Only a Month Away
The Crisis of American
Entrepreneurship
REED HUNDT
ISBN 0-300-10852-4
9 780300 108521
5 2 6 0 0
In China’s Shadow
The Crisis of American Entrepreneurship
r e e d h u n dt
China is the new global center of start-ups and is well on its way to becoming the world’s largest consumption market. China’s rising economic power challenges the strategies of virtually every American business and threatens the standard of living of every American citizen. Only if Americans respond wisely and promptly can the United States assure the perpetuation of the American Dream.
Reed Hundt paints a provocative portrait of the new reality of global competition for American firms and citizens. He warns that a respectable defeat for both American businesses and workers would undermine the possibility of an ever-increasing standard of living, as well as threaten the nation’s commitment to the values of freedom and equality. Meeting the precedented rivalry from the other side of the globe is not a matter of adopting the legislative programs of either the left or right in today’s politics. Instead, in the areas of law, technology, and leadership, Americans need to renew and expand their culture of entrepreneurship. As the boom of the 1990s was sparked by new business initiatives in every aspect of the information sector, Hundt argues, so a successful American response to the challenge of China lies in extending entrepreneurial culture in the economy, from health care to energy, and in society, from leaders in positions of power to those arising from the grassroots of the Internet.
Reed Hundt is senior adviser on information industries to McKinsey & Company, a worldwide management consulting firm in Washington, D.C. He serves on the board of directors at Intel Corporation and other high-technology start-ups and is former chairman of the Federal Communications Commission. He is the author of You Say You Want a Revolution, published by Yale University Press.
The future of american democracy series Norton Garfinkle, Series Editor Printed in the U.S.A.
“As FCC Chairman during the Clinton-Gore Administration, Reed Hundt sat in the catbird seat of the great technological and economic boom of the 90s. Building on his experience in government and business, he has provided an important, insightful, and brilliantly written prescription for the American response to global competition. This book is essential reading
for anyone who wants to understand the 21st Century.”
— Al Gore, former Vice President of the United States
“Without real gut-wrenching, risky entrepreneurialism, all will be lost for America. Reed Hundt makes an original, interesting, and compelling case for its reinvigoration—anyone interested in what happens next must read this.” —Barry Diller,
Chairman, IAC and Expedia
“Reed Hundt brings a broad depth of experience to this provocative work. America benefits when informed citizens like Hundt are at the front end
of thoughtful debate about our nation’s future.”—U.S. Senator Chuck Hagel (R-Neb.)
“In China’s Shadow draws a path for an American Renaissance in response to China’s rapid rise. Reed Hundt’s new book combines lessons from history and technology, with optimism and insights on every page.”—Eric Schmidt, Chairman and CEO, Google
“Reed Hundt shows characteristic insight into the Chinese challenge by emphasizing the
all too anemic American answer. He calls for business and public policy to return to the
sources of American growth and advantage in entrepreneurship. This is a timely book,
well argued, and right.”—Timothy F. Bresnahan, Landau Professor in Technology and the
Economy, Stanford University
“Reed Hundt casts a sober and objective eye on the subject of globalization. The results are
a powerful call to action. The solution he advocates—changing the culture surrounding
innovation—is daunting. But, as he points out, nothing less than the future of the United
States is at stake.”—Andy Grove, former Chairman, Intel Corporation
Yale University Press
New Haven and London
yalebooks.com
$26.00 / £16.00
Connie Z. Reider
In
China’s
Shadow
REED HUNDT IN CHINA’S SHADOW
Reed brings up a lot of great points. What he also does, by extension, is add fuel to the arguments within the Pentagon spurred by Donald Rumsfeld that a showdown with China is inevitible. Whether economic or military it would be brutal.
August 5, 2006 1:34 PM | Reply | Permalink
Hmmm. The message here seems to be that if an entrepreneur wants to get ahead, the thing to do is to write a fake article which turns out to be a promo ad for himself and his book. American business values reign.
August 5, 2006 2:19 PM | Reply | Permalink
If there were a way to give a SPAM rating to an article I would give it to this one. Posting an advertisement for your book, with no added information, is almost the definition of SPAM.
But, I don't even agree with the premise of the book, as it appears from this advertisement. Reed appears to believe that our and China's economy form a zero sum game, where if one of us goes up the other must go down. What a gloomy, uninspired, misinformed opinon.
If we can ever get a reality based government back, one that doesn't primarily want to shrink government to a size where it can be drowned in a bathtub, there are many possibilities for American industry. Just attacking the global warming/energy shortage problem alone should be able to drive our industry for another generatiion. And, inevitably, petroleum reserves will eventually run out, meaning that the whole world will need new energy technology - just how obvious does an opportunity have to be before Reed recognizes it?
Reed's advertisement represents a major shortcoming for TPM - weekends offer little for reading here, and bottom of the barrel "articles" like this one are not welcome by me.
Hoppy in Sacramento
August 5, 2006 2:42 PM | Reply | Permalink
Whatever the detailed concerns people may raise about the book, the bottom line remains that the central message is right on target - America risks losing its competitive edge if it doesn't invest more in education and in supporting innovation and entrepreneurship. And one of our biggest challengers is the Peoples Republic of China. They are unquestionably doing all they can to slowly but surely eat our lunch over the coming years.
Last Thursday I testified before the US-China Economy and Security Review Commission, a body mandated by the Congress to monitor the PRC's activities in these areas, and to make recommendations. It was clear from some of the questions that some Commissioners view our relationship with China as very risky and zero-sum. But it was also clear from the testimony and other comments that the key is to worry less about blocking China, and more about building up our own national capacities. It's naive not to recognize this as a really big deal for America's future, and irresponsible not to try to do something about it. Therefore, I look forward to reading the book.
