Secretary's Speech

U.S. Secretary of Commerce Carlos M. Gutierrez
Remarks at the National Summit on American Competitiveness
Chicago, Illinois

On behalf of President Bush and the Department of Commerce, it is my pleasure to welcome you to the National Summit on American Competitiveness.

I’d like to thank co-chairs, Ron Gidwitz and our host, Mayor Richard Daley. They recognized that it was important to have a forum to discuss American competitiveness, and that we should have this discussion in Chicago, one of America’s great cities.

I’d also like to thank CNBC and Maria Bartiromo for being with us. Maria’s one of the most recognized business journalists on television and host of The Closing Bell, which will broadcast live from the Summit.

Every major country in the world is competing, innovating and growing. Brazil, Russia, India, China—everyone’s in the game.

Increasingly, distance is no longer a barrier. For businesses in Chicago, customers in Seoul or Sydney are as accessible today as those in St. Louis or San Francisco.

Today, we’re here to discuss how America competes in this environment.

I believe America has one overarching competitive advantage—freedom—which makes America attractive to innovators and entrepreneurs. We encourage freedom in our own citizens and it’s why people come here from abroad. As a result we excel in the arts, sciences, economics and most every field of creative endeavor.

Government adds value through policies that encourage creativity and investment by the private sector, fueling America’s innovative spirit.

The choices we make and the policies we promote now will determine our competitiveness for decades to come.

After more than six years of robust growth our economy has recently grown at a slower pace. The question now is, “what can we do to get growth back on track in the short and long-term?”

In the short-term the Administration, working with Congress developed a stimulus package that puts money back in the pockets of Americans, and gives companies incentives to invest. By the time the stimulus is fully in place we estimate it will pump $150 billion dollars into the economy, creating a half-million jobs.

We are on the right track to recovery. Combined with actions by the Federal Reserve and proposals to help homeowners and students, we’ll begin to see solid growth in the second-half of this year.

However, I’m more concerned that Congress is not working effectively with the Administration to take the necessary steps to manage our long-term competitiveness.

Today, I want to discuss the issues that will put America on the right track for long-term growth and keep ours the most competitive environment in the world.

The context for these discussions is the public-private partnership that made this day possible. Government does not employ most Americans, nor should it—the innovative, entrepreneurial engine of America resides primarily in the private sector.

Government can be an effective partner through policies that allow the private sector to be more dynamic, efficient and competitive. I believe it’s our responsibility to create an environment that helps you succeed. Listening to your perspective on those policies is an important part of today’s summit.

After our opening panel three issues will frame today’s events. They are:

1. Encouraging entrepreneurship;

2. Lowering trade barriers; and

3. Learning from the experiences of others, particularly leaders at the regional and state level.

To give some additional context, let me give you a few brief thoughts on the policies being debated in these three areas.

Entrepreneurship—For our entrepreneurship panel we are fortunate to have Carl Schramm, who leads the world’s largest foundation for promoting entrepreneurship. He will moderate our discussion on the critical role entrepreneurs and small businesses play in our economy.

Businesses that are less than five years old create half of all the new jobs in this country. When I first heard Dr. Schramm say this I was surprised—but I shouldn’t have been.

According to a World Bank “Ease of Doing Business” study, the United States is one of the easiest places in the world to set up a business and employ workers, with a sound, predictable legal environment, and strong investor protections. Consequently, our economy attracts entrepreneurs.

Chicago is one of the nation’s most dynamic locations, with tens of thousands of companies, making, doing, inventing the products and services the world needs.

It’s where public-private partnerships are working effectively, such as the InnovateNow! partnership that’s promoting entrepreneurship and business innovation in the Chicagoland region.

These businesses and partnerships are incubators where ideas can flourish and develop into new products and business models. It is this freedom to grow—as well as the freedom to fail—that is the hallmark of American capitalism.

The question is, “What policies can help entrepreneurs get good ideas into the marketplace?”

Consider patent and trademark reform. Pending legislation will bring patent laws into the 21^st century, which is a critical part of the environment for fostering innovation and entrepreneurship.

We’ll discuss these issues and others with entrepreneurs whose companies didn’t exist 10 or 15 years ago, and are now changing the way we live and work. And we’ll be joined by John Koten the CEO of Fast Company which recently ranked Chicago as its “City of the Year.”

Utilizing Free Trade Agreements—The accessibility of international competitors and customers distinguishes today’s marketplace. Policies that have lowered trade barriers are a major factor in that transformation.

Free trade agreements slash barriers to trade and investment and allow American exporters to compete on an even playing field.

This is particularly important today with exports keeping our economy growing. Last year American companies exported a record $1.6 trillion dollars—a larger part of our economy than ever. We’re on track to break that record this year—in the first quarter exports grew 17.6 percent.

When this Administration began, the United States had FTAs in force with three countries. Since then, we’ve added 11 more FTA partner countries.

Now there are pending FTAs with Colombia, Panama and South Korea.

I’ve just returned from South Korea and recently visited Colombia and Panama. While these agreements are important to American exporters, giving access to a combined 100 million consumers with a GDP of over $1 trillion dollars—for our partners they are transformational. For each of them there are critical economic, security and foreign policy implications, particularly the agreement with Colombia.

We’ll be led in these discussions by John Engler, President of the National Association of Manufacturers. He’ll be joined by leaders of companies who’ll be affected by changes in the competitive environment these agreements will bring.

The 21^st Century American Community—Because our country is dynamic and diverse, there are formulas for competitiveness in communities around our country that have proven to be successful.

Learning best practices from leaders who have found ways to grow their regional economies is the subject of our third panel.

Often this means effectively attracting foreign investment; germinating and growing new businesses; retaining and transforming existing companies and institutions.

Usually success is also the result of partnerships between government, private industry and the community, with cooperation at the regional, state and federal levels.

Treasury Secretary Hank Paulson will moderate our panel of community leaders who’ll discuss how they have managed to compete from which we can learn, adapt and succeed.

Each of these challenges are also opportunities. Our nation has thrived on overcoming obstacles and finding solutions that work.

Today, there is more freedom, trade, investment and prosperity, in a world economy that’s growing, than ever before. This is the playing field we’ve not only sought, but have played a large role in creating.

This should be America’s best time and it can be–if we make the right decisions.

One of America’s greatest attributes is being open to new ideas, and I hope that during the course of the day you’ll share your ideas and leave here with new approaches to sharpening our nation’s competitive edge.

Thank you.