Stop Bashing Business, Mr. President

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    Oct 16, 2010 12:07 AM GMT
    We have had some discussions here as to whether this administration is maintaining a business friendly climate. To weigh in on that discussion is Ken Langone, a co-founder of Home Depot.

    "If we tried to start The Home Depot today, it's a stone cold certainty that it would never have gotten off the ground."

    http://online.wsj.com/article/SB10001424052748704361504575552080488297188.html?mod=ITP_opinion_0

    "Mr. Langone, a former director of the New York Stock Exchange and co-founder of Home Depot, is chairman of Invemed Associates."
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    Oct 16, 2010 12:19 AM GMT
    http://money.usnews.com/money/blogs/flowchart/2010/5/20/why-startups-surged-during-the-recession.htmlWith more than 15 million Americans unemployed, many for six months or longer, it's easy to stereotype the jobless as dropouts who have lost hope and motivation. But a new study of entrepreneurship suggests that the unemployed are quite industrious, helping spur the pace of new-business startups to a record level in 2009.
    ...
    Put another way, about 340 people out of every 100,000 started a business each month in 2009, compared with a rate of 320 people in 2008 and 270 people in 2000. Those new businesses aren't necessarily the next Google, but to qualify, individuals must consider the business their main job and work at it at least 15 hours per week. So selling tomatoes from the summer garden probably doesn't qualify.

    Personal opinions of Mr. Langone aside, he's just factually wrong. And I'm glad he's willing to donate his SS to charity, because others would take their unemployment benefits while probably having millions in the bank. And while I don't think cutting Treasury checks to high-worth people is going to cut a dent in the deficit, I do agree with him about means-checking for such people.

    I think the stock price of Home Depot (falling quite a bit since 2007) is making him bitter.icon_razz.gif
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    Oct 16, 2010 12:21 AM GMT
    This is absurd.

    Do you know why Home Depot wouldn't have gotten off the ground today? Because middle class consumers do not have the expendable income (or credit) to constantly be upgrading their homes. Nor, do people have access to the rising home pries that made "flipping" so popular. The constant increase in home pries is what fueled Home Depot's growth and the decline of the housing market is why it would never make it today.

    By the way, Ken Langone has quite a sordid past when it comes to business. He was one of the chief cheerleaders for Dick Grasso $140 million pay package from NYSE, which was then a nonprofit. It is widely believed that Langone was behind the entrapment of Eliot Spitzer as repayment for Spitzer taking on Wall Street as New York's attorney general. icon_rolleyes.gif
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    Oct 16, 2010 12:23 AM GMT
    q1w2e3 said
    http://money.usnews.com/money/blogs/flowchart/2010/5/20/why-startups-surged-during-the-recession.htmlWith more than 15 million Americans unemployed, many for six months or longer, it's easy to stereotype the jobless as dropouts who have lost hope and motivation. But a new study of entrepreneurship suggests that the unemployed are quite industrious, helping spur the pace of new-business startups to a record level in 2009.
    ...
    Put another way, about 340 people out of every 100,000 started a business each month in 2009, compared with a rate of 320 people in 2008 and 270 people in 2000. Those new businesses aren't necessarily the next Google, but to qualify, individuals must consider the business their main job and work at it at least 15 hours per week. So selling tomatoes from the summer garden probably doesn't qualify.

    Personal opinions of Mr. Langone aside, he's just factually wrong. And I'm glad he's willing to donate his SS to charity, because others would take their unemployment benefits while probably having millions in the bank. And while I don't think cutting Treasury checks to high-worth people is going to cut a dent in the deficit, I do agree with him about means-checking for such people.

    I think the stock price of Home Depot (falling quite a bit since 2007) is making him bitter.icon_razz.gif

    That's another viewpoint, but what specific fact did he cite that is "wrong"?
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    Oct 16, 2010 12:26 AM GMT
    Christian73 saidThis is absurd.

    Do you know why Home Depot wouldn't have gotten off the ground today?


