A Portfolio of Companies Tied to Obama I won't Invest In

Crista Huff
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Posted: Dec 30, 2011 11:35 PM

While looking at a list of Fortune 500 companies -- American companies ranked by annual revenues -- I noticed something odd at the top of the list that made me shudder.

Five of the ten biggest companies in America are Fannie Mae, General Electric,  Berkshire Hathaway, General Motors and Bank of America.  Anything strike you as not-quite-right on that list?

These are companies which have become intimately tied to American government; either run by our government or in bed with our government.  And what do they call it when governments and corporations work hand in hand to control wealth and power, and pick winners and losers?  They call that fascism.

"Fascists have an agenda that is primarily economic. As the Free Dictionary notes, fascism/corporatism is 'an attempt to create a 'modern' version of feudalism by merging the 'corporate' interests with those of the state.' " -- The Ghost of Vice President Wallace Warns: "It Can Happen Here" by Thom Hartmann

And while the aforementioned article has a secondary goal of casting aspersions on Republicans, it's pretty obvious that Democrats with fascist inclinations are equally effective in destroying free markets, the very basis of capitalism.

Here are some examples of the intricate and warped corporate/government interactions of those five powerhouse Fortune 500 companies:

Bank of America and Fannie Mae -- Can you say "bailout"? The U.S. government swooped in and rescued Bank of America and Fannie Mae from financial ruin during the 2008 Financial Meltdown.

"Bank of America has received another $20 billion from the federal government's bailout fund, along with guarantees on $118 billion of assets at the bank, to absorb its recent purchase of the ailing Merrill Lynch," reported CNN Money in BofA: $20B bailout, huge Merrill loss.

But you say that the financial system was collapsing, and the government had to step in to save the world? That very well may be.  It's also true, however, that the government was responsible for a key underpinning of the Financial Meltdown: the frothy mortgage market.  (see: Housing Finance and the 2008 Financial Crisis by Lawrence H. White)  And just when you thought it was safe to go back in the water, Bank of America got in bed with the Obama administration on the fictitious "we're going to help the little guy" Obama Stimulus Loan Modification Program.  Except that almost no one got "modified".  It was a PR stunt to make the voters feel good.

"The mortgage servicing system over the past few years has ill-served all parties involved – borrowers, lenders, neighborhoods, and investors – and has impaired the health and recovery of the housing and mortgage markets." -- Mark Pearce, Speeches and Testimony, Director, Division of Depositor and Consumer Protection, Federal Deposit Insurance Corporation, July 7, 2011

Various consumer protection groups and experts are constantly quoting "90%" and "94%" as the failure rates of these loan modification programs.  But you're not going to hear any of that from mainstream media.  Why not?  Ah, the answer to that question leads us to....General Electric!  You know, the big American corporation which is led by Jeffrey Immelt, one of America's jobs czars?  You may not have heard much about Immelt, but he's very popular overseas in places like China, where he typically sends the G.E. jobs that are shut down in America.

Jeffrey Immelt is the head of Obama's Jobs Council.  So you might think that had something to do with getting the economy running again in America?  Nah.  You're way too...logical.  Read: GE CEO Jeffrey Immelt, The Head Of Obama’s Jobs Council, Is Moving Jobs And Economic Infrastructure To China At A Blistering Pace --The Economic Collapse, July 29, 2011

Why haven't you heard about this loan modification mess, and about GE sending so many jobs overseas?  Oh, well that might have something to do with Obama's favorite American corporation owning dozens of television channels. You can be sure that General Electric's media outlets are not going to say anything which casts aspersions on the parent company, or their hand-in-hand involvement with the Obama administration.

And why is the government getting involved in giving American taxpayers' money to General Motors?  Capitalism is about businesses sinking or swimming on their own ingenuity, mismanagement or obsolescence.  Fascism is about bailouts, power, and government ownership, and our government owns 26% of General Motors (General Motors 2011 Earnings: Third Quarter -- The New York Times, Dec. 9, 2011).  "But GM got Uncle Sam’s special bankruptcy package that allows it {to} write off up to $45 billion of old losses going forward. That puts its total bailout at $105 billion," reported The Daily, May 19, 2011.

And is if the bailout wasn't enough, Obama's minions just couldn't keep their greedy green hands off the company to let it figure out how to survive after that Disneyland Christmas.  They were so obsessed with the idea of clean green energy that they forced G.M. to produce the Chevy Volt, a car which was financially unworkable, and ultimately dangerous for the consumer.  In Chevy Volt Costing Taxpayers Up to $250K Per Vehicle (Michigan Capitol Confidential, Dec. 21, 2011), we learn that the production of the Volt  "included 18 government deals that included loans, rebates, grants and tax credits."

How are Ford and Toyota supposed to compete against that without receiving similar graft?  As it turns out, not to worry!  Because the damn cars are exploding left and right. "The background on the current Chevy Volt situation is that in a very few instances, fires broke out days or even weeks after the NHTSA crash-tested the Chevy Volt and its battery pack, in crashes severe enough to damage the battery. A NHTSA investigation is ongoing. NHTSA says it is not aware of any such fires occurring in real-world crashes," reports Forbesin Chevy Volt Battery Fires Threaten All Electric Vehicle Makers, Not Just GM, Dec. 12, 2011.

To round out our list of five of the ten biggest Fortune 500 companies benefitting from government largesse is Berkshire Hathaway, famously run by Warren Buffett.  Buffett is a huge Obama supporter and was a member of Obama's economic campaign team while pressuring Congress to pass the Troubled Assets Relief Program (TARP) in 2008.  The American Thinker tells us that Warren Buffett invested $13 billion in bank stocks while the prices were trashed -- an investment that a rational person would not have made, had they not had some inside assurance that the TARP bailout would go through.  And we know that he additionally made $3.7 billion dollars profit off a loan to Goldman Sachs during the 2008 Financial Meltdown.

Okay, so maybe he just guessed that Congress would pass the TARP legislation.  But there's also that little income tax evasion problem which the I.R.S. curiously turns a blind eye to.  According to the Huff Post, Aug. 29, 2011, "Berkshire Hathaway, the eighth-largest public company in the world according to Forbes, openly admits to still owing taxes for years 2002 through 2004 and 2005 through 2009, according to the New York Post. The company says it expects to 'resolve all adjustments proposed by the US Internal Revenue Service' within the next year."

So why do I care about  Warren Buffett and his Washington D.C. dancing partner?  Because I'm a stock investor.  And stocks only work under capitalism via free markets.  Once any government gets super-involved, the company is no longer surviving on its own financial strength.  And since I pick my stock investments based on corporate financial strength, I absolutely cannot consider investing in companies which are propped up by and beholden to government.  Therefore, you won't see me writing about General Electric on my stock website, nor any of the other "corporations" listed in this article.  Because when the government players eventually cast their favors in a different direction, companies like Bank of America will be left in the dust, and will have long lost all of the management talent which knew how to run a business in the days when BofA was capable of standing on its own two feet.

As a small business owner, I don't want government involved in my business, or my competitors' businesses; the businesses I invest in nor the businesses that I patronize.  No good can come of it.  Government is notoriously lame at operating any business either effectively or profitably vs. private competition.  I want the government out of my house and out of the marketplace.

You're welcome to visit my website, sign up for the one-month free trial, and read the stock articles.  

But don't expect any recommendations from me on what to do with the stocks of Berkshire Hathaway, General Motors, Fannie Mae, Bank of America nor General Electric.  They don't operate under capitalism, so they don't fall under my purview.

Happy investing!

Crista Huff