Rick Perry fizzles, Bernie Marcus sizzles at Atlanta event

Texas Gov. Rick Perry spoke in Atlanta today, and my AJC colleague Aaron Gould-Sheinin has the details. I noted some of Perry’s lines on my Twitter feed. I’d call them his applause lines, except that he got little more than polite applause. (There were standing ovations as he took and left the stage, but they seemed to be pro forma.)

In general, I got the impression Perry wasn’t very well briefed about his audience — the event was sponsored by the free-market-oriented, but nonpartisan, Georgia Public Policy Foundation, and the crowd not only was fairly wonky but included more than a few fans of Mitt Romney. Hence, Perry’s thinly veiled attacks on Romney didn’t go over terribly well. Perry’s talk was also billed as a policy discussion about what he had done in Texas, but it sounded a lot more like a stump speech. He took no questions from the audience or the press.

In all, I’m not sure it was a very successful outing for the Texan.

On the other hand, Home Depot co-founder Bernie Marcus gave a spirited address about the Obama administration and the burdens Washington  is putting on business. Here’s a flavor:

  • On over-regulation: “You try to open up [something simple like] a barber shop, anywhere in the United States, and see what you have to go through. … It’s like walking through a mine field.”
  • On having a “very, very negative outlook” about the future: “I don’t see the future the way I did in 1978 when we opened Home Depot. … If we had the same opportunity…today, the Home Depot would open with four stores, and maybe we’d have eight” eventually.
  • On the differences between 1978 and today: First: “Regulations, regulations, regulations, regulations…from every single department in this government. Every time you form another department [he mentioned Education, Energy and Commerce] every one of them is a failure. … They’re like [Bernie] Madoff, every single one of them — just more money, nothing coming out of them of value.”
  • On the second difference: “trial lawyers” and the cost of litigation, which he said was once calculated to account for 25 percent of the cost of every tool sold at Home Depot: “Do you know how many times the Home Depot has been sued because a person dropped a hammer on their toes?”
  • On GE’s Jeffrey Immelt, one of Obama’s advisers from the business community: “He went straight from Harvard Business School to GE. … He never went through the trauma of opening a new business.”
  • On Obama: “He’s getting advice on how to be [elected] president of the United States, period. And I think that’s all he’s interested in. … He’s got to learn how to get out of his own skin. And become an American first, and a Democrat or Republican second.
  • On both major political parties, both of which he blamed for such damaging regulation as Sarbanes-Oxley, Dodd-Frank and Obamacare: “Damn both their houses. … They pass bills without understanding” the consequences.

You’ll be hearing more from Marcus on these topics. He’s begun an initiative called the Job Creators Alliance to speak out against government meddling with business. He said 1,000 businesses have already joined, and that he expects the total to reach 5,000 to 7,000 before next year’s election. It could be higher, he said, but “we have so many [business]people intimidated, it’s frightening.”

– By Kyle Wingfield

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63 comments Add your comment

MarkV

September 30th, 2011
4:22 pm

Home Depot co-founder Bernie Marcus may have given “a spirited address,” but according to Kyle’s excerpts, a rational response should have been a big yawn. Regulations – the cause of all the problems in the economy. Strange that the economy was humming with virtually the same regulations a little more than a decade ago.

CJ

September 30th, 2011
4:24 pm

The economic mess that we’re in today was caused directly and entirely by LACK of regulation, not too much of it.

Lack of regulations encouraged rating agencies to rate junk bonds as AAA for fear of losing their investment banker customers. Lack of regulations on lenders encouraged them to make bad loans without consequence since they had every intention of re-selling 100 percent of the loans on the secondary market. Lack of regulations on derivative trading. Lack of regulations that would require transparency in such products. And lack of enforcement of what regulations we did have…enforcement that should have been conducted by the Federal Reserve Bank (Alan Greenspan) and the SEC (President Bush).

