Taking care of business, taking care of America

July 25, 2006|By ANDREW L. YARROW

WASHINGTON -- Calvin Coolidge said that "the business of America is business." Silent Cal's best-known line captured the idea that the United States is a land of making money, economic growth, entrepreneurship and capitalism par excellence.

For the last 200 years, America has been the most successful exemplar of a business-oriented culture, yielding tremendous economic benefits to its people. Yet from the days of Alexander Hamilton to the present, government and business have worked together and benefited one another economically and intellectually - despite caricatured libertarian and communist views of American capitalism free of government intervention.

Instead, business - and America - have prospered through successful business-government interaction. Government-funded infrastructure and research and development have helped business profit enormously, and, as the recent Bill Gates-Warren Buffett philanthropy demonstrates, business often has worked to make America and the world better.

Although the United States never has had the formalized business-government (and labor) partnership that Western Europe, Japan and other Asian nations have, the two have often collaborated to ensure economic growth and national well-being.

But the second goal of this partnership has atrophied in recent years. Particularly after World War II, American business and many of its leaders were very engaged with not only increasing growth but also helping to address the nation's pressing issues. As Sol Hurwitz, a former president of the Committee for Economic Development, a business umbrella group, once so memorably described his organization's postwar philosophy: "What is good for America is good for business."

Sadly, that sentiment is rarely heard today. Instead, the prevailing attitude seems to be that what's good for the bottom line and increasing shareholder value is all that's good for business. Certainly, business leaders weigh in on a few topics, such as inadequate education and the poor employees generated by it, the dangers of current-account and budget deficits and - more recently - health care and pension reform. But, mostly, CEOs are silent on too many issues, and their army of lobbyists work simply to gain legislative preferences for their industries.

But the business of America is business.

From health care, public infrastructure and economic well-being for all Americans to education, foreign policy and scientific research, business leaders should be engaged as patriotic Americans in the challenges our nation confronts. Government is either too publicly discredited, too fiscally straitjacketed or too lacking in the "best and brightest" to address these issues on its own.

The near-disappearance of business from public policy (beyond parochial interests) dates back a quarter century. The reasons are many: the neoconservative mantra that government is bad, competitive pressures, globalization and the decline of business patriotism and, increasingly, icy relations with government by small-government Republican business leaders of the Reagan-Bush II era and icy relations with business by the perceived Democratic handmaidens of unbridled big government.

Nonetheless, America needs constructive business engagement to help devise solutions to make our nation stronger and better.

Mr. Hurwitz' Committee for Economic Development, as conceived by visionary leaders such as auto executive Paul Hoffman and ad executive William Benton in the 1940s, offers a good model of businesspeople working with scholars to research policy issues and proffer proposals.

But most business leaders and anti-government Republicans and anti-business Democrats need to change their tune. Some of the nation's best minds are in business. Their ideas, logistical support and political muscle could increasingly benefit America.

Business leaders should participate in public-private commissions on national problems. Corporate policy shops should study or finance research on a multitude of policy issues. Business leaders should not hide in their boardrooms but use their bully pulpit to speak constructively about American issues.

Republicans should stop thinking that the only way to interact with business is to cut taxes and, instead, encourage business to help develop policies good for all Americans. Democrats should chuck the 2000 and 2004 business-bashing playbook and engage business leaders to work together on socially and economically beneficial policies.

This is not a Republican or a Democratic issue. Business needs to engage with both parties, with government and with all who care about our nation's future. After all, U.S. business leaders are Americans, and influential ones, and they should see that what's good for America is truly good for business.

Andrew L. Yarrow, a historian at the Brookings Institution who is also joining American University as a professor next month, will publish his book on postwar America, "Visions of Abundance," next year. His e-mail is ayarrow@brookings.edu.

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