The President’s Jobs and Competitiveness Council made one of its first public statements on how the pace of US economic growth could be accelerated. The document is not useful because its recommendations are vague and its core message is overly simplistic. The Council is made of of 26 private sector leaders. Oddly enough, only two of these signed the document–GE (NYSE: GE) CEO Jeff Immelt and American Express (NYSE: AXP) chief Ken Chenault.
The note that accompanies the report says that the council has been at work for 90 days and has decided to give the White House a “progress report.” The report is little more than a small number of comments, some of which are based on fantastic assumptions. This is likely to undermine the credibility of the council while its is still in its infancy.
The first recommendation is that workers must be better trained to fill the two million jobs which are open in the US. The document does not make it clear how the group came up with this number. It hardly matters. The suggestion assumes that “The private sector must quickly form partnerships with community colleges, vocational schools and others to match career training with real-world hiring needs.” This would mean that tens of thousands of businesses would have to create programs with thousands of educational organizations, many of which will see little reason to change their existing curriculua.
The second suggestion is that the federal government should “Cut red tape so job-creating construction and infrastructure projects can move forward.” The council is aware that the majority of permits for construction are issued at the state and local level. The recommendation is another example of a plan which cannot be realistically implemented.
The third suggestion is that the government make its easier for tourists to come to the US. This can be accomplished “By making it easier to visit the U.S. through improved visa processes, we can win back market share in travel and tourism and create hundreds of thousands of jobs.” The document does not offer any proof that visas are a barrier to tourism. One barrier not mentioned is that a slowing global economy is likely to cripple global travel even if people can walk across US borders with nothing more than a driver’s license.
The final recommendation is that the federal government should “Help small-business owners obtain the information and support they need to access Small Business Administration funding.” The great majority of small business loans are made by banks which do not want to take the risk of providing capital to companies which are not large enough to have stable customer bases or strong balance sheets.
Aside from these flaws in the recommendations, the suggestions are fine.
Douglas A. McIntyre