A Governor`s Story, by Jennifer Granholm: on Corporations
Barack Obama:
Irresponsibility on Wall Street led to financial crisis
The housing and credit markets slid from "troubled" toward "imploding." On September 28, 2008, Barack Obama visited downtown Detroit to rally tens of thousands of frightened, angry Michiganders.
Obama targeted his remarks to those who had been laid off, those without hope, those who needed to believe.
"We meet here at a time of great uncertainty in Detroit and all across America," he said. "The era of greed and irresponsibility on
Wall Street and in Washington has led us to a financial crisis as serious as any we have faced since the Great Depression. We don't just need a plan for bankers and investors. We need a plan for autoworkers!" I felt the crowd's mood surge.
Source: A Governor's Story, by Jennifer Granholm, p.154-155
Oct 1, 2005
Chris Christie:
OpEd: Don't pick winners & losers? Picks "critical" sectors
Governors and politicians who constantly proclaim that "government should not pick winners and losers" are doing precisely that, and for good reason:
Virtually every state is locked in head-to-head battle with other states for business sitting decisions.
To survive such competition, state governments are forced to practice economic policy, whether they choose to admit it or not.
Governor Chris Christie's New Jersey Economic Development Authority favors specific "business sectors critical to the State's economy."
Source: A Governor's Story, by Jennifer Granholm, p.242
Oct 1, 2005
George W. Bush:
2006: Automakers need a product that's relevant
President Bush seemed to disdain any federal role in ensuring the future of one of our country's most far-reaching industries. "I can't make your automakers profitable," Bush had told me during a tour of the United Solar Ovonics facility in Auburn Hills.
In January 2006, Bush had been quoted as saying that the automakers simply needed to make "a product that's relevant."
Both remarks implied that the Detroit Three fully deserved their economic troubles--and if millions of workers and their families suffered along with the executives, well, that was just too bad.So now, in the devastation of late 2008, the
unimaginable notion that the federal government might stand idly by as the American auto industry crashed and burned seemed all too frighteningly plausible. [However, Bush funded a $17B bailout.]
Source: A Governor's Story, by Jennifer Granholm, p.168
Oct 1, 2005
Jennifer Granholm:
Executive pay imbalance is improper from moral standpoint
Corporate executives think in terms of numbers. When it comes to compensation, they see a fraction: Their pay is on top, with corporate earnings on the bottom. The resulting value is very tiny, meaning that their income is not a big deal, they reason.
Workers think in numbers, too. But the traction the workers see is quite different. They see an executive's bonus on top and their pay on the bottom. THAT fraction is top-heavy--an "improper fraction," as we learned in math class.
Such imbalance was also improper from a moral standpoint.Alienate the workers through continual demands for one-sided concessions, and it's not just morals but also morale and productivity that deteriorate. Fairness at both ends of the pay
scale is not just a legitimate moral end but also an essential element of sound leadership. Morality and morale are deeply interwoven in credible leadership. If leaders destroy the former, they will eventually destroy the latter.
Source: A Governor's Story, by Jennifer Granholm, p. 80
Oct 1, 2005
Jennifer Granholm:
Tax cuts are minor compared to talent recruitment
The notion that tax cuts are the magic elixir of business growth ignores the realities of contemporary business. As one of our interns remarked, "The old tax-cuts-only mind-set is SO 20th century." In 21st-century knowledge-based economies, tax rates
play a minor role in business location decisions. For the kinds of advanced-manufacturing, high-tech business we were recruiting, TALENT is what matters. Quality of life, culture, and the "coolness" factor of host cities are also key to those decisions.
Companies need to recruit smart, ambitious innovators--people who want to live in cool cities with exciting things to do and great schools for their kids. And where do talented young employees and the cool cities that attract them come from? From public
investments in schools, the arts, universities, and training--the very things we've been cutting for years under the mantra "Government doesn't create jobs. Only the private sector creates jobs." It's a half-truth we've swallowed whole for much too long.
