CEOs of large, high profile companies like Intel tend to be averse to making strong political stands, especially during election season. They understand that their companies can quickly become targets for regulation that can end up costing shareholders millions (or billions of dollars). Most CEOs tend to throw some money at candidates who are expected to win and keep their heads down. Which is why Intel CEO Paul Otellini’s total evisceration of Obama’s understanding of the economy in the middle of an election season was such a shocking breath of fresh air today.
“The decisions so far have not resulted in either job growth or increased confidence. When what you’re doing isn’t working you rethink it and I think we need to rethink some plans,” he said at the Intel Developers Forum in San Francisco.
Otellini credited the White House for listening to him and other business leaders. “I really think they’re trying,” he said, adding that he doesn’t think there is anti-business sentiment from the administration.
But Otellini said the $787 billion economic stimulus package passed last year has not done enough to solve problems in the job market. He argued that money not yet spent from that program might be better off allocated elsewhere and took the administration to task for focusing on short-term projects.
“It doesn’t seem to be working the way it is. Swimming pools in Mississippi are not going to create lasting jobs.”
** snip **
Otellini is also one of the first Fortune 500 CEOs to speak publicly about President Obama’s newly proposed $350 billion economic recovery plan. He said that proposal, which includes tax breaks for businesses and research and development incentives, is not the right plan either.
The way Otellini sees it, Washington must decide what the industries of the future are. “We still subsidize trains and agriculture — industries of the 19th century. We should decide what’s important to us going forward and make sure we’ve got the education system in place and the capital incentive system in place to do the investment here.”
Otellini also said that a major problem for companies is that they are being held back by high corporate tax rates.
Otellini says it costs Intel (INTC, Fortune 500) $1 billion more to build a factory in the U.S. than abroad because of a lack of U.S. tax incentives. The company has a multi-billion dollar factory slated to open in China this October.
“You have to weigh the advantages of working here, the security of working here in this country…against that billion dollars.”
Otellini questioned why global business leaders would want to do business in the U.S. due to the cost, saying it is critical to incentivize foreign countries to invest in America. “Our corporate taxes are twice what they are in the rest of the world. You want corporations to invest here.”
Gee. It seems that one party was talking about the corporate tax rate being too high all the way through the 2008 election. The other was busy talking about penalizing ExxonMobil for making too much profit. The end result is that when the financial sector tanked, the party in power did nothing to change the corporate tax rate and instead spent billions of dollars on “shovel ready” projects; i.e., completely unnecessary construction projects. These provided some level of short-term boon to construction companies, who built the projects in question and then were promptly left standing around twiddling their thumbs again. Meanwhile, companies with sustainable business practices and profitability like Intel move more and more American jobs overseas because of the hostile business climate that Barack Obama and his cronies don’t even understand, much less know how to fix.
Until America elects an administration and a Congress that has a better plan for fixing the economy than confiscating money from profit (read: job) producers like Intel and throwing it at farm subsidies and construction make-work, you can count on Austan Gooslbee being right: double-digit employment will be a more-or-less permanent feature.
Ezra Klein:
Making Social Security less generous isn't the answer, by Ezra Klein,
Commentary, Washington Post: ...Raising the Social Security retirement age
has become as close to a consensus position as exists in American politics. ...
And for a while, I agreed... People live longer today, and so they should work
later into life. But as I've looked at the issue, I've decided that I was wrong.
... We should leave the retirement age alone. In fact, we should leave Social
Security alone...
Start with the basic rationale for raising the retirement age. As Rep. Paul D.
Ryan (R-Wis.) has argued, when Social Security was signed into law, the
retirement age was 65 and life expectancy was 63. "The numbers added up pretty
well back then," he said on Fox News. But that's misleading. That figure was
driven by high infant mortality. ...
Moreover,... averages conceal a lot of inequality. In 1972, a 60-year-old male
worker who made less than the median income had a life expectancy of 78 years.
By 2001, he had a life expectancy of 80 years. Meanwhile, workers in the top
half of the income distribution shot to 85 years from 79. ...
Lurking beneath this conversation is an unquestioned assumption: We live longer,
so we should work longer. That's pretty intuitive to members of Congress, who
seem to like their jobs and don't seem to like the idea of retiring. It's also
pretty intuitive to blogger/columnists, who spend their time in air-conditioned
rooms opining about pension programs. But most people don't work in Congress or
in the media. They work on their feet. They strain their backs. They're bored
silly at the end of the day. By the time they're in their 60s, they want to
retire.
You see that reflected in Social Security. Age 66 is when you get full benefits.
But most people begin taking Social Security at age 62. They get less, but they
can retire earlier. To them, the trade-off is worth it. ...
An August survey ... tested reactions to a variety of Social Security fixes. One
of the options was raising the retirement age to 70. Two-thirds of respondents
opposed it. Another option was eliminating the cap on payroll taxes so that
well-off workers pay the tax on their full income, just as middle-income workers
do now. A solid 61 percent supported it.
That's almost the reverse of the conversation in Washington, where affluent
people who like their jobs propose cutting benefits for the poor (which is,
after all, what raising the retirement age would do) rather than lowering
benefits or increasing the payroll tax on, well, themselves. ...
