Lesson from abroad

The United States remains desperate for faster growth and stronger job creation. To unleash that growth, the dean of New York University’s business school says, maybe the country needs a big dose of its own economic advice.

For the last quarter of the 20th century, the United States and its Western allies preached a particular brand of capitalism to developing countries struggling to lift themselves out of poverty. That preaching stirred a lot of controversy; it also spurred a lot of growth in emerging markets such as Brazil, China and Chile — the countries now powering much of the global recovery from the Great Recession.

Much of the developed world, meanwhile, is struggling to leave the recession behind. Europe is contracting. U.S. growth remains below historical norms, and its unemployment rate is hovering near 8 percent.

Peter Blair Henry, the dean of NYU’s Leonard N. Stern School of Business, attributes that malaise to a sort of evangelical amnesia. The United States, he says, taught the developing world to boost productivity, invest in infrastructure and education, encourage investment and connect to the growing global marketplace for goods and services.

The United States’ weak recovery from recession, and the weak recovery of the 2000s that preceded it, he says, “are in large part due to the fact that we forgot these lessons that we taught the Third World.”

 “We’re mired in a pretty tired ideological debate, I think,” Henry said. “We’re conflating kind of fiscal sustainability issues, inequality issues.”

For example, he said, “We know that the way to close the wage gap is to produce more skilled workers. Raising taxes on the highest tax bracket may be part of the solution to our overall sustainability issues on the fiscal side, but it’s not a solution to income inequality. The conditions have never been better for potential prosperity, but we’ve got to do a better job of educating people and giving people access to the global economy.”

Henry immigrated to Chicago from Jamaica with his family as a young boy. His new book, “Turnaround,” straddles the developed and developing world. It reaches conclusions that run counter to a growing sense among many Americans that globalization has hurt the U.S. economy more than it has helped, especially for the middle class.

Much of the book should please Republicans. Henry advocates reducing the federal deficit and reducing the “uncertainty” that many business leaders and GOP lawmakers say is restraining growth. He also, in the interview, condemned “protectionist” trade measures that the Obama administration and other developed countries have leveled at their emerging-market trading partners in recent years.