Source: A Governor's Story, by Jennifer Granholm, p.124
Oct 1, 2005
Jennifer Granholm:
We pick winners & losers to compete against other states
Governors and politicians who constantly proclaim that "government should not pick winners and losers" are doing precisely that, and for good reason: Virtually every state is locked in head-to-head battle with other states for business sitting decisions.
To survive such competition, state governments are forced to practice economic policy, whether they choose to admit it or not.- Indiana's tax code boasts 8 different credits, including those for industries like media and alternative fuels,
that the administration has chosen as "winners."
- The New Jersey Economic Development Authority favors specific "business sectors critical to the State's economy."
- In Ohio, 12 different tax incentives and credits are offered to businesses in
particular sectors from manufacturing to technology.
- In Texas, in addition to the usual targeted tax incentives, the governor has doled out over $250 million to emerging businesses in 5 specific industry clusters.
Source: A Governor's Story, by Jennifer Granholm, p.242
Oct 1, 2005
Jennifer Granholm:
Carmaker government-run bankruptcies saved GM & Chrysler
When, on May 24, 2011, Chrysler announced that it was repaying the loans years ahead of schedule, the same Mitt Romney who'd used the pages of the "New York Times" to declare "Let Detroit Go Bankrupt" boldly sought to claim credit for the auto industry's
turnaround. "Mitt Romney had the idea 1st," said Eric Fehrnstrom, a Romney spokesman. "You have to acknowledge that. He was advocating for a course of action that eventually the Obama administration adopted."This was doubly wrong.
In the first instance, without the governor's investment, which Romney condemned, there would have been no auto industry left to save. Second, it was the government's intervention and the high-speed bankruptcy orchestrated by the Treasury Department
that saved GM and Chrysler. A traditional bankruptcy without the US government's participation would likely have meant liquidation and the loss of the backbone of American manufacturing.
Source: A Governor's Story, by Jennifer Granholm, p.256
Oct 1, 2005
John Kasich:
OpEd: Don't pick winners & losers? Offers 12 tax credits
Governors and politicians who constantly proclaim that "government should not pick winners and losers" are doing precisely that, and for good reason:
Virtually every state is locked in head-to-head battle with other states for business sitting decisions.
To survive such competition, state governments are forced to practice economic policy, whether they choose to admit it or not.
In Governor John Kasich's Ohio, 12 different tax incentives and credits are offered to businesses in particular sectors from manufacturing to technology.
Source: A Governor's Story, by Jennifer Granholm, p.242
Oct 1, 2005
John Rockefeller:
Persuaded Toyota to build plant in West Virginia
The role of Senator Jay Rockefeller in convincing Toyota to build a plant in Buffalo, West Virginia, after the state lost its textile industry owing to globalization, had become legendary. A scion of one of the world's richest business families,
Rockefeller had known CEO Akio Toyoda since the 1960s, and he personally appealed to him to use his company's influence to help restore his economically wounded state.
Rockefeller showed his commitment by personally tramping through wheat fields with Toyota executives in search of the perfect location. "By the time Toyota decided to make Buffalo its new home,"
Rockefeller said in 2006 during the plant's 10th anniversary, "I felt like a full-fledged member of that site selection team."
Source: A Governor's Story, by Jennifer Granholm, p. 72
Oct 1, 2005
Mark Sanford:
2009: Disdainful of auto companies' bailout proposals
I went on news shows to proclaim that the restructuring plans for GM and Chrysler would at least prevent bankruptcy, the worst possible outcome for the carmakers and our state.
I was pitted against Governor Mark Sanford of South Carolina and Governor Tim Pawlenty of Minnesota on a Fox News program. Sanford was disdainful of the auto companies' proposals. He said the furniture and textiles industries had been "decimated," but
it "didn't take a series of bailouts" to fix their problems. He didn't mention that textiles and furniture manufacturing had all but disappeared from the South. He and Pawlenty dismissed the degree of "restructuring" that was in the auto companies' plans
"You probably haven't read those plans," I asserted, furious at Sanford's demagoguery. His silence was deafening; clearly, he had not. Pawlenty admitted he hadn't read the plans either.
