In a piece for Policy Network, Stephen Ezell sheds light on the new global reality. A unique opportunity sits before the United States and other countries to usher in an era of Innovation Economics. Citizens of all countries cannot be expected to wait out a generation as leaders make incremental adjustments to time-worn policies. It is time to put innovation at the service of economic opportunity, transformation, and renewal.
Why U.S. Economy Imploded and Why Recovery is So Slow
As explained in Innovation Economics: The Race for Global Advantage, the only solution then as well as now is to address America’s real problem: its structural competitiveness crisis. Low interest rates can’t spur spending and investment when wages are stagnant and investment opportunities much richer outside the United States. This is why corporate investment in machinery and equipment has been stagnant over the last five years. And more stimulus would be like an adrenaline shot to a heart plagued with chronic disease. It might get the heart pumping stronger for a while, but without a competitive heart, health can’t be restored.