Yesterday the U.S. Chamber of Commerce hosted Andrew Mackenzie of Australian natural resources giant BHP Billiton here in D.C. as part of their CEO Leadership Series. Mackenzie’s speech discussed his own background (PhD in organic chemistry) and his company (one of the largest mining companies in the world), and then focused on international and U.S. economic policy. Not surprisingly, he is in favor of free trade, opposed to commodity subsidies, and believes that overregulation threatens the unique competitive advantages of U.S.-based companies.
What is also interesting, however, is what he did not talk about. At a time when CEOs are expected to please every self-declared “stakeholder” group under the sun, Mackenzie stuck largely to the business of mining, shipping, and selling BHP’s products. He didn’t eat up his time by announcing a green energy partnership with environmental groups, or ticking off a laundry list of diversity, labor, and cultural initiatives. He did, however, talk about how the increase in free trade—through NAFTA and engagement with China—has led to unprecedented growth and prosperity around the world in recent decades. He also took on some pernicious myths:
The political pressures to resist free trade, and even maybe roll it back, seem to have been gathering strength. … Those opponents of open markets argue that they harm working people and their families, and that protectionism is the right response for resource scarcity. I totally reject this! You know, we have a lot of working people with families who come through our gates each day, and to them and to all of those people around the world, and those who purport to represent them, I would say, free trade doesn’t take jobs on a net basis – it makes them, big time.
He also made a fascinating observation about one of the biggest challenges his company faces – recent and potentially long-term declines in prices for many of their products. Explaining the need to become more efficient, he predicted that prices would be “quite low for a long time,” and that they would need to “engineer margins out of prices that are much, much lower than we’ve gotten used to.” He went on to observe:
I actually see this as quite a noble thing to do. I do strongly believe in free markets…and I think in many ways this company, more than many, has done its share to liberate the markets for commodities and to help drive prices down, which is not always in our best interest in the short term, but in the long term these are markets we know how to play in, and I think, more importantly, I think the world will always be benefitted from the secure and efficient supply of the resources that underpin so many of the good things in life.
When it came to policy specifics, Mackenzie went after the ban on U.S. exports of crude oil:
The US would send a strong signal with the repeal of the oil export ban. A change in policy would add hundreds of thousands of jobs. Importantly, it would further demonstrate the nation’s ongoing commitment to economic freedom and the promotion of global growth.
Here’s to hoping that business leaders like him can help make it happen.