that foreign firms can take advantage here in the united states. i've seen a lot of increase in foreign direct investment this year and compared to the rest of the world, we're certainly benefiting a lot more than the rest of the world. a lot of the states are creating international trade representatives in foreign countries, and that kind of tapered off for the last three or four years, now it's building up steam again. and each state is kind of evaluating where the highest-potential opportunities are and they're putting representatives there. the final area is entrepreneurship and innovation. and this year we've seen an increased emphasis on targeting firms, emerging growth companies and high-growth firms. that's 6% to 7% of companies that have the potential to create the most jobs. a lot of programs to support those kinds of firms.

economic gardening initiatives. this is a spreading national program developed in colorado first, i might mention. and this works with existing firms who have great potential to expand, and they put a whole host of support resources around those firms to help them grow. we've seen technology-based economic development programs in the states. some are very targeted. some are very comprehensive, designed to develop the ecosystem surrounding the entire financial, technology, all the support systems that go into those kinds of things. it varies by state. and a lot of investment funding for startups and expansions. and finally, almost every state has got some program or initiative to spawn university business/government partnerships. in delaware they have a strategic fund that is focused on startups and growing

companies. nebraska just passed an innovation act which focuses on technology transfer from universities and helps startup companies. utah's got a very unique situation. they have a highly educated multi-lingual population that has really contributed, from what we can tell, to the growth of their financial services sector. and along with a number of other factors. and then wisconsin, they have an expanded loan support for growing of small companies. and in wisconsin, a manufacturing sector is doing quite well due to a number of business environment factors in the state there. so that's an overview of the highlights of what's going on this year. we've been very gratified by the number of states that give us a call and say, we've looked at the report and i know the people at the us chamber get the same calls and we find that the study's very useful to them and we are very gratified by that.

so, that's highlights. i encourage you to look at the total report to see what's going on, and thanks. >> more now from the u.s. chamber of commerce jobs summit. coming up, a discussion on financial regulations and the internet. >> good afternoon. i'm toby mack, president and ceo of associated equipment distributors. proud member of the board of the national chamber foundation. this afternoon, it's my pleasure to introduce tom donohue, president and ceo of the u.s. chamber of commerce. representing the construction equipment industry for a good number of years, i've worked closely with tom in the chamber

on some of our nation's most pressing priorities, particularly the rebuilding of america's oar cairk and crumbling transportation infrastructure. under tom's leadership the u.s. chamber is the nation's greatest champion of free enterprise, american competitiveness, and market capitalism. you can't miss the huge jobs banner on the face of this building as you come up the front steps. jobs and lots of them are what result when the chamber's growth and competitiveness agenda becomes policy. that agenda focuses on expanding trade, strengthening capital markets, driving the energy revolution, reforming our regulatory and legal systems, protecting intellectual property rights, and controlling government spending. among his many accomplishments, tom has spearheaded the creation of the american free enterprise campaign. it's a visionary, long-term program to defend, protect, and

advance a free enterprise system based on individual initiative, hard work, incentives and rewards, and personal responsibility. tom's also transformed the chamber into a major force in the electoral process through voter education and grassroots efforts. he knows the best way to get proelss is to elect lawmakers that will stand up for america's job-creators. as a leader of an industry that remains hard-hit from economic skler rose resulting from bad policy i'm proud and never jissed to be on a team of one of our nation's most effective advocates and leaders in the fight for growth and for jobs that go hand in hand with that growth. please join me in welcoming tom donohue. >> thank you very much. good afternoon, ladies and gentlemen.

