Friday, October 17, 2008

Sorman's "America at Work"

French writer Sorman has a new article about the United States in the City Journal titled "America at Work." The article offers a refreshingly positive European perspective of the strengths of the country. For example:

In 1820, about ten years before Alexis de Tocqueville made his famous visit to America, a spectacular event took place, though nobody could have known it at the time: U.S. per-capita income overtook that of Western Europe. This stunning fact was revealed only last year, in a new study by the Organisation for Economic Co-operation and Development. The study, conducted by renowned economist Angus Maddison, also showed that the U.S. economy had remained the world leader ever since 1820. ... Prior to the study, American economic preeminence was widely believed to date to 1904. ...

How did a rather small nation, which had no more natural resources than Europe and little in the way of trading activity, overtake Europe economically in 1820? ... The true reason for the American economy’s takeoff was the focus of Tocqueville’s visit: democracy itself. ...

“The American entrepreneur has a passion for the market,” says Keith Blakely, founder and CEO of Nanodynamics, a pioneer in the revolutionary field of nanotechnology. While European fundamental research can sometimes be superior, American innovation is usually first to market. In the American vision, an idea is good only when the market buys it. Again, it’s a democratic view of the purpose of innovation. This explains the unique relationship in the United States between universities and business. ...

Beyond the democratic principle, another engine is at work within these companies, one that existed on a much smaller scale in the early nineteenth century: what Harvard economist Joseph Schumpeter dubbed “creative destruction” in 1942. Schumpeter meant that the new constantly replaces the old and that the
market reallocates resources accordingly. ...

Finally, there is American cultural diversity. ... “A German company is ahead of us in the market,” admits Caine Finnerty, the Nanodynamics fuel-cell expert and a former Englishman. “But we’ll eventually take over while we tackle the subject from all cultural angles with our cosmopolitan team.”

No comments: