Throw the Bums Out
9 September 2001
When George W. Bush and Dick Cheney took over, I did not know which corporate form of government would be installed. I should have realized that Cheney was the public company type and Bush was the privately held type, and that they would bring a hybrid of these two corporate forms to the White House. To their credit, the president and vice president have kept their campaign pledge to run the White House like a corporation. To their discredit, Bush and Cheney have incorporated the most abusive practices of both forms.
Free market capitalism comes with a warning label "buyer beware." The Bush campaign should have came with the warning label "voter beware." Bush and Cheney promised to govern as "compassionate conservatives." Given those promises many Americans were shocked when new administration ran the country hard to the right. We should never confuse marketing with the truth or a promise.
Nepotism is a dirty word in public companies but a way of life in privately held companies. In the Bush-Cheney administration, the kids of Colin Powell, Antonin Scalia, William Renquist, Strom Thurmond and the son-in-law of Dick Cheney all owe their present government employment to nepotism. This is not a surprise. The revolving door between government and corporations never swings more corruptly then when family members are given key government positions.
Public companies are allowed to keep certain practices secret but are subject to a much higher level of scrutiny from the Securities and Exchange Commission. However, both private and public companies are adept at keeping secrets hidden. This administration likes to keep its own secrets and those of past presidents as well. Despite invoking the ghosts of Republicans past, Cheney adopted the policy of "Executive Privilege" and refused to turn over to Congress documents demanded by the General Accounting Office (GAO). The administration has also continuously postponed release of the Reagan presidential papers. It seems that how policy is formed is a trade secret in the Bush-Cheney corporate government.
It is common for executives in privately held companies and public companies to provide senior management and their special friends benefits that most Americans do not even dream about. The 1986 tax act tried to curb these practices by eliminating federal tax deductions for benefits that were exclusionary. Count Bush and Cheney as two guys who don't feel guilty about enjoying the spoils of the office of the presidency. The rhetoric and the record are clear. On Labor Day, upon returning to work after a month long vacation, President Bush responded to the highest unemployment rates in four years by looking American workers in the face and saying, "I am concerned about working families." Later that week he welcomed President Vincente Fox of Mexico for Bush’s first state dinner. Possibly confusing Fox with the network brass at the Fox network, Bush invited only one media personality, Brit Hume of Fox television. The night of conspicuous consumption included a 20-minute fireworks display at an estimated cost of $200,000. The citizens of Washington, D.C. were kept in the dark about the festivities until the fireworks burst into the air. Now that we have had a chance to read George W.'s lips and actions the operative phrase that describes Bush's sensitivities to average Americans: "Who cares what you think?"
All corporations have a pat response to charges the company did something wrong. They deny it. The heads of the manor tobacco companies, the so-called "seven dwarfs," denied nicotine was addictive during their testimony before Congress. Bill Gates denied all aspects of the government's antitrust case, including facts that were common knowledge within the industry. Bill Clinton will go down in history for the manner in which he looked into the camera and denied the truth about his relationship with a White House intern. Bush and Cheney followed form in denying that their tax cut favored the rich, would require the government to borrow against the social security reserves and require cuts in future spending. Corporations and government officials have a special phrase for this practice, "plausible deniability." On a close look the denials are anything but plausible.
Corporations are constantly running numbers and formulating budgets and projections. The numbers are never more cooked than when a private company is being taken public by a Wall Street investment-banking firm. The projections of future operations included in these offering memorandum are referred to as "pro forma." Past performance is also often restated to present a rosier picture. No one should be surprised that a number of the high-tech IPOs failed to meet their offering memorandum projections and their stock price tanked. Bush and Cheney utilized this corporate practice in formulating the 10-year projections associated with the promised tax cut and in selling their administration to the voters. Despite faltering revenue collections at the federal level, Bush and Cheney kept selling the same projections and kept pushing for a $1.6 trillion tax cut. Like any corporation with a good marketing department, the Bush administration sales pitch changes but the old tired product stays the same.
Corporations are judged based on the Return on Investment (ROI) they provide their shareholders. Investors look at after-tax benefits to assess the performance of their investment. Those benefits include both short-term (dividends) and long-term (capital appreciation) components. The short-term benefits are realized (tangible benefits are received). The long-term benefits are monitored but are unrealized (benefits have accrued but have not been received). How would most Americans answer the question: "Are you better off today than you were 8 months ago?"
Mr. Bush and Mr. Cheney have created a monster for themselves and for Republicans running for Congress in 2002. Unlike the entrenched management in America's worst run companies, our elected officials are subject to the referendum of a democratic vote that can't be thwarted by a Board of Directors friendly to management. (Well, that used to be true until the United States Supreme Court stepped into the presidential election in December of 2000.) Voters have the chance to assess the performances of Mr. Bush and Mr. Cheney in their corporate endeavor. Accordingly, voters should throw congressional Republicans out of office next year along with Bush and Cheney in 2004.
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