What businesses need to get moving
For those who didn’t catch this last week, here is my op-ed on “economic uncertainty” that was published in the San Francisco Business Times.
“Health care reform. New financial regulations. A lack of consumer spending. Add them up and businesses all around the country are feeling beat up right now. If you listen to the nightly news, it’s the stomach- churning ebb and flow of the Dow that is keeping CEOs up at night. It’s not. It’s uncertainty.
Most CEOs will tell you that they can’t predict when they’re going to hire again because they still don’t know how much of a hit they’re going to take from all the new government regulations, and they don’t know what’s coming next. Compounding the problem, consumers who are nervous about their financial situation are tightly holding on to their wallets. Facing less revenue, executives are trying to stay afloat by increasing productivity and saving their cash until consumers start spending again. It’s this paralysis that is keeping investment on the sidelines.
As we speak, state regulators are writing health care rules that will greatly affect how large and small companies do business. With a 1,990-page health care reform bill, the amount of rules and regulations coming down the pike are virtually unquantifiable. The recently passed financial regulation bill on its own creates over 350 new rules, 47 studies, 74 reports and a huge consumer protection agency. Without a clear picture of what lies ahead, executives are content sitting it out until there’s more certainty.
That’s why President Obama should light a fire under regulators to get them to release the new rules soon. Businesses understand that the playing field has changed and that there is a new reality they’re going to have to work in. They just need concrete details so they can start to account for those changes.
Obama and Congress also need to send clear signals to businesses that they will take reasonable, proven steps to get them to start hiring. Tax credits and other incentives should be offered to American businesses that put Americans back to work.
Right now, businesses need a stable and predictable environment. They need a commitment from government that they will not be taken for granted. They need the American people to spend, so they can expand. Ultimately, no one is in a position to wait any longer though.
Our economy hangs in the balance.”