i always worry at my age in particular when people get up and give long introductions. they begin to sound more and more like obituaries. but i do appreciate the points that you made, toby, about the things that we're trying to do on the free enterprise side and the inferences you made about the work we have with your industry as we do with many others. i'd like to thank you, margaret, and all of your team, for putting this together. two events we've merged together because they belong together. and for all of the activity that is developing itself in such a vigorous way within the foundation to look at our nation's challenges and define ways to move against them and with them. we're here to talk about jobs and given may's dismal unemployment report, some might expect a discouraging conversation. yes, we're in difficult

circumstances. economic growth is anemic and the jobless rate is chronically high and moving in the wrong direction. but if you're looking for doom and gloom from me, you won't find it. in fact, i hope everyone leaves this summit encouraged about our prospects and energized for the brighter days ahead. why am i optimistic? first, because we've got proof that things are working. that 2012 enterprising states study, which you just saw a quick cut on, shows that the states are -- foster strong business environments and embrace innovation, are bucking all the national economic trends, they're growing faster, and they're adding more jobs. a little later today, we'll hear from the governors from some of those states as well as their business and civic leaders of two of the nation's thriving

cities. these leaders are finding positive solutions to major challenges and they're seeing results now. there's a lot washington can learn from the governors and the mayors who are running these states and cities. now, here's a second reason that i'm optimistic. business has a plan. our government has tried, with little success, to stimulate growth and job creation. but government-directed stimulus isn't a long-term strategy to achieve sustainable growth. or to produce millions of new jobs, or to raise the standard of living in our country. what we need is a comprehensive plan for growth that leverages our strengths and addresses clearly our weaknesses. the chambers america job and growth agenda does both of those, as do the plans of many

of the successful governors. our plans call for greater energy development, stronger infrastructure, investment, expanded global trade, an aggressive innovation agenda, regulatory legal and tax reform, and reining in, in a creative and constructive way, debt and deficits. if we do these things, we can speed up economic growth, add jobs in a hurry, without raising taxes or adding to the deficit. so i'd first like to focus my remarks on the issues of innovation, and if you get "the wall street journal" today and major through it, you'll find a big full-page ad that we have in there on innovation. in fact, each couple of months we have one of those for one of the parts of our jobs and growth plan. the innovation system is what keeps our economy humming.

our businesses competitive and hiring, our manufacturers producing, our standard of living improving, and our wages and benefits high. very simply, if we want to spur a strong and sustainable recovery, america must ignite the innovation boom again and still further. we must start by developing and attaining world-class tall loept. because human capital is the primary driver of innovation. first, we need to develop the hometown talent. it's no secret that america's k-12 schools in many places are falling far behind our global competitors. what's most alarming is that our primary area of weakness is also the most vital to innovation, and that's science, technology, engineering, math, or s.t.e.m. it's estimated that half of the

k-12 students are being taught science and math by teachers who, by necessity or accident, are not proficient in those skills. so we need to reform our k-12 education system. embrace technology-driven learning and innovative teaching technologies. and we've got to stock america's schools with the best teachers who are rewarded based on performance. we also need to strongly emphasize s.t.e.m. studies at every level of education. let's encourage our young people to pursue these exciting subjects and rewarding careers. if we don't, our workers will have the -- won't have the education or training that they need to join an ever-changing and highly demanding work market, particularly on the skills side. studies show that within a few short years, we'll have millions

of high-skilled jobs without qualified people. right now we've got maybe 3.5 million jobs we haven't got people for. i believe it's twice that because if you filled the 3.5 million you'd get a lot of the multiples out of it as you're getting in your states. studies show that within a few short years, we've got to put these people to work to keep these innovative industries in our country, or we're going to have a great acceleration in people moving elsewhere to follow their technological dreams. in addition to developing more home-grown talent we can also fill the skills gap by competing in the global race for talent. and that brings me to the second major way that we build a competitive workforce. we must attract the world's best and brightest and put them to

work in our economy. global talent is already drawn to american universities. we have the best science, engineering and technical colleges on the planet. more than half of the graduates and ph.d. students studying in high-tech disciplines at u.s. universities are foreign-born. the trouble is that after we educate them at our american institutions, then we send them home because they don't have a u.s. visa. what we should be doing is stapling a green card and a visa to their diplomas. let's get smart. let's adopt visa reform to make it easier for high-skilled immigrants and foreign graduates of u.s. institutions to invest their talent and their personal ambition in our knowledge economy. if we don't, we'll send

