General Electric CEO Makes Case Against Protectionism
General Electric CEO Jeff Immelt defended his vision of globalization in a wide-ranging speech Thursday while also advocating President Donald Trump’s America first focus.
“We [the U.S.] have the most to lose through protectionism,” Immelt said during a talk at Georgetown University in Washington D.C. “If leaders think people want to live without the many benefits economic integration has enabled, they’re in for a rude awakening.”
While espousing the virtues of globalization, Immelt also defended the president.
“There’s nothing wrong with the president of the United States waking up and saying, I’m for creating American jobs,” he said, adding that the leaders of China and Germany wake up with that mind set for their respective countries.
Immelt argued that a number of key factors led to the demonization of the term, “globalism.” He argued that China redefined the game by making state-capitalism work. “They [China] connected geopolitical and economic goals.”
The CEO asserted that the most important relationship in the world is that between the U.S. and China. General Electric makes between $9 and $10 billion in revenue inside China, according to Immelt.
“My number one advice to President Trump is that we should have a good, bilateral relationship between the United States and China,” he said.
Immelt also argued that globalists became too elite, citing Davos, Switzerland as an example. “The middle manager at GE doesn’t want to see their CEO at Davos,” he explained.
He made the case that trade deals have been poorly defined and that companies have made the easiest play, which is often outsourcing jobs for cheaper labor.
However, Immelt defended trade agreements, specifically bilateral agreements over multi-lateral ones.
“Rather than withdrawing from trade deals, we should work to modernize and improve them,” he claimed, pointing to NAFTA as an opportunity. He argued that a fair deal could drive down costs and incentivize U.S. manufacturing.
“Multinational companies today must have their own global connections,” Immelt said, regardless of the politics of the day. “We need to continue to make investments whether there’s clarity in Brussels or Washington D.C.”
Immelt contended that growing exports, not blocking imports, is the solution to the economic woes of many Americans who feel left behind in a shifting economy. He repeated a talking point from Trump, maintaining that globalization can work for the American worker as long as there is a level playing field.
“If we can level the playing field, we will grow exports,” Immelt said. “It’s not level today, it’s not.”
“We can compete with anybody,” he said in defense of American companies. “There is nothing anybody should be afraid of if we have a level playing field, and a chance to move.”
Immelt also addressed emerging technologies and how they may affect today’s industries. He said even the largest companies must stay on top of emerging trends. “We need to be very paranoid about the disruption that is going on.”
“What you see when you visit the rest of the world is how fast its moving. There’s a real opportunity cost by not moving,” he added, supporting his own company’s global footprint. “Because Germany is moving, China’s moving.”
The CEO argued that if there’s a real focus on tax reform, infrastructure, and regulatory reform, the American economy will thrive.
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