Presenting, a microcosm of President Obama’s failed summit strategy for solving pretty much all problems—the Presidential Council on Jobs and Competitiveness. Step 1: An announcement with much fanfare, a speech against a symbolic backdrop, and dramatic promises of what this important gathering will produce. Step 2: Gather a group of people, some of whose dabbling in cronyism and rent-seeking violate every lofty value you’ve just claimed to be fulfilling. Step 3: Summit offers scattershot proposals. Step 4: ? Step 5: Progress.
Step 4, if one must attempt to flesh it out, is an utter lack of leadership or direction for translating summit findings, such that they are, into effective action that might help the economy. This is what that step looked like with the Presidential Council on Jobs and Competitiveness.
Dissent arose between the business leaders and labor leaders on the council and some of the more reasonable recommendations of business leaders on streamlining regulation and competitive tax rates to spur hiring looked too similar to the ideas of Mitt Romney for comfort. So, the Jobs Council didn’t meet for six months, even though its job was the central discussion of the presidential campaign and the No. 1 concern for American voters. And, now it hasn’t met for a year and will likely just expire Thursday. Ta-da!
The council hasn’t met in over a year (its last meeting was January 17, 2012) and has only met four times since it was created. Last summer, the White House said that the council had not convened in the past several months because the president had “a lot on his plate.” The panel has put out a total of three policy recommendation reports, but that hasn’t translated into much actual movement on jobs.
“I don’t think you could draw much of a line from the jobs council to a bunch of job creation, or even job creation policies that are on the current agenda—of which there aren’t enough,” says Jared Bernstein, the former chief economic adviser to Vice President Joseph Biden who’s now a senior fellow at the Center on Budget and Policy Priorities, a DC-based think tank.
For economist Dean Baker of the Center for Economic and Policy Research, the jobs council has proved such a political nonentity that when asked by Mother Jones for his thoughts on its expiration, he laughed. “I can’t say that I’ve given it a lot of thought,” he says. “Which I guess says a lot about it.”
“The Council was focused in 2012 on implementing the recommendations made in its three reports. Of the 60 recommendations for executive action, significant progress has been made on 54. Also Congress passed legislation on six recommendations made by the Council,” Sheffer said in an email. Council recommendations led to administration initiatives to fast-track infrastructure projects, accelerate the processing of business and tourist visas, and a program to “look back” through existing regulations for those that are outdated and burdensome, Sheffer added. He also pointed to a series of public-private initiatives council members launched to jump start job creation.
I don’t want to discount all of its efforts. I have no issue with streamlining government functions where possible, and appreciate the nod to “looking back” through existing regulations. But what little “looking back” has occurred cannot hope to keep pace with what the president has been piling on, according to regulations experts, so the effects are rather negligible.
Mother Jones has the same objections to the naming of Immelt as chair as I do, though my, the Left was awfully polite about such things before Obama was reelected:
Obama’s nomination of Immelt as chair cemented that pro-big-business tilt, critics said. As the Huffington Post wrote in January 2011, “Immelt’s firm…represents the archetypal company that’s hoarding cash, sending jobs overseas, [and] relying on taxpayer bailouts.”
“It’s almost an insult,” to have someone like Immelt head the panel, Baker says. “I mean, there are arguments for outsourcing, but to put someone in the job of doing that as head of the jobs council really is kind of of a joke.” (When reports came out that GE also used tax loopholes and creative accounting to avoid paying taxes in the United States, there were calls for Immelt to resign.)
In addition to dissent within the ranks and Immelt’s track record causing headaches, there was the dubious record of job creation by those on the council:
[T]he 13 publicly traded companies whose executives were appointed to the council, taken together, have declined in value by about 7% through year-end, worse than the decline of about 4% in the Standard & Poor’s 500 Index over the same period.
Eastman Kodak’s stock has lost more than 80% of its value since President Obama named its chairman and CEO, Antonio Perez, to the Council on Jobs and Competitiveness. Citigroup is down 44% since Mr. Obama named its chairman, Richard Parsons, to the Council on Jobs and Competitiveness. The UBS AG shares traded on the New York Stock Exchange are down 40% since Mr. Obama named Robert Wolf, the chairman of UBS Group Americas and the president of UBS Investment Bank, to the Council on Jobs and Competitiveness. All these figures are adjusted for any dividends or splits.
If these council members haven’t produced much by way of competitiveness, at least as measured by stock price, they haven’t produced much in the way of jobs, either. In April 2011, Kodak announced 48 layoffs in Durham, North Carolina. In August 2011, UBS announced 3,500 layoffs. In December 2011, Citigroup announced 4,500 layoffs. Call it the Competitiveness Council Curse.
Symbolically, not great for the jobs council, but better than them effectively using the positions to enrich their companies. Reason notes that members of the council’s precursor— the President’s Economic Recovery Advisory Board— fared better:
The four publicly traded companies represented on that Economic Advisory Recovery Board have outperformed the S&P 500 by more than 60 percentage points since the board was named. That board was active at a time when Mr. Obama’s party also controlled both houses of Congress, and when the administration was dispensing stimulus money.
This is how Obama advertised the jobs council when he announced its formation in GE town, Schenectady, NY in 2011:
Over the past two years, my Economic Recovery Advisory Board has provided this administration with support and expertise as we worked to bring our economy back from the brink and start recovering from an economic crisis that cost millions of American jobs. We still have a long way to go, and my number one priority is to ensure we are doing everything we can to get the American people back to work. As we enter a new phase in our recovery, I have asked the new Council to focus its work on finding new ways to encourage the private sector to hire and invest in American competitiveness.
Is there any evidence at all that the president did “everything he could” to facilitate solutions beyond merely announcing this council?
The New York Times picked out one phrase, reporting on the creation of the council:
The changes in the panel signal what the White House describes as “a new phase of our recovery,” a shift from crisis to job creation.
If the jobs council was indeed to be a symbol of our shift from crisis to recovery, from recession and stagnation to job creation, it is fitting that it should die the week we find out we’ve still made no such shift.
Baker says it might be nice if Obama used the end of the jobs council’s term to reorient it towards actual job creation, but he’s not too optimistic. Ultimately, he says, it’s probably better to let the council fade into the ether. The whole exercise turned out to be mostly “a symbolic gesture,” he says—”and not even a very good symbolic gesture.”
And, we just got another four years of this, ahem, exercise.
Cover photo courtesy of Michael Ramirez.