Regulators…Mount Up

There are a few core tenets that are the basis for the political divide in this country. I’ve written a number of words about identity. (One party sees the culture of America as primarily straight, white and Christian. The other supports a more diverse, inclusive vision) I haven’t written as much about the role of corporations.

I realize both parties are beholden to special interests.  I realize both parties demand corporate support and donations. I realize the political process is at this point an exercise is drumming up as much cash as possible to support marketing, advertising, grass-roots organization, search engine optimization and other voter information tactics. I get that.

But once the dollars have been spent, there’s a fundamental difference between Progressives and Conservatives in terms of the relationship government and private enterprise should have.

A quote from that article in the NY Times was illustrative.

“After a relentless, eight-year regulatory onslaught that loaded unprecedented burdens on businesses and the economy, relief is finally on the way.”

That quote, from the President of the US Chamber of Commerce, is stark. The 45th President said that this is part of his, “historical effort to massively reduce job-crushing regulations.”

Job crushing! Onslaught! Unprecedented burdens!

To hear Conservatives speak you’d think that the federal government was literally stealing money from the pockets of CEOs who then can’t afford to pay anyone.

Well, according to the same piece, companies and lobbyists now come to the white house with demands. Those demands are met. What regulations that burdened the economy so much are being eliminated?

  • Telecommunications companies don’t have to take reasonable measures to ensure their customers information is safe when browsing online
  • Investment banks don’t have to work in the best interest of their clients. They can lie or trick the clients and work in the best interests of the bank
  • Automakers don’t have to increase mpg for vehicles
  • Drug companies don’t have to market prescriptions with disclaimers about how they’re used
  • Companies no longer have to publish a comparison between the pay of their CEO and their average employee
  • Energy and mining companies don’t have to closely manage emissions in air or water
  • Furniture companies don’t have to stop using formaldehyde in their products and can contaminate customers

As a Progressive, I read those as a rollback of consumer protections the government created to ensure that companies treat citizens fairly. I’m sure it’s expensive not to use poison to build a chair. I’m sure it’s expensive to store and dispose of waste as opposed to dumping it in the nearest stream. I’m sure it’s expensive to push clients to risky investments without charging them excessively for that.

I also don’t care.

I don’t expect corporations to care about the well being of the environment or American citizens or even their customers. I expect them to care about profits. That’s the point of a corporation.

I do expect the federal government to care about the well being of American citizens. That well being doesn’t just mean a job. It doesn’t just mean health care. It also means a safe environment and ensuring that companies treat consumers fairly.

I’m scared by bankers rushing to the White House with a list of demands and having them met. I’m scared by automakers telling the government what they will and won’t do and the government changing the law to support it. I’m scared by telecom either denying my browser the ability to read or charging me extra for the right.

That’s one side of this. I expect the government to help its citizens, not its companies. The other is, does this even work? If we gut regulations and give companies a lot of money, will they hire more people? Will it help the economy? Will it drive growth?

Remember the relentless onslaught of the past eight years?  They were the highest-profit years in US history.

But that’s misleading, you might say. Everything is growing. GDP is growing. Inflation is growing. You’re right.

Looking at it by GDP shows the same story. Companies are earning more in dollars. They’re earning a larger percentage. They’ve come out of the 2008 recession with record success. They’re growing and they’re employing people. Remember that unemployment hole of 2009? It’s gone.

What does all this mean? It means company profits are soaring. They’re reinvesting into jobs. (We can argue about the quality and fair pay of those jobs, but these regulations aren’t meant to address that) That doesn’t mean all Americans are doing better or even that all Americans are doing well. It does mean that companies are doing well. Why are they claiming that regulations are stifling and hurting the economy?

Because that complaint works. The administration responds. They get the tax cuts and the consumer protection cuts and the profit increase they want. What will they do with that new money? They’re already telling us.

Apple CFO says capital returns will rise if cash repatriation rate is lowered.

What does that mean? It’s Apple telling investors that, if the tax rate is changed, they’ll use the new money to buy shares, increase the stock value and ensure Apple value continues to grow. In other words, they’ll use the extra money to enhance the bottom line and not to hire more people or pay their employees more.

That’s the real end game here. It’s a play by corporations to increase the bottom line. That’s their goal. It’s not supposed to be my government’s.


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