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07.31.2009 0

Editorial: Barack Obama Should Fire Jeff Immelt

  • On: 08/06/2009 09:52:09
  • In: Barack Obama
  • Barack Obama should fire Jeff Immelt. No, not from General Electric, although after shareholders become fully aware that their company was fudging their numbers to make investment more attractive, that may likely follow.

    Instead, yesterday the National Center for Public Policy Research’s Free Enterprise Project called upon Barack Obama to dismiss GE CEO Jeff Immelt from the president’s Economic Recovery Advisory Board because according to the Securities and Exchange Commission (SEC), “GE bent accounting rules beyond the breaking point” and “GE misapplied the accounting rules to cast its financial results in a better light.”

    Said the Free Enterprise Project’s Director, Tom Borelli PhD, “It’s outrageous for President Obama to keep Immelt as an advisor when the SEC charge that GE engaged in a series of efforts to manipulate earnings to mislead investors. The pattern of corruption raised by the SEC is deeply concerning and during a time of economic crisis, the last thing America needs is a Bernie Madoff type CEO giving advice to the president.”

    According to the Free Enterprise Project’s release, “GE agreed to pay $50 million to settle the fraudulent accounting charges without admitting or denying any wrongdoing.”

    The Project went on to urge GE’s directors to demand Immelt’s resignation from the company. And really that’s the least they can do. Shareholders should be livid, and demand full accountability from all those they put into positions to run the company. It is their company, after all.

    And certainly, Jeff Immelt, now the steward of an Enron-like scandal, has no place at all in a position of public trust, giving advice to Barack Obama on how to best improve the economy. What sort of advice will be given? To change the numbers to cast the economy in a better light?

    Making matters worse, GE is currently the beneficiary of some $139 billion of FDIC taxpayer-funded guarantees on its debt. Now that the SEC has charged that the company was faking its financial outlook, will those guarantees now be re-addressed? They should be.

    Instead of engaging in government-sponsored corporatism, which finds GE’s powerful sitting in high councils and receiving hundreds of billions of dollars in taxpayer subsidies, Barack Obama can send a powerful message by immediately dismissing Jeff Immelt from his Economic Recovery Advisory Board.

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