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American Competitiveness
Michael Porter

Michael Porter

The election’s over, the economy’s back, and everybody wants a bailout. Detroit has its hand out. Insurer AIG just got billions more. China is cranking up its own billions in stimulus.

“Job one” for the new president will be the U.S. economy. But my guest today, Harvard Business School giant Michael Porter, says crisis management will not be enough for Barack Obama or anybody else in the years ahead. America’s fundamental competitiveness, he says, is in trouble. A real comeback is going to take more than bailouts. It’s going to take a serious strategy. He doesn’t see it yet.

This hour, On Point: Michael Porter on a long-term competitive strategy for the U.S. economy, beyond the bailouts.

You can join the conversation. Where do you see America’s greatest competitive strength today? Where do you see its weakness? What should it do to bounce back and stay on top?

Guests:

Joining us in our studio is Michael Porter. He’s a world-renowned expert on how companies and nations strategize and compete. He is director of the Institute for Strategy and Competitiveness at Harvard Business School, where he is a University Professor. His article “Why America Needs an Economic Strategy?” is the cover story in the Nov. 10 issue of BusinessWeek magazine.

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  • http://www.judydunn.net Judy

    I have a great deal of respect for Mr. Porter, but I have to disagree with some of his assessment about wages. I think the relative depression of wages to the average person…as Greenspan encouraged to tamp down inflation,… was not matched by a control of wages at the very upper tiers.

    The psychology that it is about a differentiation in skills between the two pools is somewhat delusional. All you would have to do is look at CEOs at Home Depot who walked away with large sums of money after the company declined, and others like those at Enron, and on Wall Street.

    It may have controlled inflation but it seems to have left a big hollow balloon that is now collapsing in on itself.

  • Kate Ledogar

    Michael Porter claims that unequal access to education is a key factor contributing to inequality in this country, suggesting that people with advanced degrees are able to get higher paying jobs.

    My question for Mr. Porter is this: since our economy is fueled by a workforce laboring in low-paid factory and service jobs, how could equality of opportunity ever be possible in the American economic system?

  • http://www.edbizbuzz.com Marc Dean Millot

    Aside from military operations, the American government is not much for planning. Given that reality, what are the one or two most important SPECIFIC spending and legislative changes that might make a difference for Prof. Porter? Some things on the order of the decision to put a man on the moon in ten years, social security, or the post WWII GI bill?

  • Elvis Elvisberg

    Regarding corporate tax rates, it is misleading to focus on the statutory rate alone. That’s a nice talking point for ideologues, but the question in reality is, what rates do corporations really pay? Evidence indicates that these rates are not that high.

    More importantly, what is economic competitiveness among countries? I am not convinced that there is any such thing.

  • M.A Rodriguez

    I disagree with Mr. Porter.

    I have been in the IT area since 1972 and have found management getting worse over the years. I am now with an insurance company and I have to say that I have never worked for managers that are so ignorant of internal processes and so focused on the bottom line. Every time I hear the productivity reports I laugh.

    We should outsource management.

    And I disagree with Mr. Porter again. There are plenty of workers with an extensive IT background that are not employed because offshore workers are less expensive. At some point these experienced people give up and look for work in other areas.

  • Elvis Elvisberg

    Wouldn’t the best way to solve the problems of US companies be to reduce health care costs?

    It’s very misleading to blame unions for productivity problems. “[E]conomist Barry T. Hirsch, in a survey of the literature on this topic (chapter 7 of this excellent book), recently wrote that ‘[t]he empirical evidence does not allow one to infer a precise estimate of the average union productivity effect, but my assessment of existing evidence is that the average union effect is very close to zero, and as likely to be somewhat negative as somewhat positive.’”

  • Eric

    Please don’t encourage use of the non-word “incentivize”!

  • http://miroslodki.wordpress.com miro slodki

    Competitiveness comes about when there is a shared desire to succeed and to share in that success.

    The world is not flat, it’s crumpled. There are systemic inefficiencies that support a short term focus – where large supplants and prevails over smart/efficient.

    Rather than try to suppress greed, we need to channel and amply it, completely embrace it with renewed vigor. Unfettered greed expanding across the enterprise into every nook and cranny in pursuit of:

    * A greed for innovation.
    * A greed for profitable customers.
    * A greed for investors that share in a desire for long-term value creation.
    * A greed for employees with a passion for customer centricity.
    * A greed for customers that act/think like partners.

    Greed played a role in getting us into this situation and ironically only more greed will help us get out and stay out. This is a pivotal opportunity for businesses to stand, proclaim and pursue a long-term value focus.

  • Joe Spear

    First, I’ll echo an earlier comment about corporate tax rates. The statutory rate is very far from actual reality and his off-hand statement about how high they are makes him an ideologue rather than a serious analyst.

    I also must take issue with the claim that the US has historically been the industrialized nation that doesn’t prop up its failing businesses (unlike Europe). Are you kidding me? This “go it alone” and let the chips fall is one of our biggest myths that we have about ourselves. The US government actively and directly props up businesses – especially very large ones all of the time – and has since the “first” very big businesses – the railroads. Yet another point that tells me that Mr. Porter is an ideologue rather than a serious and honest analyst.

