Capitalism Under Siege

Does the perception of cronyism, overregulation and overtaxation hurt commerce, and what should business leaders do about it?

Heated public debate surrounding renewal of the Export-Import Bank charter, which expires at the end of September, makes clear that concerns about giveaways to connected corporations have reached a boiling point in the United States. Conservatives point to Solyndra and the Ex-Im Bank while progressives point to powerful lobbying by wealthy companies, such as Boeing and General Electric, as evidence that the relationship between government and business has crossed the line well beyond benign partnership.

“You can draw a pretty straight line from contributions to committees and the positions on those committees.”

Meanwhile, the average citizen, soured by declining real personal income, has become increasingly cynical regarding a system that appears to benefit the big, corporate elite at the expense of small enterprise. “Since 2009, growth has been appalling and these people are struggling. Meanwhile, Wall Street is up. That’s what makes people susceptible to the idea that the system is rigged,” Lawrence Mone, president of the Manhattan Institute, told participants at a CEO roundtable at the New York Stock Exchange in July.

But they’re not necessarily wrong, said Tom Rogers, president and CEO of TiVo. “I don’t think the public is confused. They see it clearly. There’s a reason there is a 9 percent Congress approval rating,” he said, noting that the issues CEOs are facing around growth don’t make it into the public light. “You can draw a pretty straight line from contributions to committees and the positions on those committees.”

As a result of one-sided media coverage, Main Street continues to view capitalism as corrupt. “All we read about in the paper is who is getting fined for what and who is being investigated for what. It’s just negative about business altogether. You don’t see the positives, and that’s a major issue for this country,” said Maggie Wilderotter, CEO of Frontier Communications.


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