America, Ireland, and the European Union—A Shared Path to Prosperity, Remarks by Thomas J. Donohue, President and CEO, U.S. Chamber of Commerce
Mr. Prime Minister, thank you for that kind introduction and for being here today. We are honored by your presence.
Good morning ladies and gentlemen. Let me begin by thanking the Department of Foreign Affairs for hosting us in this historic and beautiful building—surely among the most elegant in Europe.
I’d also like to recognize Gerard Kilcommins, Joanne Richardson, and all the staff and directors of AmCham Ireland for the great work they do to represent the interests of U.S. companies here in Ireland.
This month AmCham Ireland celebrates 50 years of tremendous achievements. I extend a special welcome to its members here today.
I’ve made a special trip to Ireland in these difficult economic times to reaffirm the American business community’s commitment to Ireland as a vitally important investment and trading partner.
I’ve also come to encourage steps to maximize the transatlantic relationship—the largest commercial relationship in the world—to achieve its full potential, to foster economic growth on both sides of the ocean, and to exert global leadership.
But most of all, I’ve come to express my optimism that the Irish and American economies are making real progress.
Recovery is underway—here in Ireland, in the United States, and across Europe.
But the recovery is fragile and uneven. And uncertainty about the future still abounds.
Any number of unexpected developments that could slow or derail economic recovery.
This brings to mind the wise words of that great Irish wit, Rev. John Pentland Mahaffy [MUH-HAFF-EE], who said: “In Ireland the inevitable never happens and the unexpected constantly occurs.”
Our greatest concern is for the millions of our fellow citizens who are out of work. Putting them back to work must be our number one priority.
Our U.S. Chamber of Commerce headquarters sits right across the White House in Washington, D.C. We have a huge banner on the front our building facing the White House that spells out the word JOBS. Because that’s what it’s all about. And I know you feel the same way here in Ireland.
Despite the progress we are making, no one should underestimate the tough choices and sacrifices that must be made to fully restore economic growth and fiscal health.
It’s going to take a lot of courage—and I think we’ve seen plenty of that on display here in Ireland.
And so there is cause for hope and optimism. Our economies are growing again. We have stopped the bleeding in some major sectors. Our financial systems are on a more sound footing. We have successfully resisted the siren song of protectionism.
As each of our countries struggle to repair and grow our own economies, we must never forget that our destinies are tied together.
The numbers make this crystal clear. The United States and the EU share a
$4.3 trillion commercial relationship and account for 40% of world trade.
In Ireland alone, the United States has $165 billion of investment. That’s more than the total America has invested in Brazil, Russia, India, and China combined.
In the United States, Irish companies directly employ an estimated 82,000 Americans at over 2,600 locations in all 50 states.
Because we are so interdependent, both the American and European economies must be successful—or neither will be.
So today I would like to share our views on how we can accelerate our recoveries and ensure that the transatlantic partnership achieves its full potential.
Progress in Ireland
The Irish and American people have experienced firsthand the human suffering and financial and political turmoil of an economic collapse.
But overcoming adversity is another quality we share.
We believe in the Irish economy and the Irish people. You will rise again.
The Irish economy is proving its resiliency in the face of extremely difficult circumstances.
No matter what economist you talk to, all agree that Ireland’s economy will grow this year and beyond.
Export growth is already robust and is one of the strongest in the EU.
Ireland continues to attract foreign direct investment.
Your public finances are improving and will continue to do so.
Perhaps most importantly, Ireland is an innovative and highly entrepreneurial society.
It’s relatively easy to start a business here, and entrepreneurial activity is increasing.
This confirms something we’ve known for a long time—the Irish economy is based on the resourcefulness, intelligence, and grit of the Irish people, who are well educated and industrious. That hasn’t changed. And that bodes well for your future.
Irish policymakers have also paid careful attention to maintaining the country’s competitive position in the global economy.
Given the pressures you have been under from the EU, the IMF, and the public, it would have been very easy to throw overboard the favorable tax climate that has helped transform this country into a sophisticated hub of innovation, technology and services.
But instead Ireland has rightly said no, we’re not going to squander our most important competitive strengths.
So I can tell you that the American business community still sees Ireland as a good place to invest. There are too many strategic advantages here for global investors to ignore for very long.
I truly hope that Ireland will continue to make the right decisions to stay competitive in the global economy and to build on its strengths and not squander them.
Ireland is not alone. All countries are going to have to develop sound policies that meet the needs of their people in a fiscally responsible way—while also maintaining and strengthening their competitive positions worldwide.
It’s a difficult balance—especially as populations age and demands for health care and pensions grow. And it’s a balance we’re not handling very well in the United States.
We have taken some positive steps in the last two years to stabilize and strengthen our economy.
The Federal Reserve dramatically expanded its balance sheet to shore up our banking and financial sectors. That helped save our financial system. And it appears the Fed will not only get all of its money back, but earn a profit.
Congress and the administration passed a stimulus measure that helped keep the economy afloat as consumers and businesses retrenched and regrouped.
They provided aid to key industries, such as the auto sector, that helped keep thousands employed.