  • Erich Riesenberg

    At 28.3% of GDP for 2007, US taxes are lower than every country listed other than Mexico and Turkey.

  • Neal Cappellino

    Salvaging our economy, reviving the middle class, becoming competitive in the global marketplace, education – it all requires better use of national/federal resources to drive the effort.

    Can we hear a discussion about the percentage of our tax dollars that goes to pay the interest on our federal debt to the “private” banking institution called the Federal Reserve? Government initiatives without fiscal responsibility or accountability funded by the Federal Reserve’s printing of fiat money mortgages the people’s well-being by subjugating the middle class to servicing that never-ending cycle.

  • http://www.myspace.com/r2fax2b Mari McAvenia

    I am trying to be patient, here. Mr. Porter is a very polished and articulate speaker. I am perplexed by his avoidance of the word “erosion,” though.

    Creativity has been stifled by corporate hierarchies – that is a fact. And competitiveness as the singular driving wheel of the economy has failed to build or maintain prosperity for the ordinary American worker, who happens to be a low-wage earning female.

    There is no level playing field and business as usual IS the problem.

    I would like to see Mr. Porter walk a mile in the shoes of the person with a good education, a high skill level and a layoff notice. Let’s see just how competitive he can be then.

    Thanks for your thoughtful programming.

  • http://tombstone001.blogspot.com MOHAMMED

    Don’t look now, but the American business and society is becoming more like the ancient and traditional Hindu society of a caste system, the Brahmans (the so called highly educated), The Vades,(traders). Khushtary (military) and the Shooders ( the untouchables, or lower classes doing the manial work). Call it free trade, competitiveness, globalization, productivity increases, whatever, the working class in this country does not have a prayer, however you slice it.

    At the end of this so called economic crisis, we will end up with more poverty, smaller middle class, fewer people with decent health care, but those who created the mess will be richer for it.

    Services for the poor will be reduced, roads in poorer areas will be more broken, crime and unsolved crime in the poor districts will increase as resources are diverted to the richer , “tax paying” populations. Isn’t that how things work everywhere else too, in a “free market economy”?

    The country will look more like India, that’s all.

  • http://www.fpns.net/willy will kranz

    Hi: Good show.

    I agree with Mr. Porter about the auto industry.
    I’d recommend we help Honda and Toyota buy them and
    retool to make real cars….

    But I disagree about his analysis of IT and all the
    work going offshore. I think managers are looking at the bottom line and find it can be done cheaper in other countries. I think it has next to nothing to do with US education.

    I have a Masters degree from MIT in ME. Worked in that field for 10 years, but got interested in computers. Went back to school at WPI and got a CS Masters degree.
    I worked in that field as a consultant/ job shopper programer for about 15 years. I am now effectively retired because I can’t find work anymore. I contend it is not as simple as no one in the US has the training. No one is hiring well trained gray haired guys….

    Will

  • J. Bower

    I, too, have found Mr. Porter’s comments on education to be vague and not very thoughtful.

    When schools underperform, it is not simply because they lacked funding or have poor curriculum; there are many “poor” schools which have better funding than middle class schools, and use the same curriculum. But there is very serious educational inequality among parents. I know people who work on children’s literacy; I tutor children in underperforming areas. The greatest determinant of a child’s educational performance is their parent’s own education and literacy. So much of education is taught in the home – and if parents can’t help, or simply don’t have the time to help their children with the really heavy amount of homework they have, inequality will continue.

    I’m not blaming parents – I’m just saying that the answers to educational problems are not just in schools. They are in communities, and with parents. We need to help parents improve their own literacy and education, so that they can help their children. We need to make sure that those parents don’t need to work 10-12 hours a day, or two different jobs, simply to make ends meet, so that they can be there for their children.

    And we need to break up the socio-economic ghettos, so that we don’t have schools where none of the children have college educated parents, and other schools have children with nothing but college educated parents.

  • Erich Riesenberg

    Mr Porter reveals a bit of his bias when he waxes poetic about the rich.

    Alas, he previously panned the concept of middle class tax cuts.

    Apparently, he is not aware of how government policy, including tax policy, helps determine who wins and who loses.

    The 15% capital gains tax is a great benefit to those who can take advantage of it.

  • Jerry Bowers in the Adirondacks

    With some respect to Mr. Porter: He is sooo out of touch with reality as regards middle & working class people in this economy/country. No wonder the highly educated are seen as elitist by some! (Not by me) I have known plenty of people over the last 25 to 30 years with graduate degrees who are under or unemployed. I know people of all ages, myself included, who see no point in investing their time & money (plus take on the debt) of more degrees/education when even living wages are not there, let alone any real benefits or advancement opportunities.

