Can Georgia and U.S. compete while other countries continue investing in infrastructure?
By Maria Saporta
The name of the game these days is competitiveness.
Many Georgia leaders are asking how can we create the most competitive economy in the United States, if not the world.
Gov. Nathan Deal, the Georgia Chamber of Commerce and Georgia Department of Economic Development launched a Competitiveness Initiative in 2011.
Last week, the national Council on Competitiveness held a conference at Georgia Tech on the future of manufacturing in the United States and the role of logistics and networks in Georgia’s future.
Underlying all these conversations is how Georgia compares to other U.S. states, and how the country as a whole competes with other nations across the globe.
Are we really doing all we can to become globally competitive — especially when we peer into the future – 10, 20, 30 years from now?
Nigel Brandon, a professor at the Imperial College who is director of the Energy Futures Lab in London, provided a perspective last week at the Sustainable Atlanta Roundtable that showed us how far Georgia and the United States need to go to play on an international stage.
Among U.S. states, Georgia has consistently ranked in the top five as an attractive place for business.
“We are the Southeast leader when it comes to economic development,” said Chris Cummiskey, who touted Atlanta’s Hartsfield-Jackson International Airport and the fast-growing Savannah port. Both of those are assets that make Georgia a leader in logistics — a center for the distribution of goods and services.
Today, Cummiskey said Georgia is facing increasing competition from its neighbors — North Carolina, South Carolina, Alabama and Tennessee.
“Infrastructure is our greatest challenge and our greatest asset,” Cummiskey said, referring to Georgia’s transportation network including both the airport and the Savannah port. “We have to make sure it continues to be successful.”
Unfortunately, Georgia and the United States have lagged behind other countries in their infrastructure investments. While other countries have built extensive networks of high speed rail for both passenger and freight, the United States’ rail infrastructure is spotty at best.
And why does that matter?
The countries that have established energy efficient modes of transportation and have focused on lowering their carbon emissions will be more competitive in the future.
In the United States, one often hears about how Europe is passé — an economy that’s no longer competitive because several of its countries are mired in debt and that there is a wide disparity between the richer nations of Germany and France and the poorer countries such as Greece or Spain.
But consider this.
According to Brandon, the United States is the top consumer of energy in the world — using twice as much energy per capita as Europe. Europe uses twice as much energy as China. And China uses twice as much as India.
The world’s population now is about seven billion, and it is expected to top eight billion 2030 with most of the growth occurring in the developing world. Urbanization and a growing middle class will only generate more demand for energy and modern amenities.
Currently the world has 1 billion road vehicles. By 2030, that number is expected to total 1.6 billion — again with most of the growth coming from the developing world.
Whether it be increased carbon emissions contributing to climate change or the demand for more energy, it makes sense that the cities and countries that have invested in a green infrastructure and alternative modes of transportation will be more competitive in the long run.
Consider London. It has eight million people, an extensive public transportation system and has developed financial disincentives for people driving into the city.
“We found that London had half the carbon emissions than any other city and that’s because it has public transportation,” Brandon said.
England also has a goal to reduce its carbon emissions by 80 percent by 2050. Brandon said that the goal to reduce carbon emission is now part of the national discourse.
“We have legally-binding targets,” Brandon said. “It’s hard to wriggle out of them.”
Meanwhile, the United Kingdom also has strict guidelines to increase its use of renewable forms of energy. It has been moving away from coal to natural gas, and it is planning to make new investments in nuclear energy. A major difference between the United Kingdom (and other European countries) and the United States is that nuclear wastes can be reprocessed in Europe, which makes storage much easier.
Meanwhile, the United States is trying to figure out how to promote more manufacturing and innovation as a way to retain its economic dominance. But there too, there are challenges.
“Since 1979 to 2010, we lost 41 percent of the manufacturing jobs in the United States,” said Bud Peterson, Georgia Tech’s president. “Ultimately you have to make something to be successful.”
Thomas Mayer, senior executive advisor for Booz & Co., recently wrote an article on the “Future of Manufacturing” in the United States.
“Eleven percent of the U.S. economy is manufacturing,” Mayer said. “While the U.S. share of global products has fallen, U.S. manufacturing continues to grow, and it out-performs Europe and Japan. Our output has grown dramatically,” Mayer said. “The future of American manufacturing can be extremely bright if we can learn to grow effectively and realistically.”
No matter what, Georgia and the United States are now part of a global economy. Given Europe’s investment in its infrastructure and its dedication to lowering its carbon emissions, the continent is better positioned to welcome the future when compared to the United States and Georgia.
In other words, we have a long way to go to become a contender in the new world’s economic order.