The Spectacle Blog
On April 22, 2009, GE CEO Jeffrey Immelt entered a raging controversy at the University of Notre Dame surrounding an upcoming commencement speech by Barack Obama with an op-ed in, of all places, the Notre Dame Observer.
Without addressing any of the issues in contention, namely Obama’s pro-choice policies and the school’s obligations as a Catholic institution, the article expressed Immelt’s wholehearted support for Obama and his upcoming speech. What made the article so odd, beside the apparent cluelessness of the author, was that the CEO of GE felt it necessary to add his opinion to an argument involving Notre Dame. Immelt is not a Notre Dame alumnus (he went to Dartmouth), he doesn’t have affiliations with the university other than a commencement speech he gave in 2007, and he’s not Catholic. One would think that the CEO of one of the largest companies in America would have better things to do than writing an op-ed for a student newspaper picking sides in an essentially intra-denominational controversy. So why would Immelt weigh in?
Had the Observer provided the most routine of disclosures for that article, the answer would have been obvious. On February 17th of that year, Obama had signed the stimulus bill, which included $24.9 million in grants that would flow directly to GE, with roughly $20 billion more slated for health care record modernization of the kind that GE specializes in — “with a direct request to do so from GE’s CEO Jeffrey Immelt.” Months before, during the Bush administration, GE had successfully lobbied “behind-the-scenes” to get its financing arm, GE Capital, included in a FDIC bailout program that would insure up to $139 billion of its debt. By the time Obama stepped on stage at Notre Dame, GE Capital had used the program to raise “$74 billion, helping to cover [GE’S] 2009 funding needs, and about $8 billion of its projected needs for 2010.” In addition, Immelt knew that many billions more would accrue to his company through its green initiatives if Obama’s cap and trade proposal became law.
It would be hard to think up a more direct conflict of interest.
Except, of course, for the conflict of interest raised by Obama’s decision, announced today, to name Immelt the chair of the new President’s Council on Jobs and Competitiveness while Immelt still serves as GE’s CEO.
According to the president, the purpose of the new council will be to “focus its work on finding new ways to encourage the private sector to hire and invest in American competitiveness.” It is not hard to imagine ways for Immelt to fulfill that mandate by enriching GE’s shareholders, which, remember, is his contractual obligation as CEO.
Immelt isn’t serving on the panel out of love of Obama or loyalty to Democrats: he “counts former President Ronald Reagan as a ‘personal hero,’” and donated $2,300 to both Hillary Clinton and John McCain in the 2008 election. Nor is Immelt concerned about fairness, competitiveness, or the free market: as he has explained, “It’s never been a free market; it’s never gonna be a free market. That’s just the way it is.” And: “The fact that I’d like GE to work in concert with where government policy is in the U.S. doesn’t mean that I’m a traitor or a bad guy, I think it’s just being practical that that’s gotta happen.”
Immelt is serving on the panel because of money. He represents one of Big Business’s biggest. A post in the Obama administration presents a huge opportunity to enrich his company and himself. Obama is allowing him to do so because a company as big and diversified as GE can do a lot for him, up to and including defending him in the op-ed sections of college newspapers.
That’s the measure of the extent of the corrosiveness of this kind of government-business collaboration. Its harmful effects aren’t limited to the economy, but trickle down into Immelt’s advocacy of environmentalism, the programming on GE-owned TV channels, and so on. It introduces corruption into matters, such as Obama’s visit to Notre Dame, that might be considered morally significant within a small community but should have nothing to do with big business or money changing hands. Yet Immelt doesn’t feel the need, when writing a student paper op-ed, to disclose the billions of dollars his company took from taxpayers by cozying up to the administration. Nor does he, apparently, feel compunction about promising to help people across the country find real jobs while at the same time promising his shareholders that he’ll prioritize the company’s bottom line.
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http://spectator.org/blog/2011/01/21/whats-good-for-jeffrey-immelt
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bobmontgomery| 1.21.11 @ 6:38PM
What consequence, if any, did Immelt and his company suffer because of doing business with Iran? Or do we just not talk about that anymore?
Shamus| 1.22.11 @ 10:54AM
At one time it was said that what was good for GM was good for America. That was before GM went bankrupt.
Steve in Pittsburgh| 1.21.11 @ 7:26PM
How much money does one person need?
Patriot| 1.21.11 @ 7:39PM
Well, that depends--are you talking about those privileged few who dwell in the American ruling class like Immelt and Obama or the great unwashed like you and me?
Immelt is a pig, and it sickens me that GWB slopped the trough for him, too.
PCC| 1.21.11 @ 7:43PM
This scandalous appointment creates a wholly unjustifiable conflict of interest. Immelt should resign either from GE or from the administration's new board.
Real American| 1.21.11 @ 7:50PM
sounds like a job for the new GOP congress - make sure GE doesn't get one damn cent of taxpayer money while this guy is serving on this new phony council.
solidground| 1.21.11 @ 7:54PM
This move is less than surprising. Immelt has been milking Obama for everything he's worth for the past three years. Why would anything change? And of course, the MSM gives all the backscratching, at taxpayer expense, a complete pass. The unaware and unperceptive will slobber that Obama simply is showing his willingness to move to the center and work with business to generate jobs. The rest of us will see what's really up -- more power and prestige for Jeffy, more bluffing and BS for Obama for the run-up to his 2012 rerun.
Steve in Pittsburgh| 1.21.11 @ 7:56PM
No matter how much money I make, as I aspire to greatness as an actor, or director, or writer(I have a BS in Video Production), I don't see myself needing a large mansion.
Ok, a few pricey art pieces would be nice.
