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Hand grasping at $100 bills
This story in the New York Times shows how just how far corporate America will go to retain power. Ostensibly, it's a basic economic story. In reality, it's big money's big fat thumb on the policy-making scale.
WASHINGTON — With the economy having slowed in recent weeks, business leaders and policy makers are growing concerned that the tax increases and government spending cuts set to take effect at year’s end have already begun to cause companies to hold back on hiring and investments. [...]

A senior Obama administration official, who requested anonymity when recounting private discussions, said that it was unclear whether uncertainty was affecting corporate decisions, but that chief executives talked about the subject. "Every C.E.O. I talk to" mentions it, the official said. "It's a large part of the buzz."

Translated as "Nice economy you got there. It'd be a shame if anything happened to it."

This isn't to downplay the potential harm to the economy if Congress can't get its shit together. The CBO says the combination of factors all coming together could result in a four percent reduction in economic output. But in the meantime, business leaders are pouring money into the campaign coffers of congressional Republicans whose unwillingness to work with the administration on sane policy is the basic cause of uncertainty. All to game the system to make sure that the cuts fall on the people who can least afford it so they can keep their CEO bonuses.

Here's something big business could do to help to lessen some uncertainty: Stop paying your CEOs those obscene bonuses and put some of that money into hiring people. Or give in on paying a few percentage points more in taxes on the money you make over $250,000 and let the tax fight be over. That'd end uncertainty there and then.

But if we really want to talk uncertainty, how about the "looming financial cliff" for the unemployed, knowing that all federal unemployment insurance programs will expire at the end of December? Or all the unemployed who've already run out of benefits? How about Social Security and Medicare recipients and near-retirees, who keep hearing that those programs are going to be scaled back? How about the teachers and firefighters and police, those who still have jobs, whose employment is always on the hook? How about the millions of public workers who've watched their pensions circle down the drain? Or the millions of homeowners in or nearing foreclosure?

You want uncertainty? Talk to any one of those Americans, then get back to us.

Originally posted to Joan McCarter on Fri Jul 13, 2012 at 10:03 AM PDT.

Also republished by The Royal Manticoran Rangers and Daily Kos.

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Comment Preferences

  •  Tip Jar (38+ / 0-)

    "There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning." —Warren Buffett

    by Joan McCarter on Fri Jul 13, 2012 at 10:03:30 AM PDT

  •  This is where stockholder activism comes in (14+ / 0-)

    If stockholders find out that CEO are passing on business opportunities because of their own agenda.

    Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

    by JML9999 on Fri Jul 13, 2012 at 10:07:48 AM PDT

    •  Good point (n/t) (3+ / 0-)
      Recommended by:
      JML9999, jwinIL14, sturunner

      "There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning." —Warren Buffett

      by Joan McCarter on Fri Jul 13, 2012 at 10:11:07 AM PDT

      [ Parent ]

    •  Which is why publicly owned corporations' (10+ / 0-)

      Interlocking boards of directors are doing everything they can to dilute and neuter the influence of their common stockholders.

      Both parties are beholden to their corporate sponsors. The Democratic Party deigns to throw us a few bones from the table on which to gnaw and squabble over, but it's just kabuki.

      by ozsea1 on Fri Jul 13, 2012 at 10:20:09 AM PDT

      [ Parent ]

      •  Worse before Enron and Sarbox (5+ / 0-)
        Recommended by:
        phonegery, ozsea1, xaxnar, a2nite, sturunner

        but still bad

        Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

        by JML9999 on Fri Jul 13, 2012 at 10:34:38 AM PDT

        [ Parent ]

        •  Many investors aren't American (5+ / 0-)

          And won't care too much about politics.

          They just want a higher share price and maybe a dividend.

          If they find out that a CEO is delaying these to elect a guy who puts dogs on car roofs; the foreign investors will get rid of this CEO and find one that makes money now.

          •  Which is why it's important to highlight (5+ / 0-)

            CEO's shooting their mouths off....

            Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

            by JML9999 on Fri Jul 13, 2012 at 10:52:40 AM PDT

            [ Parent ]

          •  They CERTAINLY don't care about the possibility (2+ / 0-)
            Recommended by:
            JML9999, ozsea1

            of someone else becoming unemployed.

