Sustaining Capitalism

The Committee for Economic Development, the public policy center of The Conference Board (CED), has issued a new Solutions Brief that outlines the most important policy challenges before the nation in 2023, and includes recommendations for building a stronger, more resilient, sustainable economy that provides equal opportunity for all Americans.

The Solutions Brief report—the latest in CED’s Sustaining Capitalism series—draws from a letter that the organization sent earlier this month to the President and Congressional leadership. The recommendations, developed with CED’s business leader Trustees, aim to achieve three main objectives: 1) ensuring economic growth and fiscal sustainability; 2) strengthening US leadership in a time of global political and economic disruption; and 3) building national unity and restoring trust.

“As the new Congress convenes, the nation is facing the dual economic challenges of reducing 40-year high inflation and averting a deep recession. These challenges have been exacerbated by global disruption, which is tightening the Gordian Knot of inflation and recession and endangering America’s place in the world,” said Dr. Lori Esposito Murray, President of CED. “Conquering these and other challenges lies within our reach. To do so, our leaders must demonstrate to the American people—and the world—that we can come together on a bipartisan basis to build a future of common prosperity with sustained economic growth based on market principles and democratic values.”

Key Recommendations & Priorities: 

#1: Economic Growth & Fiscal Sustainability: Reduce Inflation; Avert a Damaging Recession; Decrease Debt

The Federal Budget:

• Remove the consideration of the debt ceiling from a last-minute, volatile political battle that will threaten economic recovery.

• Spending needs to be measured, cut where possible, focused to promote work and productivity, avoid stimulus, and with a requirement that new initiatives are paid for. The Trust Funds for Medicare Part A and Social Security are expected to reach insolvency in 2028 and 2035, respectively. Bipartisan leadership is needed to reform these critical programs and ensure their viability and sustainability.

• Undertake a tax reform effort to remove preferential tax breaks to raise revenue.

• Use the reconciliation process only for deficit reduction.

• Establish a new, bipartisan National Commission on Fiscal Responsibility and Reform to build a consensus for solutions, including, for example, segregating pandemic debt as a first order of priority to address through a government corporation selling very long-term fixed-rate bonds.

• Prioritize and incentivize innovation and investment in R&D to increase US economic growth and competitiveness.

Infrastructure:

• Set priorities: Accelerate efforts on broadband and the energy grid; Invest in long-term solutions in supply chain bottlenecks at ports and points of entry; increase resiliency to natural disasters.

• Consolidate competitive grant applications where possible.

• Streamline the regulatory process by limiting lawsuits against permitting and the time to sue; streamline environmental reviews; projects should use the One Federal Decision process.

• Pursue public-private partnerships where appropriate and use alternative contracting methods such as Integrated Project Delivery.

• Collaborate on training the labor force for IIJA projects, including through apprenticeships, and recognize occupational licenses across state lines in reciprocity agreements.

• Improve transparency with easy-to-use databases of federal funds.

Workforce:

• Support public-private collaboration on training and education to link training to job opportunities and use competency-based hiring and promotion models.

• Expand learn-and-earn apprenticeships among students and workers at all stages of their careers; expand the use of Pell grants.

• Expand flexibility for workers with dependent care responsibilities and bridge programs so that women who have left the workforce have strong opportunities to return.

• Incentivize paid childcare options in both the public and private sectors to grow the workforce.

• Reform US immigration policy to increase legal immigration, decrease the flow of illegal migration, and substantially reform the H-1B visa program.

Smart Regulation:

• Streamline the regulatory process. Undertake periodic regulatory reviews to cut outdated regulation/red tape.

• Congress should clearly delineate the authority it chooses to delegate to agencies.

• Evaluate impact of new regulation by increasing agencies’ understanding of business’ perspective on how regulation should promote growth rather than distort economic incentives or discourage investment.

Public Health: 

• Continue public/private collaboration monitoring for variants and new viruses, including genomic sequencing. Rebuild the Strategic National Stockpile and reform CDC, including adding an advisory committee with business leaders.

• Promote resiliency in manufacturing supply chains through onshoring, nearshoring, and friendshoring of critical pharmaceuticals, and medical equipment to reduce shortages and respond to future emergencies.

• Establish a task force of public/private leaders to assess the lessons learned to build a playbook for future public health emergencies and conduct a review of regulatory policy changes made in response to the pandemic, many of which, including telehealth, proved successful at increasing delivery of care.

• Rebuild the health care workforce, including through registered apprenticeships and moving towards reciprocal licensing of health care professionals.

• Focus renewed attention on healthcare policy, including access, affordability, and health equity.

Cybersecurity: 

• Prioritize critical infrastructure; expand resources available to small- and medium-sized organizations that feed into larger organizations’ supply chains.

• Increase information sharing between the public/private sectors to facilitate implementing cyber resilience.

• Address the cybersecurity worker deficit through increasing private sector partnerships, attracting diverse talent, and establishing a virtual national cybersecurity academy.

