So in February I wrote a feature story about the clash of ideas underlying Washignton’s budget strife, and with the release of Paul Ryan’s budget this week, I convinced the powers-that-be to make it free for all to read. So read this sucker — here’s Obama speaking to the Chamber of Commerce for the first time:
[Obama] spoke in the chamber’s Hall of Flags, each emblazoned with the coat of arms of a golden-age explorer—Henry Hudson, Ferdinand Magellan, Sir Francis Drake. The business group sees their entrepreneurial spirit, risking their lives to explore the unknown for the promise of riches, as instructive for today’s capitalists.
It may also be instructive, however, to remember how these men obtained the financing for their endeavors. Monarchs and state-chartered companies—the government—provided start-up money for the adventurers, and often granted them monopolies on the trade they might begin or substantial grants of land they might discover. The profit motive begat the explorers’ strenuous efforts, and the investment returned to the crown in the form of new revenues and resources from abroad.
This was the age of mercantilism—governments taking control of economies to compete against other nations in a zero-sum battle for global advantage. Today we speak of neomercantilism, as China’s aggressive growth strategy, predicated on state-sponsored firms and export-favoring currency policy, has its economy growing on pace to overtake our own in the next few decades. Given China’s population and resources, such a change was inevitable.
But the Chinese ascent is raising questions in Washington. Is the consensus that prevailed under the Clinton administration—global economic changes are a positive-sum game—still true, or is the new reality “success for me beggars thee”? These tensions have put Obama in the position of arguing that China’s rise can be an economic benefit to the United States—arguably, it already is—and also that the United States must out-compete, out-innovate, and out-educate China and other nations seeking to supplant America’s dollar-driven hegemony.
You may even learn something.