            When banjos are outlawed, only outlaws will have banjos.

            by Bisbonian on Fri Jul 13, 2012 at 06:52:25 PM PDT

            [ Parent ]

          •  no they won't. (0+ / 0-)
            If they find out that a CEO is delaying these to elect a guy who puts dogs on car roofs; the foreign investors will get rid of this CEO and find one that makes money now.
            because they don't have the power to do so. most likely, the shares are held by a fund (just as a goodly chunk are held by domestic funds), and those shares don't, by themselves, represent a significant enough % of the total fund investments to warrant making a big deal out of it. if they have a big enough problem with corp. management, they'll just dump the shares.
          •  Unlikely (0+ / 0-)

            When is the last time shareholders took down a CEO for anything other than criminal activity? More likely, if a shareholders are unhappy with how the CEO runs the company, they'll sell their shares.

            But let's be real here"

            CEO's have all the information- and power over employees to manipulate the information. They are like Mafia Don's who surround themselves by people who protect them (i,e their self appointed Board of Directors). Most shareholders have little access to real information of the health and direction of the company. The entire system is designed to protect them and to perpetuate their version of the health of the company. Look at Enron and the banks before the crash. They all had the highest rating, just before they spiraled into bankruptcy. The system is corrupt.

    •  JML - how would they know? (3+ / 0-)
      Recommended by:
      JML9999, Lefty Coaster, wsexson

      All public companies, and particularly the Fortune 1000, make decisions every day regarding opportunities they might pursue or evaluate further or decline. These specific opportunities are never disclosed to public shareholders. A company may make a disclosure about a strategic initiative, but the timing and day to day operational elements are never disclosed. How would stockholders ever know that a board of directors and/or senior management was passing on business opportunities?

      "let's talk about that"

      by VClib on Fri Jul 13, 2012 at 03:59:54 PM PDT

      [ Parent ]

      •  CNBC would be a good place to start. (0+ / 0-)

        From what I've seen  these folks just are compelled to state their worldview.

        Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

        by JML9999 on Fri Jul 13, 2012 at 07:01:42 PM PDT

        [ Parent ]

        •  JML - so what? (2+ / 0-)
          Recommended by:
          JML9999, Dburn

          If I am a Fortune 1000 CEO and I go on CNBC and say that we are worried about the uncertainty, and think that the President's economic policies are hurting the country and therefore we are being cautious, so what? The shareholders aren't going to revolt and really can't even if they wanted to. Some might sell their stock, but most shareholders will give the CEO the benefit of the doubt through the election.  

          "let's talk about that"

          by VClib on Fri Jul 13, 2012 at 07:18:38 PM PDT

          [ Parent ]

          •  From what I've seen of CNBC (0+ / 0-)

            The institutional investor is not  giving the benefit of the doubt in most cases.

             It seems to me the only reason they're giving Jamie Dimon any slack is due to him being the only one seemingly unscathed by the Financial Meltdown. Credit Default Swaps sold by AIG(which nearly imploded)  and a Warren Buffet loan are what saved Goldman Sachs and Morgan saved itself by becoming a commercial bank thus getting Fed access.

            Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

            by JML9999 on Fri Jul 13, 2012 at 07:26:45 PM PDT

            [ Parent ]

            •  JML - it's not financial institutions (1+ / 0-)
              Recommended by:
              JML9999

              that I was writing about but the Fortune 1000, industrial companies who are the organizations we need to start hiring to really turn around the job picture.

              "let's talk about that"

              by VClib on Fri Jul 13, 2012 at 08:05:33 PM PDT

              [ Parent ]

              •  I just used them as example of Institutional (0+ / 0-)

                Investors.   I guess the point being is that CNBC has a limited audience but if places like Dailykos monitor CNBC and shine the light on these folks it would be a step in the right direction. As was seen with OWS folks don't like unwanted attention.

