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.