Education:

• Advance high-quality early learning as an integral part of our systems of education and workforce preparation.

• Reform K-12: Curricula should match skillset development and career guidance with labor market needs and include financial literacy, STEM, and civics. Internships and apprenticeships should be promoted. A national task force should address the impact of remote learning during the pandemic on student performance.

• Postsecondary education should align with in-demand job skills and provide apprenticeships/work experience.

#2: Strengthen US Leadership in a Time of Global Political and Economic Disruption

Global Political and Economic Disruption:

• It is impossible to separate economic troubles at home from geopolitical issues. Russia’s invasion of Ukraine, the first major land war in Europe since 1945, has brought the US and its allies and partners together but is forcing major changes in the global political and economic order.

• The US and our allies and partners have responded well to this geopolitical shift; the further challenge will be to maintain our leadership and strong response to aggression.

• China, our principal economic competitor, continues to pose challenges for US policymakers.

Russia/Ukraine:

• Russia is an immediate and acute threat to the rules-based international order and the global economy. The war in Ukraine affects all countries and is having a transformational impact on the global economy. The US should continue its support for Ukraine and provide leadership in coordinating the response among allies and partners, as well as continue to ensure reliable energy supplies to our allies, and resilient global supply chains for food, minerals, and other important commodities.

• The US should also work with other key nations, particularly China and India, as well as Turkey, to seek a resolution of the devastating conflict and ensure that it does not escalate.

China:

• China is a strategic global competitor of the US, seeking to shift diplomatic, military, and trade patterns in China’s favor.

• To reassert US leadership, particularly in the Indo-Pacific region, the US, its allies and partners, and business leaders should accelerate building greater trade resilience and better trade relations and economic integration. US relations with India are pivotal in this effort and warrant concerted diplomatic effort.

• The US should coordinate with allies and partners on advanced technology controls, protection of intellectual property, development of alternative sources of critical minerals and components, such as semiconductors, and continued economic and military support for Taiwan.

• The US should seek to collaborate with China in areas of mutual global interest.

Global Trade:

• Increase public/private collaboration to solve supply chain disruptions, particularly in key areas such as semiconductors, critical and rare earth minerals, pharmaceutical raw materials, and medical equipment and products. Work towards solutions involving reshoring, near-shoring, and friend-shoring that do not distort markets; eliminate unnecessary regulation to facilitate reshoring.

• Undertake a comprehensive review of US tariffs.

• Launch discussions to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and pursue negotiations for bilateral and regional trade agreements with Indo-Pacific countries. The United States-MexicoCanada Agreement (USMCA), which received bi-partisan and labor support, could serve as a model.

• Establish a tri-national private sector advisory council under the USMCA to advise on nearshoring opportunities; reengage with Central and South America to expand US trade relationships.

• Strengthen global institutions. Actively promote reform of the World Trade Organization (WTO), in particular, its dispute resolution mechanisms.

Climate and Energy: 

• The US should be a reliable energy supplier to allies, increase production of fossil fuels to meet the near-term crisis demand, and work with energy producers as partners in the transition, not adversaries. Increase natural gas for the transition, given its dual capacity for hydrogen; build pipelines and export terminals.

• Accelerate and increase investment in R&D in nuclear, hydrogen, wind, solar, energy storage, and carbon capture, and prioritize power grid reliability. Encourage use of nuclear power.

• Seek to develop a US carbon market plan and promote the circular economy.

• Seek global cooperation on this global problem, especially from China and India, to achieve goals and preserve US competitiveness.

• Promote climate-smart and regenerative agricultural practices.

#3: Build National Unity and Restore Trust

• As underscored at the outset, our national leaders coming together to implement bipartisan solutions on the major challenges before the nation is essential to ensure that the course we set is sustainable and restores trust. Also fundamental to the confidence of US citizens in our democracy are secure, transparent, fair, credible, and accessible elections. Following are several common-sense measures for the 2024 election to start preparing for now:

  • Require paper ballots to assist with audits and recounts; prepare vote counts to be released on election day or speedily thereafter; prohibit wireless components in voting systems; adopt best practices for absentee ballot design; and protect election workers and voters.

The Solutions Brief, 2023 Policy Agenda: Top Priorities: Bipartisan Leadership Needed to Restore Growth, U.S. Leadership and National Unity, can be accessed here.

Media Contact:

adonovan@tcb.org

About CED

The Committee for Economic Development (CED) is the public policy center of The Conference Board. The nonprofit, nonpartisan, business-led organization delivers well-researched analysis and reasoned solutions in the nation’s interest. CED Trustees are chief executive officers and key executives of leading US companies who bring their unique experience to address today’s pressing policy issues. Collectively they represent 30+ industries, over a trillion dollars in revenue, and over 4 million employees. www.ced.org  

About The Conference Board

The Conference Board is the member-driven think tank that delivers Trusted Insights for What’s Ahead^®. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. www.conference-board.org