PMC's 2025 Economic Summit: "America First meets American Capitalism"

On Wednesday, December 4, the Portland Metro Chamber hosted the 2025 Economic Summit presented by Ferguson Wellman, an important annual presentation on the economic trends affecting Oregon and the nation.

Business leaders and policymakers convened in the Ritz-Carlton in downtown Portland to hear insights from economic experts on the current state of the economy; evolving dynamics of trade, investment, and regional development; and on the critical role of higher education in shaping competitive and resilient economies.

This year’s keynote speakers were Dr. Karl Scholz, President of the University of Oregon, and Dr. Michael Knetter, Senior Advisor at the Wisconsin Foundation and Alumni Association. Drs. Scholz and Knetter provided an overview of our nation’s recent economic trends, reviewed current drivers of economic behavior and performance, offered thoughts on the America First policy implemented by the current administration, and opined on near and long-term outlooks for the United States’ economic future. Highlights of the presentation are included below.

Following the address, the audience heard discussion from a panel of local business leaders composed of Kimberly Branam, Chief Trade and Economic Development Officer at the Port of Portland, Megan Conway, President and CEO of Travel Portland, and Katherine Lam, President and CEO of Bambuza Hospitality Group. Panelists discussed trade trends shaping Portland’s economy, how Portland’s trade infrastructure can better support local entrepreneurs, and how Portland is working to balance tourism with economic growth.

Keynote Presentation:

"American Capitalism Meets America First" - View the slides from the Economic Summit's keynote presentation, courtesy of economists Michael Knetter, PhD and Karl Scholz, PhD.

Key Takeaways

Current national economic conditions

Unemployment in the U.S. is low but rising, and employment growth is slowing (due to AI implementation and a decline in immigration into the country).
Inflation is elevated but stable around 3%.
Equity markets and household net worth are at or near all-time highs. However, the gains are increasingly concentrated.
The dollar has weakened over the past year, but not alarmingly.
Consumer confidence may be waning and stagflation is possible.

What sets the U.S. economy apart?

The United States economy is the most dynamic economy on earth—AI is the latest manifestation of our dynamism—and innovation makes the U.S. exceptional.
The conditions for exceptionalism are broad and deep capital markets, a stable dollar, the rule of law, competition, entrepreneurial culture, management talent, and dominance in higher education.
Government policies created the conditions for innovation, but the private sector guided resource allocation to the best opportunities.

AI dominance

An AI and tech boom is powering the real economy and asset markets through the heightened uncertainty.
“The Blob,” a group of 41 AI-related (direct, utilities, capital) companies have accounted for a huge amount of measured economic growth

America First: policy shifts, motivations, and uncertainty

The increased use of executive authorities by the Trump Administration has resulted in myriad policy shifts and heightened policy uncertainty that is adding tremendous complexity to the operating environment of businesses.
America First policies are likely best viewed as meeting non-economic goals: maximizing control, power, and wealth by the administration; national security in the face of U.S.-China rivalry; and re-election.
In the long term, America First policies will erode the foundations of American Capitalism.
In the short term, the America First policy changes have mixed impacts on macro performance.

Trade policy

Engaging in trade spats with traditional allies is unwise. The U.S. needs low-wage trade partners so we can concentrate effort on the highest value-added sectors. We cannot go it alone—China has $1B more people than the U.S., so they can be more self-sufficient.
Trade deficits are a red herring. They are a natural phenomenon arising from market forces in a wealthy country with great investment opportunities, high demand for consumption, the world’s reserve currency, and large fiscal details.
Net foreign investment has helped bid our asset prices and eliminating trade deficits will, by definition, eliminate net foreign investment.

Higher education's role in economic development and tech leadership

American higher education has a world leadership position rivaled only by our leadership in technology.
American higher education attracts the best and brightest from around the world.
The founders of the largest companies often come out of our top universities. Many of these leaders are immigrants or first-generation students.
The synergies between research universities and tech are evident in tech company locations.
We need to preserve our leadership in the foundations of the knowledge economy. This is critical to our future economic success.

Long and short-term economic concerns

Short-term:

Several imbalances (dependence on AI theme; impact of AI deployment on labor market; inequality in income, wealth, and opportunity fueling populism and nationalism; growing fiscal imbalance) could disrupt status quo.
The imbalance in attribution is also concerning.

Long-term:

America First policy has increased the role of the executive branch in the economy.
The America First agenda is a massive break with past policy that has supported the foundations of innovation and American capitalism.
Major shifts in policy aimed at national security concerns will increase stagflation risk.
The long-term outlook is worse if the foundations of dynamism (trade, competition, and human capital development and attraction) are under attack.