Kyle Wingfield

September 30th, 2011
4:42 pm

Actually, CJ, I’d contend it had more to do with poorly conceived regulations and other laws, which created perverse incentives and false senses of security. The rating agencies certainly screwed up, but they got away with it in part because the SEC granted them a nice little oligopoly (complete with a mandate for firms to use the services of rating agencies). Those lenders had every intention of re-selling their loans, but to whom? That’s right, Fannie and Freddie — which were able to borrow money super-cheaply because of their implicit government backstops, and dictated the rules of the game to the very elected officials and bureaucrats who were supposed to be supervising them (on that note, I highly recommend Gretchen Morgenson’s book, “Reckless Endangerment”). And money was cheap in general because the Fed kept monetary policy too loose for far too long.

And so on.

jess

September 30th, 2011
5:14 pm

The burdens of regulation also extend to state and local governments. I live in a small town in the mountains. It is very well managed and is in the process of planning a future resevoir to meet the water needs of the future. The proposed budjet for the project was recently revealed in the local weekly newspaper. Total cost $50 million dollars. Of this number $34 million was for EPA and Army Corps of Engineer testing and regulations and $16 million for purchasing the land and building the dam.

ByteMe

September 30th, 2011
5:40 pm

Those lenders had every intention of re-selling their loans, but to whom? That’s right, Fannie and Freddie

That’s wrong. Most of the subprime mess went to private money, not the semi-government orgs. Some of that private money was off-book funds set up by Bear Stearns and Lehman, both deceased, because they were forced to bring them back on-book. Then there were the counter-party risk derivatives written by AIG that AIG couldn’t pay on, so all those companies thinking they were covered weren’t until the US Government decided to backstop THEM in exchange for most of that company.

Oh, and who was running the SEC when they granted that waiver to the big banks, Kyle? You forgot to mention that. And who lobbied hard for that waiver? I think you forgot that as well.

Lil' Barry Bailout (Unexpectedly Revised Downward)

September 30th, 2011
5:53 pm

MarkV: a rational response should have been a big yawn.
————————-

Yep, all the big corporations are moving overseas because we’re too lightly regulated here in the U.S.

Lil' Barry Bailout (Unexpectedly Revised Downward)

September 30th, 2011
5:57 pm

Kyle Wingfield
4:42 pm
———————

Excellent summation of what transpired, but don’t expect it to stick. The anti-business, anti-profit, anti-private-property left has their narrative already and are immune to facts.

Strawman

September 30th, 2011
6:03 pm

“On both major political parties, both of which he blamed for such damaging regulation as Sarbanes-Oxley, Dodd-Frank and Obamacare: “Damn both their houses. … They pass bills without understanding” the consequences.”

What can one expect from a body comprised largely of lawyers? And I don’t mean to impugn their integrity or intelligence by that statement; it’s just patently obvious that, because they operate within a closed system outside of normal life, they really don’t understand how to truly solve problems. Their solutions are legal ones more than practical, engineering ones.

Lil' Barry Bailout (Unexpectedly Revised Downward)

September 30th, 2011
6:07 pm

How HUD Mortgage Policy Fed The Crisis
By Carol D. Leonnig
Washington Post Staff Writer

In 2004, as regulators warned that subprime lenders were saddling borrowers with mortgages they could not afford, the U.S. Department of Housing and Urban Development helped fuel more of that risky lending.

Eager to put more low-income and minority families into their own homes, the agency required that two government-chartered mortgage finance firms purchase far more “affordable” loans made to these borrowers. HUD stuck with an outdated policy that allowed Freddie Mac and Fannie Mae to count billions of dollars they invested in subprime loans as a public good that would foster affordable housing.

In 1995, President Bill Clinton’s HUD agreed to let Fannie and Freddie get affordable-housing credit for buying subprime securities that included loans to low-income borrowers. The idea was that subprime lending benefited many borrowers who did not qualify for conventional loans. HUD expected that Freddie and Fannie would impose their high lending standards on subprime lenders.
—————————

Another big success courtesy of the federal government.

