American Innovation Better Than Ever

Writing from Chicago at the annual Housewares Show, it reminds me how many American entrepreneurs are in this industry. From booth to booth, new entrepreneurs mingle with entrepreneurs who have been in this industry for decades. What they have in common is a vision and the inner drive to make their ideas a reality and risk everything to grab a piece of the American Dream.

No nation can out-innovate the United States of America.

Measured as patents per capita, the United States takes first place by a large margin, followed by Japan, Switzerland, Finland and Israel. The late Steve Jobs at Apple held 317 patents himself.

So it’s not surprising that people attending the show represent nations throughout the world who are drawn to American innovation and product quality. They understand that their customers crave American-made products and brands and will pay a premium to add these appliances to their homes or businesses.

But while that tells a story about innovation, it doesn’t tell the entire story. The World Intellectual Property Organization released the rankings for the 2013 Global Innovation Index. Switzerland and Sweden remain first and second, respectively, but the United States jumped to fifth from 10th in 2012.

That’s a very good indication that the United States is once again investing in research and development. In 2011, the United States invested $405 billion in R&D, keeping us as number one in R&D spending.

A big roadblock to entrepreneurial innovation is the lack of access to capital. The Dodd-Frank financial reform law is forcing our community banks out of business. For more than a hundred years, community banks have been the economic drivers for small business, communities and for the nation.

But they have been replaced by megabanks that are getting bigger, fueled by the flawed perception that they are too big to fail. Our community banks have just 12 percent of all banking assets compared with megabanks’ 70 percent. The real tragedy is when community banks fail, local businesses no longer have access to local borrowing.

Regulations like Dodd-Frank contributed to this failure, but we have a government that thrives on regulation. Regulations today cost our economy $1.2 trillion a year. When regulations hold back innovation, small business cannot grow.

We must add Obamacare to the mix, where companies and institutions will have even less money to invest in hiring and R&D. When entrepreneurs can’t create and grow their businesses — the historic source of innovation and jobs — then it’s hard to expect our innovation leadership to continue.

And it’s not just about the economy. It may surprise you that during The Great Depression, while more than 5,000 banks failed from 1929 through 1933, this level of bank distress saw a rise in aggregate productivity, and in fact, statistics show that the 1930s was one of the most innovative decades of the 20th century.

The laundromat, the car radio, the supermarket, the dry electric shaver, chocolate chip cookie mix, the precursor to the Xerox machine and, ironically, the game Monopoly were all invented during this period.

We need to gain back our mojo and continue to out-innovate the rest of the world. We have the skills, we have the drive, and the only thing holding us back is a government that continues to get in our way.

I wish everyone could experience what I have at the Housewares Show — the energy, the crowds and the deal making. We can’t fall victim to the defeatist attitude that has befallen this country.

The nation’s entrepreneurs have never given up. We’re out here every day trying to make a difference and get this nation headed in the right direction.

The stakes have never been higher, and our resolve to support our entrepreneurs must never waiver. It’s the key to creating jobs and bolstering our economy. We can’t let six years of a failed administration diminish the innovation we’ve achieved over the past 100.

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