A Year In The Life Of GE CEO Jeffrey Immelt
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July 2010
At a business gathering in Italy, GE CEO Jeffrey Immelt blasts China saying that it has become hostile to the interests of large multinational companies. He also talks about how "Business did not like the US president and the president did not like business".
According to reports, Immelt went as far as accusing the president of "being a poor leader during a troubled period in American history". GE quickly issued a statement saying that Immelt's views (about China and the president) were his own and do not reflect the company's views.
November 2010
Immelt visits Beijing and announces that GE will be investing more than $2 billion in China to expand the company's research and development.
January 2011
President Obama enthusiastically picks Immelt as jobs czar.
He told a crowd of GE workers, "I am so proud and pleased that Jeff has agreed to chair this panel, my Council on Jobs and Competitiveness, because we think GE has something to teach businesses all across America".
NOTE: Huffington Post (believe it or not) reported that since Immelt took over in 2001, GE has shed 34,000 jobs in the US and added 25,000 overseas.
July 2011
At a jobs summit at the US Chamber of Commerce, Immelt encourages businesses to take the lead on job creation.
CNN Money reported that Immelt's speech included him saying "... it's important that businesses take action, like taking some risks, and thinking about bringing back jobs that had been moved overseas.
Two weeks later, GE announces that it is moving its X-ray global headquarters from the United States to China.
If the president expects businesses all across America to learn from GE, we should all be concerned.
IMHO, the president should have given Immelt the task of finding ways that will eliminate corporate tax loopholes instead of making him the jobs czar. Afterall, GE has not paid any federal taxes for two years in a row despite recording billions in profit. Is this the same company that received bailout money (in billions!) in 2009? It can't be!
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Hi, Peter. I have to agree. Immelt is doing a great job in creating jobs. Unfortunately, not here.
Thanks for your input!
Why is it always the Republicans? It seems Imelt is a businessman, not indicated whether he is Republican or Democrat. The President is clearly a Democrat...
Why does everyone have to point fingers at half the country, left *or* right, and blame someone else???? If we don't like what GE is doing, go elsewhere. They are not the only game in town.
I'd love to see a country united again. When the first thing I see is the word "Republicans" in a response, the first thing I do is consider it to be someone who has nothing of value to add.
I apologize if I offend anyone by saying that, but think about the things that others say as well.
Name calling and finger pointing is how this country got to this point. If it stops, maybe we can start going back to the productive communications that made us great.
At Peter. You know why GE does not pay taxes ? Because the former house ways and means committee Chairman Charles Rangel made a nice little deal with GE. And GE owns the propaganda machine MSNBC too. If you are mad at anybody about GE it is not the Republicans you should be mad at. This one is in the Democrats lap.
I'm mad at GE! They have the money they bought the votes. It doesn't matter if they are red or blue they are all theives stealing from the people. Take your blinders off and look at what is happening to this country. Let's all stop pointing fingers and get to work fixing things. We are all to blame.
Peter
Hi, Kate. Thanks for stopping by and for sharing your input.
In Peter's defense, I don't think he meant to point fingers or blame anyone. At least, that's not how I saw it. I believe he is simply making a statement that the Republicans (?) are insisting that GE is a job creator when in fact it is not.
As to 'going elsewhere'... if only it's that easy.
You're right - if only our elected officials would stop the finger-pointing, they will be a lot more productive and get us back on the right track.
Tony, thanks for sharing that interesting bit. I found that the deeper you dig, the more interesting this gets.
I think it is time we sent a message to Washington that most of us are sick and tired of the finger pointing, and lack of problem solving. Almost any problem can be solved once the actual problem is identified. The blame game only eats up time and effort that could be better spent solving the problem. These people were put in office to solve these problems, and watch out for "we the people." But the majority of their waking hours is spent entirely on blaming, name calling, and misdirected party loyalty.
It is a known fact that GE was a large campaign contributor, and bought themselves some nice tax loopholes and other favors by doing so. Do some research and see who received this huge bundle of cash and the picture will get clearer for you. Votes and favors really are for sale to the highest bidder.
It makes me happy that I consistently see more and more citizens dropping their party label and starting to look at the big picture of our current government. It is not a pretty picture regardless of which party you may favor.
Immelt and Obama are thick as thieves and twice as dangerous.
