What’s the takeaway from this very interesting read and a rare glimpse of social networking in high places? Dean Baker, an economist for the liberal Center for Economic and Policy Research, offered a clue in a recent blog post. Baker pointed to a December 14th Washington Post story—Baker has been something of a thorn in the side of the Post—quoting David M. Cote, the CEO of Honeywell and an early member of the Campaign to Fix the Debt. “As head of Honeywell,” reported the Post, Cote “has frozen most hiring and capital investment because of uncertainty about the fiscal cliff—a strategy other corporate heads have followed as well to hedge against a new downturn.” Baker took a look at Honeywell’s website, and reported that the company was not putting its expansion plans on hold. In the last two weeks, it announced $20 million in new contracts to produce simulations for industrial companies, a new contract with Boeing, plus the purchase of another company for $600 million.
Is the line about businesses curtailing investments in the Campaign’s “tool kit?” Aetna CEO Mark Bertolini, one of the early members of the Campaign, also made a similar point on the NewsHour a few weeks ago, telling Judy Woodruff Aetna was “gating” its investments and “pulling back on employment” because of the uncertainty surrounding the fiscal cliff. Apparently this uncertainty has not stopped Aetna from making an acquisition of its own. In a press release announcing its third quarter earnings in late October, the company said: “We committed to deploy more than $7 billion of capital for our proposed acquisition of Coventry Health Care.” Perhaps this is another place for dot connection.
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Thanks, Trudy, for pointing us to this New York piece. Too many media folks too frequently and uncritically quote Maya MacGuineas on budget and deficit issues without identifying her group's agenda and it's close affiliation with Pete Peterson, as if she were an objective, non-ideological expert. She's on NPR so often she ought to be drawing a salary from them.
#1 Posted by Harris Meyer, CJR on Tue 18 Dec 2012 at 01:49 PM
If you need a narrative, "The ownership class is organizing even as they take away your right to do so" will do
Also, the Dean Baker recent blog post link is broken.
(Captcha: "Stanton, iplickr")
#2 Posted by Jonathan, CJR on Tue 18 Dec 2012 at 06:40 PM
Here's the Dean Baker link:
http://www.cepr.net/index.php/blogs/beat-the-press/post-chooses-debt-fixers-over-commerce-department-data
And here's an example of the kissy face going on between the "fix the debt"ers and the Washington post, leeching over into the wonkblog side:
http://m.washingtonpost.com/blogs/wonkblog/wp/2012/12/20/maya-macguineass-ceo-powered-crusade-against-the-deficit/
"Early in the Obama administration, MacGuineas met Sen. Mark R. Warner (D-Va.) during a panel discussion on the budget in which Warner talked about having to raise the retirement age for Social Security.
MacGuineas, who was moderating, was struck by the statement. "I'm just going to stop this panel for a moment, because I haven't heard a sitting senator talk about fixing these fiscal problems in so long," she said.
Warner said she grabbed him after the event. "'Hey, you! You seem to get this stuff,' " he recalled. "We hit it off.""
Greeeeeat.
#3 Posted by Thimbles, CJR on Thu 20 Dec 2012 at 10:32 AM
“We have these great dinners,” raved one relatively new member, who says he has met a number of CEOs for the first time through his work with the group. “Everyone has been throwing out ideas about how to get the message to a broader audience.”
Talking about real problems, like what's happened to incomes in every percentile since the 'asset over wages' strategy hit the rocks?
Naw, we're having the same conversation we've had since 2009:
"I can't believe what I saw yesterday: CNN showed a Shock Doctrine documentary called I.O.U.S.A. It is an amazing piece of propaganda, which, if it isn't designed to destroy any chance of enacting a necessary stimulus, will persuade more than a few Americans that the biggest problem we face at this moment is long term debt caused by entitlements --- and nothing short of massive spending cuts can save us...
I suspect that people who read this blog know why that's deeply dishonest and why the timing for this crusade couldn't be worse. It's obvious to those who are following this story that what's required to avert a far worse recession and quite possibly a depression, is for the government to do the opposite of what these deficit obsessives say must be done. But I don't think everyone in the country has that understanding.
I say this is a shock doctrine documentary because it is nearly impossible for me to believe that it is a coincidence that the deficit hawks have put together this slick "non-partisan" documentary and well financed campaign to cut spending at the moment of what many people believe is America's greatest economic peril since the 1930s. They are, quite obviously, attempting to use the crisis to dismantle the social safety net and avoid doing the real work of reforming the financial system. Shock Doctrine 101."
It's the conversation we have whenever a democrat is in charge, from the wonk blog link above:
"On Wall Street, she became fascinated with Clinton-era "bond vigilantes" who warned that traders would force borrowing costs higher if the United States didn't reduce its budget deficit. She came away with a sense of foreboding.
"At first you can't believe it could be true: Could you really be borrowing this money with no plan? You're not investing it, you're not growing the economy. Is it really as irresponsible as it seems?" she recalled thinking. "The answer is yes.""
It's a scam. A scam during Clinton, a scam now. As Galbraith would say, during the Bush Administration credit bubbles/deficits, where were you?!
#4 Posted by Thimbles, CJR on Thu 20 Dec 2012 at 10:53 AM