Economic happy talk doesn't hurt

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© St. Petersburg Times
published August 14, 2002

Only one little thing was missing from the Bush administration's half-day economic forum, held Tuesday in Waco: a soundtrack from whistling musician Bobby McFerrin.

Here's a little song I wrote.

You might want to sing it note for note.

Don't worry. Be happy.

Don't get me wrong. Despite its carefully screened 240 attendees (no vocal administration critics, please), its orchestrated style (short meetings, brief statements, thin content), its panning by Democrats (it's just a publicity stunt), and its resemblance to a campaign stop (the band played Stars and Stripes Forever), I actually found the Waco forum interesting and useful. I'm glad Bush held it.

It's a matter of expectations. I did not anticipate a breakthrough to solve the nation's economic ills. I did not assume people would interrupt the oh-so-polite sessions to criticize the rising national debt, tax cuts for the wealthy, proposals for privatizing Social Security, the federal government's absurdly belated response to corporate scandals, or even skyrocketing health care costs.

None of that happened. And that's okay. No consensus emerged on fixing the economy, but President Bush's forum was a classic show of economic cheerleading and financial jawboning by the country's political leader.

Bush spent Tuesday morning bouncing among four of his forum's eight specialized sessions (a largely mum Vice President Dick Cheney visited the other four sessions) held at Baylor University. At each 15-minute stop, Bush shook hands, cracked a few jokes, listened to the remarks of a few attendees, promised to consider any recommendations, then left for the next panel. Bush reminded each of his audiences that, while the country may have hit a rough spot, the United States has the world's most productive workers, the best companies and a system that at least tries to fix things when they go wrong.

Bush also repeatedly emphasized his belief that federal intervention was not the long-term answer to the country's economic ills. He urged all attendees to encourage more responsibility in the business world, and to promote corporate cultures based on community service and honesty.

While Bush was in Waco trying to build up investors' confidence, down the road in Houston some former executives of bankrupt Enron were busy undermining it. Again. Several ex-Enron executives who earned a combined $25-million in the year before the company crashed are asking a bankruptcy judge for millions more in severance pay. Among Enron's needy: Rebecca Carter, the company's ex-corporate secretary who is the wife since March of former CEO Jeff Skilling, wants another $875,000. And former vice chairman Mark Frevert wants more than $6-million.

Bush's feel-the-love economic forum also had to compete for national attention Tuesday with the Federal Reserve's decision to hold interest rates steady, resisting Wall Street's desire for another cut. And today is the deadline set by the Securities and Exchange Commission for the CEOs of many of the nation's biggest companies to attest (in writing) to the accuracy of recent financial reports. Surprise: Quite a few are waiting until the last minute.

After an hour of listening to the Waco forum, it began to sound as if it had borrowed the script from the Rev. Robert Fulghum's 1988 best-selling book, All I Really Need to Know I Learned in Kindergarten. Many of the forum's themes echoed the author's top six tips:

1. Play fair. Apparently, the folks at Enron, Global Crossing, WorldCom, Tyco, Arthur Andersen and other companies too numerous to list, must have been absent when that lesson was taught.

2. Don't hit people. But it's okay to parade greedy CEOs in front of cameras in handcuffs.

3. Put things back where you found them. Like your employees' 401(k) savings.

4. Clean up your own mess. Unless you're an errant CEO opting to take the Fifth.

5. Don't take things that aren't yours. Unless you can do it without getting caught.

6. Say you're sorry when you hurt somebody. Don't hold your breath for CEOs on that one.

Tuesday's economic forum had its moments.

American Enterprise Institute scholar Michael Novak pointed out, correctly, that the American business culture had neglected the value of "character" and "moral responsibility" for too many years. Novak noted the economic forum was held in a university building named after Waco's own Leon Jaworski, a key Watergate prosecutor and an example of someone doing the right thing in difficult times.

Forum participant Julie Still, a student at Rutgers University, said outlandish CEO pay was hurting the economy. She and her husband -- with five college degrees between them -- had counted up their likely lifetime earnings only to find one CEO getting 10 times that sum in severance pay.

"That's obscene to those of us at lower levels in the economy," Still said, even though the couple earns twice the national average. She said there is "a disconnect" in this country as to what people should really earn for their work.

Dick Holthaus, who runs the National Association of Investors Corp., said NAIC surveys of his members showed that, until recently, every 10 trades included eight "sells" and only two "buys." In the past month -- with some CEOs taken away in handcuffs and the stock markets looking less overpriced -- Holthaus said his members are downright bullish. Of every 10 trades now, he said there are zero "sells" and 10 "buys."

A thoughtful Franklin Raines, the CEO of Fannie Mae, the nation's top buyer of home mortgages, said American corporations have gotten off track. "Instead of (corporate managers) focusing on shareholder value," he said, "we've focused on stock prices." CEOs have mistaken the two as the same thing. But they are entirely different.

CEO Larry Johnston, head of the Albertsons grocery chain, warned that consumer confidence is waning. Customers are buying more hamburger and cheaper private label foods instead of steak and name-brand foods.

"We have to restore confidence," he said. "This is a time for CEOs to be visible."

At times, forum participants supported seemingly conflicting recommendations: lower taxes but tougher educational standards; curbing federal deficits but endorsing the end of the estate tax; less regulation for entrepreneurs and small business but government incentives to help corporate research and development and 100 percent deductibility of employee health plans.

By the forum's end, participants at least felt a little better after the chance to get an economic concern off their chest. And to hobnob a bit with President Bush.

Will much change? It's doubtful. But it did not hurt the country to have its president spend part of a vacation day involved in discussion about the economy with real people, no matter how orchestrated.

Don't worry (too much), Bush urged in his final forum remarks. Be happy (and keep spending).

-- Robert Trigaux can be reached at trigaux@sptimes.com or (727) 893-8405.

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