weekly response

We Are Not Alone
By Leo Brown
[President Obama's Weekly Address]

About a month ago, the traffic on this blog doubled. I couldn't figure it out. Had I become more insightful? Maybe some post had gone viral?

As it turned out, all of the new visitors were from Siberia, where I now live. Because many of my Russian friends and acquaintances want to read what I have to say. In Novosibirsk, direct communication with an American is a rare opportunity. Some people may be less interested in my ideas and simply want to practice their English. Whatever the explanation, my audience has swelled and continues to grow at a quicker rate than before.

This is an opportunity for growth that had not occurred to me, and many American businesses operate with the same narrow perspective. As President Obama mentions in his weekly address, 95% of the world's consumers live beyond our borders. But according to this Washington Post article, 99% of American businesses do not export their product.

Of course, some businesses, due to their size or industry, should not export. But 99%? This couldn't be optimal.

Existing trade laws and tariffs are less then ideal, but President Obama is working to fix this. The trade deals he announced during his Asia Pacific tour will help.  The President has repeatedly signalled, through both words and action, his commitment to uphold the campaign promise of doubling American exports by 2014. Based on these facts, we can reasonably expect the government to support an economic climate conducive to exports.

But for all the government can do, American businesses need to open their minds. Because consumers are consumers, whether they hail from Westchester or Tajikistan. Americans may not be buying like they used to, but this needn't destroy our economy. By investing in international market research, businesses might realize opportunities far beyond what a healthy American economy could ever provide. We need to aggressively court the international consumer base rather than treating it like a cheap sideshow.

By viewing the global economy with a wide lens, we can continue to grow as a nation. If we repeat the mistakes of the last ten years or the habits of the last century, the world will leave us choking on its fumes.

President Obama sketches out a plan to substantially reduce unemployment and reinvigorate the economy in this week's address. To be sure, the President needs a plan. But he does not mention why he is focusing primarily on domestic manucturing, a strategy that, in my opinion, requires a bit of explanation.

Though our international trade deficit is problematic and unsustainable, we are, by no means, obligated to tackle the issue by suddenly becoming a manufacturing nation. Nor is that really possible, to the extent that would be necessary, in the 21st century. Manufacturing jobs disappeared overseas (decades before the current recession) not because of faulty policy or American decline, but because international labor became relatively cheap and plentiful. Today, we can no longer compete with Chinese production of pencils and McDonald's toys - our standards of living are simply too high - and that's OK.

To improve our balance of trade and to reactivate the economy, we need to focus on what we do best in this century. As Tom Friedman has argued, now is the time to be "stapling a green card to the diploma of any foreign student who earns an advanced degree at any U.S. university." The nation's system of higher education is surely one of its greatest assets; we must use it to our advantage in the global competition for talent. In the last decade, our own Silicon Valley has spawned multi-billion dollar companies such as Twitter, Facebook, and Google. These are the U.S. exports of the 21st century, and we can maintain a stronghold in this market by continuing to invest in technology start-ups. And our financial sector, while demonized and reviled, remains a global leader and major contributor to net exports.

The fact is, we need not be ashamed of our Chinese-made pencils, or, for that matter, our Chinese-made iPads. Manufactured goods were an important part of our nation's economic development, but we might best build a future upon eduction, research, financial services, and high-tech design - sectors in which we currently excel.