Wednesday, August 24, 2011

What’s good for General Motors is good for America

“What’s good for General Motors is good for America,” is a mis-quote from 1953 testimony given by Charles E. Wilson at his Congressional confirmation hearings to become Secretary of Defense in the Eisenhower administration. Wilson was defending his reluctance to sell millions of dollars of General Motors stock. When asked if he as Secretary of Defense could make a decision adverse to the interests of General Motors, Wilson answered that he could not conceive of such a situation, “because for years I thought what was good for the country was good for General Motors and vice versa.”

The American economy in the Eisenhower 1950s was the envy of the world. Without significant global competition American corporations and workers prospered. America was the workshop of the world, and American exports were king.

No modern American corporate executive could make a statement like Wilson’s without irony. Between 2004 and 2009 American based multi-national corporations have cut 2.9 million jobs in the United States, while outsourcing 2.4 million jobs to their overseas operations.

General Electric’s chief executive Jeff Immelt (the head of the Obama administration’s, “jobs council”) acknowledges that the health and well being of a company such as GE is now less connected to the well being of the American economy. Immelt says, “I’m a GE leader first and foremost. At the same time…I work for an American company.”

In 2000 some 54 percent of GE employees worked in the United States. In 2010 about 46 percent of General Electric’s 287,000 employees worked in the United States. GE laid off 21,000 American workers and closed 20 factories between 2007 and 2009.

The company, led by Immelt, earned $14.2 billion in profits in 2010, but paid no Federal taxes because the bulk of those profits, some $9 billion, were offshore. The year 2010 was the second year in a row that GE paid no taxes. General Electric states that it “pays what it owes under the law.”

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