In a recent op-ed piece, New York Times’ columnist Thomas Friedman insisted that the next U.S. president needs to focus on “nation-building at home” [“Anxious in America,” 29 June 2008]. Friedman laments the fact that America’s economic situation is so bad that it will undoubtedly become U.S. voters’ most important concern during the rest of the campaign season. He predicted:
“[Both John McCain and Barack Obama] will be looking for a financial wizard as their running mates to help them steer America out of what could become a serious economic tailspin. I do not believe nation-building in Iraq is going to be the issue come November — whether things get better there or worse. If they get better, we’ll ignore Iraq more; if they get worse, the next president will be under pressure to get out quicker. I think nation-building in America is going to be the issue.”
So what exactly does Friedman mean when he talks about “nation-building in America”? I think he means that America needs to rediscover it entrepreneurial spirit and recapture some of the values that helped make it the world’s greatest economy. I firmly agree with that. In fact, at Enterra Solutions we are daily wrestling with those issues as we attempt to greatly scale our organization and look for employees who are competitive with the best the world has to offer in significant volume (more on this later). Freidman continues:
“Up to now, the economic crisis we’ve been in has been largely a credit crisis in the capital markets, while consumer spending has kept reasonably steady, as have manufacturing and exports. But with banks still reluctant to lend even to healthy businesses, fuel and food prices soaring and home prices declining, this is starting to affect consumers, shrinking their wallets and crimping spending. Unemployment is already creeping up and manufacturing creeping down. … My fellow Americans: We are a country in debt and in decline — not terminal, not irreversible, but in decline. Our political system seems incapable of producing long-range answers to big problems or big opportunities. We are the ones who need a better-functioning democracy — more than the Iraqis and Afghans. We are the ones in need of nation-building. It is our political system that is not working.”
Friedman decries the current divisiveness in U.S. politics that has both sides more inclined to fight than compromise.
“I continue to be appalled at the gap between what is clearly going to be the next great global industry — renewable energy and clean power — and the inability of Congress and the administration to put in place the bold policies we need to ensure that America leads that industry. ‘America and its political leaders, after two decades of failing to come together to solve big problems, seem to have lost faith in their ability to do so,’ Wall Street Journal columnist Gerald Seib noted last week. ‘A political system that expects failure doesn’t try very hard to produce anything else.’ We used to try harder and do better. After Sputnik, we came together as a nation and responded with a technology, infrastructure and education surge, notes Robert Hormats, vice chairman of Goldman Sachs International. After the 1973 oil crisis, we came together and made dramatic improvements in energy efficiency. After Social Security became imperiled in the early 1980s, we came together and fixed it for that moment. ‘But today,’ added Hormats, ‘the political system seems incapable of producing a critical mass to support any kind of serious long-term reform.'”
Obviously, Friedman isn’t so naive as to believe that the U.S. is going to recapture manufacturing jobs that have moved to low cost countries. What he is calling for are policies that will help the U.S. become a center of excellence in emerging economic sectors. The manufacturing jobs in those areas, however, will require a renewal of America’s culture of hard work as well as rediscovery of the grand art of political compromise. I have argued several times in the past for new and bold leadership — the kind of leadership capable of inspiring the nation (and the rest of the world) with a vision worthy of garnering support. Great visions are based on hope not fear. Friedman and others believe that the current crop of politicians have learned how to fight and forgotten how to hope.
The hope, determinism and confidence of post-World War II America was able to put a man on the moon less than a decade after President John F. Kennedy laid out that challenge. Those characteristics now appear dormant within America -– paved over by layers of complacency, materialism and credit card debt. We have to awaken the vital, competitive and innovative spirit that past immigrant and middle classes once instilled in the United States. The concept that one generation stands on the shoulders of the previous generation needs a 21st century re-launch. This is the only way to make the current generation better off than the last. The question is whether the current political class can lead the nation through this kind of renaissance.
America is not the only country that needs this jolt. Many countries in the developed world could use it. In my travels throughout the Middle East, I routinely come across business leaders who still embrace those qualities of hard work, thrift, and ambition — unfortunately, many of them lead businesses headquartered in other emerging market countries. In a recent post [Doing Business in Iraq], I referenced a USA Today article that noted most of the foreign businesses taking advantage of opportunities in Iraq were not American. In blogging about that same article, my partner Tom Barnett wrote:
“Paul Brinkley, head of the Pentagon office who talked Enterra into entering Iraq, is quoted as saying ‘It’s ironic’ that the firms rushing into Iraq to take advantage are not American. Actually, it’s not ironic whatsoever. Check out the countries described in the piece: Romania, Lebanon, China, Russia, Turkey, France, Germany. None sent troops, but all showed up for the peace. ‘Come as you are’ meets ‘come when you want.’ Iraqi foreign minister says: ‘They take risks. No pain, no gain.’ And before you freak on the war-peace divide, realize that 95 percent of our troops die after ‘mission accomplished’ and 85-plus percent since the end of the ‘lost year.’ These countries were our unacknowledged partners all along. You can either be shocked by that or realize that making it our war to run doesn’t translate into making it our peace to exploit.”