Strawman

September 30th, 2011
6:15 pm

“The economic mess that we’re in today was caused directly and entirely by LACK of regulation, not too much of it.”

Funny…I was under the impression the mess was caused primarily by greed and folly. I really wish it were possible to legislate against bad behavior, but that always seems to fall well short of the ingenuity of those bent of wrongdoing in inventing ways to circumvent the laws or some news ways of doing wrong. What I imagine will work much more effectively is greater enforcement and harsher penalties. I hear there are fewer thefts in Turkey than in our beloved country. Fear of consequences can be a very powerful deterrent to crime, but only when justice is swift and severe (you know, like mandatory 25 year to life sentences for those convicted of defrauding the public at large).

Lil' Barry Bailout (Unexpectedly Revised Downward)

September 30th, 2011
6:20 pm

The mess was primarily caused by folks not paying their bills.

Strawman

September 30th, 2011
6:21 pm

“The mess was primarily caused by folks not paying their bills.”

Well, that too LOL.

Bevo

September 30th, 2011
7:55 pm

The problem Rick Perry has is that he needs exposure, but the more exposure he gets, the more America figures out that he’s an empty suit. All hat, no cattle is what we say in Texas, except Perry can’t even where a hat, since his primary selling point is his hair. Thank goodness that nobody cares outside of Aggieland.

pan

September 30th, 2011
8:49 pm

Enter your comments here

Joe Friday

September 30th, 2011
11:26 pm

An example of the government not thinking through the consequences of some of their decisions is Kudzu. It was brought into this country from China by the USDA for erosion control. The same lack of thought applies to almost all govt. programs.

Joe Friday

September 30th, 2011
11:29 pm

The problem we are in today was caused by people using the equity in their homes like an ATM to buy things that they couldn’t afford under the mistaken assumption that the value of the home would continue to rise.

Lil' Barry Bailout (Unexpectedly Revised Downward)

September 30th, 2011
11:46 pm

When it comes to understanding what makes business work and what creates jobs, I think Bernie Marcus might know juuuuuust a bit more than the Idiot Messiah.

yuzeyurbrane

October 1st, 2011
12:21 am

Bernie is a great philanthropist and salesman. He used to hold “juice” sessions (nothing bad, he was chief cheerleader) at Home Depot. Others made the real busn. decisions. In 1978, Jimmy Carter was President and the Democrats controlled both houses of Congress. Isn’t that when Bernie said things were great? And, of course, Home Depot was his 2nd attempt at super hardware store concept. His 1st ended in bankruptcy and he walked away from its debts. But that’s just busn. for corporations. For the rest of us, we better pay our bills.

yuzeyurbrane

October 1st, 2011
12:25 am

P.S.- Bernie also wrings his hands about us being so frightfully partisan but neglects to mention he was 1 of the deep-pocket donors who helped fund the infamous “Swift Boat” attack ads.

Inspector G

October 1st, 2011
12:48 am

Alan Keyes opines…we listen….

http://www.hailtothee.com

Cherokee

October 1st, 2011
4:46 am

Bernie – you are the reason I shop at Lowes.

Road Scholar

October 1st, 2011
7:07 am

“I don’t see the future the way I did in 1978 …”

BooHoo! Who does? The world has changed! Change is a bitch, isn’t it!

Oh the uncertainty! Oh the whining!

Jeff

October 1st, 2011
7:10 am

Perry needed to be “briefed on his audience.” This is why Washington is a joke. There is no one genuine. Does anyone think Ron Paul would have been “briefed on his audience”? Even someone like Newt I don’t think would have needed to have been “briefed” on the audience. LZ Granderson had it right on a recent CNN article. We keep complaining about having stupid politicians. Maybe the problem is our stupid voters in this country.

Ol' Timer

October 1st, 2011
7:13 am

I don’t suppose .75 cent an hour labor has anything to do with moving American companies to China and elsewhere, it’s all the burdensome regulations. Horse hockey!

