We know that President Obama is not going to win the big chieftains of business to his side, especially not during this election year. But that doesn't mean there aren't areas where CEOs and the commander in chief can find some common ground (and perhaps cause the GOP's budget cutting fanatics a bit of heartburn). Perhaps the biggest is infrastructure spending, a point I was reminded of this morning at a press breakfast with Business Roundtable President John Engler.
"We ought to get a lot more creative about how we do infrastructure in the country," Engler, a Republican former governor of Michigan, said at the breakfast, which was hosted by the Christian Science Monitor. He pointed to things like improving the air traffic control system and the electricity transmission grid. When a reporter pointed out that these are big ticket items, he responded, "The pay for, remember, is the kilowatts that get lost in transmission today now aren't lost, and so capturing those pays for the investment." A big government project that pays for itself? Sign me up.
"Your cost of capital is so low today, and with a high unemployment rate you get some real value you out there, so let's get going," he said. "We would leverage the investment we make much further today." Damn straight let's get going.
As my colleague Lauren Fox notes, Engler bemoaned what he and his corporate brethren perceive as Obama's anti big business rhetoric, but this is a place that they can find agreement, especially in the face of GOP budget proposals that are too focused on cutting taxes to bother with things like investing in infrastructure.
Of course Engler didn't spend the whole meal spouting off like a latter day New Dealer. He also sang a song of pending economic doom. "You've got what some people are describing as a train wreck, a triple witching," he said. He noted that at the end of last year 60 tax code provisions expired and another 41 will sunset at the end of 2012. "You've got this idea of a 100 provisions of the tax code expired, you've got a debt ceiling coming up again at the end of the year, and you've got sequestration waiting. The effect of all that would be somewhat catastrophic on the U.S. economy. The fact that it would happen after the election would be a small comfort, because it would still happen."
One solution he proffered, no surprise, was an overhaul of the corporate tax code. Engler's group is pushing for a 25 percent tax rate, which he acknowledged would be "pretty dramatic." He suggested that the business community would be willing to sacrifice a lot in terms of tax breaks to get there on a permanent basis. "The business community is so desirous of having certainty," Engler said. "One thing it craves is the idea of certainty and predictability. It may be boring but boy it sure is desirable. How much are tax breaks worth if they're expiring all the time. How do you depend on them? How do you build a business model?"