US business looks less to Washington as operations go global
This swing is good news for shareholders. After all, it has helped to shield these corporate giants from the American downturn. But while Washington might welcome this wider corporate success, there is a darker side. As large American companies become less tethered to the US economy, their dance with the domestic political game becomes more ambivalent. To be sure, few business leaders will openly admit this. On the contrary, most have actually increased their US political donations and lobby expenditure to ensure that their interests are protected.
Defensively paying for lobbyists is easy, though; the costs in time and money are relatively low for a large company. What most corporate executives are notably not doing today is getting actively engaged in promoting wider policy change. Some exceptions do exist. David Cote of Honeywell has called on chief executives to push for a fiscal deal.
Jeff Imelt of General Electric has been advising the White House on competitiveness and jobs issues. But for every chief executive engaged, many more remain silent. Some blame this on the nature of their day job (that is, a fear that political involvement would not serve shareholders) or the daunting challenge of doing business in Washington. Others argue it is tough for a chief executive to justify being involved in the US political debate when their staff is multinational. But behind this there is a bigger cost-benefit analysis: although chief executives might grumble about the shortcomings of US policy, they are not sufficiently desperate to act. They simply do not have enough skin in the game to make the pain of political engagement worthwhile.
It is little wonder, then, that recent earnings calls have been replete with complaints about Washington – but short of practical policy ideas. Nor that US businesses keep a low profile at political conventions.
Or that men such as Goings say “we tend not to get involved in American politics”. That does not mean that Tupperware is disengaged from the wider world. On the contrary, it pours huge energy into laudable projects promoting women’s rights and entrepreneurial issues. But these are global, not national. “A lot of what we are doing transcends what governments used to do,” Mr Goings says. “It is across borders.” Therein lies the strength of US business; and Obama’s and Mitt Romney’s great challenge.