    Because there's not enough Lesbians?

    ba dun tsssssssssss
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    Oct 16, 2010 12:26 AM GMT
    Hey, but the Pope can't be wrong:
    He was made a Knight of St. Gregory by Pope Benedict XVI.
    Other notable knights were Forbes and Murdoch.
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    Oct 16, 2010 12:31 AM GMT
    socalfitness said
    That's another viewpoint, but what specific fact did he cite that is "wrong"?

    Well, with all these startups, it just shows that it's not much harder to have gotten a startup off the ground than, say, in 2000.
    Besides, it's not a fact that he stated, he just said "if." With no justification other than accusations of onerous regulations.
    I quote the Economist article again on No Love Lost:
    http://www.economist.com/node/17095509?story_id=17095509Even a Republican administration would have been obliged to reform financial regulation, and, though there is a lot to quibble with in the Dodd-Frank act, the administration responded to requests from Wall Street to kill some of the more alarming reform proposals from Democrats in Congress. One way it did this was to punt the proposals on to regulators for their consideration—which is why business is now able to complain about its “uncertainty” over what the full impact of Dodd-Frank will be. Mr Obama might reply that uncertainty is preferable to the alternatives that were considered by Congress.
    ...
    So it would be tempting to conclude that Mr Obama’s business critics protest too much, especially as their failure to create jobs in America coincides with earning huge profits and sitting on record amounts of cash. Better to point the finger of blame at the White House, they might well think, lest it be pointed at them.


    I do agree with him that Obama needs to hire somebody from business, even if just for symbolic purposes. icon_lol.gif
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    Oct 16, 2010 12:37 AM GMT
    Christian73 saidThis is absurd.

    So every single point or observation he made in the whole piece is absurd? Nothing he said had any truth or validity?
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    Oct 16, 2010 12:38 AM GMT
    JAKEBENSON said
    Christian73 saidThis is absurd.

    Do you know why Home Depot wouldn't have gotten off the ground today?


    Because there's not enough Lesbians?

    ba dun tsssssssssss


    icon_lol.gif
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    Oct 16, 2010 12:48 AM GMT
    socalfitness said
    Christian73 saidThis is absurd.

    So every single point or observation he made in the whole piece is absurd? Nothing he said had any truth or validity?


    The absurdity is in believing the fox when he decries his lack of access to the henhouse.

    As I pointed out earlier, Langone saw nothing wrong with paying back his long time buddy Dick Grasso with a compensation package as a nonprofit executive that would have you all screaming if the head of the Girls Scouts got it.

    He points to no regulation, no policy, just a sense that Obama is "picking on business". What is the median salary at Home Depot and how does that compare to Nardelli's compensation? Their entire business model and expansion was based on convincing middle class people that they needed to constantly be upgrading their homes and leveraging their primary asset (real estate) to do so. That model has now imploded with home prices declining nationwide and foreclosures rampant, and that's Obama's fault? icon_rolleyes.gif
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    Oct 16, 2010 12:51 AM GMT
    Christian73 said
    socalfitness said
    Christian73 saidThis is absurd.

    So every single point or observation he made in the whole piece is absurd? Nothing he said had any truth or validity?


    The absurdity is in believing the fox when he decries his lack of access to the henhouse.

    As I pointed out earlier, Langone saw nothing wrong with paying back his long time buddy Dick Grasso with a compensation package as a nonprofit executive that would have you all screaming if the head of the Girls Scouts got it.

    He points to no regulation, no policy, just a sense that Obama is "picking on business". What is the median salary at Home Depot and how does that compare to Nardelli's compensation? Their entire business model and expansion was based on convincing middle class people that they needed to constantly be upgrading their homes and leveraging their primary asset (real estate) to do so. That model has now imploded with home prices declining nationwide and foreclosures rampant, and that's Obama's fault? icon_rolleyes.gif

