battery industry. The Department of Energy also released a report Wednesday documenting the economic impact of Recovery Act investments in electrical vehicles.