                Not blaming Bush for the mess we're in, is like not blaming a train engineer for a fatal train wreck because he's no longer driving the train.

                by JML9999 on Fri Jul 13, 2012 at 08:12:40 PM PDT

                [ Parent ]

    •  that depends. (0+ / 0-)
      If stockholders find out that CEO are passing on business opportunities because of their own agenda
      ordinarily, i'd say, "why yes, that's a very good point". ordinarily, if i were just some regular joe schmuck, who didn't know any better.

      if it's a publicly held entity (listed on one of the exchanges), the ownership is so widely dispersed, with possibly millions of sh's, that no one of them has enough power to do that. those that have a "controlling" interest (say, 5% of the stock issued and outstanding) are most likely in cahoots with the CEO and management. in fact, as a member of the board of directors, they probably helped draft and approve the approach being taken. the guy that owns 100 sh's, out of millions, has no say in the matter.

      minority sh's face a tough road. conceivably, they could file suit, but that costs money, money they probably don't have. realistically, all sh's are not equal. for the most part, your best option is to dispose of your shares of stock, which won't affect the guys responsible at all.

  •  I have zero doubt that companies are not (6+ / 0-)

    hiring for purely political reasons.  If jobs were being added at even a 100,000 clip than Romney would have no shot.  What's 4 more months of holding off hiring and blaming "uncertainty" when it could mean President Romney giving them all the tax cuts and regulation cuts the could ever imagine.

    •  Jacoby - I agree sort of (0+ / 0-)

      I do think that senior executives are feeling a high degree of uncertainty and anxiety about the economy and demand for their products.  The intense cost controls that were in place in 2008 have not been removed. What I don't know is if this is legitimate, and there is certainly enough negative economic news around the world for that to be the case, or the general distrust of President Obama by corporate America, or an overt political act.  

      "let's talk about that"

      by VClib on Fri Jul 13, 2012 at 04:08:11 PM PDT

      [ Parent ]

    •  I've always believed this (0+ / 0-)

      Adding to payroll and production is almost always a gamble, so it's totally plausible to me that companies are happy at the intersection of generic prudence and stick-it-to-Obama Republicanism.  I don't think most employers would go against clear bottom-line interest to help Republicans build their case, but let's face it: the economy really is pretty weak and fragile, so the decision to add or not is a pretty close one in any event.  Politics helps tip the balance.

      Romney '12: Bully for America!

      by Rich in PA on Fri Jul 13, 2012 at 06:23:38 PM PDT

      [ Parent ]

    •  Me either (0+ / 0-)

      I overheard someone in a restaurant say that a friend in a nearby town wanted to expand their business, but they wouldn't do it until a Republican was in the White House. How frickiin' patriotic.

      “Never, never be afraid to do what's right, especially if the well-being of a person or animal is at stake. Society's punishments are small compared to the wounds we inflict on our soul when we look the other way.” ― Martin Luther King Jr.

      by minglewood on Fri Jul 13, 2012 at 06:55:23 PM PDT

      [ Parent ]

  •  This demonstrates the futility of austerity (1+ / 0-)
    Recommended by:
    annieli

    Business, which from everything we're told is composed of people who have to understand the macroeconomy because their existence depends on that understanding, thinks it's more important to have higher government spending accompanied by higher deficits than lower government spending accompanied by lower deficits.  

    Romney '12: Bully for America!

    by Rich in PA on Fri Jul 13, 2012 at 06:19:29 PM PDT

  •  Corporation; "Nice economy ya got there..." (1+ / 0-)
    Recommended by:
    a2nite

    "It'd be a SHAME if something happened to it..."

    Romney 2012 - Keep your lies consistent. (Ferengi Rule of Acquisition #60)

    by Fordmandalay on Fri Jul 13, 2012 at 06:19:50 PM PDT

  •  Herein lies the problem (4+ / 0-)
    Recommended by:
    shaharazade, xaxnar, Bisbonian, psnyder
    You want uncertainty? Talk to any one of those Americans, then get back to us.
    They're above all that nationalism. Corporate Honchos are citizens of the world. No, not "citizens" - that would imply responsibility.

    Wannabe owners, willing to start as cruel overseers.

    I want a living planet, not just a living room.

    by Anthony Page aka SecondComing on Fri Jul 13, 2012 at 06:23:15 PM PDT

  •  A reminder: It's not just about taxes (2+ / 0-)
    Recommended by:
    minglewood, wsexson

    How about getting those corporations sitting on hordes of cash and big payoffs to management and shareholders to do something different: pay their workers more. They could reduce the pressure to pay more in taxes if instead they shared the wealth with the people who make that wealth possible in the first place.

    We wouldn't be having this fiscal wreck if the Masters of the Universe hadn't spent the last 3 decades ripping off the middle class. If income for ordinary people had grown at the same rate as it had for the .1% in the last 3 decades, median incomes would be three-four times what they are now for the middle class.

