What if we were to wake up and see that MSNBC's leftward lurch has been a veil, a cloak of disguise, covering up one of the great corporate money-grabs of all time? That's right: What if Keith Olbermann, Rachel Maddow, Chris Matthews, David Shuster--and all the other sneering, snarking lefties on the channel--were simply fronts for crony-capitalist lobbying and looting?
But hey, it's not me who is writing articles with headlines such as "GE Bailout Chatter Begins." The Cable Gamer has noted GE's effective money-mulcting of federal funds as part of TARP-type bailouts, but there's a lot more money-grabbing going on under the cover of environmental policy. In other words, GE's green-grabbing is hidden behind a green wall of politics.
And it might work. As The Washington Examiner reports, it looks like GE is about to get handsomely rewarded by Uncle Sam, thanks to GE's political connections. What has GE done to deserve such federal largesse? Well, it spent $19 million in lobbying in 2008--that surely helped. But lots of companies spend even more money than that on lobbyists, and get a lot less. What makes GE different is that it has a propaganda arm with, seemingly, one mission: suck up to the Obama Administration, and to the Democrats on Capitol Hill. And that propaganda arm, of course, comes in the form of GE's media properties, most obviously, MSNBC--sometimes called "MSDNC," as in MSDemocratic National Committee. Now it looks like that media-propaganda outreach is going to pay off in billions for GE and other connected-in companies, even as it costs the US economy, and all the rest of us, trillions.
The Washington Examiner's Timothy P. Carneyhas made a career out of combing through the lobbying efforts of big companies, figuring out how they seek to advance their own corporate interests at the expense of the rest of us. He should be applauded in general for his muckraking efforts, but Carney's excellent digging and explaining only becomes immediately relevant to The Cable Game when it involves a company that plays in the cable-news sphere--and that certainly includes GE. Led by CEO Jeff Immelt, Obama became the top recipient of GE money in the last election cycle.
But of course, GE's symbiotic relationship with Uncle Sam isn't limited to lobbying, or to MSNBC--GE is part of a huge corporate-funded network that helps shape popular understanding of scientific and political issues, the
The US Climate Action Partnership is a hybrid organization: on the one hand, the members are some of the largest corporations in America, including GE, Ford, Dow, and DuPont; and on the other hand, members also include such green groups as the Environmental Defense Fund, the Natural Resources Defense Council, and The Nature Conservancy. Obviously it's a mixed marriage--further made ridiculously cynical by the presence of such big polluters as BP, Shell, and Rio Tinto. As the group describes itself:
United States Climate Action Partnership (USCAP) is a group of businesses and leading environmental organizations that have come together to call on the federal government to quickly enact strong national legislation to require significant reductions of greenhouse gas emissions. USCAP has issued a landmark set of principles and recommendations to underscore the urgent need for a policy framework on climate change.
Which is to say, a bunch of giant corporations--including some of the worst polluters on earth--have gotten together to create a front group that lobbies for rules that will make these giant corporations even more gigantic.
It's a complicated tale, to be sure, but to understand it is also to understand why MSNBC has turned itself into such a cheerleader for the extreme liberalism of the Obamans and the Democrats on Capitol Hill.
So to get that understanding, let's go through Carney's article carefully:
While many companies hire lobbyists to win earmarks, General Electric’s unmatched lobbying force has secured a tax increase — or its equivalent — in President Barack Obama’s budget.
Labeled “climate revenues” and totaling $646 billion over eight years, this line item in Obama’s budget has inspired confidence in GE Chief Executive Officer Jeff Immelt. As Immelt put it in a letter this week, he believes that the Obama administration will be a profitable “financier” and “key partner.”
A relevant term here is "rent-seeking,"which has a specific meaning to political economists: "In economics, rent seeking occurs when an individual, organization or firm seeks to make money by manipulating the economic and/or legal environment rather than by trade and production of wealth."
Carney dives into the details:
On page 115 of Obama’s fiscal 2010 budget is Table S-2, titled “Effect of Budget Proposals on Projected Deficits.” The chart forecasts the costs of Obama’s spending proposals and the added revenue of his proposed tax increases. It also forecasts, beginning in 2012, billions of dollars a year in “climate revenues.” This budget line, which has struck fear into some lawmakers from coal-dependent states, could spell salvation for GE in these times of uncertainty.
How can Obama generate “climate revenues”? By forcing companies to pay for the right to emit greenhouse gases such as carbon dioxide.
A tax on greenhouse gas emissions could accomplish this, but Obama’s preferred policy — and the approach embraced by a few congressional bills in recent years — is called “cap and trade.” In short, cap and trade requires businesses to spend “credits” to pay for their emissions. Businesses can buy or sell these credits, and the market — not the government — would directly set the price of a credit. Government would initially auction them off, generating revenue.
And here comes General Electric:
GE — a member of the U.S. Climate Action Partnership, which advocates cap and trade — leads the push for greenhouse gas restrictions.
