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Rebuilding America
| Article
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12155 |
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Section : |
MODERN THOUGHT
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| Issue
Date : |
3 / 1994 |
6,474 Words |
| Author
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Richard Florida
Richard Florida is director of the Center for Economic
Development at Carnegie-Mellon's H. John Heinz III School of
Public Policy and Management. He is coauthor (with Martin
Kenney) of Beyond Mass Production: The Japanese Systern and
Its Transfer to the United States (Oxford University Press,
1994). This article is based on an ongoing project on economic
revitalization that Florida is directing for the Council of
Great Lakes Governors, with funding from the Joyce Foundation.
Special thanks are due to Timothy McNulty, executive director
of the council; Joel Getzandanner of the Joyce Foundation;
Robert Gleeson; Martin Kenney; J. David Lashar; Donald F.
Smith, Jr.; and the Heinz School students who have
participated in this project. |
With major victories on NAFTA and the GATT, President Clinton has done much to bolster the global trading system, which was faltering under the weight of growing global protectionism, and he has given a much-needed boost to his own presidency.
On the home front, however, the administration has stumbled. In its effort to revitalize the economy, the Clinton team proposed an ill-conceived stimulus package and delivered a tax-heavy federal budget. It then outlined a health-care pack age that promises to massively increase government spending and bureaucracy and has provoked the ire of many of America's most flexible and successful small and medium-sized businesses. And it has continually promised federal bailouts for high-technology sectors as well as laggard firms that fail to meet the test of global competition.
Despite its success on the international front, when advancing its domestic economic policy agenda the Clinton administration has put forward government-heavy, sixties-style initiatives that will only obstruct the far-reaching economic restructuring already under way. Indeed, while Washington continues to be dominated by images of declining old-line industries and high-technology sectors under siege by predatory foreign competitors, the economic reality is that both U.S. firms and the U.S. economy are emerging from the global restructuring of the 1980s and early '90s in much better shape than the rest of the world.
Positioning the United States for success in the twenty-first century will require a domestic policy agenda that can meet the needs of a new economy whose core principles are perpetual innovation, the continuous mobilization of knowledge, and rampant and far-flung globalization. Such a domestic agenda must revolve around America's emerging strengths in international competition--the ability to attract investment from around the world, a capacity for rapid corporate transformations, the ability to shift quickly from old-line mass-production principles to the flexibility, creativity, and innovation required of world-class companies, and the necessity for government to facilitate--not impede--the actions of private firms.
To prosper in this new economy and realize the promise of trade liberalization, the administration must develop a domestic economic strategy that leverages and reinforces the objectives of its international policy. To begin, the Clinton administration must reduce and rethink the federal government's role, giving states and localities more flexibility to respond to changing economic conditions.
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