The Competition Myth
By PAUL KRUGMAN
January 24, 2011
Meet the new buzzword, same as the old buzzword. In advance of the State of the Union, President Obama has telegraphed his main theme: competitiveness...
...But let's not kid ourselves: talking about "competitiveness" as a goal is fundamentally misleading. At best, it's a misdiagnosis of our problems. At worst, it could lead to policies based on the false idea that what's good for corporations is good for America...
...Consider: A corporate leader who increases profits by slashing his work force is thought to be successful. Well, that's more or less what has happened in America recently: employment is way down, but profits are hitting new records. Who, exactly, considers this economic success?
Still, you might say that talk of competitiveness helps Mr. Obama quiet claims that he's anti-business. That's fine, as long as he realizes that the interests of nominally "American" corporations and the interests of the nation, which were never the same, are now less aligned than ever before...
(Bold type is diarist's emphasis.)
Krugman asks what the administration's embrace of the "competitiveness" meme means for economic policy, going forward?
Taking a balanced approach, he notes that, at best, "...it's just packaging for an economic strategy centered on public investment, investment that's actually about creating jobs now while promoting longer-term growth." At worst, he states, there's a misdiagnosis which has incorrectly determined "...that the economy is ailing because they've been too tough on business, and that what America needs now is corporate tax cuts and across-the-board deregulation."
Earlier in his column, we were told that what's good for Wall Street (corporate America) is not what's good for Main Street. As he closes out his Monday column, he continues this theme as he points out that what happened in 2008 was "...an object lesson in what can go wrong if you trust a market economy to regulate itself."
I encourage readers of this post to read Krugman's entire column, especially as it concerns his sentiments about GE CEO Jeff Immelt. Cutting a little more to the bone on the matter, here's Marcy Wheeler on the Immelt selection, "Jeff Immelt's GE: The Too Biggest To Fail."
Jeff Immelt's GE: The Too Biggest To Fail
January 21, 2011 12:50PM
...In other words, Immelt and GE aren't about building the jobs American needs... ...Rather, they're about transforming the fruits of American manufacturing into yet more destabilizing casino games.
And that's what Obama picked today to lead his election-season effort to appear serious about job creation.
Sure, maybe it'll fool the Joke Lines of the world into believing outsourcing to China is a solution to America's job crisis. But those of us in flyover country seeing that jobs crisis up close are smarter than all that.
In his final comments, today, where Krugman distinguishes the vast (sometimes diametrically-opposing) differences between doing the right thing for corporations versus doing what's best for Main Street, Krugman notes that the President may profit, politically, from his current economic strategy, and thusly improve his chances for re-election in 2012; but, the greater truth is "...the ideology that brought economic disaster in 2008 is back on top -- and seems likely to stay there until it brings disaster again. "
IMHO, once again, Krugman's spot-on.