According to the Wall Street Journal, large U.S. multinationals added new jobs faster than other U.S. firms, but 75 percent were overseas. Economists believe that companies are not shifting work out of the United States, but instead adding overseas staff to expand sales in overseas markets; 60 percent of revenue growth from 2009 to 2011 was overseas for the firms studied. “If you want to capture market share in China, you're going to have to hire lots of locals," said Arie Lewin of Duke University.
U.S. Defends Beef Industry
The discovery of a Californian dairy cow with bovine spongiform encephalopathy (BSE)—commonly referred to as “mad cow disease”—has threatened U.S. beef exports (WSJ). Only Indonesia— which accounts for just 1.4 percent of U.S. beef exports—has suspended imports, as many nations did after the first U.S. BSE case in 2003. The largest importers, such as Canada, Mexico, Japan, and South Korea have accepted assurances that U.S. beef is safe. The infected cow was found by the USDA which annually tests 40,000 of the 90 million U.S. cows.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
Corporate Regulation and Taxation
FTC Considers a Google Suit
Federal Trade Commission (FTC) observers see the hiring of Beth A. Wilkinson, a top Washington litigator as a sign that the probe of Google disclosed in June may result in a lawsuit (Bloomberg). "Historically, the FTC and the Justice Department bring in outside counsel only in the most high-profile and complicated cases, and only when they’re really serious about proceeding,” said Samuel Miller, who led the FTC’s 1994 antitrust case against Microsoft. The probe is examining whether Google abuses its power over search results and the Android platform.
Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.
Education and Human Capital
States Inch Toward Digital Textbooks
Stateline reports that schools are slowly moving toward digital textbooks. The Obama administration’s Digital Learning Playbook calls for all students to use electronic textbooks by 2017, and earlier this year Apple announced iBook—a platform for multimedia rich textbooks—but K-12 schools have been slow to make the switch. To encourage adoption by school districts, states are loosening spending restrictions, considering paying for tablets and digital textbooks, and even mandated the purchase of digital content.
Testing Beyond Reading and Math
As states seek waivers for the federal No Child Left Behind Act (NCLB) from the Obama administration, many are taking the opportunity to expand accountability testing beyond reading and writing (EducationWeek). Around twenty states plan to add subjects such as science and social studies. While NCLB did not prevent states from adding those subjects when gauging performance, nearly all states only used reading and writing.
The new report of the CFR Independent Task Force on U.S. Education Reform and National Security asserts that fixing the nation’s underperforming K-12 schools is critical to economic competitiveness and national security. The report highlights the importance of the Common Core State Standards and suggests expanding them by including science, technology, and foreign languages and cultures.
Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.
Lower State and Local Borrowing Frustrates Investors
In 2011, states and municipalities issued $295 billion in long-term bonds, a third less than in 2010 (Smartmoney). Bond issuance fell an additional 2 percent in the first quarter. Much of the decline in borrowing stems from local governments delaying or cancelling large infrastructure projects. As competition has lowered bond yields, some investors are switching to revenue bonds—which are tied to a specific project such as a toll road—rather than general obligation bonds, which have a claim against all sources of government revenue.
Infrastructure. Read more on how upgrading the nation’s aging network of roads, bridges, airports, railways, and water systems is essential to maintaining U.S. competitiveness.
The Morning Brief is compiled by Renewing America contributor Steven J. Markovich.