    Correct me if I am wrong, but as I recall the book & philosophy of the ” new rules” came out of Harvard Business School. The corporations and wall street, no caps intended, not to mention the colleges and universities, embraced this new idea. Why? Money/greed. Based on my experience with corporate America, wall street has been running most of the companies through it’s focus on the end of the quarter. Forget long range. Add to that the fact that many of us were forced to bet our retirement security on wall street and the corps so we encouraged the greed and hubris. As long as “I” don’t lose my job. It’s OK if my neighbor loses his or hers. The bottom line is all that matters. We see now where that has gotten us

    The attitude is if you don’t have at least an MBA, you are worthless. Most of the MBA’s I have worked with think only about themselves, i.e. salary & bonus. They have been taught “no place for ethics/morals in business”

    I hear him at this moment blaming American workers and their unions. IT/software jobs go to immigrant workers because they will work for less. There are plenty of Americans with training, degrees and experience in IT, and many other fields, out of work right now and some have been for months or years. It is amazing to me that businesses have no money for living wages or benefits, but PLENTY for corporate lawyers, accountants, lobbying/campaign contributions, corporate jets/expensive junkets, etc, etc, you get my drift. Let’s not forget the chambers of commerce for the “small” businesses. Plenty of money for their lobbying and contributions!

    Oh yes, let’s not forget the “high” taxes. About 11% after the cpa’s get done. And those big bad lawyers. The only possible protection most of us have if corporate America maims, shafts or poisons us.

    I could go on and on, but I doubt anyone will read this whole letter now. This is what I have learned from working for businesses of all sizes plus self employment for 45 years. If anyone wants to respond or continue this conversation write to getwyrd@hughes.net. This includes Mr. Porter. Please get out into our world for a while.

    Thanks, Jerry Bowers

  • Robert Riversong

    I’m not entirely surprised that NPR would invite an Ayn Rand ideologue as a “competitiveness expert”. Not only in his words, but in the stridency of his voice one can disern the lack of intellectual rigor and objectivity.

    In Tom’s softball approach he failed to call out Michael Porter on the unchallenged axiom – and the reason for failure – of our economic system and the theories, right and left, which underly it: that a sucessful economy requires unrestrained growth.

    It is both an economic and geo-physical law of the universe that exponential growth in a finite environment results in inevitable collapse. That collapse is due both to the fact that finite resources cannot supply an infinitely-expanding economy (any more than the earth can support unlimited population growth) and to the hierarchical nature of all large economies that concentrate wealth at the top while impoverishing their human foundation (which is not the consuming “middle class” but the productive workers and farmers in the field).

    We shouldn’t now be talking about re-arranging the chairs on the Titanic (and who’s going to get the biggest life preserver), and surely not in the context of discredited ideologies. We need to create an entirely new (actually quite ancient and timeless) paradigm of a steady-state economy in support of a steady-state population, fueled entirely by the energy flux from the sun. Nothing else can be called sustainable.

  • John Cramer

    Before Mr. Porter , or his researchers , quote from ” Nation At Risk ” , he ( they ) should read ” The Manufactured Crisis ” by David Berliner and Bruce Biddle . Berliner and Biddle completely debunk ” Nation At Risk ” .

  • MinerSam

    I MORE THAN agree with Mr Porter on these issues But would love to have debated his premise that Democrats are as responsible for the terrible damage to our competitiveness as Republicans IN FACT ARE!

    …and if he is a “Guru” than consider me GURU#2 as I have been tearing my hair out about the damage the Republicans have been perpetrating upon our competitiveness for 28 years…to the point of hysteria in the last 8…except unlike Porter as well as Friedman I come free.

    …Particularly tragic is that We had to endure Friedman’s 8 YEAR LEARNING CURVE on these issues while the Republicans have been pushing us wholesale down the cliff!

    -Corportat Tax Rate: Everyone except your guest seems to know that our effective corporate tax rate is very competitive. CNBC (which I have had on 13 hours a day) has reported it repeatedly in the last 8 years.

    -Earmarks and Pork Barrel spendng (18B): Earmarks are simply when money is TARGETTED UNDER A CATEGORY THAT HAS ALREADY BEEN ALOCATED. All itsays is: Should The Executive branch spend the money on his brother’s state of Florida… OR do local authorities know what they need i.e a Congressman in some midwest state who is aware that the Bridge in his area has been rusting for years and needs repair. For a Republican Party that opposes Central Planning McCain’s fight against Earmarks as a Presidential candidate simply meant that he would have made it a policy for the Republican fundraisers now populating the executive branch agencies to over ride local officials…MUCH AS THEY DID WITH HOMELAND SECURITY FUNDING..where the per capia spending was $55 for Cheney’s state and only $5 for NYC which has been more in danger.

    There is an expression in at least one language that you say to someone addressing of the OBVIOUS : “Good Morning”

    =Education: Mr Porter’s belief (OR SPIN which ever you believe) that the Republcans share a concern about education like the Democrats do is NOT BASED IN FACT:

    ==The reinvented Reagan, who ran on telling people that the root of their economic woews was Welfare mothers..one of the first things he did was to elimintated the CEDA training program that was putting thousands of them in high paying electtonics jobs as technicians.

