I was puzzled by an appearance in a roundtable on Meet the Press on July 17th(transcript)by David Cote, CEO of Honeywell International. Mostly he kind of sat there like a dead fish, but there were two interesting exchanges that got me thinking about this whole mythology behind job creation and how very un-self-aware these guys actually are.
The first exchange was in response to a WSJ article from July 15th that said the following:
"When the Great Recession wiped out $7.8 trillion of home values," this is a former Labor secretary, "it crushed the nest eggs and eliminated the collateral of America 's middle class . As a result, consumer spending has been decimated. ... "We're in a vicious cycle in which job and wage losses further reduce Americans ' willingness to spend, which further slows the economy . Job growth has effectively stopped. The fraction of
the population now working is near a 25-year low lower than it was when the recession officially ended in June of 2009 ."
Here was Cote's response:
Well, right now the problem that we've got is uncertainty of demand. Businesses don't add until they're sure that there's -- somebody's going to want to actually buy something. To that I would add, we've added uncertainty of regulation. And when you combine those two, it just causes businesses to say, "I'm going to wait a little bit." And I always find it interesting when I hear government say..."We need to create jobs." And I say no, actually, government doesn't create jobs. Government can create an environment where jobs can be created. And I think it's important to distinguish between those two.
This caught my attention. I thought, so this supposed "job creator" is telling us that until we start spending money again, we are SOL on these large corporations creating jobs. Beyond that, it's (of course!) the government's fault for "uncertainty of regulation", which to me translates to, "you better loosen up on us, or no jobs for you".
The tone to me was even a trifle accusatory, that we consumers were really slacking off on the job, the job being buying crap. That's our most important role in the economy these days, buying crap.
Of course, no one challenged him on that, no one said, "Hey, then why are we referring to you guys as 'job creators' if you will only create jobs under favorable circumstances? That's not job creation, that's job hostage negotiations.
That's what we should be calling them, "job hostage negotioators".
Or, as Joshua Holland of AlterNet referred to them on July 19th, "Job Killers" Completely the opposite of what the Conservatives and media have been saying over and over, until people automatically say it to themselves, "Why, wealthy people are job creators! Where would we be without them?"
And isn't it interesting that he points out something from the very same article in the WSJ that was being discussed by our friends on Meet the Press. In says,
“the main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists” the paper surveyed. That jibes with what business owners themselves are saying. Last week, the National Federation of Independent Businesses released a survey of small businessmen and women that found widespread “pessimism about future business conditions and expected real sales gains.”
So essentially, Cote just threw the article that Gregory "confronted" him with right back in his face. I'm sure that Gregory knew that, as I assume he read the article, but it really hit home to me that this is just a giant circular logic loop that is being fed to us, when in fact none of it makes sense.
Holland's premise is pretty simple, that the wealthiest Americans aren't creating jobs because they're too busy sucking up all the national income and leaving nothing for the rest of us to spend. If we don't spend in this consumer-driven economy that we've all created, then the wealthy say, "Oh, the climate is too unstable and scary for us to create jobs, we'll just hold onto this wealth and see what happens."
And so here we are. I'm in a fairly stable financial situation right now, but even I don't spend, because I am scared for what might happen in the future.
The difference between me and David Cote is that a downturn in my future could lead to homelessness, hunger and untreated illnesses, whereas his downturn might lead to cancelling his country club membership and gasp taking his kids out of private school.