And, the lack of regulations in China resulted in air so polluted they had to curtail automobile traffic during the Olympics so the athletes could breathe. Of course, the oligarchs who have their businesses there breathe perfectly pristine air from their Colorado mansions or homes in the islands.

Businesses love to whine, but taxes as a percentage of the GDP are at a 60 year low.

Mr T

October 1st, 2011
7:20 am

I pity America if this fool is elected President. In fact I better start selling my gold chains, because they wont worth a dime if this fool is President.

Ol' Timer

October 1st, 2011
7:27 am

In this whole argument, no one has mentioned the Gramm-Leach-Bliley Act that allowed for the creation of these banking superstores — banks too big to fail — a bill that was signed by Bill Clinto primarily because the Republicans had a veto proof majority in both houses of congress.

Many think Phil Gramm (R-TX) is the father of the financial meltdown, and I tend to agree although there’s enough blame to go around.

Rev. Dudley Doright

October 1st, 2011
7:30 am

Everyone is entitled to be stupid, but some of these ol’ boys are abusing the privilege.

jconservative

October 1st, 2011
7:30 am

Strange that Net Job Creations went from 31% in the decade of the sixties to 0% in the decade of the 2000’s.

Road Scholar is correct. The world has changed, the world economy has changed and the US economy will never again generate a 31% net job creation number.

There are 6.8 billion consumers on the planet. 95% of them live outside the United States.
So the builder of widgets will build his new factory closer to his consumers.

And to many are saying that government with its inability to do anything correct is also the answer.
If Marcus expects government to come up with a solution to create 17 million jobs, well he just needs to go back to looking at the fish tank.

The only way government creates jobs is to start a war or create a new department.

That’s it! A new cabinet level department! The Department of Job Creation!

Skip

October 1st, 2011
7:32 am

Perry tanks and the story turns to Obama, interesting.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
7:47 am

Road Scholar: Change is a bitch, isn’t it!
————————–

If you’re talking about Obozo-style “change”, you are correct!

Used to be, when we had a recession, we recovered from it quickly, within a few months. And when we had a particularly steep recession, the recovery was correspondingly strong.

With all the “change” that’s taken place in our regulatory, legal, and taxation regimes, and recently with the unfunded government mandates and business-bashing, we aren’t recovering at all.

So yeah, “hope and change” isn’t working out too well, and it’s a real bitch for the 9% officially unemployed and the 20% unemployed but not counted. It’s a bitch for the folks who are one day going to have to pay off our recent string of $1.5 trillion deficits and the unfunded government worker pension liabilities.

Thanks for the “hope and changes”, Democrats!

jconservative

October 1st, 2011
7:48 am

While scrolling through TV channels last night I came upon the last part of an interview with Gov Christie by Piers Morgan on CNN.

Apparently I missed the political questions and only heard the personal views on issues.
Christie has firm, set views on same sex marriage, civil unions, homosexuality that at times differ from the teachings of his Catholic faith. But he does not back off those views an inch.

Marriage is between a male and female only, civil unions are OK, homosexuals are born with that inclination and homosexual sex is not a sin.

There were short interviews in his house with his wife and two teenage kids with the Governor present. All four repeated that there would not be a presidential bid.

I found the interview refreshing. The concept of political correctness has not yet found the Governor.
And I suspect it will not.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
7:51 am

Ol’ Timer: …a bill that was signed by Bill Clinto primarily because the Republicans had a veto proof majority in both houses of congress.
——————–

You might want to check your facts on that.

Clinton signed the bill because he wanted to.

Was your boy Clinton such a pushover that he would sign a bill just because a veto would be overridden? Think before posting.

