I listened with great interest to Fareed Zakaria’s interview with Jeffery Immelt on CNN’s GPS program this past Sunday. With the growing list of crony capitalism scandals surrounding the White House in recent days, perhaps the time has come to add GE and it’s CEO Mr. Immelt to the list. With his answer to Mr. Zakaria’s first question, President Obama’s job czar so much as admitted to being a crony capitalist.
ZAKARIA: When President Obama asked you to head up his jobs council, what did you come in hoping to achieve? What’s the – the one thing you thought you’d be able to get done?
JEFFREY IMMELT, CHAIRMAN AND CEO, GE: I took it just as a pure play, and the one thing I hoped to get done is to create more jobs. You know, in other words, Fareed, I – I’ve tried to stay focused on this in a very tactical way and, really, I – I think, building the amount of confidence that’s required to actually improve job creation in the United States.
Did Mr. Immelt mean that it was a pure play for General Electric? Given the fact that, according to Open Secrets.org, GE and it’s employees donated almost a half-million dollars to Barak Obama’s 2008 Presidential campaign, it would seem that he did. In addition to the campaign dollars, there are many more reasons to question the appointment of Mr. Immelt to the President’s Jobs Council.
In early December of 2008, according to an article in the Erie Times, GE inked an agreement to build high speed rail with China’s CSR Corp. and China’s Ministry of Railways. This partnership was in the works long before the President’s “WTF Sputnik moment” State of the Union address early this year. In his address, the President proclaimed high-speed rail to be the saviour of our struggling economy and pledged 53 billion taxpayer dollars to the cause.
Mr. Obama also proclaimed green energy to be a priority and worth the expenditure of billions in taxpayer dollars to the detriment of the oil and gas business. The oil, gas and coal industries have faced an impossible labyrinth of regulatory hurdles since the President assumed office. GE is a major manufacturer of wind turbines.
Another core business of GE is jet aircraft engines. GE is in competition with Rolls Royce for the engine of Boeing’s new 787 Dreamliner. The Rolls Royce engine is ready to go, but GE’s is not quite ready. Is Boeing’s trouble with the NLRB concerning expanding it’s South Carolina Dreamliner parts plant related? We won’t hear about any of these issues on NBC, as GE still owns 49% of that broadcasting business. Is it any wonder MSNBC employs such Obama supporters as Al Sharpton, Chris Matthews and Rachel Maddow?
GE also received more than $36 million in early retiree grant money as part of Obamacare.
The truly sad part of this equation is that Mr. Immelt knows what it will take to put our unemployed back to work.
ZAKARIA: Taking this position, have you learned something about the difficulties, the opportunities of job creation that’s different from what – from just running GE?
IMMELT: You know, one of the things that this made me do is reach out more and try to see it through the eyes of small business. And when you really try to put yourself in their perspective, they have all the problems GE has, only on steroids. So, in many ways, you know, one of the roads out of this is there’s got to be some simplification of regulations in the United States.
The fact is, is that GE and IBM and J.P. Morgan, we’re big enough companies that we can muscle through regulatory, you know, pressure. We can comply, we can do the things we need to do. If you’re a $50 million business, it’s just so much harder.
So I – I become much more aware of the challenges that basic, fundamental small businesses have in the United States. It’s given me a much better appreciation of what they go through.
In other words, companies that are too small to make large contributions to the Obama coffers and land a job in the White House are pretty much out of luck. I commend Mr. Immelt for speaking honestly.
It is clear that the CEO of GE was walking a fine line between what he really thinks and what he thinks the Administration wants him to say. Of the President, he said “He’s a good listener. He’s tough-minded. You know, I tell my colleagues in the business community, it’s not like your first shot on goal is going to get through his pads, right?” Which is another way of saying Mr. Obama does not take advice with which he does not agree.
On job creation, Mr. Immelt says we need a stable and predictable tax environment with lower corporate rates and closed loopholes to be competitive with other countries, smaller government, reduced debt and deficit, a trained workforce, a friendlier regulatory environment, and more certainty on health care costs and regulations.
All of these seem to be in direct opposition to what the President advocates for the rest of the country. At odds at least for those companies that did not support his campaign or hire non-union workers, but for GE and the companies that did support his campaign, the environment seems to be just fine.