Calls for corporate tax breaks won't create jobs because businesses are likely to hire more overseas and not at home, says economist and former U.S. Secretary of Labor Robert Reich.
"Lower corporate taxes and fewer regulations won't bring good jobs to America. They might lower the costs of production here, but global companies can always find even lower costs somewhere else around the world," Reich writes in his blog published by the Sun-Sentinel newspaper.
"Global corporations — wherever they're based — will create good jobs for Americans only if Americans are productive enough to summon them. Yet a large and growing portion of our workforce isn't equipped to be productive."
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Pricey college tuitions, crumbling infrastructure, and rising healthcare costs are making the U.S. less competitive and government must step in and improve these areas if the economy is to regain its competitiveness, says Reich, now a professor of public policy at the University of California at Berkeley.
Commerce Department figures show that U.S. multinational companies added 2.4 million workers abroad in first decade of 21st century while cutting their American workforce by 2.9 million, Reich adds.
Meanwhile, countries like China are working to improve their technology capacity and go beyond running low-cost manufacturing economies.
"Without bold government action on behalf of our workforce, good American jobs will continue to disappear," concludes Reich, who served in three national administrations and was a secretary of labor under President Bill Clinton.
A survey of Harvard Business School alumni shows that the U.S. economy will be less competitive in three years due to unending political impasses, a declining quality of education, and a convoluted tax code.
"The U.S. is losing ground to emerging economies, where low wages, increasingly skilled workers, growing markets and proximity to customers frequently trump traditional American strengths such as sophisticated infrastructure, a reliable legal system and effective macroeconomic policy," the Wall Street Journal reported in January, pointing to the survey.
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