Sunday, November 25, 2012

Carly Fiorina -- a 40 year low

Carly Fiorina was on Meet the Press today, where she was introduced as the former CEO of Hewlett-Packard. It would not have been polite to introduce her as former advisor to losing presidential candidate John McCain, who had her ass handed to her when she ran against Barbara Boxer for the U.S. Senate.

Much kinder to boost her bona fides by referring to her storied career in business. In doing so, if we are to continue in the spirit of generosity, let us overlook the fact that during her tenure, HP stock lost half its value and then she was shit-canned by the HP’s Board of Directors. She was given $20 million dollars to walk away and never bother them again, though a restraining order would have been cheaper. Anyway, it must have been money well spent, because the share value of the company jumped on news of her departure. Be that as it may, she’s still a reliable spokesperson for the failed policies various described as trickle-down or supply side economics.

That anyone would try at this late date to defend these policies and be able to maintain a straight face is not a testament to the validity of these ideas, but rather to the shamelessness of the kleptocratic class.

I found one thing she said to be of particular interest. “Small business formation is at a forty year low,” said Ms. Fiorina. Now, I have no idea if this is true of false, except for the fact that it was uttered by a woman who has been thoroughly discredited so many times before. Let’s assume it is true. The question is why is small business formation stalled?

Ms. Fiorina suggested that the reason is that the tax-code is too complex. That’s nonsense, of course. If you want to start a niche boutique, or dress factory employing 5 or 6 cutters and sewers, and a salesperson or two, there’s not too much to know about the tax code that can’t be learned by purchasing Quickbooks. This is not to suggest that you shouldn’t have an accountant. But if you think that the reason you are having trouble competing with Walmart is that they have a better grasp of the tax code, then you shouldn’t be in business anyway.

The reason that small business formation is at a 40 year low (if it is) is that big corporations have consolidated power under the laissez-faire economic policies of the previous administration, and the recession which these policies caused has paralyzed our abilities to deal with this problem. One of the longest lasting legacies of the Bush years will be the reactionary Supreme Court which gave us the Citizens United decision.

I am assuming that everyone who reads this knows about how Walmart moves into neighborhoods, and undercuts the competition, putting them out of business. It then purchases in quantities from suppliers that are so significant that the suppliers can’t survive without Walmart’s business. Next step: demand price breaks from suppliers to the point that the only way they can avoid going out of business is to turn to Chinese manufacturers. Goodbye, more American jobs.

Along the way, Walmart pays its workers coolie wages. You could stop right there and say that’s immoral, and you would be right. It is indefensible to pay people for working full-time for you and leave them unable to provide for their basic needs. It’s just unconscionable. In a by-gone era, Unions would have protected our fellow workers and preserved the dignity of labor. Walmart, and the candidates it supports are on the forefront of the “let's kill unions movement.” But it’s worse than that.

The workers, who labor for the Walton family but can’t provide for their own, must turn to local governments and charities to keep the wolf from the door. Who pays for that? Of course, it is not the people who get paid $20 million dollars to leave their jobs, or the Walton family who own more than the bottom 40% of Americans combined. No, it’s the folks who would like to start a mom-and-pop grocery or a small business, but can’t because local taxes are too high. It’s the former factory workers who are now out of work because their jobs are being done in China.

And there’s another reason that our would-be small business owners can’t open their doors. There are no customers in their communities. Why? It’s because a Walmart worker or an unemployed factory worker can’t afford a new dress. That’s not justice.

By the way, I was just kidding when I said I didn’t know if Carly Fiorini was lying when she told us that business formation was at a 40 year low. Of course, I know, and so do you. Remember, that last March, John Boehner said, that business formation was at a 30 year low? Well, that wasn’t true either. The very highly regarded Kauffman Index shows that, despite a drop from 2010, U.S. startup activity remains above pre-Great Recession levels. The Index shows that 0.32 percent of American adults created a business per month in 2011, the last year for which figures are available. This is a 5.9 percent drop from 2010, but still among the highest levels of entrepreneurship over the past 16 years. As Casey Stengel was fond of saying, “You could look it up.”

“ ... and tell ’em Big Mitch sent ya!”

1 comment:

George Fulmore said...

Today on Meet the Press Fiorina called for lowing the corporate tax rates. Does she not know that most of our major corporations now pay zero taxes due to the high number of loopholes that they can use? And she continues to talk about "uncertainty." Why does Gregory have her on the show, repeatedly. I wonder if any of those folks get paid. If not, maybe NBC seeks out those who do not need the money. Whatever. I'm more than tired of seeing Carly Fiorina on Meet the Press. She is a hack!