General Electric CEO Jeffrey R. Immelt is super-close to President Obama. The president named Immelt chairman of his Council on Jobs and Competitiveness. Before that, Immelt was on Obama's Economic Recovery Advisory Board. He's a regular companion when Obama travels abroad to hawk American exports. (Why does business need government to do that?)
"Jeff Immelt is perhaps the CEO who is most cozy with President Obama," says journalist Tim Carney. "General Electric is structuring their business around where government is going ... high-speed rail, solar, wind. GE is lining up to get what government is handing out."
Businesses love to have government as their partner. There's safety in it. Why take chances in a marketplace full of fickle consumers and investors, when you can get secure money and favors from the taxpayers? It's an old story, and free-market advocates as far back as Adam Smith warned against it. Unfortunately, too many people think "free market" means pro-business. It doesn't. Free market means laissez faire -- prohibit force and fraud, but otherwise leave the marketplace alone. No subsidies, no privileges, no arbitrary regulations. Competition is the most effective regulator.
Left-wingers criticize corporate welfare until it's for something they like -- for example, "green technology."
"The government's going to invest in certain companies to pioneer new technologies. That, I think, is not corporate welfare," says Tamara Draut of the Progressive think-tank Demos.
I asked her if business is too dumb to pioneer without government direction.
"The private sector will only invest if they know for sure that there is a commercial marketplace."
But if everyone wants these products, that should be an incentive for greedy businesses to make them.
"Not always," she replied. "But the free market does not know anything unless we all collect our interests and say: This is of national import to us."
This is nonsense. How did Apple know we would want iPods, iPhones and iPads? It didn't know with certainty. It took a risk with its own and investors' money.
But for some reason, other products and services are different, according to people like Obama and Draut.
"We desperately need high-speed rail in this country," she says, meaning the taxpayers must be forced to finance it.
The government gives companies billions of dollars to develop new trains. Guess who receives some of that money.
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