Deborah l. Wince-Smith, president and CEO of the Council on Competitiveness, describes how US companies can catalyze investment and growth. Immediate action is critical.
Amidst a turbulent and transforming global economy, the United States faces urgent economic issues, serious competitive challenges, and a critical need to revitalize high-wage manufacturing.
Talent, science and technology, modern infrastructure, and capital are more widely distributed than ever before. Every day, other nations get better at turning these building blocks into competitive advantage. At the same time, aggressive policies in competitor nations have evolved to favor domestic producers, attract global business investment, and undercut US advantages.
If we do not ready our economic engines for the race ahead – setting the stage for future prosperity and growth – we will fall behind in a world where everyone competes every minute for jobs, investment, markets, customers, and the business activities of global firms.
US COMPETITIVE STRENGTHS – A REVIEW
The United States has significant advantages: It’s the world’s leading high-tech manufacturing sector, demonstrating diverse and agile supply chains, $400 billion in research and development investment, annually building up a globally unparalleled stock of science and technology.
American innovators – icons of industry, brilliant scientists and engineers, and everyday geniuses – carry on our legacy of reshaping the world, entire industries, and the marketplace with breakthrough technologies, products, and services. America’s workers are creative, industrious, and among the world’s most productive. The US culture of entrepreneurship, risk-taking, and creativity is unmatched.
These competitive advantages were confirmed in the Council’s 2013 Global Manufacturing Competitiveness Index. CEOs and senior manufacturing leaders pointed to assets that made the United States appealing as a manufacturing destination. These advantages include:
- Talent-driven innovation;
- Physical infrastructure;
- Supplier networks; and
- Ability to transfer and deploy new technology.
Wise policies and practices could unleash these formidable American strengths, turbo-charge our manufacturing engines, and raise technology commercialization to new heights.
DARK CLOUDS HOVER
However, heavy clouds threaten to dim the brightness of America’s economic future. Despite competitive advantages, troubling signs cast a dark shadow. As US businesses try to scale up from small to mid-sized to large firms, tax, talent and regulatory challenges impede every step. American entrepreneurs – a job creation engine and asset coveted globally – are struggling. Business start-ups have dropped to the lowest point. Small companies are burdened by high regulatory costs. Many businesses say they can’t find the skilled workers they need. Many Americans lack the education and skills needed to secure high-paying jobs in a complex, technology-based economy, threatening greater income inequality and a persistent high rate of unemployment. The United States cannot forever be a debt-and credit-driven economy, drowning in $16 trillion in national debt and a trillion in annual deficits. The longer our leaders defer fiscal reform, the more painful the remedies will be.
CLARION CALL RINGS LOUD
Recognizing these threats to America’s economic future, the Council on Competitiveness issued “A Clarion Call for Competitiveness,” urging political leaders to work across the aisle to tackle urgent problems. The Council’s CEO-level members identified key steps the United States should take to unleash a new era of American innovation, create new industries, revitalize manufacturing across our nation, keep and grow high-skilled jobs, and deliver economic prosperity for all Americans.
Administration and Congress must work across party lines, to find compromise on spending and revenue measures that will bring the nation’s deficit and debt down to historical norms. A long-term fiscal framework to reduce debt as a share of the economy must adjust Social Security to ensure the program’s long-term viability, reform and reduce growth in Medicare and Medicaid spending, and reform and simplify the tax code to reduce rates and expand participation.
CHANGE IS NOW
Now is the time to act. A clarion call rings loud, conveying imminent danger. Historically, when confronted with great challenges, the United States has risen to meet them. The nation faces a pivotal moment: In this hyper-connected, hypercompetitive global economy, it needs to leverage its considerable strengths and correct serious shortcomings to ensure that it is the most vibrant and attractive place to do business, and the greatest place in the world to innovate, make things, prosper, and grow.
The Council on Competitiveness is the only group of corporate CEOs, university presidents, and labor leaders committed to enhancing US competitiveness in the global economy.