The Biggest Losers

Peggy Noonan, Karl Rove, the Koch Brothers, the folks at Fox & Friends ... there were plenty of losers in this presidential election besides Governor Romney.

Count Big Business among them. 

No, not because the business community put the bulk of its money on the losing horse. And not because an “anti-business” Obama administration will raise corporate taxes. 

But because the losing argument in this election tied the economic well-being of the Middle Class to the health of the business sector.

At the beginning of the presidential campaign, all the pundits were singing a common theme song: “It’s the economy, stupid.” Voters, we were told, always punish or reward the incumbent according to the economic vapors. When the economy is sweet, whoever’s in the Oval Office gets a pass; if it’s sour, he’s freed to concentrate on planning his new library. 

On that score, none of the traditional metrics supported President Obama’s re-election, whether it was the unemployment rate, consumer confidence, or the proportion of voters who thought the country was going in the right direction. Even his job approval seldom wandered  over 50%.

The two candidates’ political philosophies reflected their respective backgrounds – the community organizer who saw government as a lever for change and the businessman who considered it a drag on the economy.

Somewhere along the line, the election became a referendum on those two worldviews.

 As it turns out, most voters didn't buy the Romney camp’s argunent that the secret to growing the Middle Class is to improve the business climate for “job creators” by cutting corporate taxes and reducing regulation.that debate

For example, as David Brooks pointed out in a recent column, surveys show that Asian- and Hispanic-Americans value industriousness and entrepreneurship even more than whites, but they also think government plays an important role in enhancing opportunity and improving the business climate. They don’t see government and business as Hatfields and McCoys.

And when the question was put directly to voters in one national survey, nearly two in three said building a strong middle class was more important to economic recovery than creating a “healthy climate for business.”  They didn’t see the link.

Americans believe in private enterprise, but they no longer believe corporate success has much to do with their own security — only 18% strongly agree that “the middle class always does well when big corporations do well.”

Voters in Michigan and Ohio apparently rewarded President Obama – and arguably punished Governor Romney – for rescuing the auto industry. But that may be the exception that proves the rule. When employees see a direct connection between their well-being and their employer’s, they respond accordingly. And when they see a disconnect between rewards at the top of the company and further down in the ranks, they do the same.  

Since 2000, the middle class has shrunk in size, fallen backward in income and wealth, and lost much of its faith in the future. For more than a decade, a majority of Americans have told pollsters they don’t expect today’s kids to be better off than their parents. They can’t fix it, so it’s only natural for them to fix blame. About half point the finger at large corporations.

There’s a strong message here for American business leaders. So strong, it amounts to a warning. Any company that doesn’t factor those attitudes into its business risk assessments is asking for trouble.

 

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[Jack Pulido]

He attended Lamar University in Beaumont, then a two-year school, and earned a degree in journalism from the University of Texas. He served with the Marines in the Pacific in World War II and retired as a colonel from the Marine Corps Reserves in 1972. He received a law degree from the University of Texas and was a two-term Texas state legislator when he was elected to the U.S. House at age 29.