    THOSE WHO DID MANAE TO GET TRAINING GAVE BACK 30 TIMES THE INVETMENT BY THE GOVERNMENT IN SUBSEQUENT TAXES.

    ==He took away the tax incentive for companies to send their employees for training or an education in the fields they were already working for them in.

    ==Republicans have been trashing the teachers of our children for DECADES reducing federal dollars for publc.. Their vouchers favor private over public education with a 1-2 punch from not funding no child left behind…not to mention defunding the arts..AN AREA THAT HIGH TECH CEOs know Trains the brain toward better analitical minds.

    ==And in their last tax they gave the average millionaire and extra $19,000 while PUSHING 400,000 college eligable Young people from the opportunity of going to collage.

    ==PUBLIC TRANSPORTATION: McCan hate public transportation as does the rest of his Party..which has been fighting funding for Amtrak forever…something that happens to take millions of commuters to work…

    And just imagine where we would be if Reagan had not ripped the Solar Panels off the White House Roof or if the Republican Majority had not Fillibustered Clinton’s Infrastructure Bill which would have repaired those Leevies to an optimum level for $14B over 10 years ago!

    And will never forget when a Democratic Senator from Michigan asked the then Bush Budget Point man (Bolton) “what profession should I ask constituants t study for that will not eventually go off shore” His response FREE MARKETS: “That is not our business that would be Communist Central Planning.”

    It is the Republicans who have been damaging our competitive edge….making it a tax deductible event to pack your facility in the US and unpack it in China..

    And since the Republican Coup in 2000 so far 800 research labs have gone off shore…BECAUSE THEY HAVE HAD TO DUPLICATE EQUIPMENT HERE DUE TO THE MORONIC STEM CELL POLICIES…

    Unions: Unions are only 8% of workers. But when they were allowed to thrive Companies WITHOUT UNIONS Gave their employees Smart and Generous packages as a way of competing wih unions. AND SINCE THE AMERICAN MIDDLE AND WORKING CLASSES ARE THE LARGEST CUSTOMERS OF THE CAPITALIST WORLD (AND 68% Of our economy)..and the Democrats Take care of the interests of this group IT IS THE DEMOCRATS WHO ARE PRO-BUSINESS in the long term …and the Republicans who…WHO CUT FUNDING FOR BASIC RESEARCH WHO HAVE BEEN THE ENEMIES OF OUR COMPETITIVENESS..

    As one who worked in Hi-Tech in the 1980s (where we succeeded DESPITE REAGAN) It was Reagan who was credited with losing us the Memory Industry to Japan.

    In every area:
    From Training to comsumption as Bill Clinton used to say: “If you want to live like a Republican you need to vote Democratic”

    It is an insult to equate Democrats with Republicans IN THE AREA OF OUR COMPETITIVENESS….AN INSULT TO INTELLECTUAL HONESTY.

  • Frederic C.

    Values

    Where do values fit into this discussion?

    I think there should be massive brinkmanship protectionism to even the playing field with regards to workers rights.

  • http://www.etproductions.com James Hollomon

    I really enjoyed listening to today’s program with Michael Porter. When the comment about the inequity of “Top Dogs” pay came up, I wanted to call in but couldn’t get through in time.

    Clearly the comment was poorly worded, but the point is bigger than that which Michale took up. Since the Reagan revolution and trickle-down economics were first introduced in the 80s, The wealthiest 1% of Americans have doubled their share of the total wealth of the nation, from about 25% to nearly 50% today. In terms of real income, the middle class has been sliding backward. Whenever you “transfer wealth” to one place, it must come from somewhere else.

    I’d truly like to hear Dr. Porter’s thoughts on how growing concentration of wealth and the slow decay of the middle class threatens our nation’s future. I’d like to see the topic become part of the national discourse, as I think it is as grave a threat as we face.

  • Frederic C.

    If it doesen’t trickle down you gotta take it back.

  • http://www.lit.org/fritzwilliam Fred W. Bracy

    A Nobel Prize, Tom? Why would you cow-tow to someone with so little to say.

