Waxman: Threatening companies that announce health-tax writedown.
Posted on 03/30/2010 7:36:27 AM PDT by opentalk
In the aftermath of World War II, the U.S. Senate War Investigating Committee called hearings in an attempt to publicly shame and excoriate industrial titan Howard Hughes. Hughes was accused of wasting taxpayer money on his F-11 and HK-1 projects. The hearings backfired as the stubborn Hughes accused the Senators of corruption and blackmail and of being beholden to his competitors, and he detailed the millions of his own dollars he spent on these projects.
The committee, embarrassed by the unexpectedly effective defiance of the infamous recluse, disbanded without filing a report.
Don’t expect that kind of defiance from the chief executives of AT&T, Verizon Communications, Caterpillar, and Deere & Co., if they respond to the demands of powerful Democratic Chairman Henry Waxman. In letters issued Friday, Waxman called on each of these CEOs to appear before his committee for the absurd purpose of defending internal memos to their own employees, and related statements to the press, about the impending changes in their health care plans.
..The trouble for Waxman and his fellow Democrat leaders arises from the direct conflict between the (accurate) statements of these companies and Obama’s oft-repeated promises that if you’re happy with your health care, nothing will change.
Obama said in Iowa City last week, “[My opponents] will have to finally acknowledge that this isn’t a government takeover of our health care system. They will see that if Americans like their doctor, they will keep their doctor. If people like their plan, they will keep their plan.”
The ludicrous nature of this claim didn’t prevent Obama from saying it again and again (but these are words, just words) even as the Associated Press, ABC News, FactCheck.org, and a multitude of independent groups found this promise inaccurate at best. These predictions were borne out within the week, as companies warned employees their coverage plans will change in the face of new taxes and cut off tax breaks for providing benefits.
In a regulatory filing last week, AT&T reported, “As a result of this legislation, including the additional tax burden, AT&T will be evaluating prospective changes to the active and retiree health-care benefits offered by the company.” It also announced that the health care legislation would result in a $1 billion first quarter non-cash charge against profits.
In some of these cases the companies are required to make 8-K disclosure filings detailing their shifting tax burden under the law. Federal law requires them to make these reports, and these companies would not have filed them if they didn’t have the internal and thorough documentation on the matter.
If the CEOs’ statements or subsequent testimony conflict with internal memos or downplay risks to their companies that eventually come to pass, or if they back off plans to save their shareholders money, they expose their companies and themselves personally to shareholder class-action lawsuits for securities fraud or breach of fiduciary duty. These would be filed, coincidentally enough, by Waxman’s allies in the trial bar.
Thus as CEOs face the choice of a fiduciary breach or a political backlash from partisan Washington, it’s still better to obey the law, even if a powerful Democratic Chairman gives you hell for it.
But compliance with the law is no excuse for embarrassing the President and his Congressional satraps. Waxman’s aims are clear: he must send a powerful signal to American business leaders that any criticism of Obama’s new health care regime, however well-grounded in the facts, will not be tolerated. You can’t govern a country with CEOs running around shooting off their mouths, talking about how your policies will hamstring their companies—especially if they’re telling the truth.
No one should expect these 21st century CEOs to follow Hughes’s example. They have shareholder interests to protect and massive government contracts they could lose. In the new American economy, the best way to get rich is to make something for the government, and no company wants to land on the feds’ enemies list. Even if the CEOs believe that Republicans will soon recapture Congress and send Waxman packing, back to the malodorous impotence of a Ranking Minority Member, they know that there are no certainties in electoral politics and that Congressional Democrats have long memories.
"Intimidation" is part of the Chicago Way... get used to it.
some of us would have been burnt. some shot, and the rest: we’d be speaking german.
Jim Quinn referred to Waxman as Wesley Mouch this morning. I find this inquisition eerily similar to the Mouch/Rearden showdown in “Atlas Shrugged”.
Waxman: Threatening companies that announce health-tax writedown.
I hear CSpan will have it on April 21 or 24th. As for Waxman, put a Nazi hat on him and he looks just like Himler. Himler did the exact same thing when people disagreed with Hitler.
Henry Waxman, “Break the Sarbanes Oxley legislation, how dare you follow the law and dispute theOne.”
He doesn’t talk about it much, but his mother is an actual mole.
I was hoping there would be a bunch of CEO wiht backbones to take on these evil slimy democrats!
That was great in The Aviator when Hughes took down the corrupt senator. It was even better that the senator was played by Alan Alda.
The new supreme court ruling applies free speech to corporations. The write downs were required disclosure by law.- any retaliation of with holding government contracts or sending in media smear machine is Chicago politics corruption. Hope they bring lawyers and take a stand.
Here's a map of his totally safe gerrymandered district, which includes Beverly Hills, Westwood, Santa Monica, Malibu and all the major liberal bastions of L.A. Does it make his insanity a little easier to understand?
” I find this inquisition eerily similar to the Mouch/Rearden showdown in “Atlas Shrugged”.”
Me too. And in terms of physical appearance, I think Waxman would have been a great casting choice! :)
Unfortunately many of them likely contributed funds to Obummer and the socialist-democrat party reelection campaigns. Sow the wind, reap the.......
The CEOs still have a powerful weapon - Promise Waxman a string of embarrassing public announcements of massive layoffs as a direct result of Obamacare.
...and a disgusting pig-faced troll.
Perhaps where the last tyranny ended...on the battlefield. If not us who? If not now, when?
They certainly NEED to stand up and tell the truth....with facts, figures AND lawyers. Waxman needs to be put in his place.
We need to pray for courage and wisdom for these CEO’s.
I don’t agree that they won’t defy Waxman, especially if they expect the Dems to be thrown out of office in November. In fact, it helps their cause to be defiant and expose Obamacare so voters will vote against it.
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