– Robert C. Wolcott is the founder and executive director of the Kellogg Innovation Network at Northwestern University. Michael J. Lippitz is the senior research fellow at the Center for Research in Technology & Innovation at Kellogg and a consultant to the federal government. Their book, “Grow From Within: Mastering Corporate Entrepreneurship and Innovation” launched in October. The views expressed are their own. –
The news the U.S. economy grew at a 5.6 percent pace in the fourth quarter – the best showing in years – is tempered by the fact it was fueled by government-supported spending and revving of depleted inventories.
How can America again create quality growth? Though growth appears around the corner, many fear it’s based on governments worldwide flooding markets with liquidity and public spending. To address a crisis born partly of excessive private debt, we’re writing public IOUs to the future. But public largess only buys us time. Eventually, the future will come calling.
There is only one attractive way out: creating new value through innovation and entrepreneurship.
The alternatives—higher taxes or monetizing debt through inflation—won’t provide the jobs and productivity that sustain a rising standard of living. In 1798, Thomas Malthus predicted mass starvation and conflagration: “The power of population is indefinitely greater than the power in the earth to produce subsistence for man.” The world proved Malthusians wrong by vastly increasing agricultural and manufacturing productivity through innovation and entrepreneurship.