Business in America

[jabber1]

Business in America

A fresh start with President Obama?

Nov 15th 2012, 11:33 by M.B. | NEW YORK

http://www.economist.com/node/21566705


Having failed to get one of its own into the White House, corporate America is not sulking in a corner nursing its broken Romneyphile heart. Instead, some of the country’s best known bosses have been flashing their legs in the direction of Barack Obama, promising to make it worth the president’s while if they start over. Mr Obama is smiling right back, at least for now. On November 14th he sat down with a dozen chief executives and listened to their concerns. They spoke about the sour relationship between the White House and business, and about their frustration at Washington’s refusal to tackle the nation’s fiscal problems. “I came away feeling very encouraged,” said one of the bosses, Dave Cote of Honeywell, a prominent budget hawk, though he added that he was “not confusing words with results”.

Other business chiefs are joining the cooing. “Relations between the Obama administration and large segments of the business community have been strained and unproductive,” wrote Lloyd Blankfein, the boss of Goldman Sachs, in a billet-doux in the Wall Street Journal on November 14th. “But the election offers an important opportunity to forge a more productive relationship.” After all, he pointed out with an implicit wink, there is currently “more than a trillion dollars sitting on the balance sheets of non-financial companies”. You make nice, we make nice back.

When these business titans talk about bipartisanship, they don’t mean simply that Mr Obama should capitulate to the Republican majority in the House of Representatives. Their top priority is a deal between the two parties to prevent the American economy from plunging over the “fiscal cliff” into recession. Mr Blankfein called for “shared sacrifice” and even argued that rich people such as he should pay higher taxes (something the Republicans currently refuse to contemplate): “I believe that tax increases, especially for the wealthiest, are appropriate, but only if they are joined by serious cuts in discretionary spending and entitlements.”

American bosses want prompt evidence of bipartisanship. Ideally, that would mean a deal by the end of the year between Mr Obama and the retiring “lame duck” Congress. Businesses would view that as a clue as to whether the next four years will be a period of market-friendly policies. They would like to see a long-term reform of America’s public finances, perhaps along the lines sketched out by the Bowles-Simpson commission on reducing the deficit. They would also like to see a more laissez-faire immigration policy and the adoption of a sensible (ie, pro-fracking) national energy policy. Appointing Erskine Bowles as Treasury secretary would be a good start, businessfolk reckon. (Mr Bowles is a former chief of staff to Bill Clinton and a stout advocate of budgets that add up.)

A deal on the fiscal cliff could see the American economy grow “more than anyone expects” next year, suggests Joseph Tucci, the boss of EMC, who lately has become a frequent visitor to Washington. Failure to do a deal could spell recession, he warns. It could become clear within a few days whether a more bipartisan spirit is taking hold in the capital, said Steve Case, the founder of AOL, at the Techonomy conference on November 12th. He urged other tech bosses to move beyond their usual narrow lobbying (on intellectual-property policy, for instance). He proposed that they campaign for broader policies that help the economy. Mr Case helped steer through one of the few bipartisan pro-business reforms in the past couple of years, the JOBS act, which eases securities regulations in order to boost lending to small companies.

Mr Blankfein promised that businesspeople would “roll up our sleeves and work with the Obama administration and Congress to help fulfil America’s enduring promise”. But clearly, that depends on what Mr Obama and the House Republicans do next. If the current uncertainty on economic policies continues, it may not be long before corporate America’s affections turn to more attractive opportunities in other countries. As Mr Cote puts it, “Capital is a coward. You don’t go to places that are excessively risky.”

[roger7]

"Capital is a coward. You don't go to places that are excessively risky." Guess that is why the dollar keeps rising. R7

[jabber1]

I liked that capital is a coward comment.

Soooooooooooooo in todays economy, we have lots of the capital flows going to individuals and corps that whine all of the time about the costs that go with a relatively secure US that has great infrastructure and a great workforce. As current disturbing trends continue their capital (and mine) will be less and less secure. The above seems self evident to me but not to many that have a much larger financial stake in this outcome than me.

[drdiederich]

I started reading the article and had a major sense of deja veu... then I realized it was from The Economist and I knew why. They are always a great source, it is my favorite magazine. The next few months will really be interesting as we see what the government does (or doesn't do) about the budget.

[Faust100F]

Jabber - I think Barry is the best thing that ever happened to the banksters on Wall Street. He has always been their inside man. None of them have been indicted for the crimes they perpetrated in the Mortgage Fraud that bankrupted this country.

All that has happened is they paid a few billion dollars in fines, so they can continue to destroy this country. Barry will go down in history as the "great enabler" who allowed the flame of the rule of law that once existed upon which citizens relied to conduct business, to be extinguished, by these criminals.

This guy has done more for Wall Street then he ever did for those who got hosed in this deal. They got out completely unscathed, and transferred their losses to the backs of the sheeple they exploited.

They will gladly let the Health Care go into law, because the burden will be born by the "Sheeple" not by business. Just think how much more they can add to their bottom line when government clinics provide the care and they no longer have to provide such a benefit to their employees. Adios Amigo. Happy Thanksgiving. John