The universally unpleasant options for reform are a testament to Social
Security's efficiency. It's a simple transfer program, with administrative costs
that amount to less than 0.9 percent of total spending. There's not much fat to
cut.
That can't be said for much else in American public policy. Our health-care
system costs twice as much as the German system and doesn't deliver better
results. Our defense sector is wasteful and bloated. Our tax code could raise
more money and do less to harm growth if we cleaned it out. Our home prices are
driven upward by the mortgage interest tax deduction. Our health insurance
premiums are goosed by the exclusion of employer-sponsored insurance from
taxable income.
Reforming any of those sectors ... would be politically difficult, but would
mean better policy. Reforming Social Security will be politically difficult and
result in worse policy. ...
Here's what I
argued in May of 2005:
1. An increase in life expectancy does not necessarily imply that people are
healthier at age 65 or 70 than before. Suppose, for example, that medical
advances are discovered that extend the end of life by several years, but have
no effect on health prior to the last few years of life. In such a case there
would be an increase in life expectancy, but no increase in the health of
workers at the age of retirement. If people aren’t healthier, then increasing
the retirement age imposes a hardship over and above that faced by current
retirees.
2. It’s already difficult for elderly workers to find employment, and when
they do they are often underemployed relative to their skill levels. Raising the
retirement age will make this worse.
3. What about workers employed in physically demanding occupations? Is it
reasonable to ask them to work until, say, age 72? If not, how equitable is it
to have some workers work until 72, and others allowed to retire at a younger
age depending on their occupation?
4. Will this distort occupational choice decisions? ... How will we decide
when a worker is unable to work due to reasons associated with age?
5. The life expectancy of some groups of workers is lower than for others. If
poorer workers die younger than richer workers on average, then raising the
retirement age will have a larger impact on low income workers and thus, in
essence, be regressive.
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robert shumake
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The largest misconception about Generation Y is that technology is a replacement for interpersonal dialogue. Technology is becoming more ever-present, and Gen Y is still managing to talk to one another.
CEOs of large, high profile companies like Intel tend to be averse to making strong political stands, especially during election season. They understand that their companies can quickly become targets for regulation that can end up costing shareholders millions (or billions of dollars). Most CEOs tend to throw some money at candidates who are expected to win and keep their heads down. Which is why Intel CEO Paul Otellini’s total evisceration of Obama’s understanding of the economy in the middle of an election season was such a shocking breath of fresh air today.
“The decisions so far have not resulted in either job growth or increased confidence. When what you’re doing isn’t working you rethink it and I think we need to rethink some plans,” he said at the Intel Developers Forum in San Francisco.
Otellini credited the White House for listening to him and other business leaders. “I really think they’re trying,” he said, adding that he doesn’t think there is anti-business sentiment from the administration.
But Otellini said the $787 billion economic stimulus package passed last year has not done enough to solve problems in the job market. He argued that money not yet spent from that program might be better off allocated elsewhere and took the administration to task for focusing on short-term projects.
“It doesn’t seem to be working the way it is. Swimming pools in Mississippi are not going to create lasting jobs.”
** snip **
Otellini is also one of the first Fortune 500 CEOs to speak publicly about President Obama’s newly proposed $350 billion economic recovery plan. He said that proposal, which includes tax breaks for businesses and research and development incentives, is not the right plan either.
The way Otellini sees it, Washington must decide what the industries of the future are. “We still subsidize trains and agriculture — industries of the 19th century. We should decide what’s important to us going forward and make sure we’ve got the education system in place and the capital incentive system in place to do the investment here.”
Otellini also said that a major problem for companies is that they are being held back by high corporate tax rates.
Otellini says it costs Intel (INTC, Fortune 500) $1 billion more to build a factory in the U.S. than abroad because of a lack of U.S. tax incentives. The company has a multi-billion dollar factory slated to open in China this October.
“You have to weigh the advantages of working here, the security of working here in this country…against that billion dollars.”
Otellini questioned why global business leaders would want to do business in the U.S. due to the cost, saying it is critical to incentivize foreign countries to invest in America. “Our corporate taxes are twice what they are in the rest of the world. You want corporations to invest here.”
Gee. It seems that one party was talking about the corporate tax rate being too high all the way through the 2008 election. The other was busy talking about penalizing ExxonMobil for making too much profit. The end result is that when the financial sector tanked, the party in power did nothing to change the corporate tax rate and instead spent billions of dollars on “shovel ready” projects; i.e., completely unnecessary construction projects. These provided some level of short-term boon to construction companies, who built the projects in question and then were promptly left standing around twiddling their thumbs again. Meanwhile, companies with sustainable business practices and profitability like Intel move more and more American jobs overseas because of the hostile business climate that Barack Obama and his cronies don’t even understand, much less know how to fix.
Until America elects an administration and a Congress that has a better plan for fixing the economy than confiscating money from profit (read: job) producers like Intel and throwing it at farm subsidies and construction make-work, you can count on Austan Gooslbee being right: double-digit employment will be a more-or-less permanent feature.
