Obama Urges Businesses to Ramp Up Private-Sector Hiring, Spending
GWEN IFILL: Now: the Obama administration's new romance with the business community. Who stands to gain?
U.S. PRESIDENT BARACK OBAMA: Hey, guys.
GWEN IFILL: Only one city block separates the White House from the headquarters of the Chamber of Commerce. Today, President Obama sought to close even that distance, acknowledging right off the bat that the two have not always seen eye to eye.
BARACK OBAMA: I'm here in the interest of being more neighborly.
BARACK OBAMA: I strolled over from across the street. And look, maybe if we — if we had brought over a fruitcake when I first moved in, we would have gotten off to a better start.
GWEN IFILL: The tensions between Democrats and the business community are rooted in policy and politics. The Chamber spent more than $50 million during the 2010 midterm campaign, much of it on television ads aimed at electing Republicans who promised to derail the president's legislative agenda.
NARRATOR: Conway supports the Pelosi-Obama big-government takeover of health care.
GWEN IFILL: That strategy met with some success. Republicans won a majority in the House and picked up six Senate seats. Since then, the president has brokered and signed a tax-cut deal that helped business and pledged to relax regulations and revise the corporate tax code.
He's also filled key administration posts with advisers like new Chief of Staff and former Commerce Secretary William Daley, perceived as friendly to the business community.
In his address today, the president said, business and government share common, even patriotic goals.
BARACK OBAMA: We have to renew people's faith in the promise of this country: that this is a place where you can make it if you try. And we have to do this together, business and government, workers and CEOs, Democrats and Republicans.
GWEN IFILL: And Mr. Obama called on businesses to do their part by hiring more workers.
BARACK OBAMA: Today, American companies have nearly $2 trillion sitting on their balance sheets, and I know that many of you have told me that you're waiting for demand to rise before you get off the sidelines and expand, and that with millions of Americans out of work, demand has risen more slowly than any of us would like.
We're in this together. But many of your own economists and sales people are now forecasting a healthy increase in demand. So I just want to encourage you to get in the game.
GWEN IFILL: Senate Republican Leader Mitch McConnell said he's waiting to see that the Obama administration means what it says.
SEN. MITCH MCCONNELL (R-Ky.), minority leader: As I have said before, what the president says matters a lot less than what he does. So, we'll just have to wait and see whether the president's actions support his rhetoric.
GWEN IFILL: But some business leaders say they are willing to listen. The Chamber has endorsed the White House plan to spend more on transportation and communications networks, a proposal some Republicans say will lead to wasteful government spending.
Joining us to assess the president's business appeal are Dave Adkisson, president of the Kentucky Chamber of Commerce — he was in the audience today — and Harold Meyerson, editor-at-large for "The American Prospect" and a columnist for The Washington Post.
So, Mr. Adkisson, as you sat today watching the president, what did you think the purpose of that speech was? What was that about?
DAVE ADKISSON, Kentucky Chamber of Commerce: Well, I think it was a major gesture, after several contentious months between the business community and the administration. I think it was an important symbolic, but substantive way in which the president reached out to the business community. And I think that's welcome.
GWEN IFILL: How did it go over?
DAVE ADKISSON: It went over well.
He received a standing ovation at the beginning and the end, applause in between occasionally. I think it was a good message for the business community to hear. Obviously, people will wait to see how that becomes policy, how that plays out in the give-and-take between the administration and other policy-makers, but basically well-received. I think it was an important gesture in which a new relationship can be built.
GWEN IFILL: Harold Meyerson, what do you think he is up to, and why is he doing it this way?
HAROLD MEYERSON, The Washington Post: Well, the president is in a tough spot. He's got to generate jobs for the nation and for his own reelection. And the public sector is pretty much maxed out at this point. Politically, there's no more support for any more stimulus than there has been.
State and local governments are going to be cutting back the number of employees. So, that puts the ball in the court of the people sitting over at the Chamber of Commerce. And so, the president basically came over and said, please help. That — that's part of what he's doing.
The other part of it is political. I mean, part of this is to convey the impression that he's not the divisive president some have accused him of being, that he can get along with centrists. And then I think there's a third factor way down the line, which is in 2012, if he draws sort of a more centrist Republican, like Mitt Romney, or Mitch Daniels, the governor of Indiana, as his opponent, business is pretty much going to go to them.
But should the nominee be someone like Sarah Palin or former Arkansas Governor Mike Huckabee, it's quite possible Obama will get significant corporate support. So, I think all of those are part of his calculations.
GWEN IFILL: The president said to the business people in the room today: Get back — get in the game. Come — come with me.
What do you think he was saying — that he thought he was saying to you? What did you hear him saying to you?
DAVE ADKISSON: Well, I think we share a common goal. And that is for this recovery to become a jobs recovery. And so he's encouraging the business community that has been cautious, has been nervous, to start investing in America.
GWEN IFILL: And is sitting on a lot of cash, he has said many times.
DAVE ADKISSON: And sitting on a lot of cash, that's right. That's right.
