Strategic Competitiveness Drives American Wealth

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Strategic Competitiveness Drives American Wealth

The World Economic Forum recently released its Global Competitiveness Report 2018 showing that the United States has returned to the #1 position in overall economic competitiveness.  Germany was at #3, Japan was #6, the UK was #8, China was #28, and Russia was at #43. This ranking is based on the following twelve pillars of competitiveness:

Pillar #1: Institutions,includes “the rule of law” and ensuring fair and equal treatment; here the United States is rated at a relatively strong #13.

Pillar #2: Infrastructureincludes everything from broadband to airports and highways; with some of the oldest legacyinfrastructure, the U. S. needs to invest in moving up from 9thplace.

Pillar #3: Internet, Communications & Technology (or ICT) Adoption.  Here America’s diversity and individualism hurts, as too many people opt-out of state-of-the -art technology.

Pillar #4: Macroeconomic Stabilityrefers to the safety provided by monetary and fiscal policy; applying the same criteria to the U. S. as to more vulnerable economies results in a seemingly low ranking of 34th on this pillar.

Pillar #5: Human Health. With a rank of 47th, this pillar is our weakest; it shows that America’s high individualism and diversity has a downside.

Pillar #6: Skills.  Despite poor K-12 school ratings, we’re still 3rd in the world, in terms of skills.

Pillar #7: Product Market. On this measure of a country’s willingness to create open markets and “a level playing field,” the U. S. is the third bestgloballyand the best among the biggesteconomies.

Pillar #8: Labor Market.  America is rated #1, because its “at will” employment model enables business to respond quickly to economic realities and, thereby, remain highly competitive in a changing world.

Pillar #9: Financial System.  From venture capital to equities to bonds, the transparency and efficiency of U. S. markets make them the envy of the world.

Pillar #10: Market Size.  Only the China provides a bigger “local market” than the United States.  And notably, the United States has been one of the leaders fostering free trade, everywhere.

Pillar #11: Business Dynamism.  The capacity of America’s private sector to generate and adopt new technologies and new ways to organize work is unparalleled because it has a culture that uniquely embraces change, risk, new business models, and administrative rules that allow firms to enter and exit the market easily...

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