Booming businesses, weakened workers
I appeared on PBS’s Nightly Business Report yesterday to talk about a serious fault line that’s running through the U.S. economy: businesses have figured out how to thrive in a global economy while workers have been left behind. Unless American businesses can find a way to include the sagging middle class in their success, they will soon face a populist backlash which will make Barack Obama look like Milton Friedman. Below is the video and my full remarks:
My full remarks:
Here’s the good news about China’s emergence as the world’s second largest economy — U.S. business has figured it out. And here’s the bad news– while U.S. companies can go global, most U.S. citizens can’t. The result in this age of globalization, is a growing tension between the interests of America’s business leaders and the interests of much of its middle class. Indeed, the most important fault line in American politics today may not be between Democrats and Republicans. It is between those businesses and business people who are succeeding in the global economy and those who aren’t.
This clash of values and interests upends our usual ideas of left and right. Consider immigrants. It’s no accident that Mike Bloomberg and Silicon Valley bosses are squarely on the side of diversity and liberal immigration laws. But CEO’s are less thrilled about the Democrat-driven imposition of more regulation and the promise of higher taxes.
The irony is that the globalization of American business is surely a good thing. Imagine how much worse things would be if U.S. companies hadn’t figured out how to play and win on the world stage.
But the equally important truth is that the twin revolutions of globalization and technological change are disproportionately benefiting the global super-class and the middle class in emerging markets like China and India — while leaving much of America behind. America’s business leaders need to figure out how to help America’s middle class join the global economic party or face a populist backlash which will make Barack Obama look like Milton Friedman.