Businesses’ rude awakening

The Business Roundtable, a group of CEOs of major U.S. corporations, sent a letter and a 54-page report to White House budget director Peter Orszag last month detailing the group’s complaints about President Obama’s economic policies.

The report was a response to a request from Orszag that the group tell him specifically which of the president’s policies they think are inhibiting economic growth (to say nothing of economic freedom). It reads more or less like a summary of everything the president has done on the economic front since taking office.

The report is particularly illuminating in its summary of the group’s problems with the financial reform bill the president is scheduled to sign into law this week.

The group says the bill “will impose numerous new burdens on American businesses” and that it “will reduce efficiency, stifle competition and deter capital formation.”

It goes on to report that the group’s analysis of the new regulations on the over-the-counter derivatives market shows that the provisions “could be expected to reduce capital spending by $5 billion to $6 billion per year, leading to a loss of 100,000 to 120,000 jobs.”

And that’s just the set of regulations the bill imposes on one sector of the vast financial industry. We shudder to imagine what additional goodies lurk in the bill’s other 2,300 pages.

Perhaps the most interesting aspect of this saga is the fact that this report comes from a group that, in spite of its composition, has been largely supportive of the president’s economic agenda until recently.

The Roundtable’s members have been involved in discussions at the White House about measures like last year’s stimulus bill and have frequently laid down and taken whatever the administration and the regulation-happy Congress have thrown at them.

This report is a regrettably delayed realization on the part of business leaders that, if they thought they could win in the dangerous game of partnering with their tormentors in Washington, they were sorely mistaken.