August 5, 2006 7:10 PM | Reply | Permalink
With a little help from Wal-Mart and friends. Combine the centuries of Chinese mercantile spirit and commercialism with the monopsony generated by the company with earnings greater than the GDP of some countries and you have a real threat.
August 5, 2006 7:29 PM | Reply | Permalink
Read the book and see if we aren't more in agreement than you think. And providing the text of the jacket of the book, I hope, isn't that much of a burden on our tpmcafe community. I harbor the idea that some might want to know that I've written a book; not everyone, just some. Moreover, I'm threatening to offer excerpts in the future! Finally, on the subject of Iraq, you will see that my views are now echoed by Peter Galbraith, among others, which doesn't make them right but at least means they aren't the absolute bottom of the barrel.
August 6, 2006 6:53 AM | Reply | Permalink
I have no wish to make beating up on Reed Hundt my life's work.
That said, I don't disagree that the United States faces two key challenges: 1) The rise of China and other competitors (India, and to lesser extents Japan, Europe and Brazil) eating away at America's economic dominance. 2) It's own economic decline from an entrepreneurial based society to versions of monopoly capitalism.
I'm not sure, however, that there is a full appreciation that monopoly capitalism is seen as a desirable outcome by certain segments of the American population. Nor is it understood that monopoly capitalism is absolutely toxic to entrepreneurialism of any stripe.
And there lies America's problem. It's not that the Chinese will do America in. It's that internal decay, the tendency towards monopoly capitalism serving only a rich elite, will ultimately result in a stagnant swamp. America's challenge is America.
August 6, 2006 7:46 AM | Reply | Permalink
Remember when Japan was going to eat our lunch and everyone was reading books on Japanese management style?
What happened? The straight line graphics that projected upward, ever upward, turned out not to be true.
China is in the midst of a huge expansion, but it is unsustainable. It may have already peaked as a matter of fact. China is planning to add urban housing for 400,000,000 people in the next decade. This is equivalent to replacing all the housing in the US in the next seven years. China is already the largest consumer of concrete in the world. This much housing (and the associated infrastructure and roads) will require an impossible amount of, not only concrete, but steel as well.
China is currently running a water deficit, in that it is depleting its water table as it pumps faster than the replenishment rate. This has caused desertification and is causing shortages in Beijing and other large cities.
These problems are insoluble, if the goals are to bring a level of material prosperity to the rural regions that even approximates what the average city dweller has.
The results of such economic strain will be more civil unrest. There are already over 30,000 protests per year from rural communities and small businesses. The government tries to hide this information, but it has been getting out and inspiring others to rebel. The results won't be pretty internally.
In addition China is planning to cut back on exports as their own society demands more "stuff" and thus, won't be willing (or perhaps able) to supply the west with cheap manufactured products in the future. Since we don't make this "stuff" any more, the results should be interesting to see.
--- Policies not Politics
Daily Landscape
August 6, 2006 9:14 AM | Reply | Permalink
Cheap nationalism is not a valid foreign policy.
The Chinese are desperate to modernize, we are not, and I'm not going to do my best to keep them in their place (in fact I've got a lot of money betting they won't.)
How about a more intellectually serious argument from a pwogwesive web site?
China sees Europe as a trading partner not an adversary. Why is that?
Given that your last post was on "the imaginary[sic] nation of Iraq" I doubt you have much of an answer.
---
UPDATE: RH's previous post is here, and here is Noah Feldman's review and response to Peter Galbraith's book and theory.
There is now a question as to whether or not Iraq has become an imaginary country, but that is different from the glib assumption, now boilerplate, that this was always the case.
As to the argument in the blurb above:
Are we to take this seriously? If so why?I should remember in the future not to be both glib and brief.
August 6, 2006 10:33 AM | Reply | Permalink
If China does cut back on making cheap stuff (for WalMart) I'm sure there are other countries that will step up. Japan was the maker of cheap stuff for several years, and Korea was also a maker of cheap stuff, but as their economies boomed they shifted to being makers of good stuff. Lest we forget, there is another continent loaded with underpaid, struggling masses, perfectly willing to produce cheap stuff - Africa. How long before we lament that we can't possibly compete with Africa?
It isn't as if the world was lacking in major problems that could serve as golden opportunities for America. Just consider the energy problem for starters. If we were to set up a massive federally funded research agency to do the basic, expensive research needed, a whole economy could be build just on energy alone. Then, global warming is waiting for some country to do the necessary research to develop solutions too. The computer power needed to accurately model the earths climate, alone, is a technological area where we could become dominant if we were willing to devote federal money to the research and development effort. If no one else remembers, back in the late 1930's aviation was a struggling industry, with no private enterprise willing or able to devote the resources needed to provide the massive wind tunnels and research required to move aeronautics along as an industry. NACA was set up to fill that need.
What is lacking in America today is the understanding that a strong federal government is essential for solving national or global problems. Drowining that government in a bathtub serves the interests of only the very, very few.
Hoppy in Sacramento
August 6, 2006 11:44 AM | Reply | Permalink
Can we get an excerpt? An executive summary maybe?
August 6, 2006 8:46 PM | Reply | Permalink
See this book review in today's NY Times. It documents how the peasants have been mistreated and the growing disparity in wealth between those in the country compared with those in the cities. It also reports on the high degree of civil unrest as a consequence.
It, apparently, has had some influence on changing government policy.
--- Policies not Politics
Daily Landscape
August 7, 2006 6:57 AM | Reply | Permalink