by Peter Lauria Info
Peter Lauria is senior correspondent covering business, media, and entertainment for The Daily Beast. He previously covered music, movies, television, cable, radio, and corporate media as a business reporter for The New York Post. His work has also appeared in Avenue, Blender, Black Men, and Media Magazine, and he’s appeared on CNBC, Bloomberg, BBC Radio, and Reuters TV.
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At last week’s Sun Valley summit of media titans, the mood was dour, the forecast anxious. Peter Lauria on how America’s moguls are growing increasingly skeptical about the president.
The White House’s charm offensive toward the business community could have used a representative in Sun Valley last week. While President Obama, Chief of Staff Rahm Emanuel, and Treasury Secretary Timothy Geithner all talked up the economy and the positive impact of the administration’s policies in interviews last week, their words were viewed suspiciously by the titans of media, technology, and finance assembled for Allen & Co.’s annual conference in the sleepy resort town nestled in the crevices of Idaho’s Pioneer Mountains. The most generous comment about the current state of the economy came from Google CEO Eric Schmidt, who serves as an adviser to the president on science and technology, and even then the best he could muster was that, “Everybody is in a sort of funk.”
Click Here to Get the Sun Valley Insight on Obama and the Economy
Mario Anzuoni / Reuters
In both on- and off-the-record conversations with The Daily Beast, many of the other moguls in attendance—who collectively control hundreds of billions, if not trillions of dollars, of the country’s gross domestic product—were less diplomatic, expressing serious concern about the administration’s motives and openly worrying that its policies will cause sustained damage not just to their consumer-facing businesses, but also to the long-term health of the country.
“To start to have negative relationships with the banks hurts our economy because we depend on them,” said former Yahoo and Warner Bros. CEO Terry Semel. “It would really help if we can get both sides [government and business] to feel good about each other because what’s more important than the short term crisis is the status of our economic power several years from now and how that affects the younger population and our children.”
Added John Hendricks, founder of Discovery Communications: “Government needs to focus on how to incentivize companies because we in business are the ones who create jobs. I’d like to see them come around and be more proactive about free enterprise and this wonderful system we have.”
Despite a 12 percentage point swing in top line growth over the last six months—from negative 6 percent in last year’s fourth quarter to positive 6 percent in the first quarter of this year—none of the moguls we spoke with believe the economy is headed for a full recovery. Indeed, the administration’s response to the global economic crisis cast a pall over what should have been a more upbeat conference than in recent years when the credit market collapse, advertising recession, and continued disintermediation of their businesses from technology caused media company stock prices and deal activity to fall to unprecedented lows. Heading into the conference, stock prices were up about a third from where they were a year ago, after all. (It's also worth noting that the titans were griping while enjoying an all-expense paid retreat—complete with luxury suites, catered meals, free booze, golf and whitewater rafting, and private security detail—easily running Allen & Co. a few million dollars.)
When asked if he thought the administration was anti-business, Time Warner CEO Jeff Bewkes smiled silently for a few seconds then said, “I think it’s time for a glass of wine.”
Instead of deal-making, however, there was only dourness.
“No one is being really expansive,” said Sir Martin Sorrell, CEO of WPP Group, the the world's largest advertising company. “There’s been a sea change in people from being highly energized to pretty demotivated.”
• Lloyd Grove: Trashing Obama’s Economic TeamThere are a myriad of factors contributing to the uncertainty, from the expiration of the Bush administration’s tax cuts and looming tax increases on overseas profits to persistent joblessness and unmanageable deficits in both the U.S. and Europe. The economic contagion spreading across Europe is particularly germane to the U.S., with our recovery being stretched out into a long period of slow growth and slight dips. Hendricks, for instance, predicts that a full recovery could still be another two years away.
12 July 13, 2010 | 12:38am Twitter Emails
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AND, this is NYT: In 2009, the conference was overshadowed by the financial crisis, but this year the crowd seemed more optimistic.
Obama's failure to come up with policies that help the economy and create jobs, his abject failure to manage the federal government regulatory agencies and prevent disasters like the BP oil spill combined with his ineffectual approach to the clean up effort, and Obama's dismal showing in foreign affairs and his mismanagement of the war in Afghanistan all would lead any self-respecting mogul to doubt Obama's competence.
Well, I too, am a mogul. And the thing about us moguls that you have to bear in mind, is that we hardly ever agree with each other, unless we hold the same portfolio of financial instruments. My holdings were looking good at the beginning of the year, and they have since turned and headed south on me. The cattle out here on the farm tend to take a longer-term view of things than us humans. They ruminate, kind of chew things over before releasing an opinion. The opinions that have been hitting the ground lately indicate that there is a difference in what constitutes a benefit to Business, and what constitutes a benefit to Wall Street. But, the one thing they do agree on, is that if I offer them a choice of a bale of alfafa, or a bundle of greenbacks, they prefer the alfafa.
Thanks Zork. That one was a coffee spewer!
The Problem today is the definition of pro-business has been warped beyond recognition. Pro-business now means total deference to industry desires. This was not always the case even for GOP administrations, but after the last one....
