CEOs: Obama is bigger threat to success than Europe
Industrial executives crave certainty from Washington and, cynical as it sounds, view the election as a distraction that could prevent the president from interfering with business.
Can this economy turn without help from Washington, D.C.? Can it turn even with Washington hurting it? Those are the two questions I am asking industrial CEOs, and the answers are a little surprising.
First, many of the industrial CEOs I deal with actually see a turn happening in this country's economy. They see it in nonresidential construction, which can be a real driver of the GDP growth. They see it in autos, where a 13 million auto build, once dreamed of, is now a reality. They see it in larger orders for trucks and generators and construction equipment.
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But if offered a chance for help from Washington, D.C., almost every one of these manufacturing CEOs I speak to -- and I know I speak to a lot more of them than the president does -- scoffs and says that help from Washington is inconceivable. Just out of the question. And not just because there is a limited amount of money for projects.
There is no help from Washington because the CEOs behind this turn believe the president is ideologically committed to hurting them, either because their businesses involve some level of pollution -- or a build-out of a fossil fuel system in some way or another -- or because labor is not going to do as well as capital in their successes. There is a "plague on your house" attitude from the White House rather than any encouragement, unless they are all green or the workers own more of the means of production, which, alas, isn't really a true capitalist doctrine.
One thing that has changed, though, is that many of the CEOs I talk to have gone from reticence and defensiveness to "try and stop me, Mr. President, I am going to make money for shareholders here."
It's funny, as much as we on Wall Street fret every day about Europe, mostly about the imminent collapse of Italy, these execs, and I ask them all, are far more worried about the president and the Democrats and the obstacles they place on success.
They think there is a deep-down anti-success bias. They think the president is so anti-profit that he, not Europe, is the biggest hindrance to their successes. They feel they can work around Europe, but they know, in their hearts, that the president does not want them to succeed.
Let me say this: I used to find this analysis hard to believe. I just can't believe the White House would be so committed to the failure, not the promotion, of business unless it is green or owned by labor. I still have trouble with it, because I have to believe that you need some business people on your side to win re-election.
But the CEOs I talk to pretty much figured out a couple of years ago that they are the enemy. That somehow they are Wall Street, even as they only make a pilgrimage to Wall Street once or twice a year and don't need the bankers for their biddings. Their balance sheets are way too strong to need that help.
They believe that the president does not think their successes translate into anything good for the country. In fact, they think the more successful the shareholders are, the more the president feels the country is ripped off by them because the president seems not to understand that so many people in this country own stock in one way or another and need the stock market to do well.
They think stocks are also a dirty word with him because poorer people don't own stocks and he is their representative, not the shareholders' representative. They think the president believes only Republicans own stocks, so who cares about them.
When I press them on this, asking them what makes the president so anti-business, they laugh. They say the president's agenda isn't per se, out-loud, anti-business, it's just anti-wealth and pro-labor and, most of all, pro-green. There's no room for anything else on the agenda.
They see his agenda as making sure that the country's businesses pollute less and that the unions get a lot of money so that they will give back to the campaign and have him win again. Beyond that, they don't see anything at all.
I kid you not. That's what they say!
That said, they think they can do well without the president's help. They just want him distracted, working on his reelection, not focusing on what they want to accomplish. They want him unfocused on business because almost every one of them I speak to thinks he couldn't help even if he tried and he won't anyway.
They want him out on the trail going to small businesses and solar factories and wind farms and geothermal sites and biomass facilities. They want him spending time at schools and with first responders and the military, because it doesn't hurt them or stop them from doing business. They want him shaking hands and kissing babies and not doing much else.
And they think they do well because there is enough confusion and worry about his re-election that the president may not have time to get in their way. They think he might be too busy raising money and meeting with Democrats on the Hill to be sure the Republicans don't get anywhere. They like an election year. If it buys the economy some tax cuts and some extended employment benefits, all the better. Maybe even a highway bill. Some limited Chinese bashing.