@OP, sometimes I can't believe what I am seeing - how some of these politicians behave. It's now just all about them and their self-interests. We all know that if you are in a position to do some huge favors for a big corporation, you are guaranteed a re-election. While it's good that citizens are starting to see the reality of all this, knowing that votes are for sale can be a huge concern.
@Will, I still would like to believe that Obama is not out to intentionally destroy the economy as many people say, but if there is truth to that, it looks like he has found an ally in Immelt.
Thanks caltex for this hub...I am going to arm myself with this info on some diehard libs I know who think this guy is amazing...along with Obama.
Good hub!! up, useful and interesting.
caltex, I wish I had some answers, but unfortunately I don't. Somehow between now and the 2012 elections we need more citizens looking at results than the "D" or "R" label written on their foreheads. To vote strictly based on a letter of the alphabet is so foolish, yet so many have always voted this way, and will continue to do so. I am equally disgusted with most of the politicians who are supposed to be working for us.
Hi, CM. Thank you! Some liberals are just that - diehards who defy logic and follow blindly. I just can't think of a reason how some liberals would think he is amazing. Instead of helping create jobs as he is expected to do, he has done just the opposite. The WH probably does not even care just like it didn't seem to care GE has not paid taxes in two years despite billions in reported profits! Amazing, but definitely not in a good way. On the other hand, I can understand how GE stockholders would think he is amazing. Immelt is so focused on the company's bottomline and will do pretty much anything to get ahead. He successfully positioned the company to win bailout money, regulatory breaks and millions in tax credits. I wonder how many politicians he's been able to wrap around his little finger. For GE stockholders, I am sure the more, the better.
Hi, OP. I agree with you completely. Elections should no longer be about supporting a party, but supporting a representative that can be most trusted to work in our best interests. We can only hope the way this debt crisis was (poorly) handled becomes an awakening for many citizens - that many of our current so-called representatives are just a waste of taxpayer money.
Hi Caltex. Thanks for sharing this important information. You shed serious light on things many of us didn't know. Voted up, up and away!
Hi, Dex. Thanks! This is just one of those that lead you from one thing to another - the more you keep digging the more interesting it gets. Just happy to share what I found.
And the reason jobs are going to china is simple - Chinese factory workers are little more than slaves. Yet I hear no one, left or right, talking about that fact. To buy products made in China is helping that communist government keep their people in bondage.
Hi, Sheila. It is true there are some companies in China where workers are treated like slaves, making products for Microsoft, Apple, Hewlett-Packard, to name just a few. Businesses are out to make money and will find the cheapest bid to produce what they need. It so happens they find that in China.
Lately, it's more than just factory work jobs that US companies are employing there. The cost of labor here in the US is just not competitive.
You're not alone in saying that buying products made in China is helping the communist government keep their people in bondage. Unfortunately, I personally don't think there is much we can do about that. Even if we did stop buying products made in China, unless the Chinese stood up for themselves and did something about it, things will remain the same for those who are treated like slaves in Chinese factories.
It will be great for the US economy if we can promote US-made products and change our buying habits. But with the economy we are currently in, consumers will buy whatever they can stretch their dollar the farthest.
If China-made products were inadequate, consumers will stick to US-made products, but that's not often the case. Not until we can produce superior products here in the US at competitive prices should we be able to discourage consumers from buying China-made products.
Our steadily rising cost of living plus our dollar shrinking in value will make the buying of foreign made products even more necessary. We can put the "Made in the USA" label on whatever we still produce in this country, but we still won't be able to compete with the lower priced goods when people are struggling to survive. Putting a band aide on this problem will be very temporary relief. We need to fix the darn economy and create some jobs before we even discuss boycotting the cheaper foreign made goods. Most of us would love to buy Made in USA, but the economy, lack of jobs, and not much being manufactured here anymore is working against us.
OP, yes, it's only after we've been able to address our problems will we be able to successfully promote buying US-made products. I'm afraid though that things will only get worse before the lightbulb comes on. Other companies like GE are moving jobs out of the US. Ford will start producing next-generation Ford Focus models at a new $490M plant in China next year and I am sure there probably will be more companies that will be doing so. Can we blame them? No. Labor is simply a lot cheaper in China and regulations are a lot less repressive. We have to accept the fact that we are competing for jobs with China and other countries. If we had far more superior labor that produce superior products, I don't think we would be having any problems. Unfortunately, that is just not the case.
