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Is the appointment of Immelt of GE a conflict of interest?

 
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mac



Joined: 07 Mar 1999
Posts: 5356

PostPosted: Mon Mar 28, 2011 11:27 pm    Post subject: Is the appointment of Immelt of GE a conflict of interest? Reply with quote

The hard right is arguing that Immelt, CEO of GE, has a conflict of interest in his appointed position see for example
Quote:
“There definitely is a conflict when you have somebody who is the CEO of a company that is the biggest spender on lobbying in the past twelve years and is a serious seeker and recipient of contracts from the federal government,” argues Paul Blumenthal, a senior writer for the Sunlight Foundation, which advocates greater government transparency. http://www.nationalreview.com/corner/257890/immelt-and-conflict-interest-katrina-trinko,
The appointment was also attacked on redstate. What exactly is Immelt’s job, and what exactly is a conflict of interest?

Immelt was appointed in late January to a new Board, replacing Paul Volcker and reconstituting what had been the President’s Economic Recovery Advisory Board. It is not a Federal agency, and has no line responsibility. It is intended to provide the President with advice, something that anyone has the ability to do with a paper and a pen. It has no authority over rule-making, but can recommend changes to regulations.

What is a conflict of interest, are these folks using the term correctly? Try this:
Quote:
"We can define a conflict of interest as a situation in which a person has a private or personal interest sufficient to appear to influence the objective exercise of his or her official duties as, say, a public official, an employee, or a professional."
Source: Chris MacDonald, Michael McDonald, and Wayne Norman, “Charitable Conflicts of Interest”, Journal of Business Ethics 39:1-2, 67-74, August 2002. (p.6Cool


In practice, as an agent of the government you are required to recuse yourself from any activity under your authority that might affect your financial interests. In the case of Immelt, if the new Advisory Board formulates any recommendations about industries in which he has a financial interest, he has a duty to recuse himself from those considerations. So no conflict can possibly yet exist. Does the appointment of Immelt create an impression of conflict of interest, or insider influence? Perhaps, it depends on the other appointees. Advisory boards without statutory authority can be used to catch flack, or advance debate on changes. If you want serious discussions about change, you need to involve all potential stakeholders in the discussions about those changes or they will be shooting at you from the sidelines during legislative hearings or the rulemaking process. Does the appointment of Immelt show that there is a cozy relationship between big business and the Obama administration? To some degree, so I’ll compare it to two examples from the Bush Administration to show you the differences.

The other claim that has been made is that GE somehow benefitted from the Recovery Act (the “Stimulus Bill”), and continued to offshore jobs. This charge doesn’t hold up so well either.

The Decatur Daily covered one of the grants that GE got, for an appliance plant in Decatur. Of GE’s investment of $59 million, at at least $6.5 million came from federal Recovery Act stimulus funds. In Decatur, the money helped secure 1,200 at-risk jobs and added another 20. U.S. Rep. Robert Aderholt, (Republican) was happy to attend the ribbon cutting. According to the website for the American Recovery and Reinvestment Act, GE Consumer and Industrial in Decatur received a $6.5 million tax credit “to purchase equipment for energy-efficient refrigerators.” Hmm, I thought it saved no jobs, and did anyone notice that GE put in over $50 million of its own money to keep the plant open and improve energy efficiency? Only an energy producer could hate on that!

Now let’s look at 2 of Bush’s senior officials and see if there are some similar concerns about conflicts of interest that emerge from the right. Coming up first is Gale A. Norton, protégé of James Watt, who was Bush’s first secretary of Interior. After serving under Watt at Interior, and before becoming Attorney General in Colorado, Norton was a lobbyist for NL Industries, Delta Petroleum, and other firms associated with aspects of mining, hazmat clean-up, and energy development. Before that she worked for a right-wing law firm that challenged regulations, the Mountain State Legal Foundation where she represented developers and property rights advocates. She hired Stephen Briles, later convicted as part of the Abramoff scandal. He had been a lobbyist for The National Mining Association, Occidental Petroleum, and the American Gas Association. Here’s the LA Times take on some of the high appointees under Norton, including Jason Peltier:
Quote:
At the Interior Department, at least six high political positions have been occupied by people associated with businesses or trade associations tied to public lands or resources. One of those appointees, J. Steven Griles, a deputy secretary, continued to receive $284,000 a year from his old lobbying firm while working for the government. Mr. Griles stepped down last year, saying he had not done anything to violate ethics rules at the department.