Braves blow

October 1st, 2011
7:52 am

Top o the mornin to ya, Kyle the kontemptuous klown. I see your stupidity is on full display, in all it’s glory. Example: your suggestion that the sec (which stands for securities and exchange commission) ‘granted’ the rating agencies an oligopoly. Dont you mean the doj? And it ‘granted’ it to them? Moron.

indigo

October 1st, 2011
7:53 am

I find it outrageous when Bernie Marcus, of all people, talks about saving small businesses and creating jobs. For, other than Walmart, what business had more to do with driving small businesses out of the market place than Home Depot? Every small town in America lost businesses because of HD. And I’m willing to wager that it did so why violating one of those “regulations”- actually the Robinson Patman Act- designed to protect small businesses from big guys forcing unequal concessions on price from suppliers. I suspect Bernie was not too concerned about exclusive dealing and other anticompetitive practices as he drove the small guys out of the market. As for jobs, when it was growing so big as to make Bernie a billionaire, was he concerned about jobs in America, or were the majority of the products sold by HD made elsewhere? I suspect that the majority of products sold were made elsewhere as the managers of his suppliers those complaining about regulations as the cause of all their trouble- had no problem whatsoever shifting jobs overseas and increasing tenfold their share of the profits.

Undoubtedly, there are some regulations we could do without. But you notice that BM is not specific- it’s just regulations. Is he for clean water or not? Is he for clean air or not? Sometimes, the common good- and not individual profit- must come first. How about child labor laws” is he against them, too?

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
7:58 am

In 1975, U.S. legislators — fearing a proliferation of unscrupulous ratings agencies — designated Standard & Poor’s, Moody’s and Fitch as the only ratings organizations banks and brokers could use to evaluate the credit worthiness of their products.

http://edition.cnn.com/2011/BUSINESS/07/15/credit.ratings.agency.explain/index.html
————————————

Another fine job by the federal government.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
8:00 am

Ford probably would have vetoed that bill, but he feared his veto would be overridden. Har har!

jconservative

October 1st, 2011
8:13 am

“Another fine job by the federal government.” (Said in scorn.)

Yet most of the US is looking to government to get us out of this “mess.” Why?

If government has the record of mismanagement that most claim, why does everyone look to the government for solutions?

You would think that is the last place we would look.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
8:21 am

Why does everyone look to the government for solutions? Damn fine question, since they rarely have any and funk up most everything they get involved with. The federal government does have one thing going for it, which is irresistible to politicians, liberals, and the slothful–an essentially unlimited supply of money.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
8:24 am

We’re still waiting for those government solutions to our sucky education system, “crumbling infrastructure”, reliance on foreign oil, skyrocketing health care costs, unrelenting poverty, 9% unemployment, etc etc.

West Indian Charlie

October 1st, 2011
8:26 am

Enter your comments here

Tyler Durden

October 1st, 2011
8:35 am

Poor, poor Lil’ Barry. Still sunlight deprived from living in Mom’s basement. Please get out more so we can about something other than ‘Guvmint bad! BAD guvmint!’ :-)

Remember: Clinton had high taxes and regulations, and the economy was cookin’ hot for years and years. The Dubious and the GOP Congress lowered taxes and regulations, and sent us into a decade of high unemployment and poor growth.

The facts simply don’t support you, but I’m sure that won’t slow ya down one bit.

Buzz G

October 1st, 2011
8:37 am

Bernie is right. Transocean, the largest owner of deep sea oil platforms throughout the world, moved their headquarters from the US to Switzerland, taking with thousands of jobs. They could see the handwriting on the wall. The US has become about the last place anyone wants to do business any more. All we are able to do any more is sit on our hands and complain while our government borrows trillions to pay for food stamps for 78 million people. We have squandered an opportunity and our children and grandchildren will pay the price. Mr. Marcus knows this well.

Go Herman Cain.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
8:45 am

Too bad Tyler can only “blame Bush”. Otherwise, he might have time to tell us all about Obozo’s solutions to our many problems. Trouble is, Obozo’s so busy creating new disasters, he doesn’t have time to actually “fix” anything.