    More people with higher incomes means more tax revenue too, spread more fairly. We wouldn't have so many schools, cities and states in such dire trouble if the middle class had more money to pump into their local economy.

    "No special skill, no standard attitude, no technology, and no organization - no matter how valuable - can safely replace thought itself."

    by xaxnar on Fri Jul 13, 2012 at 06:26:56 PM PDT

  •  Prosperity/Sustainability not Austerity/Futility! (2+ / 0-)
    Recommended by:
    xaxnar, foucaultspendulum

    Präsidentenelf-maßschach"Nous sommes un groupuscule" (-9.50; -7.03) "Ensanguining the skies...Falls the remorseful day".政治委员, 政委‽ Warning - some snark above ‽

    by annieli on Fri Jul 13, 2012 at 06:27:26 PM PDT

  •  Interesting timing (1+ / 0-)
    Recommended by:
    ActivistGuy

    The CEO of the Fortune x00 company I work for sent out a company message more or less saying the same thing late this afternoon. And he's supposed to be an Obama guy.

    The 1% wants what the 1% wants (and everything the 99% has)

    Love is the only answer ... Hate is the root of cancer

    by relayerbob on Fri Jul 13, 2012 at 06:31:00 PM PDT

    •  It's the Ownership Society (1+ / 0-)
      Recommended by:
      Dburn

      If a 1%-er owns a chateau in the south of France, and a Park Avenue condo, we know those two homes serve very different purposes at different times for the 1%er.  Same thing when a 1%er owns a Range Rover and a Rolls.  So, if they own two homes and we don't say those two homes are the same, and they own two cares and we wouldn't say the two cars are the same, why is it necessarily saying the two parties are the same when it is pointed out that they are both owned by the same 1%ers?

      The law, in its majestic equality, forbids rich and poor alike from sleeping under bridges. ~ Anatole France

      by ActivistGuy on Fri Jul 13, 2012 at 06:36:22 PM PDT

      [ Parent ]

  •  If Corporations are people (0+ / 0-)

    then they have Freedom of Religion, and worship of Mammon  should be tax-free like any other religion.  It's all part of the One True Faith of Job Creationism.

    The law, in its majestic equality, forbids rich and poor alike from sleeping under bridges. ~ Anatole France

    by ActivistGuy on Fri Jul 13, 2012 at 06:32:01 PM PDT

  •  It's how the "haves" ensure own existence (0+ / 0-)

    because it would get boring for them without "have nots" to look down upon.

    "Four more years!" (Obama Unencumbered - The Sequel)

    by jwinIL14 on Fri Jul 13, 2012 at 06:35:23 PM PDT

  •  Firefighters are now being forced to accept (2+ / 0-)
    Recommended by:
    Bisbonian, minglewood

    minimum wage.

    Less than my teenager is making at an amusement park this summer.

    I think it is probably time to go to the shed and find that pitchfork.

    If the plutocrats begin the program, we will end it. -- Eugene Debs.

    by livjack on Fri Jul 13, 2012 at 06:48:03 PM PDT

  •  I see anarchy on the horizon (0+ / 0-)

    No Jesus, Know Peace

    by plok on Fri Jul 13, 2012 at 07:16:25 PM PDT

  •  Basic Misunderstanding here (0+ / 0-)

    A Crappy economy is good for Global Corporate America up until about now. With the DOJ (Dead Over Justice), their accounting departments have had a field day in the last three years avoiding taxes on the profits they do make and abusing it's workforce to help boost earnings, along with tricks like share buybacks not because they necessarily boost the shares ( See Netflix buying it's own shares at $300 /Share and having to borrow money when they were at $67 a share) but it lowers the shares outstanding which makes lifting EPS ( Earnings per share) easy since no one compares shares outstanding from one period to the next "Oh look They beat expectations again! BUY BUY BUY". The CEOs and their minions take home huge bonuses while everyone else gets fucked.

    That was all well and good but things are getting "harder". You see there aren't that many Americans willing (or able)  to subsidize their overseas business which they have bragged about incessantly. "Sniff, see we don't need the USA, we are doing you a favor".

