Stop Bashing Business, Mr. President
If we tried to start The Home Depot today, it's a stone cold certainty that it would never have gotten off the ground.
By
KEN LANGONE
WSJ.com
Although I was glad that you answered a question of mine at the Sept. 20 town-hall meeting you hosted in Washington, D.C., Mr. President, I must say that the event seemed more like a lecture than a dialogue. For more than two years the country has listened to your sharp rhetoric about how American businesses are short-changing workers, fleecing customers, cheating borrowers, and generally "driving the economy into a ditch," to borrow your oft-repeated phrase.
My question to you was why, during a time
when investment and dynamism are so critical
to our country, was it necessary to vilify
the very people who deliver that growth?
Instead of offering a straight answer, you
informed me that I was part of a "reckless"
group that had made "bad decisions" and now
required your guidance, if only I'd stop
"resisting" it.
I'm sure that kind of argument draws
cheers from the partisan faithful. But to my
ears it sounded patronizing. Of course, one
of the chief conceits of centralized
economic planning is that the planners know
better than everybody else.
But there's a much deeper problem than whether I am personally irked or not. Your insistence that your policies are necessary and beneficial to business is utterly at odds with what you and your administration are saying elsewhere. You pick a fight with the U.S. Chamber of Commerce, accusing it of using foreign money to influence congressional elections, something the chamber adamantly denies. Your U.S. attorney in New York, Preet Bahrara, compares investment firms to Mexican drug cartels and says he wants the power to wiretap Wall Street when he sees fit. And you drew guffaws of approving laughter with your car-wreck metaphor, recently telling a crowd that those who differ with your approach are "standing up on the road, sipping a Slurpee" while you are "shoving" and "sweating" to fix the broken-down jalopy of state.
That short-sighted wavering—between
condescending encouragement one day and
hostile disparagement the next—creates
uncertainty that, as any investor could tell
you, causes economic paralysis. That's
because no one can tell what to expect next.
A little more than 30 years ago, Bernie Marcus, Arthur Blank, Pat Farrah and I got together and founded The Home Depot. Our dream was to create (memo to DNC activists: that's build, not take or coerce) a new kind of home-improvement center catering to do-it-yourselfers. The concept was to have a wide assortment, a high level of service, and the lowest pricing possible.
We opened the front door in 1979, also a
time of severe economic slowdown. Yet today,
Home Depot is staffed by more than 325,000
dedicated, well-trained, and highly
motivated people offering outstanding
service and knowledge to millions of
consumers.
If we tried to start Home Depot today,
under the kind of onerous regulatory
controls that you have advocated, it's a
stone cold certainty that our business would
never get off the ground, much less thrive.
Rules against providing stock options would
have prevented us from incentivizing worthy
employees in the start-up phase—never mind
the incredibly high cost of regulatory
compliance overall and mandatory health
insurance. Still worse are the
ever-rapacious trial lawyers.
Meantime, you seem obsessed with
repealing tax cuts for "millionaires and
billionaires." Contrary to what you might
assume, I didn't start with any advantages
and neither did most of the successful
people I know. I am the grandson of
immigrants who came to this country seeking
basic economic and personal liberty. My
parents worked tirelessly to build on that
opportunity. My first job was as a day
laborer on the construction of the Long
Island Expressway more than 50 years ago.
The wealth that was created by my
investments wasn't put into a giant swimming
pool as so many elected demagogues seem to
imagine. Instead it benefitted our
employees, their families and our community
at large.
I stand behind no one in my enthusiasm
and dedication to improving our society and
especially our health care. It's worth
adding that it makes little sense to send
Treasury checks to high net-worth people in
the form of Social Security. That includes
you, me and scores of members of Congress.
Why not cut through that red tape, Mr.
President, and apply a basic means test to
that program? Just make sure that money
actually reduces federal spending and isn't
simply shifted elsewhere. I guarantee you
that many millionaires and billionaires will
gladly forego it—as my wife and I already do
when we forward those checks each month to
charity.
It's not too late to include the voices of experienced business people in your efforts, small business owners in particular. Americans would be right to wonder why you haven't already.
Mr. Langone, a former director of the New York Stock Exchange and co-founder of Home Depot, is chairman of Invemed Associates.