The Post-American World - Fareed Zakaria [97]
Being on top for so long has its downsides. The American market has been so large that Americans have always known that the rest of the world would take the trouble to understand it and them. We have not had to reciprocate by learning foreign languages, cultures, and markets. Now that could leave America at a competitive disadvantage. Take the spread of English worldwide as a metaphor. Americans have delighted in this process because it makes it so much easier for them to travel and do business abroad. But for the locals, it gives them an understanding of and access to two markets and cultures. They can speak English but also Mandarin or Hindi or Portuguese. They can penetrate the American market but also the internal Chinese, Indian, or Brazilian one. (And in all these countries, the non-English-speaking markets remain the largest ones.) Americans, by contrast, can swim in only one sea. They have never developed the ability to move into other peoples’ worlds.
We have not noticed how fast the rest has risen. Most of the industrialized world—and a good part of the nonindustrialized world as well—has better cell phone service than the United States. Broadband is faster and cheaper across the industrial world, from Canada to France to Japan, and the United States now stands sixteenth in the world in broadband penetration per capita. Americans are constantly told by their politicians that the only thing we have to learn from other countries’ health care systems is to be thankful for ours. Most Americans ignore the fact that a third of the country’s public schools are totally dysfunctional (because their children go to the other two-thirds). The American litigation system is now routinely referred to as a huge cost to doing business, but no one dares propose any reform of it. Our mortage deduction for housing costs a staggering $80 billion a year, and we are told it is crucial to support home ownership. Except that Margaret Thatcher eliminated it in Britain, and yet that country has the same rate of home ownership as the United States. We rarely look around and notice other options and alternatives, convinced that “we’re number one.” But learning from the rest is no longer a matter of morality or politics. Increasingly it’s about competitiveness.
Consider the automobile industry. For a century after 1894, most of the cars manufactured in North America were made in Michigan. Since 2004, Michigan has been replaced by Ontario, Canada. The reason is simple: health care. In America, car manufacturers have to pay $6,500 in medical and insurance costs for every worker. If they move a plant to Canada, which has a government-run health care system, the cost to the manufacturer is around $800 per worker. In 2006, General Motors paid $5.2 billion in medical and insurance bills for its active and retired workers. That adds $1,500 to the cost of every GM car sold. For Toyota, which has fewer American retirees and many more foreign workers, that cost is $186 per car. This is not necessarily an advertisement for the Canadian health care system, but it does make clear that the costs of the American health care system have risen to a point that there is a significant competitive disadvantage to hiring American workers. Jobs are going not to countries like Mexico but to places where well-trained and educated workers can be found: it’s smart benefits, not low wages, that employers are looking for. Tying health care to employment has an additional negative