MEDEF 2008 Conference “Think Big”: Is the USA Still a Giant?

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Is the US still a Giant the right question?

The plenary session of Wednesday evening August 27th at the MEDEF’s Université d’Ete was entitled: Is the USA still a Giant? And the star-filled panel gave a very vivid and resounding yes to the question, with the normal and logical set of qualifications. For purposes of this post, I have three angles regarding this plenary session.

First, the highlight comments and perspectives. Second, what was missing from the debate. Three, a quick review of the panel format and an informal scorecard on the quality of the speakers. The highlight comments and perspectives (comments are paraphrased from French into English).

  • From Ms. Christine Lagarde (Minister of Economy, Industry and Employment) Despite the quadruple crisis that America is undergoing today (rising imports, housing, finance and currency), the chances are that the US will come out of the crisis in better shape. Ms Lagarde cited the American’s ability to appreciate the value and role of failure, referring to the startling example of Donald Trump who has been up and down a few times. [Same for Martha Stewart?]
  • Again from Ms Lagarde: Why is the USA able to reinvent itself? Because the USA is not based on a rigid “model” (as in France), but on values, values that are fluid. Ms Lagarde cite three key values: self-esteem, [with a plug for the high level of R&D where over 6% of GNP is invested in private or public R&D – citing the strength of Harvard, Stanford and Berkeley]; the genuine sense of welcome and integration of the immigrants; the instinct to give back, where 10% of the wealth is given back to charities.
  • Loic Lemeur, CEO of Seesmic, his 5th startup (inveterate e-entrepreneur). Through a number of interesting anecdotes, Mr Lemeur managed to get our attention with verve. He cited paying for a billable one-hour chat with Daniel, an online consultant – and Daniel turned out to be a 14-year-old entrepreneur. Mr Lemeur resumed the existence of the 14-year old entrepreneur in the US because Daniel has entrepreneurial icons, such as Steve Jobs, Steve Case, Steve Ballmer up to whom he can look (though they don’t all have to have a first name Steve).
  • Again from Loic Lemeur who said that the notion “How can I help you?” is embedded in the American’s personality. And, Mark Zuckerberg, founder of CEO of Facebook tendered out the same help and delivered… A nice spirit of collaboration.
  • Stuart Haugen, CEO Of Certus Executives, VP of Republicans Abroad, gave a very “American” and thoroughly positive rendition of the US’ long term health, citing Mark Twain: “the rumours of my mother are considerably exaggerated.”
  • David Ignatius, journalist from The Washington Post. Mr Ignatius talked about the demise of the MSM (Main Stream Media) at several occasions and rued the end of privacy and intimacy. He also stated that America is too big to take care of so many problems that are so small (such as Kosovo). Yet, is so small to take on the truly big problems (notably Global Warming). Mr Ignatius said that the question is not whether the US is a big giant… but how big a giant should the US be? The real question is how to be the “right size”.
  • Finally, Mr Ignatius talked about the need to “turn the page”, but intoned: “yes, but the page of which book?” A nice way to plug the arrival, next week, of his new book, co-written with Zbigniew Brzezinki and Brent Scowcroft: America and the World: Conversations on the Future of American Foreign Policy.” (Buy here on Amazon).

As for my own insights on the subject, I feel that the panelists did a good job of explaining how the US has become a Giant and the underlying reasons why the US has managed to rebound so vigourously from prior recessions. However, as much as I believe that the US will indeed bounce back from the current troubles, the issue is not about the US’ ability to recover. The real questions are whether the US can ensure its’ long-term, structural health. Any decline of an empire happens deceptively and over a longer timeframe: that inevitably makes it hard to “predict.” For me, there are two key points:

  1. how to improve the education system in the middle & high school levels (the “100% positive” approach for the toddlers on the one end and the excellence of the university system sandwich a vastly inferior middle & high school product). The University product is open to the world, and the world (read Asia) is taking full advantage. The challenge is educating “middle America.”
  2. how to create a healthier USA? The medical system has, once again, excellence at the top end. However, the health of the average American is poor and his/her ability to have proper health care is limited and/or expensive. There are two underlying points that need to be reviewed in parallel: teach Americans to eat better and limit the lawsuits. The level of investment in medicine and medical services is virtually double the level in France; however, there is too much waste and wasted efforts.

Finally, a quick comment on the format of the panel and a review of the panelists. For this conference of two hours, there was barely time for one question at the end — and certainly none from the audience (although I would have wanted to get one in). Rather than a debate, the evening plenary session was a string of 9 different speakers, delivering their point of view on the question. To some degree, the request from Mr Christophe de Margerie, CEO of Total, to have the USA help Europe, summed up the usefulness of the plenary session. What are the lessons to take from this session? On the one hand, there is a need to find some structural solutions to the problems in the US in order to allow for a true long-term health, so that the famous “decline of the empire” does not materialize. With a stronger US, it will be less doubtful (as Mr Dominique Moisi suggested) it will be better able to help outside its borders. And, in the upcoming Presidential elections there is a lot riding on the victory of Obama : including:

  1. really tackling the fundamental issues of education and health care;
  2. opening the door to minorities [including women] in future Presidential races, with a trickle down in other political and non-political domains;
  3. and seeing if such a critical election encourages a larger percentage of the American electorate to participate in the largest democracy of the world. And, then, on the other hand, there are the practical actions that France could take to help “change” its own future. And, on this, I certainly didn’t get any implementable solutions.

