Secretary of Commerce Donald L. Evans
Before the Global Internet Summit
March 7, 2001
(As prepared for delivery.)
It's a pleasure to be here with you this afternoon - and with this distinguished audience, including Governor Gilmore, John Chambers (Cisco Systems CEO), Allen Merten (President of George Mason University), Mark Grady (Dean of George Mason Law School) and Chairman Bradford Brown (GMU Law School's National Center for Technology and Law).
For the past number of weeks I've been introducing myself and my plans for approaching my job at the Department of Commerce. I welcome these opportunities to share thoughts on how I see this administration working with you to create an environment in which American businesses and American capital can thrive at home and abroad.
As you heard, I spent my formative years in business working in the oil fields of west Texas, where I did everything from laboring as a roughneck on drilling rigs to working as an engineer and manager, and running a multi-billion dollar oil and gas company at 33 years old. Not surprisingly, I bring the instincts of business to Washington.
I believe our energies must always be focused on creating an environment that provides the incentives that encourage America's entrepreneurs and the American worker to do what they do best - innovate, grow the economy and create jobs and wealth. In other words, allow the miracle and genius of the free enterprise system to flourish.
I think it's important to remember that since our founding days, we have been a nation of free men and free markets. America's entrepreneurs and workers created the strongest and most progressive economy the world has ever known - not government. Whenever the hand of government has fallen too heavily on the free marketplace, the economy faltered. The better job we do of keeping government out of the way - the better job American business will do...at home and abroad.
And the best way we in government can do that is by removing barriers that prevent or hinder innovation and economic growth. Government should not be in the business of
picking winners and losers. I'm talking here about getting rid of unnecessary regulations;
making sure the conditions are right for the most effective deployment of capital; and,
perhaps most important, providing you with a government you can trust to do exactly what it says it will do.
My basic philosophy can best be described by something President Bush said the other night when he was delivering his budget message to Congress. He noted that, "Our governing vision says government should be active, but limited, engaged, but not overbearing."
Evolution of the American Economy
In my opinion, never has this approach been more important than it is today. We mustn't erect roadblocks to progress along the information highway. Our economy is evolving in ways that rival the changes that took place 200 years ago when this nation transformed itself from an agricultural economy into an industrial economy. And 200 years ago our ancestors grappled with how to cope with the changes; how to make certain that prosperity and progress were promoted and that opportunities existed in all sectors of our society.
Consider the stakes we are dealing with today. IT industries have contributed 30 percent of U.S. growth since 1995 - growth that is evident right here in Northern Virginia, where we have the headquarters of AOL/Time Warner, Teligent, XO Communications, BTG, Inc. and UUNet/MCI. Governor Gilmore and former governor and current Senator George Allen should be congratulated for their work that has helped make Virginia the "Digital Dominion."
As to the future, worldwide Internet commerce -- both business-to-businessand business- to-consumer -- will reach almost $7 trillion by 2004. By 2005, 1 billion people will be connected to the Internet and more than 75 percent will be outside the United States.
Just this morning, my Department released the latest figures on sales made online. These are 1999 numbers and a sampling shows that 12 percent -- or $485 billion in sales -- were made online in the manufacturing sector; and more than 5 percent of all sales by merchant wholesalers were made online accounting for about $134 billion. Keep in mind that these are 1999 figures and we all know they've grown tremendously since then. This growth and the prosperity it will bring in its wake are almost incomprehensible -- if we act wisely.
But we're dealing with much more here than material wealth. We're dealing with knowledge and the benefits that accrue to those who gain knowledge. I'm talking about the desire for freedom that inevitably results when people's horizons are broadened -- when they discover the endless possibilities that life offers.
And that brings us full circle and punctuates the tremendous importance of creating the conditions that will permit you to innovate and grow within an economy that appreciates and encourages your contributions.
Building the Framework
These are very powerful forces that we are all being asked to steward reasonably and for the benefit of all people. It can be a frightening responsibility -- but I prefer to accept the task as an exciting opportunity to create the conditions for economic growth and broadening people's horizons.
And one of the best ways to get the most out of this opportunity is to listen to what you have to say -- find out how you see the future developing in your industry. Here in the Reston-Dulles corridor, you have come to count on Don Upson. He listens to your ideas, lends his voice to your cause, offers counsel in times of challenge. What he has done for the Digital Dominion, I will look to do for America.
The high-tech community needs a champion in Washington -- a single point of contact to help you plot a course in the Nation's Capital and to promote opportunities in the global marketplace. And you're looking at him -- at least until I get a call from the White House after this speech.
For instance, when you talk about the concept of "networked communities," you're talking beyond what we've been concentrating on in government and I want to be your advocate for these kinds of issues. And I'm looking forward to working with you to protect your infrastructure. I appreciate how important this is not only to you but to the American economy.
It's also my understanding that your industry will be forming an advisory council that will offer recommendations to policy makers. This forum should be a very effective arm of communication. And I look forward to working with them on our shared agenda.
During the next few months, I will be meeting with my counterparts in three important economic conferences and I would like to take them our message that this administration will champion free and open markets, and provide strong advocacy for your industry in your own words.
Also, we have a number of important issues to grapple with -- I refer to such considerations as deregulation in the telecommunications market; speeding broadband deployment, including wireless as well as landline; finding ways to close the gap that currently exists in high-speed Internet access between those living in rural areas and those living in suburban areas; the disposition of the Internet Tax Freedom Act; the issue of technology transfer and much more.
New Day in Washington
As I wind down today, I'd like to spend a minute of so to review other steps being taken
by this administration that are important to you not only in your professional lives but in your roles as parents and concerned citizens.
First, there is the budget President Bush proposed last week. A broad look reveals a budget focused on government programs that most directly improve the lives of average Americans: excellent schools, quality health care, a cleaner environment and a stronger defense.
And this budget will allow us to pay down almost two-thirds of the debt; create a contingency fund for unexpected needs; and cut taxes by $1.6 trillion. You create the wealth of this nation -- you create the jobs and innovations. The more money we can leave in your pockets, the better. This is what I mean about creating an environment that allows the economy to grow and prosper.
Within this budget are also education reforms proposed by the President. His program calls for tying funding to higher standards and to accountability for results. His program also promotes local control of schools. Washington cannot do the job that you as parents and teachers can do in the neighborhoods and communities where your schools are located.
These are common sense proposals and they will close the achievement gap between rich and poor students, support teachers and empower parents with more choices. Here, again, we are promoting conditions that will help us grow and prosper. An educated workforce is a productive workforce.
As expected, we are hearing from those who are picking at bits and pieces of the budget and would tinker with it here and alter it there. That would be a mistake. It addresses the needs of our economy and of our people in a responsible and effective way. And we sure don't want to see any "ornaments" attached to the tax reforms that will dilute or distort them.
In closing, I'd like to leave you with a few thoughts.
We in Washington will be looking to you for guidance on how to proceed to make sure that not only industry but also society benefit from the developments you are engineering in your industry. Together, we must create an environment that enables high tech businesses to flourish guided by the hand of free enterprise, free markets and faith in the American people.
Those are age-old truths that should be embraced as we head in new directions. We will look to you, not government, to take us in the right direction.
Thank you for allowing me to spend time with you today.