We'll just have to see how the upcoming jobs plan goes. A brilliant plan this time? Right! Today's Labor Day speech did not give a hint of anything to be excited about.
I think one big factor everyone is forgotten about is the fact that China now is one of the biggest consumers in the world and like Toyota and Honda did in the US, companies are building manufacturing facilities nearer to their customers. This also saves them transportation and import duties. Also China being a Communist dictatorship gaurantees these companies compliance by the workers and a fixed wage that they control.
Peter
Peter, thanks for pointing that out. China's middle class is growing making it even even more attractive for US companies to expand their businesses there. Coca-Cola and Pepsi are investing billions of dollars more in China within the next few years. That is, while they continue to trim their operations here in the US little by little.
With more and more US companies expanding in China, what will stop them from continuing to find ways of cutting the cost of operation here in the US? Businesses need to stay competitive to survive and cutting their cost of operation is a big part of the equation, even at the expense of US workers.
Business is really pure math. They have to earn more than they spend or they will disappear quickly, unless of course they can get a few billion from the government to keep operating. Unions and increased regulations have made the cost of producing any product here in the US so high they can't compete with foreign manufacturers. Stockholders rarely invest in failing companies. Some have said just let these Corporations go overseas, and someone will take their place. Who I would have to ask? There is not a long line of Corporations just waiting for someone to move out so they can move in. It just doesn't work that way.
Several comments of course were pointed at the Republicans, as usual. It is a fact that GE was a heavy contributor to Obama's campaign, and I don't think Obama is a Republican. GE bought themselves some nice tax loopholes, and it was money well invested as they pay no tax.
Our whole government is bought and paid for on both sides of the aisle. Let's stop the finger pointing at just one party and take a good look at what is really happening.
OP, that's a good question - who will take their place? Is something being done about these jobs moving overseas? I most wonder what Immelt is doing about it, as the chairman of the Council on Jobs and Competitiveness.
Nowadays, finger-pointing is almost to be expected. I've never seen so much of it ever! I've always thought it was only kids that did it.
It is only kids doing it, the children we voted into office are playing the game the way their financial supporters want them to. We cannot compete with China, Haiti, Indonesia or any other thrid world country for that matter unless we lower the wages to their level, like 12 cents an hour or there abouts. With all the free trade agreements in place and the laws allowing the mega corporations to sifon money to where they want, we cannot compete. The last thing Immalt wants is to be fair and competative. Thanks, Peter
How can we even talk about getting Corporations to move back to the USA when we are up against cheap labor, few regulations, and very low tax rates? We will never be able to offer any incentives to beat what they have on foreign soil, so I think this is a permanent situation. The only way I could see to recover from this situation would be to tax all goods imported into this country to enhance revenue and even the playing field on the prices. I admittedly don't know and understand the various trade agreements we have in place, and my theory is most likely full of holes, but it would work.
@Peter, that sure would make us competitive, but we all know it ain't going to happen in the real world. It's just disgusting to think that Immelt is doing the exact opposite of what he has been tasked to do. What a joke!
@OP, I hate to think it is a permanent situation, but I am afraid you are right. For as long as there are unions, the cost of labor will never go down and will only encourage offshoring.
IMHO, one thing that needs to be looked into are the corporate tax loopholes that allow companies to hide US profits offshore, costing US taxpayers an estimated $70 to $100 billion per year.
Trade agreements will certainly need to be looked into as well. For several years now, Chinese subsidies have been under scrutiny, alleged to influence the conditions of competition and provide Chinese businesses an advantage over their international competitors. Massachusetts state officials are actually blaming China's trade policies for the closure of Evergreen's solar-panel plant in Devens, MA and their subsequent oursourcing of the manufacturing jobs to China.
We also need to find ways that will allow us to manufacture highly superior products at prices that can compete with those that are made in China. I do know that we can manufacture highly superior products. I just don't know if it will ever be possible at prices that can compete with those that are made in China. It may not be as easy as it sounds, but I believe that is the only way we can compete with China.
I doubt seriously that there are more than 10% of American workers in unions anymore, most are government employees thet are in unions now. So that is not a factor moving offshore. Not even illegal aliens would work for the wages they want to pay, sown below $1 per hour. Reagn showed long ago that he could bust unions with no adverse repercussions and since then unions became non entities in this contry.
