Amid gloom about U.S. competitiveness, reasons for optimism

February 23, 2012

America likes to win. So amid the recent discussion about the decline of U.S. competitiveness, chief executives of some of America’s biggest companies, governors, leading economists and experts in manufacturing and energy met in Washington last week to sketch out a new game plan. They argued urgently about the need to end the competitive drag caused by lousy schools, a crushing national debt and a polarized political system. More surprising was the steady undercurrent of good news.

“I think you are going to see more jobs coming back to the U.S.,” said W. James McNerney, president and CEO of Boeing. Wages in China and other parts of the developing world are rising, reducing the incentive to send jobs overseas. Add in concern about quality control and shipping costs, and the result will be more manufacturing jobs created in the United States, McNerney and others said.

Andrew Liveris, president and CEO of Dow Chemical, said recent discoveries of shale gas deposits in the United States are a game changer. “Companies like mine were having to leave the United States because of energy costs,” he said. “We are coming back. I’m putting $5 billion into Texas and Louisiana based on these [gas] discoveries.”

“I would not overdo the U.S. declinism,” said Zanny Minton Beddoes, economics editor for the Economist magazine. Yes, she said, there are considerable problems, but look around: “Many other countries in the rich world are in much worse shape.”

Robert E. Rubin, the former Treasury secretary who is now co-chairman of the Council on Foreign Relations, rattled off huge U.S. advantages, including the rule of law, flexible labor and capital markets, natural resources, and “better demographics than Europe, Japan or China.”

In the land of innovators from Benjamin Franklin to Steve Jobs, many said, a big focus should be on fostering the big new idea, the next great invention.

Regina Dugan, who runs the Defense Advanced Research Projects Agency (DARPA), the elite Pentagon group that came up with the Internet and the Global Positioning System, said her group is working on an astounding array of innovations, from new vaccines to stop pandemics to a plane that can fly at Mach 20 — which Dugan said would mean travel from New York to California in precisely 11 minutes and 20 seconds.

Dugan counseled fearlessness, citing a question she keeps posted on her desk: “What would you attempt to do if you knew you could not fail?”

More excerpts of what speakers said at the “American Competitiveness” forum are found on these pages. Convened by General Electric, the forum was held over four days at the Andrew Mellon Auditorium, and the sessions were hosted by many organizations, including Washington Post Live, the Brookings Institution, the Peterson Institute for International Economics, the Heritage Foundation, the Bipartisan Policy Center and Wired magazine.

While there was a generally optimistic tone and much discussion of the United States’ capacity to retool, the to-do list for America was long.

Among the changes many said were needed:

●Investment in airports, roads, ports and other neglected infrastructure, the lack of which is hurting economic development. “Go to Shanghai Airport and go to Kennedy [International Airport] and tell me which is the First World country,” Rubin said.

●A change to post-Sept. 11 immigration laws that cause top talent to leave the United States or not come here in the first place. Even the brightest PhD students find it exceedingly hard to get a visa to work here, although employers say they cannot find all the talent in math, science and engineering that they need. “It’s insane for this country to make it hard for highly skilled graduates and postgraduate degree holders to stay,” said Minton Beddoes. “Delinking high-skilled immigration reform from the broader immigration debate seems to me to be an absolute no-brainer in terms of securing the long term competitiveness of this country.”

●An all-out national effort to modernize elementary and high schools that have not kept pace with 21st-century societal and workplace demands. Improving schools was seen as the surest way to increase global competitiveness.

“We are falling behind in this country,” said Boeing’s McNerney. “When you get to the root cause it is K through 12 [education]. Kids don’t turn on. They don’t get excited. The quality of teaching is not there.”

Students are leaving high school with so few of the skills that are needed in factories and offices that no one wants to hire them, business leaders said. Hundreds of thousands of jobs are unfilled because of the lack of skilled workers. This particularly stings in a time of high joblessness.

Other countries, such as Germany, Singapore and South Korea, invest more in “their people pipeline,” said Dow Chemical’s Liveris. American competitiveness, he said, “gets back to the education question and the shortage of skills we have in this country.”

But Liveris, summing up the thoughts of many, said the problems weighing the country down can be solved. “If we have to do the tough stuff, we do the tough stuff,” he said.

Jordan is the editor of Washington Post Live.

Mary Jordan is a national correspondent for the Washington Post covering the 2016 presidential campaign. She served as the co-bureau chief of the Post’s London, Mexico and Tokyo bureaus, and was the head of content of Washington Post Live, which organizes forums and debates.
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