I titled this post “Development-in-a-Box™ at Home in America” to connect with Friedman’s idea that we need to conduct nation-building at home as well as highlight the fact that America, too, needs to ensure that it builds the future on best practices and global standards. That is the only way that U.S. companies will once again demonstrate the kind of competitive edge that they will need to compete in emerging markets — the markets that hold the greatest promise of growth in the future. By focusing on competing in new market sectors, America can remain a world leader, but it must invest wisely in new infrastructure, improved education and training, and technologies that will make it more responsive to the global economy. That is why I believe that Development-in-a-Box™ needs to be rolled out both in the U.S. and overseas in emerging countries. It is imperative to have both because, if we are effective in providing an effective On-Ramp to the Global Economic Grid for the 2-3 billion new consumers, quasi-capitalist, quasi-democratic peoples in the emerging world, we can give peace and stability a chance of flourishing overseas and then the U.S. can spend more of its treasure on development at home rather than on warfare abroad.
I’m a bit more sanguine than Friedman that America can respond to this challenge. A Philadelphia Inquirer story that spotlighted my company [Enterra Solutions Provides Technology to Iraq], discussed the fact that it is entrepreneurs who are taking advantage of emerging market opportunities.
“Hundreds of foreign companies are now doing business in Iraq. Enterra has two Pentagon contracts. One is to establish a call center that will handle incoming and outgoing calls for products from Iraqi manufacturers. The other is to set up a business-to-business trading portal, or Web site, for Iraqi manufacturers, similar to Amazon.com Inc. or eBay Inc. The call center and Iraqi business portal are expected to be operational in about six weeks. Enterra partnered with Iraq and Western firms to do the work, including Korek Telecom in Kurdistan. A Kuwait-based firm, Agility Logistics, will handle supply-chain logistics to get goods shipped out of Iraq. ‘We created a business model that will address the nation-state-building portion of war in the 21st century,’ said DeAngelis, Enterra’s founder and chief executive officer.”
Unfortunately, as noted above, most of those foreign companies are not American. I’m working with the U.S. Chamber of Commerce to change that. I recently joined the Chamber’s activities in Iraq as Co-chair of its Iraq Initiative and Co-chair of its Kurdistan Region of Iraq Investment Taskforce. Those roles have exposed me to some of the companies that “get it.” As they succeed in emerging markets, they should provide a role model for other U.S. companies who will either change with the times or die like the dinosaurs. Friedman concludes his op-ed piece this way:
“Digging out of this hole is what the next election has to be about and is going to be about — even if it is interrupted by a terrorist attack or an outbreak of war or peace in Iraq. We need nation-building at home, and we cannot wait another year to get started. Vote for the candidate who you think will do that best. Nothing else matters.”
Friedman understands that politicians and governments have less influence over global economics than they did in the past. But he also knows that politicians still have tremendous influence on establishing the tone and direction for the future. A leader with vision and charisma can instill hope to replace fear. In an op-ed piece that I wrote for the Philadelphia Inquirer [“A New Global Framework,” 6 December 2006], I wrote:
“What we need is a new framework for an entirely different era, a vision like that provided by the Wise Men – Dean Acheson, George Kennan and others – in the late 1940s. These leaders promulgated a governing framework for dealing with the postwar “third wave” of globalization, one that led to the development of institutions (the United Nations, the World Bank, etc.) and concepts (such as mutually assured destruction) that helped establish and maintain global stability for more than 50 years. That framework and those institutions, however, no longer address today’s global environment. Today, few organizations – and this includes everything from companies to nation-states – understand how to align themselves with the times. No governing framework exists to help organizations array their resources properly. As the fourth wave of globalization unfolds, new Wise People have not yet stepped forward to create a next-generation grand ordering set of principles. Instead, today’s leaders are trying to adapt old concepts and institutions to emerging challenges — which is why Western liberal democratic principles seem to be in retreat on so many fronts. … The future will bring new challenges, both natural and man-made. We’ll know an appropriate framework is in place when both corporations and governments can respond successfully to these and other stressors created by globalization, rapid technological change, terrorism, natural disasters, and other 21st-century challenges.”
Hope is the clarion call needed to re-instill the kind of values that made America great in the first place. People immigrated to America with nothing but hope in their pockets and they managed to build a great nation. We’ve gotten lazy as we’ve wallowed in our success. We have assumed that the good times would always roll and that we could continue to live large without working hard and remaining innovative. We need leaders who can make the clarion call and motivate a new generation to greatness. On that point, Friedman is right, “nothing else matters.”