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IMF Says U.S. Economy is Now Number 2

Dec 17 , 2014

There is no guarantee the U.S. remains in the dominant position on the world stage. In fact according to The International Monetary Fund, as reported by The Daily Mail — we no longer are, at least economically. In 1872, the U.S. economy overtook Britain to become the world’s largest, a position it held for the next 142 years.

America, as it seeks to transform itself, needs to take a page from Deng Xiaoping, the de facto leader of China after the death of Mao in the mid-seventies, set into motion the world’s most massive economic, social, and political tsunami in the history of man. Deng understood that to create a reform process you needed missionary leaders willing to shake a nation off of its stifled ideological moorings.

Currently, American leaders are too beholden to their respective political ideologies to break from the status quo. Our elected leaders whine about how difficult it is to forge change in the nations capitol; try changing a country with a 5,000 year history, a military and other high level bureaucrats benefiting from the status quo – now, that is difficult! China has been a kaleidoscope of change over its 5,000-year history. America must be willing to break from the ideologue left and right that created the mess we are in today. This means Democrats must be willing to “offend” their allies in Labor and the Republicans their “friends” at the Chamber of Commerce to advance the needs of the citizens of this great country. Like Deng, we can choose to cast off the negative ideology of the past and forge a bold new future. Doing what we have always have done will not get us to where we need to go.

Where is America’s plan to reinvent itself? As a country we are in a rebuilding phase and needs to focus on our game plan and stop complaining about the other team. Guess what, sometimes the other teams are more agile, nimble, faster and, surprise, sometimes they cheat and get away with it for a game or for a few years. As my old coach would say, “Get over it!”

Some standard complaints against the “Red” team are currency manipulation, intellectual piracy, unfair labor practices, labor exploitation, unfair tariffs on our goods and human rights violations. Do these issues need to be addressed? Of course. But we cannot wait until they are before engaging with China; we need to compete to win.

In 2007, I served as a China, education and business consultant for a two-hour, Emmy Award winning documentary on CBS-WWJ-Detroit TV: “Building Bridges: From the Great Lakes To The Great Wall,” which takes a look at how economic growth in China could help position America for future growth. While the focus is on Michigan, it offers lessons for everyone in America who is confronting the fast-paced, transformational, disruptive, global knowledge economy.

With 1.3 billion people and a rising middle class, tapping the Chinese market is the mother lode of the 21st century global commerce. More than 400 million Chinese people have risen out of poverty in the last quarter of a century. For America to be prepared, we must ask: Can we break from our old economic and political ideology and forge a uniquely American model to compete in the 21st century? Can our automotive and other industries break into China even more so than they have done to date? There are countless business opportunities in China for American businesses willing to be creative and innovative.

The Chinese are studying our language, history, political systems and other ways to enhance their standing in the world. Can we say we are aggressively doing the same? How much do you know about China? We need more of our students across the country learning Chinese, the most widely spoken language on the planet. Chinese is the most spoken language in the world. Chinese/Mandarin is the most used language on the Internet. There are more people who can speak English in China than there are English speaking people in America.

We have a choice to either shift into high gear or get run over! Regardless of your view of China or globalization, neither is going away. How do we prepare our children, and our nation for this hyper-competitive, rapidly changing, disruptive, information and technologically driven world that defies predictability?

America will continue to be successful when we make our nation the “Brain Bank of the World,” where everyone comes for intellectual deposits and withdrawals and we export knowledge, creativity, innovation and talent onto the world stage. Yet, we continue to disinvest in education from high quality preschool to top-flight institutions of higher education. We need a greater sense of urgency to help prepare our children for the rising global competition.

The enemy is not China. As Pogo said, “We have met the enemy and it is us!” We must do a much better job of preparing our children and providing retraining opportunities for workers that are not benefitting from the global economy. We can compete – but only if we continue to invest in the education and training for our people. We are not doing an adequate job at this date.

Our political leaders need to stop using China as the 21st-century bogeyman as a means to scare workers who have suffered as the world economy has shifted fortunes. Anti-China rhetoric may win votes but does nothing to create jobs or build relationships. Where is the strategy to make China work for the U.S.? Our nations leadership must do more to prepare our citizens for this changing world, where work and ideas can move around the globe effortlessly. Education, talent, creativity and innovation are the commodities that will drive change.

One thing is certain. China will loom large over world events as the 21st century unfolds. Clearly, how we manage our relationship, our fears, tensions, opportunities and threats will not only impact us, but all of humanity. We need more than a “pivot to Asia.”  We need a plan to assure China’s rise does not come at our demise.

Leadership, innovation, creativity, knowledge, and change will drive this century and the U.S and China will be at the helm.


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