innovation to our competitors at the expense of our own economic growth, our own job creation, and our own global competitiveness. the bottom line is that a globally competitive workforce is going to require a rational immigration policy. one that harnesses the energy and innovation of enterprising foreigners. if we fail to do this, to become this talent to our country, then the work will follow this talent to their country. let me say further that ideas and talent are only part of the equation. thomas edison, an american who knew a thing or two about innovation, said, a vision without an execution is a hallucination. inventors and entrepreneurs need access to capital. to help breathe life into their ideas and bring them to the

market. many startups rely on seed capital from, where do you get individuals, local banks, credit unions, even credit cards, to help people get off the ground. recently there's a lot of excitement and a little bit of controversy over the facebook ipo. the important thing to remember about that, and countless other examples, is what made them possible to begin with was someone was willing to take a risk on a fledgling project or an idea. and to put up funding and to give it a chance to flourish and grow. today, facebook has 3,500 employees and is valued at $70 billion. i told my kids, just think about it. anyway, that was largely because of an angel investor who saw

some potential. large, established firms also routinely turn to america's vast pools of capital so that they can invest in new products or services and satisfy market demands. by the way, so do states and the federal government. jamie dimon was up there for a grilling today, made the point which brought a lot of the members of the senate to a more reflective set of questions, that it was our bank and only our bank, and he named three very significant states that came and showed up and helped you when you were in real trouble with your pensions, don't forget it. this capital investment creates a virtuous cycle. ideas that are transformed into products or services generate revenue that is often poured back into research, development and discovery, leading to even

more innovation, more jobs, and more growth. this is the process that yields cutting-edge industrial techniques and more efficient business operations. so it's critical that we keep our markets open and efficient and provide investors with predictable rules of the road so they can take appropriate and thoughtful risks. any measures that strangle capital formation or choke off the flow of financing must be revised or repealed, and i think some of dodd/frank meets that standard of review. that's why the chamber's capital market center is working with congress to address that question. even more importantly, we're working to breathe life back into our capital markets so they're flush with capital and able to fulfill these fundamental missions. fueling innovation, spurring growth, and creating jobs and

prosperity for americans. a competitive business environment is just as essential to innovation as well-functioning markets. in the enterprise state study, we have fresh evidence of how states are fostering economic growth and jobs through their innovation. what do successful states have in common? a tax and regulatory climate that allows companies to continuously innovate. unshackled by needless delays and burdensome costs. and states that maintain a good legal reform environment can also expect hundreds of millions of dollars or more in economic activity and tens of thousands of new jobs, according to our study. the right policies also attract manufacturers. innovation gravitates to manufacturing centers and manufacturers are some of the

strongest drivers of new innovation. but when the federal government and their tax and regulatory policies are excessive, it breeds slows investment, depresses new technology, drives manufacturing overseas, and puts business at a competitive disadvantage. take taxes. you take them and you keep them, but take taxes, for example. no one would hold up america's byzantine tax code as a model of efficiency or clarity or an engine of economic growth. our tax code must be restructured. so that it is simple and clear, so that it spurs growth, encourages investment, and efficiently generated revenues to reduce the deficit and meet our national priorities. we must enact comprehensive tax reform that broadens the base,

lowers all business rates, and reduces the burdens of compliance. this reform should reduce the corporate tax rate, the highest in the world, and drive innovation by permanently extending the r&d tax credit. we must also do away with specific tax provisions that target innovators. like the thing that's on the table right now, the $20 billion tax on medical devices that will take effect next year under obama care. this excise tax would squelch innovation in medical technology industry. and it's so vital to all these new developments that are keeping us alive so long and so healthily. and by the way it would threaten 43,000 industry jobs that would

disadvantage u.s. business and drive some companies and their jobs overseas. if you can't do it here, you're going to do it somewhere else. innovation depends on a rational, efficient, and globally competitive tax system. and currently, that's not what we've got. in addition to the uncompetitive tax code, an explosion of regulations inhibits entrepreneurship and innovation. a heavy regulatory burden prevents companies and startups from being fast and nimble in a competitive environment. compliance costs divert time and resources from business expansion or exploration and uncertainty restricts capital needed for experimentation. we need a smarter regulatory system that preserves economic freedom and flexibility while removing unnecessary burdens and keeping the costs in line.