But there's — there are concerns there. There are concerns about a hyper-regulatory environment in some industries. That's very much an inhibitor. There are concerns about tax policy, whether or not Washington is going to get it — get its act together in terms of spending and the entitlement programs.
All of those things make for a very cautious environment. Plus, these businesses, a lot of them have been burned in the last two or three years. I talk to people in commercial real estate and other areas of business that have — they're just — they're still saying ouch from what happened in — in '09.
GWEN IFILL: Does that explain the disconnect we see between this high employment rate and — and evidence that so many businesses are rebounding?
HAROLD MEYERSON: Well, big businesses are rebounding. I'm not sure small business is rebounding. But big businesses — and this is important — they're not necessarily rebounding here.
The growing markets in the world, if you're a multinational corporation, as all of our big businesses are, are those in China and Brazil and India. The percentage of revenues that these companies get from — from those nations — from other nations is now about half of their total revenues. That's up from a third back in 2000.
So, their sales are abroad. And, increasingly, for many of these companies, their production is abroad. And — and that, I think, is the real conundrum with this recession. And that's what makes this recession different from all earlier recessions.
GWEN IFILL: It's interesting, because we saw in the — in the tape piece there, Ron Kirk, the U.S. trade representative, sitting front and center…
DAVE ADKISSON: Right.
GWEN IFILL: … with the administration. And that was one of the — the few, admittedly, applause lines that the president got in the meat of his speech, which was talking about trade.
How much of that is — is a pitch to get everybody on board on the things you can agree on and then attack the things you can't agree on later on?
DAVE ADKISSON: Right. And there are areas, like trade, the South Korean trade agreement, the proposals to have a trade agreement with Colombia and Panama, those are important to the business community.
I read a story in Kentucky the other day that over 50 percent of our agricultural jobs now are related to exports. So, as the middle class grows in China and India, and they add protein to their diet — in other words, they add meat to their diet — we're selling them soybeans and corn to feed, you know, the — the agricultural products they need over there.
So, I think there's a growing awareness that trade and, of course, the — the — trade is a big part of our recovery. How much? We'll have to wait and see. The administration and the Chamber share this goal of trying to double exports in the next five years.
GWEN IFILL: At what point does the president's repeated promise to relax regulation to make things better for business or to revise the corporate tax code, how much does that — when — at what point do, I guess, liberals begin to worry that he's giving away the farm?
HAROLD MEYERSON: Well, I think revising the corporate tax code is a — may be, as he presents it, pretty much of a neutral endeavor. It would be lowering the overall rate, but — but closing a bunch of loopholes. It's not clear that the percentage of money coming into the federal government from corporations would be any less at the end of the day.
The regulations are something else. And I think there's a hope and expectation that it's not going to gut workplace safety, certainly not affect things like minimum wage. And in environmental regulations, the liberal community absolutely is counting on the president to — to hang tough on this. That — that's one of the core values of the Democratic Party.
So, I think — I think there could be some real whistles and bells ringing and blowing if — if we begin to see some weakening of those — those — on those issues.
GWEN IFILL: There are already some whistles and bells blowing on the conservative side of this. When the president talks about infrastructure and investment, the I-words, they hear spending.
So, what did you hear?
DAVE ADKISSON: Well, the — I think the details will matter here. And I think the business community will be tuned into the president's budget speech to find out exactly what is meant by those investments.
But the business community favors investment in infrastructure and in spreading broadband to rural areas, for example, investing in research and development, investing in higher education. We did a study in Kentucky and found out that the — a lot of the — what we would all agree we should be investing in, like education and higher ed, was — that was actually decreasing in our state because of problems like public employee pensions and Medicaid and our prison system.
So, I think we have to look at where we're spending and be very smart about strategic investments.
GWEN IFILL: You're saying that was because of spending on those three areas?
DAVE ADKISSON: Spending in those three areas was taking money away from strategic investments in education. And that was obviously a problem for the business community in Kentucky.
GWEN IFILL: At the root of this always — always is the question of what government's role should be in getting the — the corporate sector to play in issues like this, to help bring the economy back. And there's a trust factor here. There's a trust factor that people on the left have toward the president. And there's a trust factor that people on the right have toward the president. And he's trying to negotiate a tightrope in the middle.
How do you define that?
HAROLD MEYERSON: Well, the Democratic Party, liberals, the places where the president comes from, have always believed there's a strong role for government, both in the sorts of things that David is talking about, in infrastructure and whatnot, but also in regulating business successes, such as the kind of things that led us to the Wall Street collapse of 2008.
I mean, if you're — when banks complain that, oh, you're — you're — we can't do the things we used to do, and that's going to cut down our growth, the things they used to do cost us eight million jobs. I mean, government is important for establishing rules that keep the private sector sometimes from self-destructing.
GWEN IFILL: OK. Well, we will leave it there for tonight. And we will revisit it, I suspect, soon.
Harold Meyerson, David Adkisson, thank you both very much.
HAROLD MEYERSON: Glad to be here.
DAVE ADKISSON: Thank you.