Change: Be Careful What You Ask For

Business Week recently ran a story that the recent Washington bailout is a watershed moment, "a fundamental rethink of the proper boundaries between public and private sectors."

This may be true.  And normally, the government getting involved in anything that needs to move fast, provide innovative solutions, and (get this) turn a profit would be an enormously BAD idea.  In fact, it still is, to a great extent.

But consider this.  The recent financial crisis has debunked the myth that innovation alone can carry our economy.  We must couple innovation with a strong, modern manufacturing base.  So what is the best relationship between business and government?

Like most things, it's somewhere in the middle.  Conservatives need to give up on the idea of carte blanche deregulation.  And liberals need to stop thinking that helping businesses succeed is somehow awful at it's core. 

What the United States needs now is a true realignment of industrial policy that gives US companies a real advantage.  Tax breaks?  Of course.  But how about outright subsidies for new factories, worker training and research?  

The great news is that with Obama comes a filibuster-proof Senate.  Sweeping change is within our grasp.  But therein lies the danger.  If the democrats use this to settle scores and position themselves for stump speeches with liberal constituents, we're doomed.  

Now is the time to truly build the platform for a new industrial/economic/governmental axis.  And then get out of the way and let the private sector make it reality.  And the key to all of this is Obama.  If he can keep Congress honest through his direct link with the American people, we just may see the change we all hope for, regardless of what side of the aisle your on.

Comments

[ct]

I have a feeling with the new administration we'll see plenty of government/business interactions. The current optimism surrounding the election that we're feeling is wonderful. But at the end of the day Obama was a party line democrat as a Senator and I believe we'll see those ideals in his policies. The one hope I'm clinging to is that he ran his campaign closer to the middle, almost in the republican vein, i.e. as a tax-cutter. I just hope that's how he operates in office. But with the blue Congress, I'm not so sure that will be the case. I'd feel better if there was balance between the White House and Congress.

[Len]

I agree, but I'm hoping that we see old party lines blur a bit, and that the president starts to become a bit more of a CEO in the vein of the private sector. We'll know a lot by spring.