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Timothy P. Carney: Obamanomics: General Electric wins big with White House

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Editor's note: This week, we will be running excerpts from "Obamanomics: How Barack Obama Is Bankrupting You and Enriching His Wall Street Friends, Corporate Lobbyists, and Union Bosses," the new book by Examiner Columnist and Lobbying Editor Timothy P. Carney, released this week from Regnery Publishing. The following is excerpted from Chapter 10.

Days after Obama's inauguration, Jeff Immelt, CEO of General Electric, wrote to shareholders: "[W]e are going through more than a cycle. The global economy, and capitalism, will be 'reset' in several important ways.

"The interaction between government and business will change forever. In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner."

General Electric is a sprawling, complex corporation with many diverse businesses. The company makes light bulbs and refrigerators, sure, but it also has a finance arm, a transportation arm, a health-care arm, a communications arm, and more. The above letter from Immelt reveals what these arms all have in common: They all reach out for government favors.

Look at any major Obama policy initiative -- healthcare reform, climate-change regulation, embryonic stem-cell research, infrastructure stimulus, electrical transmission smart-grids -- and you'll find GE has set up shop, angling for a way to pocket government handouts, gain business through mandates, or profit from government regulation.

In April, President Obama appeared with train enthusiast and Vice President Joe Biden and also Transportation Secretary Ray LaHood alongside a map depicting a network of high-speed passenger rail lines crossing the nation. "What we're talking about is a vision for high-speed rail in America," Obama said.

He added: "Imagine boarding a train in the center of a city. ... Imagine whisking through towns at speeds over 100 miles an hour, walking only a few steps to public transportation, and ending up just blocks from your destination. Imagine what a great project that would be to rebuild America."

After the Hope came the call for Change: "There's no reason why we can't do this. This is America.

"There's no reason why the future of travel should lie somewhere else beyond our borders. Building a new system of high-speed rail in America will be faster, cheaper and easier than building more freeways or adding to an already overburdened aviation system -- and everybody stands to benefit."

He was talking about $13 million in federal spending on this rail vision. So, it was clear someone would benefit.

One month later we got a hint of who it would be: "GE has the know-how and the manufacturing base to develop the next generation of high-speed passenger locomotives," said Lorenzo Simonelli, CEO of GE Transportation. "We are ready to partner with the federal government and Amtrak to make high-speed rail a reality."

GE was rolling out its next-generation locomotive "before a crowd of employees and public officials," the Erie Times-News reported. One month later, GE Transportation hired Linda Daschle, wife of Obama confidant Tom Daschle, to lobby on train issues.

This was typical -- an Obama policy pronouncement in close conjunction with a GE business initiative. It happens across all sectors of the economy and in all corners of GE's sprawling enterprise.

Here's another example: On March 9, 2009, Obama issued an executive order extending federal funding, through the National Institutes for Health, for research on stem-cells derived from human embryos.

Obama's executive order went into effect July 7, 2009. A week earlier, GE had announced that GE Healthcare and embryonic stem-cell giant Geron "have entered into a global exclusive license and alliance agreement to develop and commercialize cellular assay products derived from human embryonic stem cells (hESCs) for use in drug discovery, development and toxicity screening."

Geron described itself as having "core expertise in telomerase and human embryonic stem cells."

Obama sent money to an industry, and GE hustled to make sure the company was there waiting.

The GE-Obama "partnership" may even extend to the realm of foreign policy. In September 2009, Presient Obama acceded to a long-term Russian demand to cancel U.S. plans to place missile-defense installations in Poland and the Czech Republic.

Many Republicans and hawkish commentators assailed Obama for showing weakness. Not everyone was disappointed, however.

Reuters reported, "Investors could see some long-term trade and other benefits if a U.S. move to back away from a missile shield in Eastern Europe yields improvements in relations with Russia." Then Reuters reported a telling detail: "Shortly after the pullback on the shield programme was announced, Russia's government said Prime Minister Vladimir Putin would meet several U.S. executives on Friday from firms including General Electric."

Obama acts, GE profits.

Timothy P. Carney is The Washington Examiner's lobbying editor, His K Street column appears on Wednesdays.

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