Obama Bribes CEOs

On Thursday (12 Mar 09), President Obama offered a bribe to the 65 CEOs from the Business Roundtable:

Support Obama's agenda of dramatically deepening government control over the health, energy and education industries and the President will support cutting the corporate tax rate.

The President is searching for any and all CEOs that are short-sighted and weak on fundamental political and economic principles. He needs backing by some CEOs (a majority is not required, only a handful) in order to use their backing against the arguments against broader control of these 3 key economic segments.

Any CEO that is contemplating the compromising of their positions on this matter need to reconsider what this bribe entails. It is extremely difficult to roll back government intervention in any sector of the economy. Every government disruption in the free contracting of services and product (health care, energy and education are products or services just like food, cars and cable television are products and services) inevitably results in further crisis due to the inefficient displacements within that economic segment that result from governmental interference. Those disruptions are used, by those who believe in government control, to justify further government intrusion into the economy. Therefore, supporting Obama's agenda will lead to an ever deepening cycle of problems and increasing government control of health care, energy and education.

Although the CEOs may see short-term benefit by shifting the cost of health care and, perhaps education, from direct entries on their books to the government, those costs will be more than offset by the increase in costs in taxes, regulation and an increasing less efficient economy overall.

What do they get in exchange? A token reduction in corporate tax rates. Since the corporate tax rate remains, they continue to concede the principle that the government should tax corporations (which ignores the fact that only living, breathing human beings that produce anything of economic value actually pay taxes, not fictitious entities such as corporations, more on that some other time). They are only negotiating the current rate of taxation of corporations. How long will it take before the government once again increases the rate at which corporations are taxed? It won't take long as the Obama plan will significantly increase the cost of government. If the President insists on directly raising taxes only on the top 3% or so of the population, then he will be forced to indirectly tax the population through higher corporate taxes.

The Obama CEO bribe is transparent. Its consequences obvious. The decision for the CEOs of the Business Roundtable is easy.