    The dirty little secret is that they do need the USA. Earning Warnings are way up this Quarter. See, they didn't figure that when they emasculated our work force for short term gains, that it would ever catch up with them. Well it has. The rest of the world's economies are drifting because of their own banks follies but also because their economies were geared towards supplying ours. Maybe they could take a half a hit but not two whole hits of the  Globalist bong.

    So our Corporations are running out of ways to pop earnings. The workforce is as trimmed as it gets. 1 out of every 10 jobs is a real full time hire. The rest are temps or part-time. Investments overseas are  Risk ON as Indian Work force demands are going up by double digits every year. China has the same problem,.

    That cuts into their margins which is a huge element in determining the health, wealth and/or stock price of a company which in turn determines bonuses.

    You see they really are uneasy.

    The salad days are gone and the easy no brainer profit supplements; share buybacks, large scale lay-offs, outsourcing,  technology initiatives to increase productivity but not pay, temps, benefit cut-backs, worker clock abuse, in-your-face age discrimination on both sides ; old and young, are no longer pumping the profits anymore because their overseas sales are slowing and the middle-class here has been decimated.  They have to borrow money to pay dividends because they leave their cash overseas to avoid taxes. With the economy going down, issuing bonds with a 1-2% interest rate is not going to be possible.  

    They are fresh out of tricks. The notion of investing in their businesses is just an idea that has had it's time. They would rather invest where the pay-off will be felt in oh, three months. Not three years. That's just too long.

    Damn right they are uneasy and damn right they are going to blame Washington because , after-all, how many times can you fire your ad agency, consulting firms, CFOs and Audit firms without looking like a bunch of douche-muffins themselves. The shit has just caught up with them. They need their old tricks to work dammit or new ones. More abuses. Lower wages. No Taxes anywhere. Anything but growing their business organically,  through internal investment and paying a days pay for a day's work.

    "That may have worked 30+ year ago, but obviously we can all see with these earnings warnings there's no room for that now. Hey, what you got over thar'. Not that we , heh heh, want to make George Carlin look like he knew what he's talking about but , why don't the govt get the cut over with and pay us the 2.6 Trillion y'all owe the Social Security fund. We don't need it all at once, but lets just call it our slush fund to better manage earnings. Ya hear?  

    Oh yeah, small businesses? Heh, they can just go fuck themselves.

    •  They are not going to hold off on hiring (1+ / 0-)
      Recommended by:
      wsexson

      even for one minute if demand is there. The fact is they are all out of tricks. They would never take the chance of missing sales to maybe get a Romney in the White house. Ever. Even if you hear it, never take it at face value.

      Sales are weak, so who they gonna blame it on? Themselves? Hell no. The idea they would slow down hiring when there was demand just to try to get "their guy" in there isn't even possible. Not a frickin chance. Not now, not ever. They don't think it more than 3 month increments and there is no doubt this quarter is gonna suck the big one.

      So when you hear they aren't doing anything until a Republican is in the White House; Read between the lines. Sales Suck. All of their tricks have played out. You can fake a lot of shit, but not too many will fake top line sales. They tried that in 2000 and the CEOs are still in Prison who did that.

  •  this is always such a ginormous crock! (1+ / 0-)
    Recommended by:
    countwebb

    every time one of these bought-and-paid-for business "reporters" claims that "uncertainty" will cause businesses to re-think their plans to hire, i just really want to reach through the screen of my tv, and shove my fist down their throats.

    the fact is, life is uncertainty, unless you have a crystal ball. you go with what you know, and adapt as the situation changes. that's pretty much how it's always worked. to claim that, somehow, there was certainty before is a flat-out lie. businesses hire based on demand, period. not based on taxes, not based on who's going to be president. of course, everyone who has a clue knows this, but, when it suits their interests, they pretend otherwise.

    i would like, just once, for a krugman or stiglitz to come right out and say, in public, "these guys are full of shit, they will hire as they need new employee's, just as they always have".

  •  It has already been said so many times... (0+ / 0-)

    We have been pampering the "job creators."  Why aren't they creating any jobs?  

    A 3% rise in the personal Income Tax is not the kind of uncertainty that spooks investors.  War is.

    If "regulation and uncertainty" stopped entrepreneurs, we would still be living in caves.

    Early to rise and early to bed Makes a man healthy, wealthy, and dead. --Not Benjamin Franklin

    by Boundegar on Sat Jul 14, 2012 at 02:12:29 AM PDT

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