The US, and the concept of being “relatively ok”
In the yearly IMD World Competitiveness Ranking, the US is often at or near the top, and yet Rosenzweig, a US native, pointed out that basic education in the country doesn’t have a good reputation. Conversely, the country is a magnet for talent.
“Our infrastructure, too, seems way behind,” he said. “We spend a lot of our GDP on healthcare, but we don’t have obviously good results. As for political consensus, it’s only got worse over the years. It’s an odd mix. If it’s not explicit branding, it’s how we are perceived abroad – soft power or cultural power – and that’s very powerful.”
Asked to imagine he was advising the US on its competitiveness, Bris responded, “The lack of consensus in the US largely explains why its competitiveness has fallen over the years. Public sector investment in high schools and universities relative to GDP is much higher in the US than the global average, so the performance of students in the labor market isn’t bad at all. Also, the match between the education system and job opportunities for graduates is very good, relatively speaking. After all, it’s easier to be employed in the US if you have a university degree compared to many other countries.”
Regarding infrastructure, Bris pointed out that when you consider non-physical (i.e. digital) infrastructure, the US tops the WCC’s digital connectivity criterion and its full Digital Competitiveness Ranking.
So, what are the major challenges in the US today? Bris argued that it’s down to the structure of its government, and its inherent inefficiency, adding, “The private sector is to some extent corrupt, and does not serve the needs of society. In terms of equality, the social gap is huge.”
Corporate leaders also underestimate their ability to shape policy and change governmental actions to create change, which Bris argues is much easier in a small country like Denmark.
But customers and shareholders do want their senior executives to speak up about important issues because their opinion matters for policymaking, said Bris. “Personally, if I buy a product, I want the CEO to have an opinion on, say, Ukraine, or policies in their country.”
Rosenzweig concurred, adding, “With climate change and sustainability center stage, there is an expectation from both the public and from employees that businesses will play a more active role in shaping the government agenda in terms of the future of competitiveness.”
However, in some countries, such as Switzerland and Thailand, the private sector is more proactive in political decision-making than in others. On the other hand, there are countries where political leaders are (or purport to be – probably for political reasons) totally deaf to the needs of the business sector, such as Brazil and Venezuela.
“This is a recipe for disaster,” Bris warned. “But let’s be clear – it’s not because we want to promote capitalism that we need to listen to corporate executives; it’s because they bring the voice of civil society.”