The Economic and Political Challenges Ahead, with John Manzella

Economic keynote speaker and international trade expert, John Manzella, provides businesses and organizations with the latest developments on trade, global affairs, and economic markets. Manzella is the founder of The Manzella Report, a leading source of economic analysis for countless readers across the globe including UPS, Hewlett-Packard, the Federal Reserve, Phillip Morris, Toyota, Wal-Mart, and General Motors. He is the author of several books, the most recent of which is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.

SPEAKING.COM: We’re just a little more than a year into the Trump Administration and it seems that so much has already happened. What is your top advice for businesses and investors as they navigate the waters ahead?

MANZELLA: The Trump administration has implemented legislation and advocated policies that are putting upward and downward pressure on economic growth, and impacting levels of risk and volatility. As a result, it’s essential to continually monitor events in Washington, DC, and constantly re-calibrate corporate levels of risk and strategies moving forward.

SPEAKING.COM: In a recent video on the Manzella Report YouTube channel, you mentioned there’s a great deal of misinformation about trade in the news. Could you please clear up some of that misinformation for us?

MANZELLA: Globalization and international business have had a net positive impact on economic growth and the American standard of living. However, companies that do not produce smart (IP rich) products and services, and employees that do not embrace life-long learning will incur increasingly greater challenges ahead. Unfortunately, policymakers and the media tend to assume that globalization and trade have had an overall negative impact on the United States.

SPEAKING.COM: What effects do you think the steel and aluminum tariffs will have on the American economy?

MANZELLA: President Trump’s tariffs on imported steel and aluminum of 25 and 10%, respectively, will punish American workers, continue to invite retaliation – most likely against agricultural products from red states — and harm U.S. exports. There are better strategies to deal with foreign countries than abuse global trading rules.

SPEAKING.COM: What do you recommend businesses do with the money they’ll save thanks to the tax cuts?

MANZELLA: The Homeland Investment Act of 2004 provided a one-time tax break for repatriating foreign cash held by U.S. corporations. A significant portion of repatriated cash was used to fuel share purchases rather than growth investment. Because President Trump’s recent tax reform is permanent and allows for faster depreciation of equipment, businesses are investing in R&D, employee training and wages, and infrastructure. These investments will have a positive impact on companies, employees and U.S. economic growth.

SPEAKING.COM: How could we effectively close the skills gap in the U.S.?

MANZELLA: As companies delve deeper into their core competencies, they need employees with deeper skill sets and the ability to think critically, solve complex analytical problems and manipulate sophisticated technology. This is a tall order.

To reduce the increasingly greater skills deficit, companies need to step-up in-house training, educational institutions need to better understand the skills demanded by industry, companies need to consider hiring well educated older workers, the United States needs to admit more, not fewer immigrants, and companies need to establish more apprentice-type positions offered in Germany, Switzerland and Austria.

SPEAKING.COM: You’ve said, “What happens in China no longer stays in China.” How could China influence the U.S. economy this year?

MANZELLA: China, which continues to grow at very fast rates, is currently incurring several transitions. How China navigates these changes will have a tremendous impact on the United States and the world.

SPEAKING.COM:What implications does the abolishment of presidential term limits in China have for its economic future?

MANZELLA: President Xi understands that he has to implement various reforms in order to safely navigate and prepare for the obstacles ahead. As a result, he has consolidated power. This has major positive and negative ramifications.

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