Abe Eshkenazi, CSCP, CPA, CAE
APICS CEO

    Traveling back from Toronto Wednesday, I picked up a copy of Newsweek. The issue features an article titled “Is ‘Buy American’ a Slogan worth Preserving?” The story presents the opinions of a panel of six experts—three argue that the “Buy American” legislation is beneficial and three counter that the policy will backfire. The impetus for the article is the impending trade dispute between the United States and China. Specifically, U.S. officials have announced tariffs on imported Chinese tires, while government officials in China are threatening to do the same with U.S. poultry coming to China.

    Dartmouth economist Douglas Irwin argues that there actually will be fewer construction projects because the U.S. economic stimulus requires the use of U.S.-made steel in those projects. He says, “Fewer jobs will be created with the limited amount of money we have to spend.”

    On the other side of the debate, Jeff Madrick, a fellow at the Schwartz Center for Economic Policy Analysis at the New School, asserts that most studies reveal a direct negative impact from free trade on wages and on the creation of jobs. “Exchange is the key to economic growth,” he says. “[But] fiscal policy becomes necessarily ineffective when 20 to 30 to 40 percent of every dollar we spend to pump up our economy in a recessionary emergency leaks overseas.”

    Although the Newsweek article analyzed the situation between the United States and China, the question of whether protectionism stimulates or stifles a nation’s economy affects countries all over the world. It was on the minds of many participants at the APICS 2009 International Conference & Expo, as well. The discussion is an extremely complex one, and I encourage you to read the entire Newsweek piece to get an understanding of the many viewpoints on this single subject.

Highlighting Global Ability

    This year, I was honored to speak to attendees at Monday’s general session. My message followed a powerful presentation of APICS stories—personal and professional triumphs from colleagues representing Canada; China; Egypt; Elkhart, Indiana; India; Italy; the Mexico-U.S. border; Poland; and South Africa. My goal was to show how the development of APICS as a professional society has closely followed the development of the global economy. I drew correlations between our growth as an organization, the growth of the United States and other global economies, and the development of trade agreements between countries.

    When addressing the challenges of an interconnected world, we need to be cautious in constructing tit-for-tat barriers to trade. At the same time, it is important that we operate on an even playing field that prohibits product dumping and price manipulation.

    The prosperity experienced in the United States the last half of the 20th century would not have been possible without the emergence of new consumer and production markets. The force of history is against aggressive trade barriers. Does the current recession present a new set of challenges to national economies that warrant trade restrictions? Perhaps. However, I am convinced in all we do—as nations, as an association, as individual operations management and supply chain professionals—that we need to take a more global perspective. As I said on Monday to conference participants: “Your challenge is to hone our Global Ability by engaging across borders, over time, beyond roles, and throughout your careers.” As nations the challenge will be to stimulate domestic production and output while operating in a global economy.

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