Jeff Immelt takes on Bernie Sanders in this morning’s Washington Post for saying GE is “destroying the moral fabric of America.”
“We’ve never been a big hit with socialists,” the GE (GE) CEO writes, but “we create wealth and jobs, instead of just calling for them in speeches.” He says Sanders has never visited GE’s plant in Rutland, which has been “turning out some of the finest jet engine components in Vermont since the 1950s.” And he rejects Sanders’ criticism of GE operations abroad – “as though a company that has customers in more than 180 countries should have no presence in any of them.”
Also this morning, the Committee for Economic Development, a business group founded at the end of World War II, releases a thoughtful report on the problem of rising inequality in the U.S. The issue is one of many that has been perverted by polarized politics, with Sanders’ fans on the left championing a soak-the-rich approach, while purists on the right say even the mention of “inequality” incites class warfare.
In an essay written for Fortune, the co-chairs of the CED study group acknowledge the gap between rich and poor in the U.S. is approaching levels of the 1930s – the highest on record. Some of that “stems from healthy byproducts of free enterprise,” and shouldn’t be a source for concern. But “what merits serious concern is the vast inequality and lack of opportunity that comes from the lagging growth in real incomes of working people.” The group calls for, among other things, expanding the Earned Income Tax Credit, funding pre-school education, increasing health care competition, and reforming taxes to encourage greater “equality of opportunity” while avoiding a counterproductive focus on “equality of outcomes.” It also calls on companies to “restore the U.S. business social contract” by reevaluating relationships with employees and the communities in which they operate. You can read the full report here.
A few CEO Daily readers have chided me recently for devoting too much of this newsletter to politics. I share their concern. Every morning I wake up hoping something else will strike me as more important. But truth is, the political story is the most important business story out there right now. Elections matter. And business leaders can’t afford to keep their heads in the sand. Kudos to Immelt and the CED for attempting to counter the bombast.
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