Source: A Governor's Story, by Jennifer Granholm, p.175-176
Oct 1, 2005
Mike Johanns:
Auto bailouts were worst investment you could possibly make
President Obama was back in Michigan to celebrate another success story: Automobile factories in Detroit had added new shifts.
For the first time since 2000, employment in the auto industry had grown year over year; in all, 55,000 new jobs had been created.He said, "So today, this industry is growing stronger. It's creating new jobs. We are moving forward.
I want you to remember, though, that if some folks had their way, none of this would be happening. There were leaders in the 'just-say-no-crowd in Washington who didn't think it was a good idea.
There was one who called it 'the worst investment you could possibly make' [Nebraska Republican senator Mike Johanns, who'd fought the loans].
Source: A Governor's Story, by Jennifer Granholm, p.223
Oct 1, 2005
Mitch Daniels:
OpEd: proclaims laissez-faire; but offers 8 tax credits
Governors and politicians who constantly proclaim that "government should not pick winners and losers" are doing precisely that, and for good reason: Virtually every state is locked in head-to-head battle with other states for business sitting decisions.
To survive such competition, state governments are forced to practice economic policy, whether they choose to admit it or not.
Governor Mitch Daniels of Indiana may proclaim his fealty to laissez-faire on the campaign trail, but his state's tax code boasts
8 different credits, including those for industries like media and alternative fuels, that the administration has chosen as "winners."
Source: A Governor's Story, by Jennifer Granholm, p.242
Oct 1, 2005
Mitt Romney:
NY Times editorial: "Let Detroit Go Bankrupt"
When, on May 24, 2011, Chrysler announced that it was repaying the loans years ahead of schedule, the same Mitt Romney who'd used the pages of the "New York Times" to declare "Let Detroit Go Bankrupt" boldly sought to claim credit for the auto industry's
turnaround. "Mitt Romney had the idea 1st," said Eric Fehrnstrom, a Romney spokesman. "You have to acknowledge that. He was advocating for a course of action that eventually the Obama administration adopted."This was doubly wrong.
In the first instance, without the governor's investment, which Romney condemned, there would have been no auto industry left to save. Second, it was the government's intervention and the high-speed bankruptcy orchestrated by the Treasury Department
that saved GM and Chrysler. A traditional bankruptcy without the US government's participation would likely have meant liquidation and the loss of the backbone of American manufacturing.
Source: A Governor's Story, by Jennifer Granholm, p.256
Oct 1, 2005
Rick Perry:
OpEd: Says don't pick winners & losers; but doles out $250M
Governors and politicians who constantly proclaim that "government should not pick winners and losers" are doing precisely that, and for good reason:
Virtually every state is locked in head-to-head battle with other states for business sitting decisions.
To survive such competition, state governments are forced to practice economic policy, whether they choose to admit it or not.
In Texas, in addition to the usual targeted tax incentives, Governor Rick Perry has doled out over $250 million to emerging businesses in 5 specific industry clusters.
Source: A Governor's Story, by Jennifer Granholm, p.242
Oct 1, 2005
Tim Pawlenty:
2009: Automakers should have gone bankrupt 6 months earlier
I was pitted against Governor Tim Pawlenty of Minnesota on a Fox News program [where I proclaimed that] the restructuring plans for GM and Chrysler would at least prevent bankruptcy, the worst possible outcome for the carmakers and our state.
Pawlenty dismissed the degree of "restructuring" that was in the auto companies' plans."You probably haven't read those plans,"
I asserted. "Governor Pawlenty, have you read the report that the carmakers have just submitted? I bet you haven't." Pawlenty admitted he hadn't read the plans.
He [asserted] that the automakers should have gone into bankruptcy six months sooner. "They should do it now," he concluded.
I responded by strongly reasserting the importance of the auto industry to the American economy.
Source: A Governor's Story, by Jennifer Granholm, p.175-176
Oct 1, 2005
Page last updated: Jun 11, 2014