Clyde Prestowitz Interview: Conversations with History; Institute of International Studies, UC Berkeley

The Changing Balance of International Economic Power: Conversation with Clyde Prestowitz, President of the Economic Strategy Institute, August 9, 2005, by Harry Kreisler

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Background

Clyde, welcome to Berkeley.

Thank you. Nice to be here.

Where were you born and raised?

In Wilmington, Delaware.

And looking back, how do you think your parents shaped your thinking about the world?

My dad worked for a Belgian company and was always traveling through some exotic place. That really got me interested in the world. Languages were his hobby [so that] got me interested in language. Both my mom and dad were very much internationally oriented and they got me that way as well.

And you're multilingual, I saw in your vita, correct?

Well, I hack at a number of different languages!

Where were you educated?

I did my undergraduate work at Swarthmore College and then I did graduate work at the East - West Center at the University of Hawaii, Keio University in Tokyo, and I got an MBA at the Wharton School of the University of Pennsylvania.

In your book one gets a sense that you're very conscious of what your generation was able to achieve because of the success of the American economy and its role in the world. Talk a little about that.

Tom Brokaw wrote the great book The Greatest Generation about our fathers, and I would say if that was the greatest generation, we were the luckiest generation. We hit the sweet spot of American economic history. America emerged from the Second World War as incomparably the overwhelming economic power. In fact, in 1948 the U.S. all by itself accounted for more than half of global output. We were the leader in every technology and every industry. The U.S. was the only mass market. So, we had enormous economies of scale. We could be the low-cost producer and pay the highest wages.

When I graduated from high school most of my class just walked down the street and went on the assembly line at the local General Motors assembly plant. I saw many of these people recently at a reunion and they're all retired and they have defined benefit pension plans, they have indexed healthcare, most of them have a house at the beach or a house in the mountains, sent all their kids to college, most of the kids are doctors or lawyers or professionals of some kind, and they did all that with a high school education. Just really a very, very fortunate generation.

Now what led you into business? You say your father was a businessman. Did it just come naturally to seek a business [career]?

No, actually, I started as a journalist and I worked for the Wilmington Morning News and the Honolulu Star Bulletin. Then I went in the foreign service. Interesting tidbit there. I passed the language exams of the foreign service in Japanese, they assigned me to the U.S. Consulate in Rotterdam in the Netherlands.

That's a natural match!

I spent a couple of years in Rotterdam and in the Hague. Then I left the foreign service. I came back from Holland in 1968. I had gone through Swarthmore on a scholarship funded by a man named Tom McCabe, who was the long-time chairman of Scott Paper Company. I had lunch with McCabe, was trying to figure out what to do. I had applied to law school and I'd done some other things, and after talking to McCabe I decided to try business. So I went to work for Scott Paper Company in 1968, and was with Scott for a number of years and then with some other companies before joining the Reagan administration in 1981.

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