Tyler, I’d be happy to go back to the Clinton levels of spending, and in trade I’d agree to his higher tax rates. It’d be a big improvement over your Idiot Messiah’s disastrous, credit-rating-lowering, un-American spending orgy.

Joe the Plutocrat

October 1st, 2011
8:51 am

god bless Bernie, Home Depot was good to me as a shareholder and business client back in the 90’s, but for all his complaints, I think he needs to acknowledge that SOME regulations are necessary and judicious. and while we are on the subject; regulations are a two-way street. various corporate (and individual) tax codes are “regulations” (they regulate how much a person or business pays or does not pay in taxes, and these regulations are often put into place via the efforts of lobbyists, who basically draft legislation per the directives of their clients. not saying if it is good or bad, but money buys access to regulation – for example the de-regulation of Stegall-Glass, the Commodities Futures Trading Act, etc.). nope, Bernie needs to run his Aquarium, Foundation, and whatnot, thank America for “enabling” him to become a billionaire, and leave the politics to less noble types (Deal, Romney, Perry, et al).

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
9:00 am

Joe the Plutocrat: [Bernie] needs to acknowledge that SOME regulations are necessary
——————-

I completely missed the part where Bernie said no regulations are necessary. Link please.

Uncle Billy

October 1st, 2011
9:04 am

Kyle,

In addition to the Morgenson book I would suggest that you read:
Simon Johnson, “13 Bankers”
Michael Lewis, “The Big Short”
Bethany McLean and Joe Nocera, “All the Devils Are Here”
Paul Krugman, “The Return of Depression Economics and the Crisis of 2008.”

FNMA and FHLMC each behaved badly in the matter of the housing bubble, but they were far from the only bad actors. A bi-partisan group legislated that derivative contracts could not be regulated by anyone. Major Wall Street firms and others funneled money into the sub-prime market by increasingly complex derivatives which they had little understanding of but which Moody’s and S&P gave AAA ratings to. The result was that the system was on the verge of collapse when the Federal Government had to step to prevent it. This confirms the late, great Michael Harrington’s aphorism, “In the USA the profits are privatized and the losses are socialized.”

And remember that Fannie and Freddie had been privatized so that their executives had the same incentives to increase their own incomes that Wall Street executives had.

Lil' Barry Bailout (Unexpectedly Revised Downward)

October 1st, 2011
9:09 am

…and then when the stuff hit the fan, the federal government did what everyone knew they would and bailed almost all of them out.

Federal government interference in free markets strikes again.

Uncle Billy

October 1st, 2011
9:10 am

I forgot to mention that one of the heros of Morgenson’s book is Roy Barnes who got the legislature to pass a strong predatory lending law which was gutted in 2003 after he lost the 2002 election. This made Georgia a practically unregulated mortgage market where abuses, even in good times, were legendary.

Uncle Billy

October 1st, 2011
9:12 am

The bailout was orchestrated by Hank Paulson, Secretary of the Treasury, and Ben Bernanke, Chairman of the Federal Reserve Board. BOth were appointees of George W. Bush.

Skeptical

October 1st, 2011
9:28 am

Examples of burdensome, unnecessary regulations? I’m sure that Bernie Marcus sincerely believes that government regulation of business is excessive and often counterproductive. But it strikes me as odd how seldom the anti-regulation folks offer specific examples. I suspect the reason is that in any given case, a large majority of people would think that the regulation sounds perfectly reasonable.

Here’s one way to look at it. What if you’re on the other end of some harmful action or inaction by a business? Get sick from eating contaminated food and you’re not going to be overly sympathetic to Marcus’s view. If your supervisor systematically harasses you and other employees, you’re probably not going to want to hear much more from Marcus. Or if the textile plant upriver, over many years, brazenly dumps pollutants into your river — where you fish, where you let your kids swim — you may even want want more regulation, not less, along with aggressive enforcement of the regulations already on the books. In the last example, search for news stories on “Ogeechee River” and keep in mind that the outraged general public in that part of the state is, almost to a person, deeply conservative and largely Republican.