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USANews版 - Executives Lack Confidence in U.S. Competitiveness
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Executives from around the world are profoundly pessimistic about the
ability of companies operating in the U.S. to compete in the global economy
and to pay high wages to U.S. workers, a survey of more than 6,800 Harvard
Business School alumni found.
Some 58% of the respondents expect the U.S. to weaken on one or both of
these two dimensions of competitiveness over the next three years. Only 25%
expect the country to improve on one or both.
"It's not that the sky is falling," said Jan Rivkin, a Harvard professor
overseeing the project with competitiveness guru Michael Porter. "We've got
great strengths, but the strengths are weighed down by weaknesses that are
getting worse."
The survey is one piece of a broader effort by a group of Harvard Business
School professors to rally executives to encourage business and government
to pursue policies that will improve U.S. living standards and bolster the U
.S. economy's competitiveness.
One bright spot in the new survey: Respondents were less pessimistic about
prospects for the U.S. than they were in a similar survey last year. "We are
sinking more slowly," Prof. Rivkin said.
That appears to reflect a deterioration of the outlook for Europe and Asia
rather than improvements in the U.S.
"The perception of the rest of the world has slipped," Mr. Porter said. "The
sense of doom is a little bit less." Indeed, the decline in pessimism about
the U.S. was sharper among Harvard alumni abroad than those in the U.S.
Unlike some other efforts to diagnose the competitiveness of the American
economy, the Harvard project emphasizes both making U.S. companies more
competitive, which could be achieved by cutting wages, as well as making the
U.S. economy more competitive, so it can deliver rising wages.
The Harvard alumni are less gloomy about the former than the latter. Some 34
% said companies in the U.S. would be less able to compete in the global
economy over the next three years; 28% said they would be more able. But 52%
said the U.S. would be less able to pay high wages and benefits; only 20%
said it would be more able. The remainder in each case said "neither more or
less."
The Harvard professors found particularly strong support among the alumni
for encouraging more immigration of highly skilled individuals, for
rewriting the corporate tax code to lower rates and eliminate loopholes and
for making the federal budget more "sustainable" with spending cuts and
revenue increases.
A parallel survey of 1,025 Americans found them far less pessimistic than
the business-school alumni. That survey found, to the surprise of the
professors, strong support among the public for corporate tax reform. Both
surveys also found enthusiasm for a multiyear effort to invest more in
communications and transportation infrastructure.
The alumni survey attempted to identify political leanings of executives by
soliciting their views on two policies seen as conservative—right-to-work
laws and the budget crafted by Rep. Paul Ryan (R., Wis.)—and two seen as
liberal—clean-energy incentives and the so-called Buffett tax on the
highest-income earners.
Just as in recent polls of the public, liberal business-school alumni are
more upbeat about the future of the American economy than conservatives.
The survey of alumni was conducted by Abt SRBI and the online survey of the
public by GfK, which maintains a statistically representative panel of
Americans.
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