Not long ago, most American companies were urged by the U.S. government to avoid doing business with Libya. It was a pariah state, a sponsor of terrorism, a sworn enemy of the West.
On Sunday, however, former President Bill Clinton asked the chief executive of Wal-Mart Stores if he would open a store in Libya.
"If the new president of Libya asked you to open a store in Tripoli, would you consider it?" Clinton asked CEO Mike Duke at the opening panel of the Clinton Global Initiative.
The Wal-Mart CEO said that the company does not currently have any stores in the Middle East or North Africa, although it does have stores in South Africa and fourteen other sub-Saharan African nations.
What followed next was quite interesting, because it exposed a gap between the way Clinton thinks and the way Duke thinks about business expansion.
Clinton’s question, which he reformulated a few moments later to be about any country’s president calling on Wal-Mart to open stores, packs in an assumption about the centrality of government’s role in business decisions. For Clinton, government really is the starting place. It’s not even a short jump from his Libya question to Obama’s infamous “you didn’t build that” claim. (More:Hillary Clinton: Raise Taxes on the Rich Everywhere)
Clinton described at length an attempt to construct something called “political risk insurance” that would promote business expansion in areas of politicial instability. Government or a government-linked financial institution would, under this scheme, underwrite the political risks of private, profit-seeking companies expanding into risky areas. Sort of Fannie Mae for global capitalism.
Perhaps it’s not surprising that Clinton thinks of business expansion as beginning with a phone call from a national president, but that is not the way Duke thinks about it. His answer began by explaining that Wal-Mart begins thinking about where to open a store by looking to see where there might be customers who are “under-served” by traditional retailers. In short, Wal-Mart thinks first about business opportunity questions: would market demand support a new store, and what kind of competition is in place? (More:Romney and Obama Will Have a Close Call)
The other panel members were U.N. Secretary-General Ban Ki-moon, Queen Rania of Jordan and World Bank President Jim Yong Kim. Duke was the only businessman on the panel.
Clinton’s next question was about the need to think holistically about education and economics. He asked whether the United Nations, the World Bank and other international institutions should be trying to design a “21st century education and economy system where “you don’t have education over here and economy over there—but you ask them to do it together.”
This wasn’t the way Duke talked about things. Instead, he talked very specifically about Wal-Mart doing “job training” for employees it actually wants to hire. Wal-Mart’s CEO isn’t designing a "21st Century System"—it is training the workers it needs for its stores.
By the way, Duke never answered Clinton’s question about a store in Libya.
- by CNBC senior editor John Carney