    Here is a man–Michael Porter of the Harvard Business School–whose only real point of the interview was to decry the (public) education in America. It sounds to me like he is probably someone who knows of the problem first hand–perhaps he’s one among the many who indeed failed in that system. Or maybe he, instead, really knows far less than he would admit simply by virtue of the fact that didn’t attend public school, but obtained a privileged private school education. Either way, it must be asked. . .what is an economist and a business school educator doing passing himself off as an expert in the area of public education in this country? He certainly had nothing to say about economics other than to defend the policies of all past Republican administrations (Including Clinton’s which also qualifies even though Clinton ran as a Democrat) and as such would have brought us to the same point we’re now at were he to have been in charge. Now the professor would dare, it seems, to claim ownership of the solution. My question: How do people get into the position of educating, writing and speaking on topics that they are so ill equipped to handle. Michael Porter’s appearance on the excellent program, On Point, was the worst case of blathering I’ve ever heard on radio, TV or anywhere else in the public media. Mr. Porter (the good professor, no less) needs to read a REAL economist’s view of the current financial problem, the factors that got us here, and what to do about them by reading “Obama’s Challenge” by Robert Cuttner. Indeed the professor may never heard of it. I’ve just finished it and I’ve heard a few clips that encourage the President Elect to name Mr. Cuttner as his treasury secretary. To hear Michael Porter claim the the government has already spent too much with the 700 billion dollar bailout of the financial system proves to me that he should not be teaching at the level he’s at. Problems with education? He’s contributing to it! He and people just like him stand before business school students and are still teaching Reaganomics! Reaganomics has been thoroughly discredited, folks! The professor isn’t teaching. He’s proselytizing! He’s beating neoconservative philosophy into the heads of our next and upcoming generation of CEOs. . .all for the purpose of maintaining the status quo in business. Which is. . .well, you know what it is. GET ALL YOU CAN WHILE YOU CAN. Take it offshore if you must. Beat down unionism. TAKE THE MONEY AND RUN. We’re sick of it, and people like Michael Porter need to find a job offshore or under a rock somewhere in a place where they can do no actual further harm to the human race

  • Sam E.

    Ouch this hour was depressing.

  • Ken

    I would argue that supply-side economics has had the effect of producing a “Dutch Disease” for capital speculation – where a disproportionate share of the nation’s capital went to one sector (finance), at the expense of all other sectors except non-tradable services.

  • Chris S.

    I think there is a much more fundamental discussion that needs to occur, which is what are the values that we will use as metrics when discussing the economy? Growth? Sustainability? It’s apparent that it’s about sheer growth for Mr. Porter; I have no doubt that his ideas on business and education would help meet that end. But growth and prosperity do not necessarily equate to long-term health, happiness, and equality, which are also values that we ostensibly hold dear.

  • http://sos-newdeal.blogspot.com mark Brown in NJ

    Here’s an idea.

    Yes, We need to do more then bail out the banks and the car companies. Yes, we need a new STRATEGY to rebuild our country, rather then just bailing out all the companies, and rewarding (all) the bad (and stupid) behaviors of the past.

    (written before hearing the show…)
    Yes, here’s a concrete idea, YES, bail out the Car companies, WITH a CATCH.

    Instead of rewarding GM for targeting individual autos,
    we, the people and government paying for the buyout
    need to “push” GM, into a new business, that will work with the new infrastructure we are attempting to build

    To save the Car companies, we need to change them FROM car companies INTO transportation companies. They need to be refocused from selling individual cars to mass transit solutions.

    See my blog for a suggested reading.
    Essentially, we can SAVE the car companies by changing them to provide public transportation to help save energy and rebuild our infrastructure.

    Yes, it IS imposing our will on the company, however the nearly 1 million indirect jobs in the auto (and parts and associated) industries are WAY too important to throw away, and we ABSOLUTELY need to rebuild the country’s infrastructure anyway.
    See my blog entry here: http://sos-newdeal.blogspot.com/2008/11/next-prediction-save-car-companies.html

    There are a great deal of pro’s and cons. however, I think that saving this plethora of jobs, as well as changing our economic base AWAY from OIL based industries.

    It takes a VILLAGE to raise a child, it takes a COUNTRY to redefine it’s industries.
    mark brown in NJ

    PS: It would also be interesting to make GM PAY for destroying the previously existing Mass transit system before the bus. (streetcars and trolleys…)
    see my post..

  • Barry Bliss

    Listening to Mr. Porter voicing the usual “talking points” offends me. Mr. Porter mentioned “corporate tax rates”, rates are really irrelevant, and tax liability is the issue. Talking about having the second high corporate income tax without the mention of the U.S. having the highest number of corporate tax loopholes troubles me.
    Many large multinational corporations pay no taxes at all. According to the GAO more than 60% of U.S. controlled corporations with at least $250 million in assets (representing 93 percent of all corporate assets reported to the IRS) reported no federal tax liability each year between 1996 and 2000, while the economy boomed and corporate profits soared. 71% of foreign-based firms operating in the U.S. during that same period paid no U.S. income taxes. According to Citizens for Tax Justice, 82 of 275 top U.S. corporations paid zero taxes between 2001 and 2003, although they earned $102 billion in pre-tax profits. 46 companies with a combined profit of $42.6 billion paid no federal income taxes in 2003 alone. Instead they received rebates totaling $5.4 billion.
    One of the simplest ways some corporations have reduced their taxes is by relocating their headquarters offshore on paper (a relatively simple transaction known as “corporate inversions”). This scam is expected to cost the U.S. $5 billion over the next decade, according to the Joint Committee on Taxation. By paying just $30,000 to establish a simple postal drop, for instance, Ingersoll-Rand expects to save $40 million per year by declaring itself headquartered in Bermuda. Dozens of companies have undergone corporate inversions to reduce their taxes while continuing to enjoy U.S. protections.
    Mr. Porter’s lack of mentioning the increase of productivity and the decrease in wages is also troubling.

