Browsing the blog archivesfor the day Monday, September 21st, 2015.


Why CEOs Shouldn’t Be President

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Bad Hair, Republican Party

Not that Fiorina was much of a CEO — no one has offered her a  CEO job since she left HP in 2005 — but this to me screams out loud why being a CEO and a POTUS are two different things —

Carly Fiorina said Sunday that neither she nor Hewlett-Packard should be faulted for the sales of millions of HP printers in Iran when such business was prohibited by U.S. law.

Appearing on Fox’s Fox News Sunday, Fiorina said that despite being the CEO of HP when the Iranian sales took place via a third party, she was unaware of them. …

… “In fact, the SEC investigation proved that neither I nor anyone else in management knew about it…” she insisted, adding,  “…when the company discovered this three years after I left, they cut off all ties. The SEC investigated very thoroughly and concluded that no one in management was aware.”

A 2008 Boston Globe investigation found that, while U.S. companies were banned from selling goods to Iran, an Indian company in Dubai called Redington Gulf had sold HP printers there. They sold them so well, in fact, that HP had 41 percent market share in Iran by 2007. Redington Gulf obtained the printers through a European subsidiary.

Wallace asked Fiorina why HP had named Redington Gulf its “Wholesaler of the Year” award in 2003 if the company wasn’t aware of its sales to Iran, Fiorina again deflected blame.

It’s possible Fiorina wasn’t aware of how Redington Gulf made its sales, because that’s not the sort of thing a CEO has to worry about. Sales are sales.

(However, according to a 2004 article in Forbes, Fiorina’s HP was one of the companies that knowingly — or, at least, they must have known — shipped products to Dubai to be re-exported into Iran. Halliburton was another company named, of course. This practice was openly winked at even as the companies in question denied they ever sold goods to Iran.)

A POTUS has to have a more, shall we say, nuanced view of the world, in all of its complexities. And a POTUS is held responsible for things a CEO can get away with denying.

JP Morgan Chase CEO Jamie Dimon, not someone on my most admired list by any stretch, did say something insightful awhile back. When asked if a CEO’s skills would make someone a good President, he said, “It’s not sufficient. I think you have a whole ‘nother set of attributes. I think it’s really complex — politics. It’s three-dimensional chess.”

And if politics is three-dimensional chess, foreign policy is 12-dimensional chess. Businesses, even big corporations, operate within relatively narrow parameters – – cost, profit, cash flow, sales figures. CEOs don’t have to worry about whether selling widgets to France will cause a war with Spain. Presidents do.

Back when Mittens was running for POTUS, it struck me that he is probably very shrewd but not intelligent. By that I mean he seems to have a knack for calculating how to wring every dollar out of a business venture. But how does he understand history? How does he understand the causes of poverty, or the dynamics of race, or why certain wetlands have to be protected from development, or what it’s really like to be poor and have no health insurance? I very much doubt those things were even on his radar.

The purpose of a corporation is to make money for the investors. And if you have to wreck the environment or move jobs overseas and screw your employees in the process, that’s okay in the business world. The purpose of a government is to support fairness, justice and a decent standard of living for its citizens. And by “support a decent standard of living” I don’t mean hand out welfare, but to enable citizens to be self-supporting by preventing the malefactors of great wealth from exploiting the hell out of them, and to enable upward mobility through things like education and public health policies.

These two purposes are completely at odds with each other, and I don’t think the CEO presidential wannabees grasp that. Or, if they do grasp it, they don’t care. Winning the White House would be the ultimate “regulatory capture.” Why be content with getting industry-friendly executives appointed to federal regulatory agencies, when you can take over the entire executive branch?

Further, CEOs are tyrants. They exercise power largely through intimidation. David Corn wrote of Carly Fiorina,

At HP, Fiorina developed the reputation of a manager who knocked heads together—or who chopped them off. And there were massive layoffs during her tenure. In 2003, the company announced it would dismiss almost 18,000 people. (That year, the firm posted a $903 million loss on $56.6 billion in revenue.) When the outsourcing of jobs turned into a national political issue, Fiorina became the poster-girl for an industry campaign aimed at blocking any legislation that would restrict a company’s ability to can American employees in favor of workers overseas. She and executives from seven other tech companies issued a report that argued that any such measures would hurt the U.S. economy. The best way to increase American competitiveness, they declared, was to improve schools and, yes, reduce taxes. At a Washington press conference, Fiorina said, “There is no job that is America’s God-given right anymore. We have to compete for jobs.” The remark did not go over well with critics of outsourcing, who have ever since used it as an indicator of corporate insensitivity.

Note that candidate Fiorina already is promising to lay off government workers. It’s what she knows how to do.

Presidents, in contrast, have highly restricted powers. And they can’t fire Supreme Court justices. One of Fiorina’s excuses for her failures at HP is that the Board of Directors was hard to work with, and there may be some truth in that. But, my dear, have you seen Congress lately?

Nor do CEOs concern themselves with coming up with plans — that’s what the help is for. Note that Fiorina’s official campaign web site doesn’t have a “Carly on the Issues” section. It’s all about her resume, not her policy ideas. (Donald Trump has recently added a “positions” section to his, although the only two issues he addresses are 2nd amendment rights and immigration.)

(I am reminded of the Ultimate Donald Rumsfeld memo. This is what you get with a CEO secretary of defense.)

I’m not going to look at every presidential candidate website, but I will note that Bernie Sanders has an extensive issues section that would take someone a while to read.

Right now Trump and Fiorina are one and two in the Republican polls. At least Scott Walker seems out of the running; that’s some comfort.

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