Ezra Klein:
Making Social Security less generous isn't the answer, by Ezra Klein,
Commentary, Washington Post: ...Raising the Social Security retirement age
has become as close to a consensus position as exists in American politics. ...
And for a while, I agreed... People live longer today, and so they should work
later into life. But as I've looked at the issue, I've decided that I was wrong.
... We should leave the retirement age alone. In fact, we should leave Social
Security alone...
Start with the basic rationale for raising the retirement age. As Rep. Paul D.
Ryan (R-Wis.) has argued, when Social Security was signed into law, the
retirement age was 65 and life expectancy was 63. "The numbers added up pretty
well back then," he said on Fox News. But that's misleading. That figure was
driven by high infant mortality. ...
Moreover,... averages conceal a lot of inequality. In 1972, a 60-year-old male
worker who made less than the median income had a life expectancy of 78 years.
By 2001, he had a life expectancy of 80 years. Meanwhile, workers in the top
half of the income distribution shot to 85 years from 79. ...
Lurking beneath this conversation is an unquestioned assumption: We live longer,
so we should work longer. That's pretty intuitive to members of Congress, who
seem to like their jobs and don't seem to like the idea of retiring. It's also
pretty intuitive to blogger/columnists, who spend their time in air-conditioned
rooms opining about pension programs. But most people don't work in Congress or
in the media. They work on their feet. They strain their backs. They're bored
silly at the end of the day. By the time they're in their 60s, they want to
retire.
You see that reflected in Social Security. Age 66 is when you get full benefits.
But most people begin taking Social Security at age 62. They get less, but they
can retire earlier. To them, the trade-off is worth it. ...
An August survey ... tested reactions to a variety of Social Security fixes. One
of the options was raising the retirement age to 70. Two-thirds of respondents
opposed it. Another option was eliminating the cap on payroll taxes so that
well-off workers pay the tax on their full income, just as middle-income workers
do now. A solid 61 percent supported it.
That's almost the reverse of the conversation in Washington, where affluent
people who like their jobs propose cutting benefits for the poor (which is,
after all, what raising the retirement age would do) rather than lowering
benefits or increasing the payroll tax on, well, themselves. ...
The universally unpleasant options for reform are a testament to Social
Security's efficiency. It's a simple transfer program, with administrative costs
that amount to less than 0.9 percent of total spending. There's not much fat to
cut.
That can't be said for much else in American public policy. Our health-care
system costs twice as much as the German system and doesn't deliver better
results. Our defense sector is wasteful and bloated. Our tax code could raise
more money and do less to harm growth if we cleaned it out. Our home prices are
driven upward by the mortgage interest tax deduction. Our health insurance
premiums are goosed by the exclusion of employer-sponsored insurance from
taxable income.
Reforming any of those sectors ... would be politically difficult, but would
mean better policy. Reforming Social Security will be politically difficult and
result in worse policy. ...
Here's what I
argued in May of 2005:
1. An increase in life expectancy does not necessarily imply that people are
healthier at age 65 or 70 than before. Suppose, for example, that medical
advances are discovered that extend the end of life by several years, but have
no effect on health prior to the last few years of life. In such a case there
would be an increase in life expectancy, but no increase in the health of
workers at the age of retirement. If people aren’t healthier, then increasing
the retirement age imposes a hardship over and above that faced by current
retirees.
2. It’s already difficult for elderly workers to find employment, and when
they do they are often underemployed relative to their skill levels. Raising the
retirement age will make this worse.
3. What about workers employed in physically demanding occupations? Is it
reasonable to ask them to work until, say, age 72? If not, how equitable is it
to have some workers work until 72, and others allowed to retire at a younger
age depending on their occupation?
4. Will this distort occupational choice decisions? ... How will we decide
when a worker is unable to work due to reasons associated with age?
5. The life expectancy of some groups of workers is lower than for others. If
poorer workers die younger than richer workers on average, then raising the
retirement age will have a larger impact on low income workers and thus, in
essence, be regressive.
robert shumake
Fox <b>News</b> Poll: Coons Leads O'Donnell By 15 Points In Delaware | TPMDC
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iLounge news discussing the International iPhone rollouts reach far beyond China. Find more iPhone news from leading independent iPod, iPhone, and iPad site.
David Helfenbein: The Facebook <b>News</b> Feed and Twitter Generation
The largest misconception about Generation Y is that technology is a replacement for interpersonal dialogue. Technology is becoming more ever-present, and Gen Y is still managing to talk to one another.
robert shumake
Fox <b>News</b> Poll: Coons Leads O'Donnell By 15 Points In Delaware | TPMDC
The new Fox News poll of the Delaware Senate race shows Democratic nominee Chris Coons continuing to enjoy a double-digit lead against Republican Christine O'Donnell.
International iPhone rollouts reach far beyond China | iLounge <b>News</b>
iLounge news discussing the International iPhone rollouts reach far beyond China. Find more iPhone news from leading independent iPod, iPhone, and iPad site.
David Helfenbein: The Facebook <b>News</b> Feed and Twitter Generation
The largest misconception about Generation Y is that technology is a replacement for interpersonal dialogue. Technology is becoming more ever-present, and Gen Y is still managing to talk to one another.
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