Clint| 1.21.11 @ 8:31PM
Michael Brendan Dougherty on:
Obamanomics: How Barack Obama Is Bankrupting You and Enriching His Wall Street Friends, Corporate Lobbyists, and Union Bosses, Timothy P. Carney, Regnery, 256 pages.
Chapter 9, “GE: The For-Profit Arm of the Obama Administration,” is worth the price of the book and provides a perfect case study. Just days after Obama’s inauguration, General Electric CEO Jeff Immelt wrote to shareholders, “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.” Translation: Washington will subsidize our industry, provide grants for our research, and mandate our products for environmental reasons. Kaching! “The company makes light bulbs and refrigerators, sure,” writes Carney, “but it also has a finance arm, a transportation arm, a healthcare 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.”
"Let us count the ways. GE launched its own PAC to solicit donations from its employees for candidates “who share GE’s values and goals.” Unsurprisingly, Obama received more money from GE employees than any other politician. Immelt now sits on Obama’s economic recovery board and enjoys a weekly phone call with White House economic adviser Austan Goolsbee. In the past decade, GE has spent more on lobbying than BlueCross, Exxon, or Altria, the owners of Philip Morris. Former Sens. Trent Lott (R) and John Breaux (D) lobby for GE. And former Rep. Dick Gephardt, tribune of the working man, lobbies for NBC Universal, which as we go to press is a subsidiary of the GE conglomerate. If by any chance Obama forgets to ask himself “What would Jeff Immelt do?” before signing legislation, GE has recruited Linda Daschle, wife of that authentic North Dakotan voice of reform, Tom, as another of its lobbyists. "
mark| 1.23.11 @ 8:54PM
Excellent commentary on Tim Carney's work. I've so appreciated his research into the connection by certain companies with the administration and congress. Immelt is little more than a smart con, looking to make all the right connections. I read a short comment by a former GE engineer who thought that GE was proposterous for wanting government guarantees for business risk taking. There's a reason it's called risk, and why the research is done. Screw medium and small business; give all the advantages to connected big business. Screw most Americans who aren't connected to the Ruling Class. It's the new "American way."
Teflon93| 1.21.11 @ 10:52PM
Immelt is Jack Welch's biggest mistake.
All this government bootlicking has left GE stock in the toilet.
David W| 1.21.11 @ 10:56PM
This is the perfect example of why we have to reduce the interference of government. I think it is obvious to the most casual observer that government, especially under Obama but not exclusive to him, is doing more to reduce competition by picking the winners and losers.
So much of our tax dollars go to immoral if not illegal corruption at all levels. I hope our new House members will try to stop this (but I'm not real confident).
Greta| 1.22.11 @ 12:55AM
Many worry about the seperation of church and state. There is a lot more reason to worry today about this type relationship than worry about what happened with church and state in other countries 200 years ago or more. We should really work to keep these type relationships well exposed and at arms length. Yes, political hacks need to hear from business and try to make policies that are business / jobs friendly, but they should also prohibit any gain in any way, during or after office from this type relationship.
Dixie Pixie| 1.22.11 @ 9:14AM
Let me get this straight, Obama has outright given Jeffrey Immelt $44.9 billion, stop loss insured GE Capital for $139. billion, helped him raise $82. billion and gave him a permanent seat on making economic policy. .
All he had to do is write a pro Obama article in a Notre Dame student newspaper??????
That is one expensive writer.
What does mean per word?
$100. million dollars a word?
That is insane amounts of money for so little.
With that kind of money GE could run permanent full page ads for Obama in every major news paper.
No wonder the US Government is bankrupt.
With financial acumen like that, Obama is either the most inept executive or the biggest financial criminal of all time.
Richard Baker| 1.22.11 @ 9:22AM
solidground:
Immelt is playing the Kenyan like a drum and His Imperialness is too stupid to notice that his fur is being stroked the wrong way.
K| 1.22.11 @ 1:39PM
Something that conservatives need to remember. Big corporations are quite happy being allied with leftist government and keeping them in power indefinitely.
Either the government can have very little say in the economy or big business must be cut down to size in order for a free market to work like it is supposed to. Right now it would be easier to downsize the corporate "too big to fail" monsters than get the government paired down. The latter would then follow automatically.
Kurt in S.L.C.| 1.22.11 @ 6:22PM
It's a shame that Jack Welch won't admit that he made a mistake in naming this rent seeking loser C.E.O. and thereby facilitate his removal to the benefit of both country and company
martin j smith| 1.23.11 @ 12:36PM
Boydo you have spammmmmmmmm.
The good news is that GE and Immelt-an example of crony capitalism will bring help on the way!!!!!!!!
Occam's Tool| 1.24.11 @ 6:34PM
GE, under Immelt, has lost 60% of its stock value. Moral maggot, incredible scum bag.
Scott Peterson | 3.26.11 @ 7:26AM
“Improve competitiveness” is a mantra frequently heard in discussions of how countries can increase economic growth. What that slogan actually means is that global corporations want workers in developed countries to agree to wage reductions to levels similar to those in the People’s Republic of China. The unspoken threat is that workers will be driven to accept such reductions inevitably.
Wages in China are actually rising due to the country’s success in extracting manufacturing jobs from the rest of the world. The correct policy that should be pursued by developed countries and China is to have the PRC adjust its labor markets so that Chinese workers’ wages continue to converge with those of workers in developing countries.
Increased standards of living for Chinese workers will mean less of a reduction in standards of living in developed countries. In some industries, Chinese goods are already not competitive with similar goods produced in developed countries due to transportation costs.
Executive management currently colludes with a corrupt PRC system to extract the value of increased productivity throughout the world to increase the wealth of the top 1% of society…the super-rich. Workers throughout the world need to organize to reject the “competitiveness” propaganda and restructure the distribution of wealth more fairly.