According to Bureau of Labor statistics (2010), 11.9% of wage and salary workers in the US were members of a union.
That may seem a small number, but research has shown that:
- Strong unions set a pay standard that nonunion employers follow. For example, a high school graduate whose workplace is not unionized but whose industry is 25% unionized is paid 5% more than similar workers in less unionized industries.
- The impact of unions on total nonunion wages is almost as large as the impact on total union wages.
SOURCE:
http://www.epi.org/publication/briefingpapers_bp14
Therefore, it does not really matter if most union members are government employees.
The cost of labor IS the factor in moving offshore and not necessarily the unions.
Many have no idea what the true cost is of having employees on the payroll. They seem to think that if you pay $20 per hour, that is what it costs the employer.
The employer also pays Workers Compensation Insurance, Unemployment Insurance, half of their healthcare, vacation and holiday pay, vehicle insurance, gasoline, tools, uniforms, and dollar for dollar matching on their SS withholding to name a few. When all is added up, that $20 per hour is rapidly approaching $40 per hour per employee.
An employee calls in one morning and quits his job over the phone. No notice or good reason involved, he just doesn't feel like working anymore. Three years later this employee files for unemployment and the previous employer gets a notice saying his account is being charged with the cost of paying this past employee his unemployment pay. The next notice the employer receives says his rates for unemployment insurance are being increased because of this claim.
It is not only the cost of labor, but laws like this that are driving employers out of this country. Workers Compensation is a good thing, but if an employer ever files a claim god help them. Their policy is dropped at the end of the term and they are placed in a high risk group with heavily increased monthly premiums. And this happens when the injury was through no fault of the employer. Actions like this being allowed in the insurance industry is another reason companies are leaving.
The reasons companies are leaving are not complicated, and it is not just cheap labor that is driving this movement. An employer in this country has almost no rights, and the expenses and red tape continue to grow. For many, the employer is the enemy, not the one who puts clothes on their back and food on their table.
OP, you're an employer so I can say you're an authority when it comes to cost of labor. I appreciate you adding your valuable input.
I did forget to mention that making regulations less repressive should also be something that needs to be looked into. Thanks for pointing that out.
"For many, the employer is the enemy, not the one who puts clothes on their back and food on their table." -> Exactly how the unions portray the employer.
I have to agree with Mike, the hidden costs that employers pay are what really hurts. I used to employ 50 people and when times were good it didn't matter we were all making money. The costs of doing business were worth it. But now with the world competing for every dollar we need to loosen up on some of these costs for employers and make it easier not harder for companies and individuals to put people to work. The whole financial structure in this country is weighted away from the small business man and the workers and favoring the big companies that are "to big to fail". The government and the big corporations are taking us to the cleaners. Why? Becase they own the law makers and the regulators so they can do what suites them. We need a little balance here, if anything we should be catering to the small busnesses they are the ones who are the employers, they put people to work not the uber rich. Let's help the real job creators not these fake job creators.
Peter
Peter, that is sadly the truth. In addition to all that, big businesses can afford a whole separate division of tax accountants allowing them to avail of every tax loophole while the small businesses are taxed to the max.
If this administration was smart, and they aren't, they would sit down with small business and ask what they need to get the ball rolling again. If they met only a few of the requests from small business, we would see hiring taking place and the economy moving again. The sad part is that small business doesn't have the funds available to buy themselves a politician like the "to big to fail" guys can afford. They hunt for ways to fix our economic problems, yet ignore the one thing that would put us on the road to recovery.
Another reason WHY I want you in the Dept of Common Sense...
@OP, you would think they would have thought of that, but instead he's been conferring with mostly CEOs from big corporations. I read that he's hosted more than two dozen roundtable lunches and dinners with business leaders since 2009. That is plenty. And they have not come up with anything. Let's hope one day soon the lightbulb comes on.
@CMerritt, I agree. OP is the man!
PETER LUMETTA Level 6 Commenter 10 months ago
I think he should be asked to testify, under oath, to Congress on these same questions so if he lies again we can put him in Jail for being the criminal that he is. And the Republicans keep insisting these people are job creators, they are but not in our country. More corporate welfare.
Peter