And in a rare bipartisan agreement, they recently extended current tax rates on income, capital gains, and dividends, preventing what would have been a massive tax increase at the worst possible time.
Thanks to these positive steps—and due to the natural resiliency of our economy—we predict growth of about 3.2% this year.
While a welcome development to be sure, that’s an insufficient rate of growth to bring down our unemployment rate as fast as we’d like.
So our priority at the Chamber is to find ways to turn an economic recovery into a jobs recovery.
It’s estimated that our companies and entrepreneurs are sitting on about $2 trillion in cash. To create jobs, we need them to invest more of that money—back in the United States, here in Ireland, or anywhere else that it can make a decent profit, generate wealth, and create jobs for all our citizens.
But to unleash that investment, we must take decisive action in the United States to restrain the growth of regulations and jump-start a free trade agenda that doubles our exports in five years.
Unfortunately, our country has taken several steps backwards in these areas—and the resulting uncertainty has slowed our recovery and our investments at home and abroad.
The last Congress and the administration have unleashed a tsunami of new regulations that have created tremendous uncertainty, stifled job growth, and delayed our recovery.
They passed a sweeping health care reform bill that dramatically expands coverage without controlling costs, increases government involvement in health care, raises taxes, and explodes the deficit.
Our financial reform bill fails to address key shortcomings in our system. Instead, it adds even more layers of bureaucracy and constrains access to capital.
Together, these two laws alone will create a flood of new regulations that could drag our economy under water if we don’t take prudent action to stop it.
And on top of that, we face a wave of new environmental, workplace, and labor regulations that will further weigh down our recovery.
Our trade agenda, for the most part, has been stuck in neutral, with the United States sitting idly by on the sidelines as other nation’s rack up new trade agreements.
To his credit, President Obama has put his weight behind the U.S.-South Korea free trade agreement, which has languished for years.
We also urging movement on agreements with Colombia and Panama.
We will soon possess the highest corporate tax rate in the world when Japan reduces its rate this summer.
The United States is also facing a number of serious challenges that it can no longer kick down the road—chief among them is spending and deficits.
Many of our states, as well as the federal government, are just now waking up to the reality of a deficit and debt crisis that will lead our country to insolvency if we don’t address it.
We are watching Ireland’s actions in this area and perhaps we can learn from it.
The Transatlantic Relationship
So our plates are full and our challenges are many. But we can speed recovery and job creation in both our countries by taking decisive action to strengthen and expand the most important trading and investment partnership in the world—and that is the trade and investment that crisscrosses the Atlantic Ocean to the tune of trillions of dollars every year.
One idea I’d like to suggest is striking an agreement between the U.S. and the EU that would simply eliminate all tariffs on trade in goods. This could boost transatlantic trade by more than $120 billion by 2015.
Irish and American companies would be among the first and most clear beneficiaries of a zero tariff agreement because so much of our trade is intra-company transfers. Tariffs between us amount to a nuisance tax that simply drives business elsewhere.
And wouldn’t such a bold move turn heads around the world!
A zero tariff agreement does not mean we would overlook the important work we must do together to facilitate trade in services, to harmonize divergent regulations, strengthen the global financial system, or to find a successful conclusion to the Doha round.
In fact we believe such an agreement could spark new activity and action on these critical matters.
The transatlantic partnership is more than just a commercial one, it’s also strategic. To that end, we must successfully manage China’s rise; strengthen our trading relationship to effectively compete with other trading blocs; and tackle common challenges, from demographics to climate change to energy policy.
I hope that Ireland will be a strong voice within the EU for such an agenda.
I can assure you that in the United States, the Chamber will remain the strongest champion of keeping the American economy open to Irish ideas and investments. And we will continue to fight policies that aim to punish or penalize U.S. companies that want to do business in Ireland and elsewhere.
As we make critical decisions in these difficult times, we must never forget where true prosperity comes from—not from raw materials, but from human talent …
Not from behind a wall of protectionism and isolationism, but from an open and globally engaged society …
And not from an all powerful government, but from the entrepreneurial spirit of a free people.
Americans like to think they invented entrepreneurism and free enterprise, but I know much of it was imported to America through our Irish ancestors. And we’re very lucky as a nation to have it.
Each of our countries must summon the will and courage to make the tough choices, to take the political risks, and to embrace the sacrifices to build a brighter future.
I know what choices America will make … and I know what choices Ireland will make. We will choose the future, we will choose to be bold … we will choose to engage … and we will choose to lead—together.
For America, Ireland, and the EU, the path to prosperity is a shared one and a path we must walk together.
With that in mind and knowing there are difficult steps ahead, I will close with that most famous of Irish blessings:
May the road rise to meet us.
May the wind be always at our backs.
I want to thank the Prime Minister and his staff, the Department of Foreign Affairs, AmCham Ireland, and all of you for the opportunity to be here today.
I will be returning in a few months to check on Ireland’s progress, to advance our common agenda, and to assess what the United States and its business community can learn from your experiences.
Until then, you have my gratitude and best wishes. I look forward to the discussion period.
# # #