    You have reasons to dismiss the whole piece out of hand. Perhaps others will read it and decide what specifics make sense. BTW - wondering if the left sites you frequent have hit pieces prepared on all prominent businessmen so guys like you will be ready. Your dossier on him was pretty conveniently retrieved and so quickly. You guys are organized.
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    Oct 16, 2010 1:03 AM GMT
    And his feelings about Mr. Bahara (the US attorney for southern New York) aside, I hope he's not condoning insider trading:

    http://dealbook.blogs.nytimes.com/2009/10/16/hedge-fund-executive-is-charged-with-fraud/Preet Bahara, the United States attorney for the Southern District of New York, compared the investigation to those used against the Mafia and drug cartels.
    “This case should serve as a wake-up call to Wall Street and to every hedge fund manager,” Mr. Bahara said. “These people were privy to inside information, but they didn’t know one secret, that we were listening.”


    He's not actually saying they are the Mafia, he's just using the same techniques he's using against the Mafia.
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    Oct 16, 2010 1:15 AM GMT
    Let's use the Chilean miners as an example. Read the full article for how corrupt and unethical the private company owning the mine were.
    http://www.huffingtonpost.com/william-k-black/capitalism-would-have-kil_b_764948.htmlWhere did the profits go? Capitalism would have left the miners to die. The government paid to rescue the miners.

    When we prevent a corporation from engaging in fraud or endangering its workers we do not harm capitalism, but rather save honest businesses from being driven from the marketplace. Akerlof demonstrated in 1970 -- forty years ago -- that control frauds can produce a "Gresham's" dynamic in which the markets drive ethical firms and professionals out of the marketplace. When cheaters prosper, markets become perverse. Effective regulators serve as the "cops on the beat" that allow honest firms, workers, lenders, investors, consumers, and taxpayers to prosper.
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    Oct 16, 2010 1:27 AM GMT
    http://www.economist.com/blogs/buttonwood/2010/09/politics_regulation_financial_markets_and_inequality

    QUOTE AUTHOR GOES HEREAlas, the use of the Marxist terminology betrays a distressing tendency in modern debate. The recent discussion on this blog of The Spirit Level provoked one inevitable comment about how those who worry about inequality should consider the Soviet Union or Cuba or North Korea. But we are not talking about a choice between modern America and north Korea, but between 2010 America and 1950s America, which had a more equal income distribution, but was fiercely anti-communist. All western democracies are mixed economies, in which the state performs some functions and the private sector others. The argument is about where to draw the line, and it goes back and forth in a process of trial and error.
    ...
    To say that any further regulation is socialism, or that any consideration of inequality is misguided, seems wilfully blind. If banks earn huge profits, and their traders huge bonuses, only because of an implicit state subsidy, that seems a legitimate matter of public concern. For those who believe this is the road to Cuba, one might easily respond that the other camp is on the road to 18th century France, where wealth was concentrated in the hands of a tiny, hereditary elite. A gross caricature? No more than the Cuba example. After all, the evidence suggests that social mobility is falling in America and Britain, probably because the wealthy can gain advantages for their offspring via private education.

    Surely the American dream suggests that all people should have an opportunity to succeed, despite the circumstances of their birth. This meritocratic model is not only inspiring but the best way of ensuring economic success. So any sign that the model is being destroyed requires serious consideration. Using the Marxist label is as fatuous as bringing Hitler into any political discussion.
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    Oct 16, 2010 1:59 AM GMT
    socalfitness said
    You have reasons to dismiss the whole piece out of hand. Perhaps others will read it and decide what specifics make sense. BTW - wondering if the left sites you frequent have hit pieces prepared on all prominent businessmen so guys like you will be ready. Your dossier on him was pretty conveniently retrieved and so quickly. You guys are organized.


    Nope. There's no conspiracy. I work in philanthropy in New York City where Lanagone's good and bad deeds are legendary.
  • Webster666

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    Oct 16, 2010 6:32 AM GMT
    Claiming that any President was anti business, seems absurd...
  • tokugawa

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    Oct 16, 2010 9:25 PM GMT
    Webster666 saidClaiming that any President was anti business, seems absurd...


    ... especially considering the many millions of dollars in campaign contributions Obama received from business interests which assisted in his election as President in 2008.