When Google announced
that Eric Schmidt was stepping down yesterday, I joked that Schmidt
must be leaving to lead Obama's campaign economy -- the one he'll use to
get re-elected with. After all, Schmidt is one of the Obama's closest
CEO buddies, and he's leaving at the same time as Jim Messina and Patrick Gaspard are leaving
to take over the campaign infrastructure. The decision to close the
Office of Political Affairs seems to indicate a decision to stop
governing and start spinning wildly to ensure re-election. There's no
area where Obama will need to spin more wildly than with the economy,
right?
Turns out, I wasn't far off.
What else can you conclude from the news that Obama is replacing his President's Economic Recovery Advisory Board, led by Paul Volcker, with a President's Council on Jobs and Competitiveness, led by General Electric CEO Jeff "Nut on China" Immelt?
President Obama has asked me to chair
his new President's Council on Jobs and Competitiveness. I have served
for the past two years on the President's Economic Recovery Advisory
Board, and I look forward to leading the next phase of this effort as
we transition from recovery to long-term growth. The president and I
are committed to a candid and full dialogue among business, labor and
government to help ensure that the United States has the most
competitive and innovative economy in the world.
Aside from the tired DC trick of renaming the Council with the latest
buzzwords -- jobs and competitiveness -- there's all the things GE has
done under Immelt that make the U.S. less competitive. I noted the other
day that GE had signed a big deal
with China that will involve us sharing our jet technology with China,
which will ultimately help China compete with both GE and -- China has
said explicitly -- Boeing. Then there's the fact that, even as Immelt has
been calling for manufacturing in the U.S., his company has been shutting U.S. plants to move the work to China.
While Immelt was calling for manufacturing to stay in the U.S., his company was at the same time shipping manufacturing jobs overseas
by canceling an order with an American-based wind turbine maker, ATI
Casting Service in LaPorte, Ind., so that GE could instead buy the parts
from a factory in China.
Recently, ATI made $30 million worth of investments to buy, convert,
and modernize a shuttered factory in economically ravaged Michigan so
the company could provide more parts to GE as the green economy expands
with federal stimulus funding. But a Chinese firm underbid ATI, and the
factory faced having to lay off 302 union workers and shutter the
plant.
In an aggressive bid to keep the factory open, ATI offered to match
the price of the Chinese producers. GE once again said they would prefer
to buy from China. The ATI plant is now closed, the jobs gone.
Then there is Immelt's call for Free -- not Fair -- Trade in his op-ed announcing the Kabuki Council.
Free trade: America cannot expand its
manufacturing base without greatly increasing the volume of goods it
sells overseas. That is why I applaud the free-trade agreement
recently concluded between the United States and South Korea, which
will eliminate barriers to U.S. exports and support export-oriented
jobs. We should seek to conclude trade and investment agreements with
other fast-growing markets and modernize our systems for export finance
and trade control. Those who advocate increasing domestic manufacturing
jobs by erecting trade barriers have it exactly wrong.
And then, finally, there's the little detail that GE managed, alone
of "manufacturing companies" in the U.S., to turn itself into a Too Big
To Fail overleveraged finance company in need of a $16 billion bailout from the government (as has happened with all the TBTF finance companies, bailouts have made GE's financing business profitable again).
In short, no matter how many times Immelt gets up on a podium or in
an op-ed and feigns an interest in American jobs, his actions make him
the poster child for everything wrong with the U.S. economy right now.
And that's what Obama is rolling out, as he moves into campaign mode,
to convince Americans he's going to do a damn thing about jobs.
