Wampum

In discussing how Republicans should talk about the economy, the Frank Luntz (link to zip file here) has a remarkable idea:

Why not have 10 of the Fortune 100 CEO’s come to Washington and announce that if the Senate will pass lawsuit abuse reform, they will each pledge to hire 10,000 new employees in the next year?

That is a remarkable question for a number of reasons. First, please note that Luntz believes that the CEO’s of America’s 100 largest companies take their orders from the Republican Party. That may be true but it is remarkable just the same.

Secondly, Luntz sees nothing wrong with large corporations spending shareholder’s money to promote a political agenda as opposed to maximizing shareholder value. I had always heard that the fiduciary duty of a corporate CEO was to the shareholders not the GOP. I guess that is just September 10th kind of thinking.

Hiring 10,000 employees is not cheap. Let’s look at a couple of the Fortune 100 companies. The Fortune 500 list is here.

Number 81 on the list is Ingram Micro Inc. Ingram just released its fourth quarter and year end financial results. For the entire year, Ingram earned a profit of about $219 million.

Let’s say Ingram does hire 10,000 new workers just to help out Frank Luntz and the GOP. It has to train those workers. It has to pay wages and benefits. It also will incur administrative costs to manage those workers. If the total cost per new employee is more than $21,900 per year, Ingram would go from a profit to a loss. That, or course, is just a quibble compared with helping the GOP.

Number 89 on the list is Comcast. Comcast has a total of 68,000 employees. Adding 10,000 employees would represent a 14.7% increase with absolutely no indication that any of those employees would have any productive work to do. Who cares about efficiency when Frank Luntz wants Comcast to make a political point?

Mr. Luntz might also want to talk to UPS. They are 42nd on the Fortune 100 and are currently laying off 1400 employees in Dayton, Ohio. Those employees might want their jobs back before UPS decides to spend all that money to help Bill Frist pass llegislation.

Similarly, I expect that the 500 CitiGroup employees laid off in Des Moines might like to know how easy it is to get the company to just hire 10,000 people for political reasons. Maybe Denny Hastert or Bill Frist could call up CitiGroup and save their jobs. Luntz apparently thinks it is just that easy.

Perhaps Democrats should not dismiss Luntz’s crazy idea out of hand. Maybe they should try to improve on the idea. That way, they would not just be obstructionists. How could it be improved?

Well, one way would be to write the lawsuit reform bill so as to change the fiduciary duties of CEO’s to shareholders because, otherwise, there are going to be a heck of a lot of shareholder suits.

An even better idea comes from Belle Waring. The CEO’s could not only promise to hire 10,000 new workers each, they could also promise to give them each a pony. Yea, that is it. We can be for hiring workers and for each of them getting a pony. I’m sure the CEO’s will agree if Frank explains it to them.

Luntz’ idea of having CEO’s spend large amounts of shareholder money on a political stunt to help Bill Frist pass legislation is really just crazy.