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.”
- GE CEO sours on Obama despite green energy subsidies (junkscience.com)
- White House Turns Over 432 Pages of Documents in Solyndra Case (blippitt.com)
Government officials and experts said the new guidelines are in keeping with proposals contained in China’s 12th Five-Year Plan (2011-2015), which seeks to lay the foundations for a more innovative and greener economy. [Photo / China Daily]
Updated: 2011-12-30 09:03 By Ding Qingfen and Lan Lan (China Daily)
Ministry opens more industries to investment from overseas
BEIJING – China will encourage foreign companies to invest more in domestic industries to further make good on the country’s commitment to open its economy, according to guidelines released on Thursday.
In a new version of the Foreign Direct Investment Industry Guidelines (2011), the Chinese government is encouraging foreign investors to put money into advanced manufacturing, the service industry and certain business concerned with energy conservation, advanced technology, renewable sources of energy, new materials and advanced-equipment manufacturing.
Government officials and experts said the new guidelines are in keeping with proposals contained in China’s 12th Five-Year Plan (2011-2015), which seeks to lay the foundation for a more innovative and greener economy.
On Thursday, the Ministry of Commerce and the National Development and Reform Commission (NDRC) issued the guidelines, which will replace a previous version of the rules that was published in 2007. They are expected to come into force on January 30.
Compared with the 2007 version, the new guidelines encourage foreign companies to invest in a greater number of industries and reduce the number of industries that are off limits to such investment.
“The new version indicates China’s strong commitment to opening its market wider,” said Wang Zhile, director of the ministry’s research center for transnational cooperation. “It’s absolutely a positive signal.”
In the new guidelines, the Chinese government will encourage foreign enterprises to invest in new technology and equipment for the textile, chemicals and machinery-manufacturing industries.
The guidelines also call for the encouragement of investment into nine service industries. Among them are those concerned with charging electric vehicles and swapping their batteries, protecting intellectual property rights, cleaning up offshore oil pollution and vocational training.
China will also allow foreign companies to invest in medical institutes and various other industries that were previously off limits to them.
Dirk Moens, secretary general of the European Union Chamber of Commerce in China, said foreign investors are likely to take heed of the government’s investment guidelines.
This “will indeed facilitate decision-making for foreign investors thinking of coming to China”, Moens said.
Kong Linglong, director-general of the National Development and Reform Commission’s department of foreign capital and overseas investment, had similar thoughts.
“Looking at the changes in the new version, we can tell the way in which the Chinese government would like to transform its industrial structure,” Kong said.
“And another message is that China is now placing more value on the quality of foreign investments rather than their scale.”
The government will also prevent foreign companies from building or operating refineries that have the capacity to distill fewer than 200,000 barrels of crude oil a day. That is up from the previous limit of 160,000 barrels a day.
China, meanwhile, has removed industries from the list of those it encourages foreign companies to invest in. No longer part of that group are automakers, large coal-to-chemical operations and manufacturers of polycrystalline silicon.
“The restrictions generally apply to industries that have excessively large capacities and that pollute the environment,” said Zhang Xiaoji, senior researcher at State Council’s development research center.
“But they will probably be a source of their (foreign companies’) complaints about transparency in China’s market for foreign investment. To alleviate their concerns, China should try to provide detailed information about what will be restricted.”
China issued the first version of its guidelines governing foreign direct investment in 1995. They are now amended every four years.
China released a draft version of the new guidelines in early April, seeking the public’s suggestions and comments.
“We have made reasonable changes in response to foreign companies’ opinions,” Kong said. For instance, the draft version said foreign investors could take no more than a 50-percent stake in joint ventures that produce all of the chief components needed in new-energy vehicles, a proposal that led to heated discussions in the auto industry.
The final version changed the stipulation about “all chief components” to one that only concerns “fuel cell batteries”.
Giving a keynote speech in December at a celebration ceremony for the 10th anniversary of China’s entry into the World Trade Organization, President Hu Jintao said China will continuously open its economy to the world. He said that is especially true for industries concerned with advanced manufacturing, strategic emerging industries, services, agriculture and modern culture.
In April, China issued a directive that encouraged more investment in the high-tech, renewable energy and service industries, and for more attention to be paid to the country’s western and central regions. The directive marked a turning point in China’s policies concerning foreign direct investment.
China is now the second-largest destination for such investment in the world and the largest among developing economies. In 2010, the value of foreign direct investment into China hit a record high, increasing to $105.74 billion, a rise of 17.4 percent from the year before. In 2009, it decreased by 2.6 percent.
From January to November, the value of China’s foreign direct investment increased by 13.15 percent from the same period the year before, reaching $103.77 billion.
- Foreign investment in China falls in November (mysanantonio.com)
- Foreign Investment In China Fell For The First Time Since 2009 (businessinsider.com)
- China to channel foreign investment to new sectors (marketwatch.com)
- Fixing Chinese Investment in the U.S. (pekingreview.com)
- Investment in China falls amid world doldrums (seattletimes.nwsource.com)
The XL Pipeline will be essential to securing the future of oil security in the United States. According to the US State Department, the pipeline will deliver 700,000 barrels of oil daily to consumers. This will generate enormous revenue in local communities and create 20,000 American jobs. With the current price of WTI crude hovering at the $100 mark, the pipeline will deliver $70,000,000 worth of oil every single day, helping the United States grow and prosper.
However, the Obama administration has delayed its decision on the pipeline until after the election. According to Bloomberg, this means that the pipeline will not be completed until at least 2015. Had the pipeline been given the green light this November, thousands of valuable construction jobs would have been immediately created and in 2013 the pipeline would have come on stream. But instead this administration prefers to export jobs and US dollars overseas, squandering $70,000,000 per day.