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US Competitiveness Declining, According to OECD and Harvard Business Rewiew

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Uncle Sam looks at stormy economic clouds

Over the last couple of weeks, I’ve been reading and studying reports on US competitiveness and what must be done to regain our nation’s competitive edge.

Fact: US competitiveness, according to the 2012-2013 OECD Competitiveness Report, shows the US has declined to 7th place. The OECD states quite clearly that unless the US reforms and rebuilds its economy in very central ways, including politically, the US will continue to decline against other advanced nations.

In March of 2012, the Harvard Business Review analyzed US competitiveness. According to their analysis, the US economy, including both political and business environments, require major changes.

Because the global economy is not a zero-sum game, the decline of American competitiveness is a problem not only for the U.S. The global economy will be diminished if its largest national economy is weak, ceases to be an engine of innovation, and loses its influence in shaping a fair and open global trading system.

[W]e see significant cracks in its economic foundations, with particularly troubling deterioration in macro competitiveness. Problems include levels of government debt not seen since World War II; health care and primary education systems whose results are neither world-class nor reflective of the large sums spent on them; and a polarized and often paralyzed political system (especially at the federal level) that makes decisions only when facing a crisis. In micro competitiveness, eroding skills in the workplace, inadequate physical infrastructure, and rising regulatory complexity increasingly offset traditional strengths such as innovation and entrepreneurship.

The issue of US competitiveness, and what makes up that competitiveness, is the overriding issue of this election and the next decade. The US must get its house in order or it will fail. To say the US is exceptional means nothing if it fails to meet the economic challenges facing the nation. In other words, US exceptionalism is nothing more than empty rhetoric if we continue down the path the nation has been following for the last 20 to 30 years.

That is why this election is so important. The economic cataclysm the nation endured in 2008 revealed all the cracks, problems, and challenges that have built up over decades. These are not simplistic economic challenges that, for example, can be easily fixed with a change in the tax code or privatizing Medicare. They are dynamic and growing. We must commit ourselves and our nation to rebuilding and renewing our nation to compete in the 21st century and to provide a better future for our children.

As a result, many of our assumptions will be challenged and our political ideologies must give way for the sake of the future and our nation.

We have the opportunity to demand better than what we now see in our political rhetoric. We need a national discussion on how to renew and revitalize our nation and our political system. This is not a left vs right or Democrat vs Republican issue. It is an American issue that has no partisanship. And it is the primary issue of our decade.

The questions we must all ask ourselves are: Who is discussing these challenges fully? Who is talking about renewing, rebuilding and revitalizing the entire economy to meet the economically competitive challenges of the 21st Century? And what must we, as a people and a nation, do to meet the challenges required to reverse the nation decline in competitiveness?

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Written by Valerie Curl

September 25, 2012 at 9:51 AM

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