The recent White House personnel shifts signal the kickoff of President Obama’s 2012 re-election bid. Of the many changes, the selection of Bill Daley as White House chief of staff and General Electric CEO Jeff Immelt as the head of the President's Council on Jobs and Competitiveness are the most important because they will play a key fundraising role in the upcoming presidential campaign.
Choosing Daley and Immelt are not signs of political moderation by President Obama, as some have suggested, but is the stone cold political realization that the president needs big-business cash to fuel his 2012 campaign.
It’s been reported that Obama’s 2012 re-election bid will shatter the record $750 million in contributions collected during the 2008 campaign by reaching the billion dollar mark.
To raise that staggering amount of cash, Obama is going to need substantial support from corporate deep pockets. Big-business donors, such as CEOs, hedge fund managers and law firm partners typically are not ideologues seeking to advance a political philosophy but are pragmatists wanting to know how Obama’s policies can increase their influence, business strategies and wealth.
Translating Obama’s policy into business returns and campaign dollars will be job one for Daley. As a political and Wall Street insider, Daley has the contacts to make the sale but Obama’s rhetoric and policies has not endeared the president to the animal instincts of many big-business leaders.
There is, however, one policy that can galvanize the president’s fundraising base: Obama’s war on fossil fuels and his unyielding promotion of renewable energy and a green economy.
Billions of dollars invested in renewable energy are now in jeopardy because Congress did not pass Obama’s cap-and-trade plan, which would make energy derived from the burning of fossil fuels more expensive – or, as the president said, “skyrocket.” Because renewable energy can’t compete with the price and reliability of fossil fuels, the financial viability of these investments is dependent on government action to raise the cost of carbon-based energy.
At a recent policy forum at the Brookings Institution, GE CEO Jeff Immelt emphasized the importance of a government policy that would raise energy prices to spur renewable energy. According to Reuters, “On energy, Immelt said a clear U.S. policy making fossil fuels that emit greenhouse gasses more expensive is needed ‘to move the needle’ on accelerating advanced technology investments. ‘There has to be a price on carbon,’ he said.”
Daley and Immelt are the perfect team to appeal to other corporations that gambled on climate change fears and merge these interests with progressive activists, and the social and media elites to unleash the political donating frenzy for Obama’s re-election.
Before joining team Obama, Daley was the head of JPMorgan Chase's corporate social responsibility department, which developed a climate change policy that is hostile to carbon-based energy - coal, oil and natural gas. JPMorgan’s policy is “to advocate that the US government adopt a market-based national policy on greenhouse gas emissions, which includes all sources of emissions and is fair. Options include either a cap-and-trade or tax policy to reduce greenhouse gas emissions at the lowest possible cost.”
JPMorgan, like many other financial institutions, is banking on making money by trading carbon credits and by investing in renewable energy projects. GE and JPMorgan are not the only companies that have a business interest in seeking higher energy prices. Exelon, the Chicago-based utility, has taken a lead role in attacking coal-based electricity generation.
Exelon is a member of the United States Climate Action Partnership (USCAP), a cap-and-trade lobbying organization, and the company was a recipient of a $200 million grant from Obama's economic stimulus plan.
Daley also has ties to Exelon – he advised the company on its failed effort to buy Public Service Enterprise Group Inc. in 2004.
The failure of California Proposition 23 last November shows the fundraising potential behind the war on fossil fuels. A collection of left-wing philanthropists, activist groups and business interests contributed over $30 million to defeat the measure, which would have delayed implementation of a state law mandating a reduction in greenhouse gas emissions until unemployment rates drop to a specific level.
Green technology venture capitalists John Doerr and Vinod Khosla gave $2,100,000 and $1,037,267, respectively, and PG&E, a California utility and USCAP member, kicked in another $500,000.
Doerr’s involvement deserves special attention. Along with Immelt, Doerr is a member of President Obama’s Economic Recovery Advisory Board. He also is Al Gore’s business partner.
The campaign to defeat Prop 23 reveals the money behind the war on fossil fuels. With billions of dollars invested in a green economy, we can expect huge sums of special interest money to back Obama.
As the 2012 presidential election draws closer, we can expect to see Daley and Immelt playing a major role in selling Obama’s green economy to those dependent on legislative fixes to their business plans.
Let’s hope the fossil fuel industry recognizes Obama’s new team is not going to be a moderating voice in the White House. Rather, Daley and Immelt will be green economy bag men collecting cash to put them out of business.