Signs point to an American economic decline. GDP growth has slowed. Our debt now exceeds our GDP. Our bond ratings are wavering. Congress shows no signs it is willing to cut spending and, given that half our citizens get government checks, most Americans resist cuts to entitlements. Our anemic recovery has created few jobs. Regulations, mandated benefits and uncertainty over the future have made hiring—at least hiring Americans to work in America—an unattractive proposition. Many businesses are hoarding cash or investing it in faster-growth economies.
President Obama is not helping. While his anti-business rhetoric has softened, the President still incites class warfare by insisting that our financial problems can be solved by soaking “the rich.” He has no plan to cut the deficit; even the Democratic Senate unanimously rejected his whimsical 2012 budget.
Congress is not likely to make decisions focused on long-term economic growth either. Democrats will not cut entitlements and want higher taxes; Republicans will not cut military spending and will not raise taxes. Given the intensity of fights over short-term fixes and tax cuts, it’s no surprise the middle ground in long-term solutions has become more like the Demilitarized Zone.
So we are a nation without strong leadership, clear strategy or defined direction. The result is a business environment without any sense of long-term stability or confidence. Indeed, the recent Global PWC Survey of more than 1,000 CEOs added two top concerns of CEOs: the “public deficit” and “increasing tax burden,” which had not appeared on the list of top risks related to government policies the previous four years.
If you agree that on our present path the U.S. economy will weaken, then our decline must factor in your business strategy, board discussions and planning. Leaders have a responsibility to shareholders to consider the prospect of economic decline, as well as a moral imperative to act to resist this decline.
Yet, when business leaders do speak out, it’s often in favor of wasteful short-term solutions like the stimulus, Cash for Clunkers, first-time homebuyer subsidies and assorted government largesse. But business leaders have to think strategically and consider the long-term health of the U.S. economy. Isn’t our nation’s economic health more important than any of these short-term “feel-good fixes,” especially when the short-term fixes yield such painful hangovers?
Three years ago, tech company CEOs on the Board of the Consumer Electronics Association (CEA) concluded that our economy is in danger in the mid- to long-term due to the actions of our government.
CEA started the Innovation Movement as a grassroots movement for individuals and businesses alike to step out and speak up, to insist that our elected officials set a new tone for the U.S. economy and start pursuing policies that will actually encourage growth, innovation and entrepreneurship. CEA’s Innovation Movement is committed to cutting the deficit, promoting free trade, attracting the best and brightest to America and making a broader spectrum available for wireless broadband innovation.
Once upon a time, America’s businessmen and entrepreneurs were social and political leaders. Too often now we leave those leadership duties to others who, frankly, don’t know what it takes to run a business or create wealth. But we have an opportunity to reclaim them and take a stand for what is best for our nation.
What can you do?
- Urge your own trade association on a similar path.
- Give your voice to this debate within your company in its newsletters, communications and elsewhere.
- Join and urge your employees, partners, suppliers and customers to join the Innovation Movement or similar efforts like NoLabels.