Standard & Poor's did us a service by pointing out our leadership problem
In the weeks since Standard & Poor's announced its decision to downgrade the creditworthiness of the federal government, I have stood on the sidelines and cheered the stinging criticism of Standard and Poor's from politicians, everyday folks and even the "mainstream" media.
I experienced chills of joy when Jon Stewart and "The Daily Show" ripped the hypocrisy of Standard & Poor's downgrade. Stewart pointed out (in ways that only "The Daily Show" can do) that Standard & Poor's gave the highest possible rating to some of the worst mortgage-backed securities that ultimately set in motion the Great Recession. So, it comes with great sadness that I write that those scoundrels at Standard & Poor's actually make a good point. I hate when that happens.
Buried beneath the hyperbole of the reactions and the spasms of the stock markets, there is an important point. Standard & Poor's believes the United States has a leadership problem. The S&P "Research Update" points out that "the effectiveness, stability and predictability of American policymaking and political institutions have weakened" at the worst possible time — in the middle of "ongoing fiscal and economic challenges." If there is one thing that screaming partisans can agree upon, this might be it.
In government and business, the best leaders paint a long-term vision with "effective" policies that create greater "stability" and a greater sense of "predictability." None of this exists today. And let me be crystal-clear — this is not a Barack Obama or Eric Cantor or Tea Party thing. It's bigger than any one of them. It's ALL of them. And as the administration fights with the two (or three) fraternity houses that control the U.S. Congress, the reputation of the United States is suffering.
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A few of our smartest business leaders saw this coming. Andrew Liveris, Dow chairman and CEO, makes the point clearly in his book "Make It in America." Liveris outlines a clear path that could revive manufacturing in America. Liveris says manufacturing jobs are leaving the United States not because of high wages, but because business needs "a degree of predictability and certainty when they invest in the United States."
Predictability and certainty are the collateral damage of partisan political leadership that gravitates to the easy stuff: staging sensational fights focused on our political differences. The really hard work is focusing on areas where there is political alignment (lowering the debt, creating jobs) and finding ways to craft and enact "effective" policies to make it happen.
Let's face it, the credit downgrade is humiliating. The greatest country in the world no longer has the greatest credit rating. Now that it has happened, the real question is whether this is a beginning of a bad story or the end of one.
Standard & Poor's was right, for now. But the real outrage should not be over our credit rating; it should be about our reputation. The only way to fix that is to elect leadership focused on getting the United States repositioned as a true world leader in terms of stability, predictability and effectiveness — oh, and on proving Standard & Poor's was wrong to ever bet against us.
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Patrick Milan monitors consumer behavior and applies it to brand strategy and marketing programs for clients of Tunheim Partners, an agency based in Minneapolis.
