Posted by Brad Smith General Counsel
While lots of attention in the U.S. has focused on governmental efforts in Washington to create jobs and economic growth, governments all over the world are grappling with similar challenges.
The challenges to the global economy have been top of mind this week in meetings I’ve had with government officials, business leaders, and academics during a trip to Latin America. In some countries it’s not yet clear how strongly the downturn in the United States will impact their own economies. But everywhere there is a new effort by public and private enterprises to strike the right balance between short-term adjustments and long-term investments to address the new economic reality.
I spoke today at the American Chamber of Commerce in Sao Paulo, one of the largest business groups in the world, and addressed Microsoft’s support for decisive government action to accelerate economic activity. At the same time, we also believe governments must be careful to avoid protectionist policies that would have negative long-term consequences.
The world has been down that path before. In the wake of the 1929 stock market crash, protectionist pressure spread from capital to capital in early 1930 as countries sought to insulate their own economies. Ultimately, the U.S. Congress enacted legislation that raised tariffs to the highest level in the history of the country. While these measures defied economic common sense, they enjoyed widespread populist support. However, the net result was a plummeting of world trade, and the economic crisis in the United States soon engulfed the rest of the world.
The business community around the world needs to be an advocate for trade, economic development, and workforce policies that resist protectionist impulses and provide a sustainable foundation for long-term economic growth.
In tough economic times, more than ever, businesses need to act creatively to promote workforce development, create jobs, and spur economic activity. That is why we launched the Elevate Americaprogram in the U.S. last month, which that is designed to give state and local governments the tools and resources they need to provide no-cost or low-cost technology skills training to help get people back to work. And despite tight budgets and cost controls that all companies are facing, businesses need to sustain their important social responsibility activities, despite the current economic hardships.
For a full transcript of my remarks in Sao Paulo, click here.