With the threat of plunging over a fiscal cliff in less than 90 days CEO’s from all different areas are beginning to sound the alarm bells and planning for a worst-case scenario. Goldman Sachs CEO Lloyd Blankfein said that the U.S. is heading towards fiscal disaster. “We have $7.7 trillion worth of economic events that are going to hit America in the gut in December, and in Washington they’re doing nothing about it.”
There is no doubt and no one can deny that Washington is being extremely irresponsible and going down a dangerous road by not addressing this serious situation. Both parties seem to be more concerned about their re-election activities than tackling this huge problem that is crippling business and causing anxiety for millions of Americans. We are stuck in quicksand, afraid to move in any direction for fear of sinking further. CEO’s of large and small companies alike are holding off on hiring, buying inventory or making any kind of commitments for the future because of this uncertainty.
We know what the tax burden looks like and the numbers are not pretty. Economists are pegging the damage as high as $720 billion and 4.6 percent of gross domestic product. Even Fed Chairman Ben Bernanke predicts catastrophe if the automatic tax increases and spending cuts take effect on Jan. 1.
So what do we do? Many high-profile CEO’s are speaking out and making contingency plans. Westgate Resorts CEO David Seigel sent out a letter to his employees last week telling them the cold hard truth that if things continue as they are and nothing is done, he will have no choice but to cut jobs, scale back and downsize even more than he already has. He states that since Obama took office he has lost ½ the amount of sales that he had prior to 2008 and instead of his business growing at 20% before Obama, it is now growing at 0%.
Danny Strigl, former CEO of Verizon Wireless also sounds a warning and predicts that the U.S. will fall back into a recession if it hasn’t already.
The incompetence and arrogance of our government is incomprehensible. Why do these people think that this is unimportant? Why do they play with us as though we were puppets, stringing us along month after month until one minute before midnight when they try to come up with a solution? What are we paying them for? To campaign for re-election?! It seems that their number one priority is to not lose their power and their status. For many of them the concerns of the American people are not high on their list. They are career politicians and have secure seats so why bother worrying about doing their job? They get re-elected anyway.
CEO David Seigel said it brilliantly. He said that if he was looking for someone to run his business and had the choice of two people, who would he choose? The person who had built businesses, run companies, made payroll and balanced budgets, or the person who had no experience in anything other than politics or community involvement? The choice is clear.
From Donald Trump to Steve Wynn, the alarms are being sounded. They are laying out what the future will look like if we continue down this destructive, irresponsible path. None of them are sugar-coating it, they are being honest with their employees and associates letting them know that if something doesn’t change there will be consequences.
These people are preparing. They are smart, savvy and know that the economy of this country needs to be run by someone who knows how to run a business. In order to get things back on track, these CEO’s are begging for a business savvy leader.