They are not being cynical. They are accepting of the whole second-ratedness of it all. The second-ratedness of politics. They don't even talk about taxes. Most of them just want stability in taxes, even at a higher level. They just want certainty from Washington, meaning the certainty that nothing can or will be accomplished. The uncertainty that something can be accomplished that will be negative for business is always a threat to them.
Fortunately, the business people also think the Republicans are hard at work frustrating the president and the Democrats, so the combination of the election and the stalemate produces a decent environment to start growing again. It's not like they have anything good to say about the Republicans either. They can't believe that the only thing they seem to be focused on is lower taxes. Almost all of the execs I speak to aren't being driven by the tax code. They are simply trying to build and sell better products than the other guy, particularly the other guy from overseas.
I know, it is totally backward. I have asked about this time and again, over and over. I keep getting the same dynamic. I have known many of these CEOs for many years, since before they were CEOs. I know some of them because of my contacts in the Democratic party, from when I was a substantial giver. They know my politics. I know theirs. Most aren't even political even, as they fear that somehow they are viewed as John Birch Society members by some and crypto-fascists by others, particularly the more mean-spirited Occupy Wall Street protesters.
They just want to do their jobs and make money for shareholders. If there is enough demand, they will hire more. If there isn't, they won't.
I figured I should just share this with you and see if you find it as "out there" as I did, until I have heard it so many times that it has become gospel.
Anyway, it should make you feel better about one thing: The election is getting closer, not further away, and win, lose or draw, as long as the White House isn't focused, CEOs think the expansion can continue.
What a world.
Guess what, they are the enemy. They sit on $2.8 trillion in profits and are hiring, overseas! The driver of capitalism is keeping labor expenses down, even with "white collar" jobs. They have cut US workforces to the bone along with our health care benefits. These CEO's had 8 years with the most business friendly President in modern times and what did they do? Moved millions of jobs to China, India and Mexico. Oh and they helped put our country in the worst financial crisis since the Great Depression. The 2004 Repatriation Act proved giving companies breaks on their taxes doesn't work. By the way, they have been taxed less under President Obama than under both Bush's and even, dare I say it, Reagan--14.3% of the GDP vs. 18% on average. Your talk about "true capitalist doctrine"; how about our great capitalist system being dependent on the greatest communist system for our goods?
ceo's making 460 times the average worker's salary
there is no man on the planet worth that kind of money
companies hire when they do more business
companies do more business when cutomers have jobs
giving all the money to wall street means good news for the yacht business
Maybe some folks are looking at the difference between US CEO pay 230 times an hourly worker vs 50 times hour worker rates in most other foriegn countries, maybe some folks are looking at what Companies have been doing for the last 15 years moving offshore Whirlpool being the most recent example, maybe some folks think that the country that founded capitalism deserves some loyalty from the very companies that built large successful companies here------as far as stimulating the economy ie business ie demand that was one of the first things Obama did but that has become a dirty word with Republicans----if the CEO's of this great country have a case to be made for moving manufacturing facilities off shore and by doing that closing down whole towns that supported those facitilies let them make that case directly to the American people
Someone, feel free to hire anytime you want. But you would have to a complete idiot to do so while Obama and his class warfare socialist, Karl Marx inspired union goons are around...
We are waiting for all you democrats to hire like mad. Don't you long for the days of W and his 5.5% unemployment?
Tim in Virginia, you sound like a good little democrat... Now how many people have you hired? I would bet ZERO, because you sound just as clueless as '57 States'...
Here in lies the problem, democrats, do not want to work, or start business'. Some think they are to stupid or lazy. If that is not the case why, have the demcorats not hired all the out of work people and started so many new business? What say you?
You seem to be totally clueless about business... Maybe you just blindly believe in Hope and Change... After 3 years of the moron in the White House now, don't you long for the days of W and his 5.5% unemployment?
The consensus is probably correct as few see this president doing anything to stimulate this economy. It is as if he wants this country to fail...by not doing anything.. We fall into an abyss with lack of leadership in this country.
Too bad as this country was once the greatest and now it is stagnating. Lots of distractions to keep everyone focused on other things while our government does very little...
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The solid report comes a month after the retailer closed all of its Canadian operations.
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