When Norton left Interior, she went to work for Shell. Here’s a little more about her from the Los Angeles Times:

Quote:
The Justice Department investigation centers on a 2006 decision to award oil shale leases in Colorado to a Royal Dutch Shell subsidiary. Months later, the oil giant hired Norton as a legal counsel.
September 17, 2009|Jim Tankersley and Josh Meyer
The Justice Department is investigating whether former Interior Secretary Gale A. Norton illegally used her position to benefit Royal Dutch Shell PLC, the company that later hired her, according to officials in federal law enforcement and the Interior Department.
The criminal investigation centers on the Interior Department's 2006 decision to award three lucrative oil shale leases on federal land in Colorado to a Shell subsidiary. Over the years it would take to extract the oil, according to calculations from Shell and a Rand Corp. expert, the deal could net the company hundreds of billions of dollars.


Now let’s look at the other carbon industry, coal, and see if there were any cozy ties between the Bush Administration and that industry. OMG, there are. First at bat, Massey Coal, which you may remember from the horrific accident. Accident? Well, the political appointees in the Bush administration reportedly forced out Jack Spadaro, the former head of the National Mine Health and Safety Academy, a branch of the Department of Labor, because he was trying to investigate a 2000 mining accident.

Well, Bush did have the right to appoint political appointees to exempt positions, and I’m sure he appointed good people, right? Well, no. Here from Democracy Now.

Quote:
In 2002, Bush named former Massey Energy official Stanley Suboleski to the MSHA review commission that decides all legal matters under the Federal Mine Act. Massey Energy is one of the largest coal companies in the U.S and has been cited for numerous violations. And David Lauriski, the former head of MSHA, spent 30 years as an executive in the mining industry before being tapped to head the agency. He resigned last year to work for a mine-industry consulting company. The current head of MSHA, Richard Stickler, was appointed by Bush last September. Stickler is a former manager of Beth Energy mines. The Bush administration has also cut 170 positions from MSHA.


What happened next? April 5, 2010, 29 miners were killed in West Virginia at the Upper Big Ben mine.

Now I'm pretty sure that Norton, as an attorney, was careful to recuse herself from any decisions that would involve her direct financial interest. Instead she brought in Briles and Peltier to do the dirty work. The results? This crew from the mineral and energy businesses did their best to get public lands leased--at a song. They didn't do it because they would personally gain, they did it because they hold a philosophical viewpoint that public land should be transferred to energy and mining companies. Did they ignore other aspects of Federal law that provide competing uses for public lands--like protecting water quality and endangered species, and public access to parks? Yes, that's why they were sued and lost so frequently.

Massey is a more serious issue, and I hope there is a special place in hell for all of those who fought safety regulations.

Is there any Republican--or Democrate--that is willing to carry a bill to close this swinging door between the government and later lucrative jobs in the industries you were supposed to regulate? Naw, the object here was to try to embarass Obama, and if you have to be a hypocrite to do so, its a small price to pay.
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stevenbard



Joined: 11 Nov 1993
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PostPosted: Tue Mar 29, 2011 1:18 am    Post subject: Reply with quote

Do you have any doubt that the oligopolists that Obama and Bush support are supporting Obama because it is a no lose proposition?

If the conservatives win, nothing will happen to the big companies, but if the socialists prevail, GE, Goldman, Big Banks and Insurers, will all continue to be embraced by their emperor like they are in Russia and China. (as long as they continue in lock step with Obama's ideology)
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isobars



Joined: 12 Dec 1999
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PostPosted: Tue Mar 29, 2011 8:16 am    Post subject: Reply with quote

Ideology, my butt. MONEY. GE/NBC, the unions, and Soros got Obama elected once, and can do it again if the Obamacare and Obamanomic houses of cards don't collapse too soon. Now that the same centrist and right wing media who revealed McCain's amnesty program are now revealing both the reality (and certainly some hype) of Ocare and Onomics, both are coming to light. The race is on for the Independent vote between Nov '12 and the light of day.

