Advertisement
Politics

Should Obama Make Nice to Business?

An accommodation is key to getting the economy moving again.

From now until Nov. 2, President Obama will walk a tightrope, trying to please his business-bashing base without going so far that he makes an eventual rapprochement impossible. That’s hardly surprising ahead of a crucial election, but what happens afterward?

Here’s hoping Obama offers an olive branch to the business community and follows it up with meaningful action. For starters he should appoint a highly respected CEO to replace National Economic Council Director Larry Summers, who’s leaving at the end of the year. Summers’ replacement will be part of the inner circle, with daily access to the president. Any of the business execs being mentioned -- former Xerox CEO Anne Mulcahy, Honeywell CEO David Cote, Google CEO Eric Schmidt -- would be a good choice, and there are lots of other strong possibilities.

Advertisement - Article continues below

Business desperately needs a “go-to” person close to Obama, someone who understands the needs of companies and shares their perspective. It won’t ease all the tensions or solve all the problems -- far from it -- but it’s an important first step. Atmospherics do matter. And if the business advocate chosen is effective, it could have a real impact on policy.

There’s no shortage of things that Obama might do for business. He can stop with the bashing, for one. He can work to overhaul the messed-up corporate tax structure that makes international competition harder. And he can put some muscle behind his talk of free trade.

Advertisement
Advertisement - Article continues below

That’s not to accept all of businesses’ complaints about Obama or blame him entirely for the bad feelings. Obama will never give business the kind of preferred status it had under George W. Bush, but that didn’t work out so well for the economy, either. And the fact is, business hasn’t done that badly under Obama. The economic recovery may be hit and miss, but business has gotten most of the hits. Company profits are up 28% since Obama took office, and share prices have climbed even more. And business seems to forget that Obama has actually provided a number of business tax breaks.

Advertisement - Article continues below

Administration officials have their own gripes. They accuse business of backing the stimulus and the bailouts, including for the auto industry, and then running for the hills when those policies became controversial.

They have a hard time, too, accepting gripes over the Wall Street regulatory bill. Did anyone really think the government would or could do nothing after the 2008 crisis? And if the legislation left too many details to be filled in by regulators, that’s in large part because Obama blocked Democrats in Congress from writing tough provisions into the law.

But name-calling doesn’t get the country where it needs to be. As a result of the higher profits, businesses are sitting on $2 trillion in cash, ready to invest at a moment’s notice. But the catch-22 of this recovery is that businesses won’t hire until consumers start buying their products, and consumers won’t spend until businesses start hiring. The key is confidence, and the tense relationship between the White House and the business community undercuts confidence.

Advertisement - Article continues below
Advertisement
Advertisement - Article continues below

The ball is in Obama’s court. He has to go first. That means listening to business executives and showing a willingness to meet them partway. Many of his initiatives -- education reform comes to mind -- can be starting points for building a more trusting relationship.

But the business community has to work with Obama, too. It can’t expect a return to the Bush era -- Democrats are never going to desert organized labor, for example -- and it can’t count on a Republican-controlled House doing it much good. In fact, that will just bring more complications. Gridlock is usually good for business, but not this time. With a vast number of regulations coming to fill in the blanks of the health and financial laws -- to say nothing of climate change and workplace safety -- gridlock will only increase the uncertainty about what will happen next. And as everyone knows, business hates uncertainty.

Both sides have to be willing to compromise, and while that’s impossible with many other disputes, it’s not the case here. Businessmen and businesswomen have a reputation for being practical and achieving results, and Obama needs results just as much. And in this case, both sides have the same goal -- a vibrant and growing economy.

Advertisement
Advertisement

Most Popular

What Trump's Payroll Tax Cut Will Mean for You
Tax Breaks

What Trump's Payroll Tax Cut Will Mean for You

President Trump issued an executive order to suspend the collection of Social Security payroll taxes. How much could it save you?
August 13, 2020
8 Things You Must Know About Retiring to the Carolinas
retirement

8 Things You Must Know About Retiring to the Carolinas

From the mountains to the beaches, North Carolina and South Carolina offer retirees plenty of incentives.
August 14, 2020
7 Surprisingly Valuable Assets for a Happy Retirement
happy retirement

7 Surprisingly Valuable Assets for a Happy Retirement

If you want a long and fulfilling retirement, you need more than money. Here are the most valuable retirement assets to have (besides money), and how …
August 3, 2020

Recommended

Vote by Mail: A State-by-State Guide to Absentee Ballot Voting
Politics

Vote by Mail: A State-by-State Guide to Absentee Ballot Voting

With health authorities recommending people continue to social distance, the idea of voting by mail is becoming an increasingly hot topic.
August 4, 2020
Election 2020: Joe Biden's Tax Plans
taxes

Election 2020: Joe Biden's Tax Plans

With the economy in trouble, tax policy takes on added importance in the 2020 presidential election. So, let's take a look at what Joe Biden has said …
July 22, 2020
Answers to PPP Loan FAQs (Now That There's Fresh Funding for the Loans)
small business loans

Answers to PPP Loan FAQs (Now That There's Fresh Funding for the Loans)

Small business owners are getting another crack at Paycheck Protection Program loans. Here are answers to some frequently asked questions about the lo…
July 21, 2020
Travel Planning in the Time of Coronavirus
Travel

Travel Planning in the Time of Coronavirus

Insurance may not cover canceled vacations, but airlines and hotels may be flexible.
June 11, 2020