  • http://www.psgoodrich.com Peter Spang Goodrich

    Dear Onpoint,

    Thanks Tom for your many informative shows especially this one with Michael Porter.

    However, I never cease to be amazed that even Harvard professors perpetuate the “US corporate taxes are among the highest in the world” myth.

    While it is true that the “nominal rate” is high (US (39.3%) ranks second to Japan (39.5%) among the 30 OECD countries*, that is not the crucial issue.

    There are so many loopholes and allowable deductions that the US corporate share of gross domestic product (GDP) (1.8%) ranks 28th among the 30 nations (source: Table 2.1 from http://www.cbo.gov/ftpdocs/69xx/doc6902/11-28-CorporateTax.pdf). Only Germany 1.0% and Iceland 1.1% pay less. Of the larger OECD nations, France and the UK pay 2.8%, Japan pays 3.1%, Italy 3.2%, and Australia 5.3%.

    Furthermore, in 2003, the total US tax was about 25.6% versus 33.9% for the other G7 members. Of this 25.6% only 2.1% was paid by US coporations versus 2.7% by the other G7 corporations. So US corporations contribute less than 10% of our total tax revenues. Whom to bailout the 10% or the 90%? (Source: http://www.urban.org/UploadedPDF/1000976_Tax_Fact_05-08-06.pdf)

    I hope you will put this in your info database for future shows when some corporate advocate tries to pull the wool over your eyes once again.

    Peace,
    Peter Spang Goodrich

    * Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden,
    Switzerland, Turkey, United Kingdom, United States.

  • jim agans

    No one goes into IT anymore due to competition from abroad. I know many, many people who are over 50 and no longer have a job that pays a living wage or ‘benefits’-they have had to train they’re replacements for severance pay.

    They are outsourced. I work w/ more H!B workers than nationals and have for about 2 years.

    Education as an answer is nothing but crap. Hes telling me that the 1 billion people worldwide are less educated or capable? They arent – and corp usa knows it.
    What he has forgotten , as well as obama or clinton or Bush is that demand is – and wont be up for many years to come .
    Sounds like the 1920′s all over again?

    Laws of supply and demand apply to labor and always have. Wait until hes replaced w/ someone willing to come here and do his job for 5 figures instaed of six.

    This man has the ear of DC. So does Paul Rubin and other Clintonites( Im not going to mention Bush because we all know its patriotic for us to give those wages to a non resident.)

    Nothing will change. Nothing will get better as far as the economy for years out. We need a different way of thinking. Globalization isnt it. Tort reform isnt it.
    This man needs to lose his job. After 2 years of looking for work and telling his kids they aint going to college – his perceptive will change.

    Cmon Tom – get someone w/ a bit of real sense and imagination on and stop wasting my time.

  • Ken

    I’m an engineer for a tier one supplier in the Metro Detroit area. I disagree with Mr. Porter’s common assumption that retraining a education will fix everything. Our company uses contractors from India for CAD design, engineering services, FEA and software validation. Less than 10 years ago these positions were “high tech” in demand jobs that people could be trained for. What does Mr. Porter see the midwest train for if blue collar and white collar jobs are lost overseas? There are plenty of educated people in the midwest companies just don’t want to pay a typical American wage when they can hire an Indian for much less.

  • Jean

    They are referred to as Top Dogs because they are thought of as amoral and greedy not as bright and successful

  • Bob Agle

    I listened to Mr. Porter briefly in the car on a rebroadcast of On Point. Then I read some of the posts here. I don’t see anyone who agrees with him — and neither do I. His attitude seems to be that all government in the U. S., including the public education system should be geared to support business, and BIG business, at that. Most of what I’ve learned about business is that its primary purpose is the redistribution of wealth from the many to the few. The rest I learned is that we need to watch businesses and “entrepreneurs” like hawks lest they poison us, degrade our environments, and mislead us about the products and services they attempt to sell.

    One comment from Mr. Porter particularly rankled me — paraphrasing, “The public education system isn’t preparing enough students to provide the skills needed by the business community.” I think that what they want is to make schools into factories that prepare automatons that kowtow to the the demands of these business “leaders.” Students who don’t fit into their mold are somehow defective, or the schools are failures because they can’t fit all students into their molds.

    Let’s be clear, the current business leadership that we have has led us to the edge of ruin with the motto that bigger is better, that greed is good! I am not anti-business; but, I am anti-big business. The bigger the business is, the more it expects us to serve it, instead of serving us.

    Bob Agle
    Flint, MI

  • ben

    poorly done embarrassingly softball interview.

  • http://outsourcing.yuku.com/ Frank the Underemployed Professional

    After listening to the first five minutes of this show it doesn’t sound as though Mr. Potter has anything new to say that we haven’t heard before from other free market dogmatists.

    So far he’s said that (1) We need to reduce the costs of doing business (taxes, regulations, litigation) and (2) we need better education.

