Is America losing its competitive edge? China's rise and a struggling U.S. economy raise questions about America's future.

• Author: Hassett, Kevin
• Position: DEBATE - Discussion

YES

The United States used to be the most desirable place in the world to operate a business.

It boasted plenty of highly skilled workers, comparatively few regulations, and reasonable tax rates. This is no longer the case.

The World Economic Forum ranks nations each year on competitiveness; the U.S. used to top this index year after year. But its most recent report puts the United States in seventh place.* The reasons for the slippage include high tax rates, government inefficiency, and burdensome regulations.

Signs of America's declining competitiveness are all over. In the first half of 2012, China surpassed the U.S. as the country receiving the most foreign investment, according to the United Nations. A survey of Harvard Business School alumni last year found that businesses involving large numbers of jobs and high-end work are moving out of the U.S. faster than they're moving in. Two thirds of those surveyed believe the U.S. is falling behind, and 71 percent expect the U.S. to become even less competitive in the next three years.

What's behind this trend? For starters, it's gotten too expensive to do business in the U.S. The corporate tax rate is 39 percent; in Ireland, it's as low as 12.5 percent. The U.S. also isn't admitting nearly as many skilled immigrants as we need to stay competitive. This year, Australia raised the number of skilled immigrants it admits to 126,000. The U.S. admits just 140,000 a year--though our population is 13 times larger. Keeping America competitive is key to turning our economy around and creating jobs. We must do better.

--KEVIN HASSETT

American Enterprise Institute

NO

The United States remains the world's premier power economically, militarily, and most importantly, in terms of our ideas. The U.S. is the world's largest marketplace for goods and services. We export $2.1 trillion of goods and import $2.6 trillion. Our annual gross domestic product...