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.
Yep. It’ll be interesting when Waxman is confronted with REAL numbers from REAL number crunchers who actually have to do this for a living and don’t live in the nether world of Congressional staffer wishful thinking.
You got rid of the tax benefit for companies’ giving their retiree’s Prescription Drug Benefits. Now they won’t. That simple, moron. Or did you even KNOW that was in the bill? I’m betting not.
Waxman-a minor apparatchik in the Obama Politburo!
What is he going to do, subpoena them? On what grounds?
Of course like illustrated in this article, it is doubtful that there is a "Pair" between all the CEO's combined!
“
CEOs won’t dare defy Waxman, even with facts on their side
“
Many CEOs that haven’t receive their version of the request that
Waxman (AND BART STUPAK) sent to AT&T...
should DEMAND to testify.
Especially the head of Aetna Insurance.
Because he and Obama possess about the same nice “tan”.
Just to show this ain’t about any other color...than the (green)
color of money.
aviator bump for later..........
Yeah, I posted the Democratic Socialist information and the names of Congressional members here on FR about 8 years ago. What I was trying to point out today with my Waxman post is that he represents the Hollywood-Beverly Hills-Malibu socialist elite, which is why his positions are so extreme. The way his district is gerrymandered to exclude conservative voters, there’s no way I know of to vote him out.
Obviously Waxman feels he has them by the short hairs.
We will see. The truth shall set you free.
The Investigating Committee will see you NOW.
Is there a way for him to lose his position as chair of the House Energy and Commerce Committee after the election.
cowards
Remember National Black Chamber of Commerce President Harry Alford’s heated exchange with Boxer. He wanted to discuss the issues, she shut him down.
That depends on how many conservatives we can elect, as you know. If Amnesty passes before the Congressional elections, all those new Democrat votes (legal and illegal) could upset our best hopes. They seem confident they can ram it through, just like health care.
The corporations have the power to smack Waxman and they should.
Where is Hank Reardon when we need him?
we need to burn Ollie North’s testimony at the Iran-Contra hearings to DVD and send one to each of these guys
Who is John Galt?
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