http:\/\/www.whitehouse.gov\/the-press-office\/2014\/12\/03\/remarks-president-business-roundtable<\/a><\/p>\nThe last 2 paragraphs before Q&A were particularly revealing:<\/p>\n
But, domestically, the area where I have the deepest concern is the fact that although corporate profits are at the highest levels in 60 years, the stock market is up 150 percent, wages and incomes still haven\u2019t gone up significantly, and certainly have not picked up the way they did in earlier generations. That\u2019s part of what\u2019s causing disquiet in the general public even though the aggregate numbers look good.<\/em><\/p>\nAnd one thing I\u2019d like to work with the BRT on is to ask some tricky questions, but important questions, about how we can make sure that prosperity is broad-based. I actually think when you look at the history of this country, when wages are good and consumers feel like they\u2019ve got some money in their pocket, that ends up being good for business, not bad for business. I think most of you would agree to that. And we\u2019ve got a lot of good corporate citizens in this room; unfortunately, the overall trend lines, though, have been, even as productivity and profits go up, wages and incomes as a shared overall GDP have shrunk. And that\u2019s part of what is creating an undertow of pessimism despite generally good economic news.<\/em><\/p>\nThe President is arguing that CEOs have a responsibility to be \u201cgood corporate citizens\u201d and increase wages when profits and stock prices increase. When they don\u2019t, a \u201cdisquiet\u201d and \u201cundertow of pessimism\u201d develops in the populous. He\u2019s wrong for at least 3 reasons:<\/p>\n
First, wages are\u2014or at least should be\u2014determined by the market, not profits or stock prices. Companies pay workers what is necessary to get a job done. Companies don\u2019t increase wages because profits increase. If this were true, then wages would fall at a company when profits decline. The market simply doesn\u2019t respond this way.<\/p>\n
Second, shareholders incur risk that typical workers do not bear. Companies that lose money still have to pay their workers\u2014or lay them off; their shareholders suffer the consequences. Workers wishing to share in the bounty of anticipated company growth should become shareholders and accept the risk. You can\u2019t have it both ways.<\/p>\n
Finally, Obama only<\/em> mentioned profits, share prices, and wages. He neglected to address the myriad government policies and regulations that discourage companies from hiring workers. Whether it\u2019s Obamacare, his higher minimum wage proposals, or his support for amnesty for illegal immigrants, Obama\u2019s policies\u2014not corporations\u2014have created the \u201cdisquiet\u201d and the \u201cundertow of pessimism.\u201d<\/p>\nThe President\u2019s comments reflect a continued misunderstanding of how business can and should function.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Business Roundtable (BRT) is a group of US CEOs that seek to promote pro-business government policies. My review of the BRT is mixed. Some of its positions, like the group\u2019s support for \u201ccomprehensive immigration reform,\u201d are just plain self-serving. In fact, the notion that CEOs and the President should \u201cwork together\u201d to solve our […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts\/854"}],"collection":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=854"}],"version-history":[{"count":0,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts\/854\/revisions"}],"wp:attachment":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=854"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=854"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=854"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}