Bush To Tout Caterpillar As Symbol Of Trade Policy Success

Others say credit simply goes to Cat management.

EAST PEORIA, Ill. (AP) - President Bush has said he uses Caterpillar Inc.'s trademark yellow earth-movers on his Texas ranch, but will get a firsthand look at one of their big brothers Tuesday during a tour of a central Illinois factory that makes the world's largest bulldozer.

Officials say Bush's scheduled stop at the East Peoria plant was steered by more than a boyish fascination with the hulking machines that clear the way for construction and mining work around the world.

On the eve of his State of the Economy address Wednesday in New York, Bush is touting Peoria-based Caterpillar as an example of how his administration's trade agreements and tax breaks can boost global sales and create jobs for U.S. workers.

''Our economy is strong thanks to the pro-growth policies we have in place here and the hard work of American entrepreneurs and workers,'' Bush spokesman Alex Conant said.

Others, though, say Caterpillar itself is behind a global sales surge that helped the heavy equipment maker post record profits and revenues for three straight years, creating about 5,000 jobs at its U.S. plants in Illinois, Colorado, Pennsylvania and Tennessee.

Morningstar analyst John Kearney says the company simply took advantage of heightened worldwide demand for both construction and mining machines, using a strong dealer network and respected brand name that make Caterpillar ''the 800-pound gorilla'' among heavy equipment makers.

''I'd probably give management more credit than the president ... I'm no politician, but it seems a pretty good political move to pick a successful company like Cat and give your spiel through them,'' Kearney said.

Fred Giertz, a University of Illinois economics professor, says Bush's trade policies deserve a little credit. He said the administration has steered clear of import restrictions that other countries might have mirrored, creating a tougher market for U.S. exports.

''Sometimes politicians get too much blame when things go bad and too much credit when things go good. Most of the credit goes to the people at Caterpillar. They created an environment where it's possible to compete on a world scene and do well,'' Giertz said.

But Caterpillar spokesman Timothy Elder says Bush's trade policies helped the company net about $9 billion in sales outside of North America in 2006, when revenues of about $41.5 billion netted profits that topped $3.5 billion - both company records.

A free trade agreement with Chile has boosted exports by 25 percent to the South American nation, moving it up to No. 5 among Caterpillar's overseas markets, Elder said.

Bush, who signed a $286.4 billion transportation bill at a suburban Chicago Caterpillar plant in 2005, was to meet with workers in East Peoria who are part of a company training program that can help them advance and aid in Caterpillar's growth.

''The president apparently thought that was a very good story and perhaps a template for others in manufacturing,'' Elder said.

U.S. Rep. Ray LaHood, a Peoria Republican, said he lobbied Bush to visit Peoria since before the 2004 elections. Bush, last in Peoria during his 2000 presidential campaign, agreed last week, zeroing in on Caterpillar as a backdrop for his message on the economy.

''Peoria is Caterpillar and Caterpillar is Peoria, and thank goodness for that. When Cat is going well our community is going well,'' LaHood said of the Peoria region's largest employer, with about 17,500 local employees.

Mike Lawrence, director of the Paul Simon Public Policy Institute at Southern Illinois University, wondered whether Bush might be trying to duck debate over the Iraq war rather than plugging his economic programs.

''If that is what he's trying to do, it hasn't been very successful the last few months,'' Lawrence said of the president, whose approval rating has dipped to record lows in some polls.

Greg Baise, president and CEO of the Illinois Manufacturers Association, disagreed, calling Caterpillar the perfect stop ahead of Bush's economic address.

''Cat has had a very strong run the last few years. If there was a symbol of industrial might in America, I think they represent that as much as anyone,'' Baise said.

Regardless of the reason for the stop, LaHood said he's looking forward to newspapers across the country trumpeting his hometown with variations of ''Will it play in Peoria?'', an adage tied to the city's legendary status as a test market.

''It is a hackneyed phrase, but it still has a lot of traction,'' Lawrence said. ''Politicians must think so anyway because they keep coming back to Peoria.''