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Home Publications Blogs Beat the Press Jeffrey Immelt Thinks It's "Just Wrong" He Has to Argue for the Money that He and GE Get from the Government

Jeffrey Immelt Thinks It's "Just Wrong" He Has to Argue for the Money that He and GE Get from the Government

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Wednesday, 06 August 2014 06:53

Yes, that is what he said according to the Washington Post. The context was a business summit involving U.S. and African business people and African heads of state. Immelt was complaining that the reauthorization of the Export-Import Bank is being seriously debated Washington.

The Bank makes or guarantees around $35 billion in loans, with the vast majority of the money going to large companies like GE, which Immelt heads. The Bank effectively is allowing these companies to get loans at below market interest rates, adding billions of dollars to their profits each year.

According to the piece Immelt complained:

"There’s a lot of things to be critical about big businesses, and there’s a lot of things that don’t work in government, but exporting is not one of them and the Ex-Im Bank is not one of them, ... And the fact that we have to sit here and argue for it I think is just wrong.”

It is also worth noting that article misled readers by saying:

"some Republicans and conservative groups say the bank should be allowed to die, claiming that it doles out corporate welfare and engages in crony capitalism."

There are also many people who are neither Republicans nor conservatives who do not think it is an important role of government to make people like Jeffrey Immelt even richer.

Comments (17)Add Comment
Lots of things from GE don't work
written by Dave, August 06, 2014 8:48
There are a lot of things to be critical about GE, and there's a lot of their products that don't work, and my dishwasher and refrigerator are to prime examples.

These are one of the more expensive models, and they were broken on delivery and have broken many times since.

This is not Edison's GE.

Obama was a fool to provide clout to Immelt by asking him to help create American jobs, when Immelt's main goal is to move as many of those jobs overseas as possible.
Excuse Me?
written by Larry Signor, August 06, 2014 9:29
GE has in excess of 108 billion dollars in profits being held [invested], untaxed, in foreign countries. Perhaps Immelt and GE are committed enough to the Ex-Im bank that they will backstop the loan guarantees. Privatizing government functions is all the rage among the plutocracy and Ex-Im looks like a fine candidate. Jeff could really hit one for the Gipper. Yup.

http://www.huffingtonpost.com/...52094.html
$35B in loans?
written by Tom, August 06, 2014 10:11
For those of us not familiar with the size of the export market, perhaps you could put the $35B figure into context so we have a sense of how significant that is
Jeffrey Immelt Channels Ronald Reagan: I Own This Microphone
written by Last Mover, August 06, 2014 10:24

Imagine that. Dems telling Repubs not to stifle subsidies from the Ex-Im bank when the lecture is usually in the opposite direction from Repubs on grounds of "free trade".

It's rare the bonds between the two in support of the rich surface so clearly, revealing most of their differences are a carefully designed sideshow to disguise the main attraction:

Immelt and his pals are the ones really running the show. As long as the pols are reduced to squabbling about how much subsidy GE gets - not whether and how GE's massive global market power should have been busted up long ago - Immelt can sit there and pretend participating in a serious discussion about "Why are we even talking about this?".
Tom:
written by medgeek, August 06, 2014 11:26
$1.57 trillion

http://www.bea.gov/newsreleases/international/trade/2014/pdf/trad1213.pdf
oops
written by medgeek, August 06, 2014 11:28
forgot to mention that's 1.57 trillion for 2013
US Exports
written by Larry Signor, August 06, 2014 12:12
U.S. exports reached $2.3 trillion in 2013


or, 35 billion/2.3 trillion = 1.52% of total 2013 exports. [Someone please check my math]

http://www.commerce.gov/news/p...aight-year

Republicans vs. the Ex/Im bank?
written by willf, August 06, 2014 1:49
"some Republicans and conservative groups say the bank should be allowed to die, claiming that it doles out corporate welfare and engages in crony capitalism."


I would like Rebecca Robins, the author of the article, to give examples here, or even one example, of a republican or conservative group that is against corporate welfare or crony capitalism. Otherwise, I call bovine fecal matter
WaPo's Weak Link to Conflict of Interest
written by Robert Salzberg, August 06, 2014 2:45
WaPo did provide a link where you could find that GE was the second largest beneficiary of the Ex-Im bank at $2.6 billion but that wasn't clear in their piece:

Former President Bill Clinton:

"“We don’t want to get in the middle of Washington’s political wars, but how important do you think it is for the future prospects of getting more financing in Africa for American businesses to renew the Export-Import Bank?” the former president asked panelist Jeffrey Immelt, the chief executive of General Electric.


Immelt, whose company has been a vocal supporter of the bank, made the most of Clinton’s question.

