speeches
Harvard Business School Alumni
Ambassador William R. Timken, Jr.
Berlin
September 12, 2006
As prepared for delivery.
It is a pleasure to join this meeting of the Berlin Harvard Business School Alumni Association. I myself am a member of the MBA Class of 1962. My boss, President George W. Bush, is a member of the Class of 1975. But the reason I am here tonight is because of my son, Kurt, a member of the Class of 1992. He made this connection to the Berlin alumni association on one of his first visits to Berlin soon after Sue and I arrived here just over one year ago.
You also know that until one year ago, I was on the other side of this podium with you. The private sector was my life for 43 years until the President asked me to do this job. This transition from private to government gives me some unique perspectives that I would like to share with you.
My observations do have some American bias and you may feel things are a little different in Europe.
Let me start with an observation. All hail the private sector. This is where all the earths’ wealth is created, all the innovation and the wonderful standard of living we enjoy.
Every politician, every teacher and, in fact, every repressive government should be made to write that fact on the black Board 100,000 times.
The governing structures of the world should stop doing things that impede the private sector and do more things that enhance the opportunity for growth.
Economic growth and the prosperity it produces would solve most of our world’s problems. It is a question of growing the Pie so there are more pieces for everyone, or trying to cut a static size pie into smaller pieces. Big government advocates enjoy the power of cutting the smaller pieces.
I ask you the question? Which of the government approaches to the economy is the most socially responsible? With less social engineering, the American economy is the strongest the world has ever known by every measure. 96 % of the people who want to work are working. This translates into a standard of living undreamed of in which somewhere over 70 % of the people own the dwelling they live in, creating a huge asset base of wealth.
The U.S. welfare rolls are depleted, with fewer and fewer people dependent upon; i.e. slaves of the state for their paycheck.
Each year more people are attaining higher and higher education levels.
Are there problems? You bet. Income disparities, lack of health insurance for some who receive health care in a different way. But all in all, life and opportunity is so great in America that millions want to go there; tomorrow.
Here in Germany, there is and has been a concerted effort by bright people in government to engineer a socially responsible economy. Is it socially responsible to have 10-11 % unemployment year after year? An economic situation develops where the young feel there are restricted opportunities to create a future for themselves and their families. The number of humans who are dependent on the state for their food and shelter is shocking. These individuals effectively become wards of the state. Germans are leaving Germany and forsaking having children. This cannot be an acceptable social result.
I believe the people of the private sector need to become more involved in public policy. As I used to preach as Chairman of the National Association of Manufacturers, Politics is too important to important to leave to the professional politicians.
You members of this Club are successful in your private sector lives. You must become a stronger voice into public policy. You can do it! We changed the situation in the United States over the last 40 years by hard work.
We all know what needs to change to promote growth: Lower taxes, less government regulation, reduction of incentives not to work, excessive environmentalism, free trade, more education and training, more investment in innovation. The lists go on and are well documented.
For 40 years I criticized American government and worked to get it to do more things that helped the private sector and less things to hurt it. I supported candidates that saw the light, and worked to get them elected.
Today I am part of government and I can tell you the need is greater than ever. Too many in the U.S. Government still don’t get it. I will let you judge Germany.
On another subject, I can say the degree of partnership and cooperation between the U.S. and Germany is today excellent. We are working closely together on all the serious world issues. This is very good news for all of us. It is also good news for our private sector relationships.
As I have criss-crossed this nation and looked at the numbers, I have found that the economic relationship between our two countries is far greater than I ever imagined, and going straight up. Our economic tie-up is so strong that everyone in the political sector must take note. To advocate a weakening of the transatlantic partnership is to threaten the jobs of hundreds of thousands of workers on both sides of the Atlantic.
Note that the largest investor, bringing job creating capital investment in the so-called new Lander is the United States. U.S. investments are reducing German unemployment.
Two last points I would like to make before I open for questions. The United States has been disappointed in the failure of the world to realize the promise of a successful Doha round of trade negotiations. Since the Second World War, opening up the world markets for trade has been the engine of economic growth. Germany has been the biggest beneficiary. You are the world’s largest exporter and as a result the world’s third largest economy.
Never-the-less, the pressure on your government to complete Doha successfully has been minimal by the private sector. To me this is incomprehensible. To permit the first negotiation since the war to fail can only signal victory for protectionism. Why the German private sector wants that to happen is seemingly irrational.
A last point. You can forget about comfortable lives in the private sector if world security issues destroy our economies. This is precisely the goal of fundamental terrorists worldwide. We saw the shock of 9/11.
The recent train bombing efforts scheduled during the World Cup could have killed thousands of Germans and visitors. That was the goal of the terrorists.
If we do not support our Governments in their efforts to fight terrorism, we make a terrible mistake. Yes, sometime the private sector will be affected by these efforts. As you know today, many American companies are not permitted to economically engage in certain transactions around the world. Yes, foreign policy efforts can create problems. Having crossed from the private sector into government, I now appreciate the reasons for some of these governmental strategies. To give up business in the short run to avoid a catastrophe down the road makes good business sense.
There you have a few provocative views to start the conversation. I will be happy to answer questions as long as I can.
Unfortunately, I have to go from here to a NATO meeting and cannot stay long.
Thank you.
