In his 2011 State of the Union Address, U.S. President Obama made a commitment to doubling America’s exports by 2014 to help rebalance America’s longstanding trade deficit. Yet most large American Fortune 500 companies already have significant overseas presence and export capabilities. Hollywood banks on international sales that amount to roughly 60 percent of its $27 billion in revenues. 1 Apple manufactures all of its products abroad through contract manufacturers, which famously adds to the American trade deficit even though Apple captures most of its products’ value. 2 UNCTAD found that General Electric was the world’s largest “transnational” firm (with more than 50 percent of sales, assets, and employees abroad) so that its “transnationality” index (TNI) was 52.2 percent. The TNI rating of other quintessentially “American” firms is high: Procter & Gamble’s (P&G) was 60.2 percent, Coca-Cola’s 74.3 percent, Ford’s 54.3 percent, General Motors’ 48.7 percent, and Wal-Mart’s, though just 31.2 percent, is increasingly rapidly. General Motors fell just below the 50 percent threshold, but in 2010 GM sold more cars in China than in the United States. 3
Exporting or establishing a global presence is apparently less a problem for large American-headquartered companies, but the ability of a broad swath of American businesses-particularly small and medium-sized onesto export successfully is questionable and they have little presence overseas. Only 1 percent of American firms export-of those, 58 percent export to only one country, most often NAFTA members Canada or Mexico. U.S. Commerce Secretary Gary Locke admitted that large-but not smallerfirms receive the “full force of government” to assist them. Traditionally, American firms have been able to rely on a large, wealthy domestic market. Going abroad is also potentially hazardous: while small and midsize companies can easily chase after nonpaying domestic customers, international ones are harder to track down. Locke recommends better contacts with the Export-Import Bank to guarantee payments so that an “owner of that company in Maryland [can] sleep at night.” 4 Locke frames internationalization as a fear of being defrauded rather than as an opportunity.