Hey goober, you forgot he's a Black Muslim too!! Failed policies?? What policies? EVERY one of his economists said we needed at least twice the stimulus that we provided. Remember, a one time stimulus bill adds short term to the US debt. Iraq/Afghanistan, the 2003 tax cuts and W's Medicare Drug Bill are all long term debt burdens and according to the CBO combined will add $8.6T to the US debt by 2019. Throw in that the GOP has been the party of NO! Jesus F-ck, this ENTIRE Recession was created by the greed and criminal activities of Wall Street, yet the GOP still is trying to filibuster the financial reform bill! Not surprisingly, the largest donor to the GOP over the past 6 months has been financial institutions! Foreign affairs, for the first time EVER Russia just rebuked Iran for it's Nuke attempts!! Obama meets with Medvedev and lo and behold they give Iran the smack down, Iran whines that Russia is being a U.S. pawn! Government regulatory agency's? What are you talking about retard? Have you listened to the hearings??? The MMS became a Country club of Oil buddies because for 8 years we had the W administration and it's Administration of 45 former Oil executives in Washington creating an "Oil first" environment. Remember, Exxon had to rename it's Oil tanker The Condi Rice after W took office.
Plantagenet: The perceived "Obama's failure" (your old song and dance) is your failure. You seem incapable of understanding that there is a worldwide recession which further leaves me to believe that you are unaware that we are in the worst recession since the '30s. But, typically, you expect things to change in a year and a half. Your impatience is staggering. But, is it really about your impatience or about something else?
BS. If companies wish to create jobs, they will create jobs regardless of tax issues. Besides, if taxes were the issue, there'd be plenty of jobs inasmuch as taxes have never been lower in the post WWII era. Bush policies of wasting tons of money on foolish wars is the root cause of our current problems.
If Obama came up with a cure for cancer Plantagenet, you and the rest of the brainwashed Obama haters would come out with a comment complaining he is bad for business because his cure his hurting the companies that formerly made cancer drugs. He saved the economy from a second great depression, fact! He has saved thousands of jobs and for the past several months has created jobs, fact! Bush turned the regulatory agencies over to the businesses they were supposed to regulate, fact! Obama is changing this as fast as possible, fact! BP caused the oil spill and is responsible for the clean up,not Obama, fact! He got $20 billion out of BP to pay those hurt by the spill, fact! Russia and China on our side in boycotting Iran for the first time, and nuculear proliferation agreements among major powers is far from a "dismal" showing in foreign affairs, fact! Focusing on getting out of Iraq (the wrong battlefield) and going after the real threats to our security the Taliban and Al Qaeda, and keeping them away from Pakistan's nuculear arsenal is only a mismanagement of the war in Afghanistan in your full of hate and failure right wing talking points, mind Plantagenet, fact!!!!!!!
"To start to have negative relationships with the banks hurts our economy because we depend on them," Awww, is Obama being mean to the poor banks?
All those "moguls" are republicans, of course they would revolt.
Liberal democrats want to pretend that Obama is incapable of doing anything about the economy until there is a bit of good new and then Obama himself rushes to claim he is responsible for the good news. Why not quit all the BS and admit the truth----Obama made a lot of promises about jobs---he's failed to keep them. Obama's policies have utterly failed to produce jobs or improve the economy. The man is a disaster magnet and has proven to be an utter failure at his job.
Why are these eggheads whining, they got what they voted for, failure
ok enough already! obviously there were more less intelligent people who voted last time, myself included. the problem is serious enough that there's no room for finger pointing. we need to right this ship. stop being so mad madcharles. start working on a positive presentation. here's an easy one, reduce the capital gains tax. let's get some of the money sitting on the sidelines into play. this presidency is becoming surreal but what we need is real.
just1drun, you're optimism is astounding. No one, especially the banks will lend a dollar until some clarity surfaces in four years or so.
Madness: Don't forget the trillions spent in Iraq. That's added to the recession woes. Let's see.....who was President then?
madcharles, I'm pretty sure that this country's banks have lent a dollar since you wrote that, maybe several.
It's been a long time since I heard anybody say "egghead." What's the matter, MadCharles, did them eddicated fellers put you down?
I keep thinking I'm through with Obama and then I read something like this. If the titans of business and finance are "turning on him" (I never trust these con hack writers DB uses) he's obviously doing something right.
that is really stupid thinking. thats why many are unemployed, noone knows what Obama is doing or TRUST him. Go stand in line and get your government hand-outs, that's your mentality.
Moguls seek one thing: tax cut for their caste. The fact that they are unhappy is worthy of celebration.
Agree! As Hillary Clinton once said, "If Obama walked on water, they would say it was because he couldn't swim."
I suppose when banks mess everything up, and when B.P. destroy The Gulf of Mexico, I guess pointing out how that these things are somehow wrong makes one anti business.
no sam, it's when you proclaim the private sector "the enemy", as Obama did in at least one book, that you become anti-business.
wareagle82 you should have named the book and the page but you didn't cause once again you are lying.
vic, intellectual laziness on your part does not constitute dishonesty on mine - chapter 7, Dreams of my Father.
to bigvic..... In Dreams of My Father, Barack Obama wrote, on page 55, ... He describes his time working for a business as "Like a spy behind enemy lines. ..."
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