POLITICS

Immelt, Daley, and Obama's antipathy to free markets

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Since his party's November shellacking, President Obama has worked hard to show America that he is not anti-business, notably by picking General Electric CEO Jeff Immelt and Chicago banker Bill Daley for prominent posts in his administration. But their selection does not mean Obama is "pro-business," at least as the term is commonly understood. The president is no champion of open markets and free competition. His idea of being friendly to business means more government subsidies and corporate-government cooperation, both of which are mother's milk to Immelt and Daley.

Obama joined Immelt on Friday at a GE plant in Schenectady, N.Y., to announce his appointment as chairman of the President's Council on Jobs and Competitiveness. Like Obama's pick of Daley as White House chief of staff, the selection of Immelt sparked applause from the U.S. Chamber of Commerce and, in the eyes of the media, defused the Republican charge that Obama is anti-business.

But the anti-business charge against Obama was always off target. "Anti-free market" was -- and is still -- more accurate.

Immelt and Daley don't represent a new side of Barack Obama -- they represent the unhealthy collusion of Big Business and Big Government that has always been the essence of Obamanomics.

Check out Daley's resume. In the 1990s, he ran Amalgamated Bank, owned by a union and described by the Chicago Sun-Times as "one of the city's most politically connected financial institutions." Bill's brother, Mayor Richard Daley, kept the city's money on deposit at Amalgamated. Later, Bill held a seat on Fannie Mae's board, pocketing six-figure compensation from the government-sponsored enterprise that used a housing bubble and an implicit government guarantee to fill a slush fund for well-connected Democrats -- until taxpayers bailed it out in 2008.

This is Obama's kind of businessman: a banker who leverages his political connections for profit.

And Obama's kind of corporation: GE, which marches in sync with government, pocketing subsidies, profiting from regulation, and lobbying for more of both. Just look at the GE ventures Obama chose to highlight Friday.

Obama appeared on stage with Immelt in Schenectady, sounding more like a pitchman for GE stock than a head of state. The factory makes turbines, which Obama bragged GE would be selling to a power plant in Samalkot, India. That sale is no triumph of free trade -- Obama's Export-Import Bank is providing at least $400 million in subsidized financing to grease the skids.

Subsidies are GE's lifeblood, and Immelt's own words make that clear. In his op-ed announcing his appointment, Immelt called for a "coordinated commitment among business, labor and government," and wrote that, "government should incentivize ... investment in innovation." He also advocated "partnership between business and government on education and innovation in areas where America can lead, such as clean energy, are essential to sustainable growth."

This is Immelt's style. Days after Obama's inauguration, the chief executive officer wrote to shareholders of a post-bailout "reset" in the global economy. "In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner."

Sure enough, wherever Obama has led, GE has followed. Obama has championed cap and trade in greenhouse gasses, and GE has started a business dedicated to creating and trading greenhouse gas credits. As Obama expanded subsidies on embryonic stem cells, GE opened an embryonic stem-cell business. Obama pushed rail subsidies, and GE hired Linda Daschle -- wife of Obama confidant Tom Daschle -- as a rail lobbyist. GE, with its windmills, its high-tech batteries, its health care equipment, and its smart meters, was the biggest beneficiary of Obama's stimulus.

To get these gears in sync isn't cheap: The company has spent $65.7 million on lobbying during the Obama administration -- more than any other company by far. So much for Obama's war on lobbyists.

For much of the media, the nuances will be lost: You're either pro-business or anti-business. But the distinction is crucial between making a profit through subsidy, regulation, and bailouts on one hand, and competition and innovation on the other hand. The latter creates wealth. The former consumes it.

While Obama's favors for the likes of GE, Google, Pfizer, and Boeing should demolish his finely honed image as the scourge of the special interests, the real problem is not hypocrisy -- or that GE's profits and share prices are soaring. The problem with Obamanomics is that it kills the very entrepreneurship that Obama is always touting.

Newsweek's Jonathan Alter, in a new afterword to his chronicle of the Obama administration, notes that the Obama White House struggled to come up with policies to stimulate small business. Here's why, Mr. Alter: Big government will always benefit the biggest businesses with the biggest lobbying budgets.

The pundits will say Obama is warming toward business. Immelt's and Daley's appointments show us which businesses.

Timothy P.Carney, The Examiner's senior political columnist, can be contacted at tcarney@washingtonexaminer.com. His column appears Monday and Thursday, and his stories and blog posts appear on ExaminerPolitics.com.

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