First of all, congratulations! Who would have ever thought after your long career, and two failed attempts at the presidency, you would be going to the White House in 2021! But such are the times in which we live. For the record, I voted for you just because I got tired of the other guy. He’s exhausting! Plus, I’m an independent, not a party man. I once had the good fortune to meet Presidents Clinton and Bush. Flummoxed about what to say, I blurted out, “I voted for both of you twice!” Which was a true statement.
But, you know what they say: campaigning is easy, governing is hard (or is it campaigning is poetry, governing is prose?). I’ve watched you put your team together and like a lot of what I’ve seen. Janet Yellen as Treasury Secretary is a solid pick. I dealt with her when she was president of the San Francisco Federal Reserve and I was at Bank of America. I came to appreciate her even-handedness and pragmatic judgment. I like Steve Ricchetti (Senior Counselor) and Brian Deese (National Economic Council). And Ron Klain will make a fine Chief of Staff. These picks have something in common. They’ve all worked in the private sector. But, shockingly, that’s a problem with some of your supporters. Which is why I’m writing to you.
Apparently, you have been considering Jeff Zients for a senior economic position, which was swiftly opposed by the progressive wing. “(Progressives) view his recent work running an investment firm – Cranemere — and sitting on the board of Facebook as a detriment,” noted the New York Times.
Wait, what? Business experience is a detriment?
You didn’t ask, but if I were putting together your economic team, one of my first questions would be, “What kind of business experience do you have?”
Because the simple fact is that society and all of its components —government, nonprofits, academia, the arts, everything — wouldn’t exist if not for the private sector.
It is our capitalist system that creates the wealth which funds all of these activities. Private business creates the goods and services that make our lives possible. The jobs on which our tax system is built. The health care benefits enjoyed by millions of Americans. All of the contributions that fund our nonprofit sector. All of it derives from the private sector.
Trump realized this. His presidency was problematic for many reasons, but it is a fact that the economy prospered under his policies, notably a reduction in corporate taxes and elimination of unnecessary regulations.
The long-overdue cut in the corporate tax rate, in particular, finally made America competitive with the rest of the world, promoting a wave of business and capital formation. You don’t want to turn that spigot off.
The result of these policies (pre-pandemic) has been strong economic growth, record-low unemployment (particularly among minorities), and a rising stock market that benefited more than half of American households. During the Trump years (2016-2019), median real incomes grew 5 percent. On a relative basis, most of those gains accrued — wait, get ready for it — not to the top 1 percent but to families near the bottom of the income and wealth distribution scale.
This is how the private sector works when given enough oxygen. Mr. President-Elect, please don’t cut off that oxygen supply.
This will not be easy for you. Bernie and Elizabeth and AOC are clamoring to get their mitts on the private sector. Government spending is expanding faster than the universe (for some essential reasons, give the pandemic) and there is a massive and long-deferred need for investment in U.S. infrastructure.
And personally, you don’t have a predilection for business, given your past 44 years in elected office. Which is a little ironic since you come from Delaware, where 65 percent of the Fortune 500 are incorporated due to the state’s highly efficient and transparent corporate law infrastructure.
So yes, I think we all expect some taxes to go up. We expect some more climate regulations. And we expect businesses to continue leaning toward a more proactive role in the creation of social wealth and stability.
But let’s remember the words of Winston Churchill: “Some people regard private enterprise as a predatory tiger to be shot. Others look on it as a cow they can milk. Not enough people see it as a healthy horse pulling a sturdy wagon.”
So Joe, please don’t screw it up. With a vaccine around the corner, the U.S. (and global) economy is set for a robust rebound in 2021 and beyond. Give ‘em plenty of runway. Be pragmatic. Be brave. Get some more business people on your team (maybe Gary Cohn would like to come back; he knows his way around the West Wing). Hold businesses accountable, but let them breathe. Our society depends on it.
You got this Joe, we know you do.
Let’s go to work.