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What will happen to America when we’re no longer No. 1?

Marketplace Staff Jun 30, 2011

What will happen to America when we’re no longer No. 1?

Marketplace Staff Jun 30, 2011

Kai Ryssdal: Aspen this week is a place in which — almost by decree — big thoughts are thunk and big ideas are imagined. Our New York bureau chief Heidi Moore has been immersed in the panels and all the Ideas Festival comings and goings this week. We’ve asked her to come by and share. Hey Heidi.

Heidi Moore: Hey Kai.

Ryssdal: So last year, this festival — at least to my mind — was all about the recession, it was about the financial crisis, it was about stuff that was sort of in the past. I get the impression from what you and I have been talking about and some of the panels that it’s more about external stuff now, about our place in the global economy.

Moore: That’s a pretty good observation. That’s exactly what everyone has been obsessed with. And in fact it’s pretty funny. Some of the sessions have been on happiness and I wonder if it’s because we have nothing left to do for the economy, so we might as well just feel better. But I think one of the things that most people are concerned about is how competitive the U.S. can remain in an economy where we are highly indebted and you have really big, important market nations like China, Brazil and India coming up behind us. The consensus is that we are probably going to have to lose a little bit of standing in order to gain economic growth.

Ryssdal: Play that out a little bit. I mean, what exactly are they talking about?

Moore: Well they are talking about things, for instance like Liaquat Ahamed, who wrote the book the Lords of Finance. He talked about how in the United States, we expect to be number one. And what that means is we carry the burden of global stability, and we may just have to give up that burden. Here’s Ahamed.

Liaquat Ahamed: It’s not just us simply setting the rules and then through a process of carrots and sticks, getting everyone to follow the rules. It’s going to be countries trying to influence us, and using carrots and sticks to us. And we’re going to have to swallow our pride occasionally.

So what Ahamed also added there afterwards is that why are we so obsessed about being number one? What are the true benefits? You can look at countries like Sweden, a lot of the Scandinavian countries or France — they’re wealthy, happy countries and they’re not number one.

Ryssdal: Talk to me about mechanics. How do we get to this place where we have innovation and we get to be OK not being number one?

Moore: Well apparently we are going to talk our way out of it.

Ryssdal: Welcome to the Ideas Festival.

Moore: That’s right. Also known as diplomacy. So I talked to Bob Hormats, he’s a high-ranking official in the State Department. And he says that the State Department has been redoubling its efforts to lobby for U.S. businesses overseas. So whenever Hillary Clinton goes overseas or President Obama, they talk up American companies like Boeing, Caterpillar, IBM, and they try to get them to win contracts to build equipment in other countries.

Ryssdal: Turn it inward for a second and talk to me about the domestic part of of this. Because we have, as you know, housing problems, joblessness problems. I mean, it’s tough to see how this all fits in the context of an American economy still stuck.

Moore: That’s absolutely right. And unemployment is the one thing we can’t get around. Ahamed made a very good point. He said we have been the least activist of nations about our unemployment problem and we have the smallest possible cushion for people to land on. I talked to Marty Seligman about this. He’s a well-known psychologist on happiness issues. And he’s been studying things like unemployment and resilience. He said when people are unemployed, they never really come back from it. Even after they have a job, they never have the same sense of well-being that they did before. So if you extrapolate that to a nation of 14 million people who are unemployed, this is a real crisis — not just financial, but also psychological because this is the population that is going to have to rebuild the country after this crisis.

Ryssdal: Right. And it plays into that thing we started with, which is our place in the global economy.

Moore: Exactly right.

Ryssdal: Our New York bureau chief Heidi Moore up here at the Aspen Ideas Festival with us. Heidi, thanks a lot.

Moore: Thank you, Kai.

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