“There’s a lot of things to be critical about big businesses, and there’s a lot of things that don’t work in government, but exporting is not one of them and the Ex-Im Bank is not one of them,” Immelt said. “And the fact that we have to sit here and argue for it I think is just wrong.”"

3 paragraphs later, probably straining modern readers comprehension or after they've quit reading:

"Large U.S. companies like GE, which benefit from the bulk of the bank’s financial support, have been among the most organized advocates of the agency."

The previous sentence doesn't make it clear whether GE is a beneficiary or if GE is just a large company. If they had instead of "like GE" written "including GE" the link would have been solid. When quoting someone with a direct conflict of interest, real journalism identifies the speaker as such immediately, not later and indirectly.

Worse still, there are only a handful of large companies that get the bulk of the support from the Ex-Im bank so the "large companies like GE" is also misleading. Saying that a "handful of companies including GE…" would have been more accurate.
...
written by Dryly 41, August 06, 2014 3:37
When GE Capital became insolvent(the General Electric Corporation was not insolvent) the Socialist-Republican CEO Comrade Jeff Imelt of GE went to the Socialist-Republican Bush II-Cheney administration led by Comrade George W. Bush, Comrade Dick Cheney, Comrade Hank Paulson, Comrade Ben Bernanke and Comrade Tim Geitner for a handout, you know, free stuff. Comrade Imelt got his handout.

Then the Socialist-Republican CEO of General Electric joined Pete Peterson's "Fix The Debt" boys advocating cutting "entitlements" allegedly because of his concern about the growth of the debt. This notwithstanding the fact that the debt was caused by the "supply side" tax cuts for the wealthy in 1981, 2001, and, 2003 in the Reagan and Bush II-Cheney administrations while the Social Security Trust Fund was building a $2.6 Trillion surplus due to the 1983 payroll tax increase.

Nice.
Nice to have Dean come out against a Roosevelt Era idea for a change
written by pete, August 06, 2014 5:28

"There are also many people who are neither Republicans nor conservatives who do not think it is an important role of government to make people like Jeffrey Immelt even richer."
Tom
written by Squeezed Turnip, August 06, 2014 6:18
$35 billion in loans, the interest savings are smaller but whatever those savings are are, when you divide by the $0 in tax revenue GE pays, that amounts to an infinite subsidy. You must be one rich SOB if you can't see the significance of that!
...
written by AlanInAZ, August 06, 2014 8:38
@Squeezed Turnip

I will not defend the GE tax rate but one could point out that the company employs 133,000 people in the US - enhanced profits for the corporation would benefit a bunch of ordinary people beside Jeff Immelt. I would like to see Dean Baker decry the favorable terms that overseas competitors get.
@ Squeezed Turnip
written by Larry Signor, August 06, 2014 9:36
In FY 2013, Ex-Im Bank’s financial performance excelled. Ex-Im Bank sent $1.057 billion to the U.S.
Treasury...


That would be 1.057/3454 of federal spending in 2013. That is a really small number.

http://www.cbo.gov/publication/44716
Dave, re: Obama
written by ifthethunderdontgetya™³²®©, August 06, 2014 11:27
.
Obama was a fool to provide clout to Immelt by asking him to help create American jobs, when Immelt's main goal is to move as many of those jobs overseas as possible.


If that was the only 'foolish' move Obama made in that regard, I'd agree.

He ran against Hillary on NAFTA. Almost immediately after he was sworn in, he resumed negotiations on the TPP (NAFTA on steroids). And he's pushing the TISA, which is even worse (NAFTA for TBTF banks).

So it isn't that he's foolish...he's a cynic with the same goals as G.E.
~
...
written by AlanInAZ, August 07, 2014 1:26
I see that folks don't like my thoughts on the pragmatic implications of the EX-IM bank. Let me quote Jared Bernstein from his blog of July 2014.

better to test the international credit waters rather than do an experiment with full withdrawal, especially at a time when we very much need the labor demand generated by exports–and remember, we’re talking manufactured goods. Phase-out is also a better strategy given the other main defense of the bank, which is that as long as our competitors for international sales keep their similar credit-providing institutions up and running, we’re at a disadvantage if we drop out of this market. As one critic wrote, that’s not a principled defense, but I think it’s a pragmatic one.


Now quoting Krugman, June 2014

Right now, however, we’re at the zero lower bound, which means that the Fed won’t raise rates. As I’ve said a number of times, under current conditions mercantilism works – so this is exactly the moment when ending an export-support program really would cost jobs.


Government doesn't create jobs
written by Robert Weiler, August 08, 2014 1:55
I've personally heard Immelt parrot this GOP canard and yet here he asserting that the government does in fact create jobs. Of course it's a stupid saying in the first place unless you don't consider people in the military, defense contractors, public schools and universities, the judicial system, the transportation industry, etc as having 'jobs'.

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Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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