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James McNerney, Jr.


It's like the business Oscars down here in Washington this week.

There are stars everywhere. Wednesday, it was Jamie Dimon at the U.S. Chamber of Commerce Thursday, the Export-Import Bank drew no fewer than four titans of industry: Honeywell International Inc. chief executive Dave Cote, Caterpillar Inc. Douglas Oberhelman, Siemans AG chief executive Peter Löscher, and Boeing chief executive James McNerney, Jr.

The heads of five of the world's biggest companies see the world roughly the same way.

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Like Mr. Dimon on Wednesday, Mr. McNerney said he thinks the United States economy is rebounding from a recession just about as you would expect it to. Growth is a little slow, but that's because the housing market is so weak, robbing the country of construction jobs. "I see a pretty normal recovery, quite frankly, with the exception of real estate and construction," Mr. McNerney said.

These men agree that the U.S. needs to embrace China, not confront it. They are exasperated that free-trade agreements with Colombia, Panama and South Korea are blocked by political gridlock. They are a little worried about energy prices and wish the Obama administration and Congress would agree on a proper energy policy. At the same time, they are visibly giddy at prospect of all the money they are going to make during what Mr. Cote called an "infrastructure boom" over the next couple of decades.

Two things appear to worry these five titans more than anything else, however.

One is government debt. Mr. Cote, who was a member President Barack Obama's deficit-and-debt commission, said the U.S. government's interest payments are on track to reach $1-trillion by 2021. "If you spent $1-million a day from the day Jesus Christ was born, you still wouldn't have spent $1-trillion," Mr. Cote said.

The other is the state of the U.S. education system. These guys are desperate for engineers, and they are having great difficulty finding them at home. "We seem to be falling behind by the year," said Mr. Oberhelman. "If we don't get our people to a worldwide standard, we are in trouble." Said Löscher, "Put the focus on engineers." Mr. Cote again: "WE NEED ENGINEERS."

Unfortunately, the titans did a better job articulating the problems than they did offering solutions. That might be because these sorts of appearances don't lend themselves to detailed discussions. Messrs. Cote, Löscher, and Oberhelman appeared together for an hour-long segment - not a lot of time when each man gets to take a turn answering a long and varied list of questions.

Boeing's Mr. McNerney was alone on stage with an interlocutor. He went a little deeper on the education issue, saying the focus must be on Science, Technology, Engineering and Math, the subjects that "related most directly to innovation and growth." Mr. McNerney said the focus on these subjects should occur in kindergarten through Grade 12 - after that, it's too late.

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He also called on engineering schools to stop acting like "boot camps." Mr. McNerney said he has observed a penchant in engineering programs to try to weed out about 85 per cent of their classes in the early years. Instead, he said these programs should be trying harder to graduate 85 per cent of their original enrollment. The current approach "doesn't make sense" when there are more engineering jobs than there are graduates. "We should be going after yield," he said.

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About the Author
Senior fellow at the Centre for International Governance Innovation

Kevin Carmichael is a senior fellow at the Centre for International Governance Innovation, based in Mumbai.Previously, he was Report on Business's correspondent in Washington. He has covered finance and economics for a decade, mostly as a reporter with Bloomberg News in Ottawa and Washington. A native of New Brunswick's Upper St. More

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