Published November 25, 2011
When it comes to the business community, the White House may feel like an abused partner in a bad marriage. President Obama likely believes that he keeps giving business what it wants yet gets nothing but complaints and unemployed Americans in return.
His gift giving began with the stimulus package, full of goodies for the preferred businesses. It continued with the auto bailout, payroll tax holidays, accelerated depreciation, “cash for clunkers,” first-time homebuyers credit, and even the extension of the Bush tax cuts.
In fact, Obama even created an Economic Advisory Recovery Board chaired by GE’s Jeff Immelt whose purpose is to report to the White House on ways to improve the economy. The board was created in 2009, nearly three years ago.
The president speaks passionately about entrepreneurs and innovation all the time. He continually addresses the need for economic-friendly policies, like more spectrum for wireless broadband. On the surface, the relationship between major business leaders and the White House seems quite cozy and comfortable.
Yet, the economy continues to stagnate and unemployment remains above nine percent. Adding salt to the wound, business owners and executives, including many former Obama supporters, seem likely to support the Republican candidate next November.
Indeed, more and more business leaders are speaking out against the president. The dam broke in mid-2010 when then-Business Roundtable Chairman and Verizon CEO Ivan Seidenberg said that the Obama administration was creating “an increasingly hostile environment for investment and job creation.”
Earlier this year, Steve Wynn, the billionaire head of Wynn Resorts and a Democrat, said that “the business community in this country is frightened to death of the weird political philosophy of the President of the United States.”
Now public criticism is common. Just this month a poll in Chief Executive magazine concluded that 85 percent of CEOs rank Obama’s performance as “weak” or “poor,” with one CEO saying, “The current administration is so anti-business, we don’t plan on any expansion until we have a new president. We just hope we’ll be around to see that day.”
Why the disconnect?
Business is not just big companies. Smaller companies dominate America. Entrepreneurs create almost all the new jobs. As I recount in my book, “The Comeback: How Innovation Will Restore the American Dream,” a 2010 Kauffman Foundation study found that “without startups, there would be no net job growth in the U.S. economy.”
Yet small businesses have gotten little access or attention in this White House. The White House appears oblivious to the psychological impact of GE heading the committee that advises the president on how to create jobs. GE is so big and reliant on government contracts that its problems and challenges are not shared by most American businesses.
Moreover, the federal government is hurting business and job creation as it increases the regulatory burden.
Making a payroll means dealing with new taxes, health care mandates and the cost of new regulations. To compensate for the added burden, businesses must hire scores of accountants and lawyers to decipher and follow all the new rules. Washington has shifted from occasionally helpful to downright destructive of business interests.
Anti-business actions, proposals and rhetoric make it worse. Frequent talk of “spreading the wealth around,” “corporate greed” and new tax proposals all discourage investment and job creation.
Closing Boeing’s new South Carolina factory, raiding Gibson Guitars for violating an ambiguous law in another country, and changing unionization rules to allow sudden union formation all force companies to invest and hire overseas. Encouraging hostility to business by embracing the Occupy Wall Street protesters only makes matters worse.
Results must match rhetoric. President Obama excited the business community when he promised to double exports in five years. Yet it took almost three years to simply get three Bush-era trade deals signed and no other deals have been made to promote exports and trade.
Nothing has been done on repatriation of corporate profits, lowering our absurdly high corporate taxes or shifting our educational system to train Americans for the 3.4 million jobs that are open. While college-educated, liberal arts majors protest in American cities, jobs for engineers, technicians and skilled machine operators go unfilled.
President Obama and his advisors have scant business, managerial or leadership experience. The president has relied on personality and oratory and the Democrats in Congress to lead. He created a Deficit Reduction Commission and ignored its bipartisan recommendations, which led directly to a Congressional stalemate over our debt ceiling. Obama also blew off Rep. Paul Ryan’s good faith effort to address skyrocketing Medicare costs and tried to make it an election issue.
It might be a big mystery to the president and his advisers why business spurns their advances. But it isn’t a mystery to anyone in business. Businesses are not hiring and this anti-business government is at least partially responsible.
Gary Shapiro is president and CEO of the Consumer Electronics Association (CEA), the U.S. trade association representing more than 2,000 consumer electronics companies, and author of the New York Times bestselling book, “The Comeback: How Innovation Will Restore the American Dream.”