    That might sound good until you dig deeper. Just what does reducing business taxes, regulations, and litigation mean? It means that federal and state governments need to either cut back on public welfare services or get the money from some other source (individuals). It means having fewer environmental protections and civil rights protections. Basically, it means having a lower quality of life in this country and transforming our business environment into what the third world has–few environmental protections, etc.

    Then he advocates having more and better education (for what–non-existent job positions that were outsourced to India and China?) when we already have a large oversupply of qualified Americans in a great many knowledge-based fields, including technical fields and fields that require advanced degrees such as Ph.D. scientists, lawyers, MBAs, and even patent lawyers (requires two degrees–science/engineering and law–OMG–an oversupply–how is that possible for something that requires so much education?).

    Any way you slice it, it’s very difficult if not impossible to compete against people in other countries who are willing to work for far lower wages and a far lower standard of living than what Americans are accustomed to in addition to their not having environmental protections, civil rights protections, and personal injury protections, etc.

    Is there something we can do? Yes. Put up barriers against the economic force of global labor arbitrage and dramatically reduce immigration to pre-1965 levels to combat population explosion at home.

    The solution to our “competitiveness” problem is not to join the other billions of people in the world living in third world poverty but rather, we need…

    TARIFFS

    That dirty, filthy word–tariffs and trade protectionism.

    To this date, no politician, economist, journalist, or pundit has been able to refute the argument that Global Labor Arbitrage will decrease Americans’ standard of living. When the supply of labor increases dramatically relative to capital the price point, wages and standard of living, must decrease; it’s just that simple. (If they could refute it, they’d be shouting the persuasive logic from rooftops.)

    Instead of acknowledging our nation’s real economic problems, our politicians and intellectuals are selling Americans on education and the sheeple have gobbled it up like an opiate of the masses. It makes you wonder what fraction of the populace is even aware of the concept of tariffs or not having immigration or the concepts of supply and demand for that matter.

  • Topic

    ****The greatest determinant of a child’s educational performance is their parent’s own education and literacy. So much of education is taught in the home****

    Above comment is very true, also I like to stress that even parents are not very educated, but if they are able to realize how important education is to their kids future, they should put that emphasis on their kids.

    I came from another country, we don’t have state of the art of facilities, and programs. But the emphasis on education is enough to get kids wanting to do good at school. The education is the peer pressure instead of being more cool or more popular in pop cultures like here in this country.

    I’m not saying which education system is better than the other, but to achieve a goal, we need to take examples and reform our existing system.

    Think about it, schools here have rich resources, just not enough students taking full advantage of them.

    As long as the parents recognize the importance of education, even if not so educated parents can still produce very educated elites. They can do so by encouraging their kids to make friends who has same interest to achieve, so they can do homework together.

    There are so many ways to reform our education system, we need to start from “changing the culture” of viewing the value of education.

  • Gwen Frankfeldt

    Shame on you, Tom Ashbrook, for giving special authority to Michael Porter’s deeply flawed views by repeatedly referring to him as a “super-guru.” Someone whose ideas are so partisan and out of touch should be countered by another expert guest with a different worldview. Instead, we had callers making excellent points, which Porter promptly and authoritatively dismissed, and there was no one to explain with at least equal authority just how wrong he was, and how false and misleading were the supposed facts and statistics he cited.

  • Philip R. Olenick, Attorney at Law

    I listened in vain for the economic strategy that your guest averred was urgently needed by the incoming President, but instead was reminded of the pace of play in Monty Python’s famous soccer game among world philosophers, each of whom wandered around aimlessly, oblivious of each others’ presence.

    Worse, his faux even-handed criticism of victims and perpetrators alike appeared designed to distract attention from the obvious question raised by the increase in American productivity he acknowledged had occurred: So where did the fruits of that increased productivity go? Could it have gone to . . . the “top dogs?”

    As many of the posters above have pointed out, that term hardly includes engineers and inventors – their jobs have been cheap-sourced along with everyone else’s, with H1Bs obtained by fraudulent corporate certifications that no Americans could be found to do the jobs.

    The proper epithet for your guest was not “super guru” but “apologist.” Congratulations, you just wasted an hour of your air on advice to the incoming progressive administration from an apologist for the faction that was resoundingly rejected in the election. And, no, we’re not a “center-right” country! Only those who look at surface labels and ignore the answers given to policy questions in surveys make that assertion.

    The show was an insult to your listeners’ intelligence.

  • Jerry Bowers

    OUCH! Mr. Porter seems to have struck a nerve. I have never seen a more unanimous string of comments in response to any program, editorial, column, etc.

    What strikes me is that all of them obviously come from people with experience out here in the “real America” (what’s left of it) after 28 years of Reagan Voodoo economics. I just hope it’s not too late.

    Great job folks! Good luck to all, we’re going to need it.

    Jerry Bowers

  • Sam E.

    I have to defend Mr. Porter; maybe most of the poster here do not realize it but Mr. Porter is an economist he does not deal with ideas such as social welfare or equal distribution of income. What he is concerned with is how to make the economy more effective as a whole not necessarily more fair. He is right that giving more tax breaks does not address the root cause of why many americans are not getting ahead and actually distracts from it.

