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Political Economy
Posted at 12:37 PM ET, 06/08/2011

Fareed Zakaria on ‘The Daily Show’: What Germany is doing right

CNN host and syndicated columnist Fareed Zakaria joined comedian Jon Stewart on Tuesday night to discuss the future of the U.S. economy and the nation’s ability to compete globally.

“I want to talk our economy in relation to the outside world,” Stewart began, and then asked his guest whether the United States had indeed fallen behind, losing its place as the world’s economic superpower.

“I cannot point to anything that anybody has done to alleviate this ,” Stewart said, “but it feels to me a fool’s errand to chase the idea that we can create conditions as conducive for corporations as it is for India and China. Americans will not and should not live like those workers. We’ve earned our middle-class status, and I don’t know that — how is it that if you make our country more conducive to corporations you’ll bring those back? We just can’t compete.”

“Well certainly not in the short term,” responded Zakaria, whose special on innovation in the United States aired on CNN on Sunday. He said that drastic federal spending cuts have contributed to high unemployment and lower consumer spending.

“The measure should be a country like Germany,” he said. “...Because they view government in a positive way, which is government invests in technology, in science, in technical institutes and apprenticeship programs. It tries to figure out what is it you can do positively to grow the economy.”

The Post’s Jia Lynn Yang reported Tuesday that the German model for job creation is, indeed, working:

Although U.S. policymakers say they’re running low on ammunition to jump-start the economy, the German government has been aggressively instituting policies aimed at protecting jobs — and they’ve worked.
The difference, say some experts, is that the German government has been unafraid to pursue policies that induce companies to preserve high-paying jobs and boost exports, embracing two words that can make lawmakers in Washington recoil: industrial policy.
In the United States, actively interfering in the affairs of big companies to save jobs is a line many politicians are unwilling to cross.

Asked whether he was suggesting that the United States didn’t have a “coherent domestic manufacturing or labor policy,” Zakaria responded quickly, “We don’t.”

“If you think about what made Silicon Valley,” Zakaria said, “Silicon Valley was made by a great state education system, you know, these amazing U-Cal campuses, a great public education system. It was made by Defense Department demand for engineers. ... U.S. government used to buy every computer chip that was manufactured.”

Zakaria’s comments (and his book) come as Republicans and Democrats argue over the roles that the federal government and corporations should play in job creation. What do you think? Should the United States adopt the German model, or is there another way to spur economic growth and kick-start job creation?

Leave your thoughts in the comments below or post your #econsolution to Twitter.

By  |  12:37 PM ET, 06/08/2011

 
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