In the fourth quarter of 2008 as the company’s stock fell 30 percent, GE spent $4.26 million on lobbying — that’s $46,304 each day, including weekends, Thanksgiving and Christmas. In 2008, the company spent a grand total of $18.66 million on lobbying.
And now we begin to see why MSNBC had to move left, embracing Obama, and his idea for an 80% cut in CO2 emissions by 2050--GE and the rest of USCAP have a long wish list:
Reviewing their lobbying filings, you might think you were looking at Al Gore’s agenda. GE’s specific lobbying issues included the “Climate Stewardship Act,” “Electric Utility Cap and Trade Act,” “Global Warming Reduction Act,” “Federal Government Greenhouse Gas Registry Act,” “Low Carbon Economy Act,” and “Lieberman-Warner Climate Security Act.”
This isn’t altruism or public relations. GE has started a joint venture called Greenhouse Gas Services, which invests in — and hopes to manage the trade in — greenhouse gas credits. But these investments and this trading floor are of basically no use and nearly no value without government restrictions on greenhouse gases.
Hence the lobbying, buttressed by generous campaign contributions: Employees and executives gave $1.35 million to politicians in the past election while GE’s political action committee shelled out $1.55 million. About 64 percent of this $2.9 million went to Democrats, with Obama easily the top recipient of GE money.
And here's Immelt, explaining the strategy:
Obama’s budget includes the payoff, promising to start a multibillion-dollar greenhouse gas industry by 2012. In a letter this week, GE’S Immelt told shareholders that current events present an “opportunity of a lifetime,” because “capitalism will be ‘reset.’ ”
Immelt wrote: “The interaction between government and business will change forever. In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner.”
In short, GE plans to get rich by being one of the government’s closest partners — which it has always been, thanks to its unmatched lobbying efforts.
Next Carney puts the issue in larger context, which should even enviros pause:
The environmentalist at this point might respond, “Well, good for GE. if they can get rich while helping the planet, more power to them.” But this ignores important issues. First, restraining greenhouse gas emissions will cost Americans dearly. Gas, electricity and heating prices will all go up. The prices of manufactured and shipped goods will go up. A Clemson University report on similar cap-and-trade proposals forecast a 1 percent decline in he U.S. gross domestic product by 2015 if they were implemented.
There are environmental costs, also, to such a focus on greenhouse gases: Ethanol’s damage to water supplies, soil health and air quality are the fruit of government pushing the product as a climate-friendly fuel.
Carney concludes:
When the lobbying fingerprints of GE and other well-connected firms are considered, it’s not hard to conclude that the policy that will finally emerge won’t be the one that is best for the planet and least bad for the economy, but the one that is best for General Electric.
OK, so GE plans to get rich--or at least recover some of the nearly 90% of shareholder value that's been lost over the last eight years, as the stock from nearly 60 to around 7--by rent-seeking the rest of the US economy. To most Americans, that's not a very attractive plan, but at least it's a plan, right?
Well, actually, no, it's not even a good plan. And why not? Because the whole global warming scheme is collapsing, a victim of increased scientific skepticism, decreased temperatures, and increased realization that a weakened economy can't take any more punishment.
So if GE is betting big, as Immelt says, on "green rent-seeking," then GE and its boss are due for an unpleasant surprise--just like Enron, which went belly up in 2002, after betting big on being able to manipulate the Kyoto Treaty into a windfall for itself, by trading "carbon futures" and the like.
But unfortunately for Ken Lay, Jeff Skilling, et al., any prospect for the world-government that Enron was counting on to guarantee its insider-profits collapsed after 9-11, and so Enron itself soon collapsed.
And now the worldwide recession (we hope that's all it is) is going to put the kibosh on Kyoto, and other similar climatic foolishness. Which is to say, all the green rent-seeking that GE has been counting on is not going to come to pass, as countries realize that they can't afford green foolishness.
Yes, Olbermann, Maddow, et al. will continue to huff and puff their lefty cant--no doubt because they really believe it. And all the while, their corporate masters will encourage them. (Do you suppose that MSNBC staffers ever wonder why it is that GE continues to support the #3 rated cable news network? Do they really think that it's because of their talent?)
But the ultimate joke may be on Immelt and his cohorts at the top of GE. After all, the worst kind of cynicism is failed cynicism. And, in a way, the worst kind of ripoff is the failed ripoff. That is, many times we grudgingly admire the successful rogue, who wheel and deals his way to system-beating riches. But it seems like GE is making the same bet as Enron.
In which case, the deeper problems of GE, as closely documented by Henry Blodget and his team at The Business Insider are likely to drive GE's stock down even lower. Yes, GE's Immelt is currently counting on green rent-seeking to save his bacon, and many on Wall Street believe him, but when that prospect evaporates, GE could be left with nothing more than toxic financial shock, from all those toxic "assets."
And then, one imagines, Keith and Rachel will head to NPR.
