Bailout Watch: HP Ex-CEO Carly Fiorina Says Something Smart

I've never been a huge fan of ex-Hewlett Packard CEO Carly Fiorina, but I sure admired her performance Sunday on NBC's <i>Meet The Press</i>. Discussing the sinking economy, Carly cut through the clutter -- and put Mitt Romney's won't-let-you-get-a-word-in-edgewise performance to shame -- by succinctly identifying the root of our ongoing problem: It's the unavailability of credit, stupid!

Alexander Wolfe, Contributor

December 15, 2008

3 Min Read

I've never been a huge fan of ex-Hewlett Packard CEO Carly Fiorina, but I sure admired her performance Sunday on NBC's Meet The Press. Discussing the sinking economy, Carly cut through the clutter -- and put Mitt Romney's won't-let-you-get-a-word-in-edgewise performance to shame -- by succinctly identifying the root of our ongoing problem: It's the unavailability of credit, stupid!Indeed, on both style and substance, Carly was equaled only by Michigan Gov. Jennifer Granholm, who argued forcefully in favor of a bailout for the automakers. (That's something I've come out for myself, in 5 Things GM's Bailout Package Must Have.)

Gov. Granholm wants government monies for GM and Chrysler, which is good, because it's important to prop up the automakers and save tens of thousands of jobs at both the car factories themselves and in the ecosystem of parts supplies (and deli owners who serve the workers, etc.). Yet no one seriously believes this is going to right the economy; it's simply a temporary measure which is better than loading up the unemployment rolls and gutting the U.S. industrial base.

But Fiorina's reasoning was more significant, because it brought to light a point which is being ignored in the current debate. "While we have been focused in Washington on big companies. . . the truth is we're not as concerned -- and we should be -- about the hundreds and thousands of small businesses who actually create two-thirds of the jobs in this country," is how she began.

A light bulb went off in my head when I heard that, because I realized that she's absolutely correct. Most of the chatter we've heard out of Washington and on the cable-TV news gabfests have revolved around funds for big banking and big auto. Nada for the heart and soul of American small business.

But wait; she's got more:

"We have a deepening recession right now, because credit is unavailable. Credit is unavailable to small businesses, so they can't hire. When hundreds of small businesses can't hire 10 and 15 people, over time that creates big unemployment numbers. They may not have big unions in Washington to represent their interests; they're the little guy. But the little guy matters. When credit isn't available, consumers don't have the money they need to spend."

OK, I'm not so down with the dig at the unions. If the unions were as all-powerful as Fiorina implies, I suspect the Congressional bailout package wouldn't have cratered over the UAW's refusal to take a pay cut. (A counterintuitive argument, I know, but think about it: if the union had that much juice, they'd have gotten a bailout package passed with their contract intact as it currently stands.)

Back to Carly: "So I think we have to go back to the root of this problem, which is that credit is still unavailable," she continued. "And that is despite massive bailouts of big financial institutions who are still not lending."

That's all the material that's available in the video "Meet The Press" video clip posted on msbnc.com. However, I distinctly remember Fiorina closing with an assertion that there should be conditions imposed on the bank bailout money. Namely, that the banks lend it out, and include small businesses among the recipients of the loans.

If Carly can continue to be this coherent, with arguments which aren't tied to any political ideology -- she was a McCain supporter during the campaign -- I think she might be able to resuscitate her public persona and become a major player (business or politics, or both) once again.

Here's the video clip:

What's your bailout take? Let me know, by leaving a comment below or e-mailing me directly at [email protected].

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Alex Wolfe is editor-in-chief of InformationWeek.com.

About the Author(s)

Alexander Wolfe

Contributor

Alexander Wolfe is a former editor for InformationWeek.

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