And, lastly, rather than make a person by person grading on the quality of the speeches, I note, with irony, that among the least exciting presenters were the two Americans (notwithstanding that they were both speaking in French), Mr Ignatius and Mr Haugen, along with Mr de Margerie. The most invigorating speech came from Loic Lemeur, with some pertinent anecdotes, which received several rounds of applause. But, the best speech came from Ms. Christine Lagarde who, freed from having to speak once again about the morosity of the French economy, was brilliant and pertinent in the 15 minutes she was accorded at the opening.

8 Comments, RSS

  1. RD

    Very detailed. But I failed to see what was new. I suppose that I wasn’t feeling the emotion of being in the room with these folks.

    The reality is that, though America will (always) bounce back, each time the bounce is lower.
    It’s like a superball.
    And, gravity is an unescapable fact.

    America’s highest point was in the 50s, post war.
    Japan gave it a run for it’s money but, for a myriad of natural and human resource reasons, could never overtake the US.
    Soon, China will.
    India may follow.
    Brazil will give it a run, like Japan, but may never overtake it either because of governmental/structural reasons.

  2. Colin

    I would have loved to attend this brief but undoubtedly interesting event. As a Canadian currently living/working in the US I have unique perspective on the current state of the US economy.

    I think the points you raise regarding education and health care are clear and valid inadequacies of the US system. However I would add to that list a grotesquely short sighted approach to energy and environmental concerns. This is an area where their current hubris will leave them dangerously exposed to foreign innovation and development on everything from food production to transportation. Need I sight anything other than the worst automobile mileage regulations on the planet.

    In a time when the world is facing such drastically diminishing natural resources and a globally unstable economy the true giants will emerge as those countries who develop new solutions and perspectives to reinvent and restructure the US dominated culture of endless consumption.

  3. AE

    Think you are right on about education and health care; disappointing that Obama, in order to court the teacher’s union, thinks there should be no objective standards for any public schooler to measure progress-just throw more money at it…. Mccain’s stand on abortion and No to Roe-Wade is getting macro air time here on Obama’s radio ads. You can’t answer your land-line at home-both political parties are relentless at calling looking for money.

  4. Minter

    @rd: I understand your point that nothing is new… the decline of any empire happens over a much longer period of time that our collective minds seem to work.

    @colin: at the heart of the “eco waste” is the hyper consumption and I couldn’t agree more. Then we should start evoking over consumption, under savings…

    @ae: education needs accountability, I agree. But, in the solution set, we also need to demand accountability of the parents as well.

  5. R Learner

    In a, uh, packed news week, I find the GE/Google agreement


    as telling as anything.

    A fascinating joining of forces for many reasons, and as pointed out in the article, the focus on lobbying maybe the most interesting part of it. It’s indicative too of how just about everyone’s ahead of the govt. on energy, which is the economy and is the environment.

    The question moving forward is whether the US govt. is still capable of massive, meaningful programs, or is the paralysis so entrenched as to be terminal. The lobbying agenda of the GE/Google alliance points to how top-down leadership is necessary.

    ‘Someday Americans will want peace so bad they’ll storm the White House and take it’, D. Eisenhower. The context of the quote wasn’t simply about peace, but rather about entrenched power and unwillingness to change — and that the people will have to initiate it.

    America can get its act together, but it will take both top-down and bottom-up initiative. GE/Google and others who see where future profitability (and simply, the future) lies, as well as us citizens, who have to look at our kids and get off our asses. We’ve moved from ‘Ask not what your country can do for you, ask what you can do for your country’, to ‘Are you better off than you were four years ago’ — not much future in that.

    blah, blah, blah

  6. Minter

    @rleaner: In the end of the day, we are talking about change and change management. On the one hand, I feel that there is not enough open debate. Mass media channels too frequently are just looking for ratings-boosting “live fights”. On the other hand, politics seems to revolve too much around the local/parochial issues. Personally, the slogan “better off than four years ago” is a sorry statement for two reasons. A President is generally not responsible for the economics under his/her 4 year stint — “better off” really only translates into earning/having more money and we need a lot more than that to be “better off.” And, secondly, I believe that a 5-year mandate would make more sense: first year a new President is getting to know the ropes. Last year is either lame duck or election run-up. That leaves 2 years to make things happen.

  7. R Learner

    It’s maddening — the mass media (and by this I’m referring to television primariliy; CNN, FOX, CBS, et al) seems almost entirely campaign/poll focused rather than issue/policy focused. This feeds into the candidates desire not to get specific about policy, it’s circular and reinforcing. Net is, we get a lot of coverage on bickering in the face of enormous problems. Hopefully the debates will change the dialogue a bit.

    And yeah, the ‘better off’ thing was/is depressing; not much notion of society in that; we’re all free agents.

  8. Fabrice

    Is the US still huge: absolutely.

    What will the fallout of the credit crisis be? It’s still unclear. A lot of the regulation from the 1930s ended up being counter productive (like the creation of Fannie).

    We’ll see!

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