Wait! You mean it’s not true that corporate CEOs are waiting to get that gold-plated affidavit from Pres. Obama that he will stop making them feel so uncertain with all that scary talk about climate change legislation?
According to a bunch of senior executives interviewed for an article in the Washington Post, neither Republican solutions (deregulation and corporate tax cuts) nor Democratic proposals (more stimulus) address the deeper problem:
Corporate profits are soaring. Companies are sitting on billions of dollars of cash. And still, they’ve yet to amp up hiring or make major investments — the missing ingredients for a strong economic recovery.
Many Democrats say the economy needs more stimulus. Business lobbyists and their Republican allies say it needs less regulation and lower taxes.
But here in the heartland of America, senior executives say neither side’s assessment fits.
They blame their profound caution on their view that U.S. consumers are destined to disappoint for many years. As a result, they say, the economy is unlikely to see the kind of almost unbroken prosperity of the quarter-century that preceded the financial crisis.
Why? Because, according to the business leaders quoted in this piece, consumers are strapped with mountains of debt and, even those who still have jobs are making significantly less than they did in the past.
Across the industrial parks and office towers of the Chicago region, in … more than a dozen interviews, senior executives said they see Americans for years ahead paying down debts incurred during the now-ended credit boom and adjusting spending to match their often-reduced incomes.
Executives see little evidence that the economy is slipping back into recession. But they describe a business environment in which sales come in fits and starts and their customers can’t predict what they will want to buy in the future.
So, in a nutshell, uncertainty is keeping companies from hiring, but about customers not regulations or taxes.