and that makes clear rules based on sound science and proven benefits. and if they can't get that here, as i said before, they'll find it somewhere else. we can see in the states that people are going to the states that offer them that opportunity. systematic overregulation and punitive taxation drive entrepreneurs overseas and straight into the economies of our competitors. what's true of capital is also true of innovators. they will go where they are welcome. where they are safe and stand a good chance of being rewarded for their efforts. a strong business environment you can see is essential.

while it's cripple call the government stop pushing policies that stifle innovation, the government does play a useful role in basic research. we see it in health care, we see it in national defense, we see it in a host of places that we applaud. the equation has worked pretty well. for our system. and so as lawmakers face tough and necessary decisions about spending, they've got to keep an eye on the traditional role m r of driving basic research. we can't fix our entitlement problems in this country by trying to take it in nickel and dimes out of essential programs, we can fix the entitlealment issue without denying anyone their fundamental coverage by making some sensible changes.

until we do this, all of the things that i'm talking about here will be all the more difficult to rationalize and fund. . while we're talking about positive things, let's not forget that maintaining our investment in physical infrastructure is essential. and right now, as toby indicated. we're in trouble. we're in trouble on roads and bridges, we're in trouble on energy infrastructure and energy production, power generation and the issue of moving the power around. we have salt on our hands. we have done it because we don't have the money, because neither party is willing to step up and do this. but there are a lot of ways to do it with public, private partnership and with user fees that the users of these systems will provide.

and we urge the government to get off the dime and seize this opportunity, put people back to work, improve our infrastructure, grow our productivity and put this behind us instead of as an obstacle to our global growth. i want to say a word, i'm almost finished, and by the way, i thought this was a rather long speech and the more i talk about it, and the more i'm giving it, the more excited i am about it. at the same time, we have got to invest in technology of infrastructure that's vital to a wave of innovation. the u.s. internet traffic is growing rapidly. you've all seen that, to support services. we have got to continue to invest in this and right now the u.n. has brought people together from all over the world.

we have invented the drive of this country and we have got to make sure that what is done at the u.n. doesn't affect that negative. i think it's very important that we look at the critical element to innovation. without it innovation won't exist. there are really two, one is reward. if you don't reward people and let risk takers be rewarded, they will go somewhere else. the second is the willingness to

take a risk and fail. investors must know that the fruits of their labor will be strongly protected by the law. without assurance of this incentive, innovation will decline. one debtment is ttriment is -- t year's passage of the reform legislation, we got some good progress, and we still need to wade through the logjam. and that creates all kinds of problems as people go in and try and do copy patents and try and get a piece of what everybody is doing, it's a real complicated issue. we also need to crack down, and i use those words strongly. an ip theft, piracy, rogue websites, we need to fully fund, as we get it back thousands of times over, the enforcement of

ip protection and whie need to it now. economic incentives are equally important. and innovative ideas, there's little hope of reaching consumers and bettering our lives if we -- if investment is punished, if it is demonized as is being done maybe even today on television, or stolen, america will lose its talent, it's capital, it's ideas and it's jobs to our economic competitors. and you know, what's just as vital as success is failure. it's our greatest teacher. after all and go find the private investments in the private equity firms and they will most likely invest in someone who has had a failure and has come away from that failure much smarter than they were before they had it.

we must never abandon the idea that it is okay to take a risk and it is okay to fail. we must never reject the notion that it's okay to make a mistake, whether you're an investor, an entrepreneur, whoever you are. if we instead adopt an idea that you get one shot, which is by the way is the way it works in japan. we'll find something that is fundamental about our system, the belief that opportunities are limitless and dreams are achievable. america is and must remain a place where you can fall on your face, pick yourself up, dust yourself off and try it again. nations at different stages of development doesn't necessarily have to be as innovative as we do to flourish.