There’s a rising chorus of whining and finger pointing from the Wall Street tribe that the recession is due to the mess in Washington. It should reach a crescendo, amplified by money and sloppy reporting, in the weeks before the November election. A mess exists in Washington; that’s clear. However, the gist of articles like “It’s NOT the Economy, Stupid: It’s the Mess in Washington” written by Jeff Cox, a CNBC staff writer, is that a Republican takeover of at least one House in Congress will cure our financial ills.
Cox’s article is bogus on three levels: a) His so-called experts lack objectivity and relevant knowledge to support the headline, b) Cox lacked objectivity and professionalism when he wrote it and c) CNBC, management lacks competence and integrity for promoting self-serving political agendas under the guise of news and for tolerating sloppy, unprofessional reporting by their staff. (Jeff Cox is pretty much par for the CNBC course, better even than some of his compatriots.)
His leading expert, David Kotok founder of Cumberland Advisors, ―a wealth management firm for individuals and governments― attributes motives to small-business owners that he can’t possibly know: “Businesses―especially smaller businesses, independent businesses― they don’t know what their cost structures are going to be because of government-imposed changes.” Then he makes an assertion he could only have pulled out of his ear or another, less hygienic orifice: “Half the US economy’s holding back because of this great uncertainty that’s coming from Washington.” Speculative BS!
It flys in the face of my 16 years as CEO of a smaller business in a highly competitive industry: a hi-tech company near Silicon Valley. None of the factors he cited were ever motives for hiring or not hiring, investing or not investing in new products, new facilities, or new equipment. We focused on market opportunities, new technologies and competitive threats. I worked with many other entrepreneurs who also treated what government did or didn’t do as background noise; common to us, our competitors and our suppliers, not among the top five reasons for doing anything of significance.
However, concerns and even irrational fears about what Washington does were then and are now important to the executives of large companies like Hewlett Packard, Intel, General Motors and Goldman Sachs. I suspect that Kotok, who deals with the wealthy and powerful, has transferred their concerns onto the entrepreneurs of small companies because the executives of behemoth financial and industrial companies are suspect. The public is increasingly aware that they have systematically outsourced jobs, laid of highly paid skilled workers and plundered their companies for decades. The public rightly expects job growth to come from smaller firms, while the rich and executives of behemoth organizations need a weak or complicit government which enables large firms to continue dominating their competitors and looting their customers.
An objective professional journalist would have cross checked his experts, verified or qualified their assertions and written a responsible article. However, Jeff Cox chose to go with the flashier, more convenient, and possibly more lucrative message of “blame big-bad Washington.” Sadly, he is but one of a phalanx of unprofessional journalists most of whom will be singing the same tune for the next few months.
Ed Lee, 9/2/10
www. Dismountingourtiger.com
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