And in Immelt's case, I'm not sure I see a conflict of interest in his public and external political actions. His interest is inherent in his title: CEO. It is his open, sworn, and almost sole duty to increase the price of GE stock. His attempts to do that have almost certainly included selling weapons components to nations on our terrorist list, which violates federal law. Maybe even worse, he has corrupted the journalistic process a free nation depends so heavily upon by making certain that his wholly owned private TASS we know as NBC/MSNBC lies every day to voters too stupid to know they're being lied to.

In an honest market, Immelt's dismal failure to increase the value of GE stock would have gotten him fired years ago. But since he lavishes enormous benefits upon GE's board of directors, he can pretty much dictate their votes internally. THAT, it seems to me, is where the conflict of interests comes in. Like unions buying presidential votes, Immelt buys his tenure, and thus his total ownership of NBC, its cable affiliates, and the idiots who watch them. They in turn vote in empty suits like Obama, and NBC tells them what a great president he is, and the whole circle jerk is complete. Until the light of day exposes that, the beat goes on until 51% of the voters are on the dole and the lights flicker out on the world's greatest nation, beginning in earnest in 2013 unless there are still some checks and balances between the White House and the Congress.
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boggsman1



Joined: 24 Jun 2002
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PostPosted: Tue Mar 29, 2011 8:24 am    Post subject: Reply with quote

EARTH to ISO: GE sold NBC ! Kind of ruins your little rant, doesnt it ? CNBC, and MSNBC are decent channels, and I dont think Im a dummy. Idea
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coyotewindsurf



Joined: 03 Apr 2006
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Location: SF Bay

PostPosted: Tue Mar 29, 2011 10:55 am    Post subject: Reply with quote

Perhaps the sale has not yet been reported on Fox News.
Very Happy

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dsgrntlxmply



Joined: 16 Jun 2010
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PostPosted: Tue Mar 29, 2011 2:30 pm    Post subject: Reply with quote

GE remains a 49% partner in the joint venture that, with Comcast, owns NBC.

Most anything that Immelt touched, the sleazy vain avaricious philanderer Welch touched first. That means that it remains contaminated and stinky.

Perhaps I'm just jealous that I, a mere mortal, have no access to the sorts of elaborate and highly effective tax reduction strategies that GE uses.
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boggsman1



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PostPosted: Tue Mar 29, 2011 2:37 pm    Post subject: Reply with quote

Right, but in terms of political persuasion, the Roberts family and Comcast have the controlling interest in NBCU, and the ability to hire and fire the people who run the content of CNBC, MSNBC, and NBC. I do love your description of Mr. Welch, probably the most overrated CEO of my lifetime.
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mac



Joined: 07 Mar 1999
Posts: 5356

PostPosted: Fri Apr 01, 2011 4:47 pm    Post subject: Reply with quote

Did any of you righties actually read the NY Times article instead of your favorite talk-radio style summary? What party do you think created the tax credits that GE has been using? Rather than summarize, those of you who can read:
Quote:
the company’s lawyers and lobbyists became deeply involved in rewriting a portion of the corporate tax code, according to news reports after the 2002 decision and a Congressional staff member.

By the time the measure — the American Jobs Creation Act — was signed into law by President George W. Bush in 2004, it contained more than $13 billion a year in tax breaks for corporations, many very beneficial to G.E. One provision allowed companies to defer taxes on overseas profits from leasing planes to airlines. It was so generous — and so tailored to G.E. and a handful of other companies — that staff members on the House Ways and Means Committee publicly complained that G.E. would reap “an overwhelming percentage” of the estimated $100 million in annual tax savings.

According to its 2007 regulatory filing, the company saved more than $1 billion in American taxes because of that law in the three years after it was enacted

As the Obama administration and leaders in Congress consider proposals to revamp the corporate tax code, G.E. is well prepared to defend its interests. The company spent $4.1 million on outside lobbyists last year, including four boutique firms that specialize in tax policy.

http://www.nytimes.com/2011/03/25/business/economy/25tax.html?pagewanted=4&_r=2

Hmm--what party was it that blocked any changes to the tax credits in late 2010?

I appreciate the scrutiny on GE and Obama on renewal, but blaming this on Obama is nonsense.
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