  • linda johnston

    in regards to mr porters comments about how the auto industry should bot be helped. let me ask him this. who is going to pay all the workers who have retired pensions? these people worked hard and many years for their pension. i have an idea. my mother-in-law is one of those that worked at gm all her life. she will lose her pension. Mr porter can take his wages for two weeks every month and send it to my mother-in-law. i am sure he can afford it whereas my mother-in-law cannot afford to have her pension stopped. she paid into that pension with the belief that she would get her pension when she retired for the rest of her life. and lets not forget about all the workers that will be out of jobs should our auto industry close!
    another comment. the ceo’s and wall street boys are crooks. look at the bonuses they get. GREED. how much money do they need. they don’t look out for the american workers. they look out for only themselves.
    last comment. instead of having everything we buy coming from china (made in china) let’s start making the items here in America. i can’t stand it when i go to buy a item and i look where it was made and guess what its china. i bet if you went to china you won’t find many (if any) items made in the USA.
    thanks for your time
    linda johnston

  • Jesenko Vukadinovic

    I podcasted the show and listened to it today. And I must say, I got really worked up about it. Not only did I disagree with Prof. Porter on so many points, but I could not believe that neither Tom nor any of the callers challenged Prof. Porter’s premise. He, basically, characterized everything else that is not directed toward advancing American competitiveness in the world `noise’, besides the point and discussion we should have in this country. Implicitly, that included lifting people from poverty and strengthening the middle class. Yes, America was much more competitive when there was no bottom to how much American workers could be exploited before they started organizing themselves in unions. But, what I want to know is the following: how many Americans really benefit from this competitiveness. I’d rather live in Sweden for example, less competitive country, and have good schools, roads, healthcare, safety… Also, can we fix the public school system as long as we have such a poor and overworked population? That is what drags our schools down, not some systemic problem as Prof. Porter claimed.

  • Alex

    Tom: That was one of the weakest interviews I’ve seen you do. The guy is anti-union, against breaks for the middle class, claims that corperations suffer, and says that all of our jobs are going overseas because we don’t have enough people to fill them. All of these are untrue, but you really didn’t even push him to give data on this. Also, it is well-known that there are tons of talented, American IT people who can’t find a job. Why? Because they can send them to India for a quarter of the price. Simple fact.

    Also, Tom said nothing about Porter’s stance on education. Porter knows nothing about education, but then he is proposing models. As an educator myself, I’m greatly offended that someone who has no background in teaching and learning is telling me how schools should be modeled.

    Oh, wait, he has taught–at Harvard. Yes, that institution is so representative of the whole country: A one class per semester load for full professors such as himself and dozens of graduate students to help you with whatever you need. Gee-whiz, Beaver, talk about someone who has been in the trenches!

    Letting someone like Michael Porter form educational policy is like letting someone who has played war-themed video games form our military strategy in Iraq! Nonsense.

  • Jesenko Vukadinovic

    I completely agree with Alex. This was such a weak interview. I really like Tom’s interviewing style, but sometimes he gets carried away with platitudes. He called Prof. Porter a competitiveness guru so many times. But, when you call someone that, and don’t challenge them enough, it just sounds like stroking their egos. And, I think it is fair to say that people like Prof. Porter and their economic philosophies contributed a lot to the situation we now find ourselves in. They keep selling their opinions like the ultimate wisdom, and now it is not time to stroke their egos, but to challenge the premise of their claims. The man is proposing the return to the gilded age. And, to the education point again, we need to stop expecting our teachers and schools to fix societal problems. If we solved the poverty problem by allowing our workers to claim their rights through the unions, I guarantee you that our schools will get better! And we will be more competitive!

  • Kent J

    What we lack.

    Our culture fails live and breathe in an attitude of truth. An example. Business does not ever pay tax. They ALWAYS pass the cost of doing business on to those that pay for their services. Always. Its time to end the taxation on business. It is a graduated tax AGAINST the poor.

    The Federal Income tax is CLEARLY way outside the spirit of the constitution. Who are all the idiots that swallowed this CRAP. Taxes should be payed to our state governments and then HOPEFULLY they will fight hard to keep that money in MY FREAKING STATE. Any conservative who does not begin speaking out loud against this crime against free enterprise is an idiot. Lets agree to get rid of this terrible evil against our selves and our children. Why do liberals think that GW should know how much money you earn and how you spend your working hours?

    WHY?

    And lets get rid of fiat money. It is SO clearly evil and unfair. Oh.. right.. no changes there.. we will just let unelected fed employees print away.

    ANd the next time a politician says things like “health care is a right” or “spread the wealth around” lets vote that bastrd OUT.

    Oops.. right .. half the country thinks its okay for a politician to even be able to let these freaking phrases slip from their lips.

    Obama.. is proof that we have lost the battle on the education front for Free Markets… that is FREEDOM.

    VOTE IN THE UNCLE TOM and put African Americans back another 50 years.

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