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Continued: 'Competitiveness' redefined: Call it our Symphony No. 1

  • Article by: DANE SMITH
  • Last update: March 21, 2014 - 5:47 PM

Minnesota is hardly alone in its evolution toward a more balanced understanding of competitiveness, which could be described as a return to more mature view of competition and community — one that was embraced by moderate Republican governors throughout the 20th century.

The U.S. Council on Competitiveness, composed of the nation’s top corporate and academic leaders, since the mid 2000s has focused its policy advice on three “pillars,” namely “talent, investment and infrastructure.” And although its latest document, “Clarion Call,” calls for reduced corporate taxes and national debt, at the top of the list are demands for heavy new federal investment (that would be taxes and spending) in basic research, infrastructure, cleaner and renewable energy, workforce education and training, and immigration reform that encourages productive and creative immigrants to find a path to citizenship.

Liberal economist and Nobel laureate Paul Krugman has complained for years about America’s “dangerous obsession” with competitiveness. In 1994, when the U.S. was still panicked by fear over Japan’s rise, Krugman wrote a memorable essay arguing that nations are nothing like competing businesses, and that the complexities of their interdependence means they can actually benefit from each other’s success. Japan and Texas are not Pepsi, in other words, and the United States and Minnesota are not Coke, competing over a finite demand for carbonated beverages.

Nations and states, instead, at their best, are communities seeking to maximize the happiness of all their people, and focusing on that priority will likely ensure that their firms are competitive.

Persuasive as Krugman’s arguments are, the word competitiveness and everything associated with it (picture sports fans waving the big foam “We’re # 1!” fingers) remains sacred in the American psyche. Our most watched television shows are now winner-take-all competitions in singing and dancing. Europeans may scoff, but for better or worse, we love competition, and we love the word itself. There is no political future in telling Americans and Minnesotans that competitiveness is unimportant. The competition gene is dominant in our DNA.

And so, it’s a winning strategy (see, winning is everything) to reclaim the word and give it an improved meaning, emphasizing how equity and foundational public investments are crucial ingredients to business competitiveness, rather than to deny or decry competition.

Surfacing in legislation

Thus, President Obama and Minnesota Gov. Mark Dayton both have landed on “competitiveness” as key unifying themes in 2014, and they push agendas for investment that have significant business support.

In Minnesota for the 2014 legislative session, the main pieces that serve competitiveness, writ wiser, are:

• A major new expansion of the state’s early childhood education program, backed by the MinneMinds coalition, and more investment in ­cradle-to-career education interventions that reduce race and income gaps, and drive up postsecondary completion.

• A long-term transportation/transit funding package backed by the Move MN coalition, and expansion of broadband access to the 500,000 households who do not have it.

• More incentives to work, provided by a higher minimum wage that catches up to competing states.

• Reasonable bipartisan agreements to reduce some business taxes, taking care not to extend permanent cuts that benefit mostly the wealthy and threaten budget sufficiency for further investments in human capital.

Minnesotans throughout 156 years of statehood have distinguished themselves for understanding that building a better place and stronger people was the best recipe for business growth. We built excellent schools, public improvements in water power and transportation, first-rate parks, the best health care and hospitals, and economic security for ordinary folks and vulnerable populations in the dawn, twilight and shadows of life.

And as we wave the foam fingers these days — whether it’s over the latest business vitality ranking or for our favorite teams in one of those extravagant new stadiums — we really must think about the foundations of that competitiveness.


Dane Smith is the president of Growth & Justice, a public-policy organization that seeks to reduce economic and racial inequality in Minnesota.

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