During the holiday season we think of the spirits of Christmas past, present, and future. So, consider a modern Ebenezer, a man who did not want government to interfere in his counting house, but who is forced to read three books by three spirits.
Ebenezer learns that his counting house is now challenged by similar operations throughout the world. The spirits shows him how we got into the present economic situation and what his country needs to do for his company and community to prosper.
Our first spirit, Clyde Prestowitz, has Ebenezer read his book The Betrayal of American Prosperity, which traces how we got into the competitive situation. He contents we neglected our commercial and competitiveness policy for other national priorities.
The spirit of Christmas present is Thomas Friedman, resplendent in green robes. His recently published That Used to Be Us describes our current situation and how we used to be. His solution to our problems is to create a new third political party. The thesis is that third parties that are big enough to threaten the two existing parties can influence the policies of the country.
The spirit of Christmas future is Jim Clifton, CEO of Gallup, who arrives shrouded in a deep black garment. This spirit’s new book is The Coming Jobs War. It’s based on data gathered from international polling Gallup has conducted since 2005. The central finding is that the number one issue internationally — ahead of health care, education, crime — is getting and keeping a decent job.
Clifton’s book begins, “The coming world war is an all-out global war for jobs.” He provides data on the number of people in the world seeking employment and the dramatic shortfall. His book is subtitled, “What every leader must know about the failure of job creation.” He views cities and their leadership as critical in the jobs war. Elected officials live by polls, so this book might have influence. The book presents a number of issues that need addressing, including education and research. Among the ten recommendations with which the book concludes is the need to triple exports in the next five years.
Before the spirits arrived, Ebenezer already knew how Boeing, Ford, and Microsoft, among others, are successful American companies competing against international rivals for profit, market share, and jobs. They are big guns in this war. They all have the size and muscle to be successful. When competing against international companies that receive government assistance or are government owned, they all receive assistance from our government. They all have long term strategic plans and study their competitors. Ebenezer asked why can’t this country learn and adopt lessons from successful private competitors.
Ebenezer had also read an article by Tim Keating, senior vice president of Government Operations of The Boeing Company entitled, “The U.S. Can and Will Compete in the Global Economy." Keating wrote, "Government also plays an important role in helping companies and their workers compete globally.” He outlined six areas business needs assistance from government including, education, Ex-IM Bank and enforcement of trade agreements.
It is no surprise that we run a trade deficit. It isn’t even a surprise that our economy can emerge from the recession without jobs. A 2010 Brookings study noted that while China and Canada each export roughly 35 percent of GNP, the United States exports only 13 percent of GNP. Domestically, consumers are spending, but they’re buying things manufactured overseas. That creates jobs, just not here.
In the upcoming elections, the American public is considering two philosophical opposites to represent them. Both the far left and right reject the notion of government assistance to U.S. businesses competing on the global stage. The left calls it corporate welfare. The right calls it interference in the free market.
During his long night of visits from the three spirits, Ebenezer learned of the urgent need to change the ways of America. Taking Friedman’s advice that a third party is needed, he undertook the very next morning to begin forming a new political party, and he drafted Friedman himself to be the candidate for President.
Realizing it was foolish to debate whether government should have a role when it comes to international competition for jobs, Ebenezer counseled Friedman to take a heretical approach called Pragmatic Centrism. Because our international competitors are often government agencies, government owned, or government assisted, Pragmatic Centrism sees U.S. assistance to U.S. companies as a way to level the playing field.
Once Congress focuses on our competitors’ strategies, tactics, and programs, it might reject the philosophical rhetoric and start to develop a competitive strategy for our country. The position rejects the political left’s notion that business does not need assistance to compete on the global stage. It also rejects the right’s notion that business can compete against government owned or assisted competitors and in systems where the laws, regulation or their application favor local companies. This is especially the case with small and mid-size companies, our foot soldiers. The pragmatic centrist will be attacked as promoting industrial policy or favoring corporate welfare.
A focused and specific strategy then would assess the infrastructure, education, and research needs to allow our products and services to be more competitive. A high level group might also monitor the legislative process and kill attempts by former congressional members, now lobbyists, to hang baubles on the needed legislation or appropriations. We could work to avoid the normal “Christmas tree” process of each member adding a goody for their district. It becomes a freight train with three cars and 42 cabooses. We try not to let civilians become armchair generals. Let’s try being professional in the jobs war.
Part of the competitive strategy for a Pragmatic Centrist administration would be an assessment and expansion of trade assistance. Our nation has slowly shrunk our U.S. Foreign and Commercial Service. Now the service nickels and dimes the people they are to assist. We should instead ensure that our companies, educational institutions, and tourism agencies are assisted. This includes instituting decent funding levels for the Export Import Bank, Overseas Private Investment Corporation, the Small Business Administration, and other trade assistance programs.
When reauthorizing the Ex-Im Bank in 1995, Congress created the requirement for a National Export Strategy, which few people read. Currently, the yearly strategy is created in a conference room in Washington. In contrast, President Friedman’s Secretary of Commerce would hold field hearings on the creation of the strategy. We’d have business, agriculture, education and other institutions present their suggestions. This would give the strategy a constituency and maybe even political legs.
The 1995 Act also created the cabinet level Trade Promotion Coordinating Council (TPCC). President Friedman could hold a meeting of the TPCC in Seattle rather than in the White House. After the meeting, the president would lead the members in visits to Boeing, Microsoft, and small successful companies.
If we believe the current polls, the American public is no longer supportive of trade and does not see it in the country’s interest. The polls also show a very low regard for America’s political leadership. The new Pragmatic Centrists Party under President Friedman would create Team America to rebuild confidence in our ability to create and retain jobs. The creation of a National Competitive Strategy will be challenging. Both labor-saving technology that increases productivity and movement of low skill jobs off shore will require significant attention to education for our less skilled workers
We currently blame China for our jobless recovery. That’s a factor, but we need to get our own house in order rather than look for a scapegoat. China has an assertive high technology economic strategy. The war is not just for low skill jobs.
Ebenezer's learning from his night with the spirits can only take us so far. The current administration has created a National Export Initiative but Congress has not funded it. The national election will be a contest between those who know the road to success is less regulation and a free market and those who don’t always trust business leaders.
Let us hope legislators from both sides of the aisle look overseas, study the war plans of the competition, and provide leadership for American workers and American companies. If not, we will follow Horace Greeley’s advice and “go west” for jobs. Of course, since we are already in Seattle, Asia is the next stop.
While it is seasonal to give Dickens as a holiday gift, these three books could also help focus discussion on some of our larger, all-too-real issues.