Sen. Warner on Business, Trust, Congress and the President

By January 19, 2009Economy

The National Association of Manufacturers held its Leadership Luncheon next door at the JW Marriott today as part of the Inauguration celebrations. Virginia’s new U.S. senator, Senator Mark Warner, was our guest speaker, and he was generous with his time and his insights.

Warner gave a fine speech on building U.S. competitiveness, focusing on innovation, education and workforce issues. On several issues — trade, energy, visas for critical foreign employees — he made clear, concise statements about political principles and policies that are entirely consistent with the NAM’s priorities. (We’ll post those later this afternoon.)

In response to the first question about how business should approach the new Congress, Senator Warner went on at some length, identifying areas where he thought business had come up short and needed to do some repair work. (We’d guess this is the news that the reporters will highlight.) Warner:

My biggest single take-away from this last campaign, more than any particular issue, was, I think the American people have had a fundamental break in trust with the business community.

The public is angry about executive compensation, and business would be wise to work to restore that trust through collaboration rather than immediate rejection of policy proposals, he argued.

Sometimes when a politician makes comments along these lines, it’s really a veiled message to the audience  to not ever criticize the speaker, ever. But we absolutely did not get that sense from the Senator. His tone was conversational, his observations constructive, and the audience appeared to take them in the spirit they were intended.

But they did seem newsy…(.mp3 file here.)

My biggest single take-away from this last campaign, more than any particular issue, was, I think the American people have had a fundamental break in trust with the business community. I know that may not be a popular way to start the day before this inaugural…. We can all point to certain excesses, whether it’s on Wall Street, whether it’s on some of the corporate CEO parachute packages, and my fear is that this break in trust desperately needs to be repaired, because it’s critically important that the American people believe in the honesty and integrity of our business community and the free enterprise system.

But I warn, I would argue, that this break in trust will not simply be repaired as the economy recovers, if the Dow is back at 14,000. ….I think that three areas where I would love to see, because it’s a bigger question than just how you deal with the Democratic Congress.

The three issues where I think the business community needs to do some reflection and engagement and conversation – one is around this issue of executive compensation, trying to bring some sense of fairness back into business.

I’ve sat on company board boards, I was the co-founder of Nextel, I’ve spent more time in the business community than I have as an elected offices. It is a challenging and troubling issue, but do not underestimate the amount of public anger at this issue.

And unless there are proactive steps from the business community, you may see legislative solutions that may not be the right approach. So, thinking through this issue in way that is proactive rather than reactive would be No. 2.

No. 2, and this is perhaps a little more candor than the question warranted: No 2, I think for a while there has always been this argument in this business community that if there is any – and I realize in the global economy, that you have a choice about where you want to locate your businesses, and that overregulation can stymie the ability to be competitive in the global economy. I recognize that – but time and again I think the business community not just during the last Administration, I think over the last 10 or 12 years, has used the argument, “If you Congress do X, that’s going to destroy our business and drive all our jobs away.” More often than not, Congress or what have you, has not done X, and yet here we are at this point, where the jobs are still gone, where the economy is still in challenging places, where we’re looking at a fundamental disconnect and the balance of the economy, and trying to find some areas where you could find early collaboration rather than simply immediately knee-jerk opposition to some of the policy proposals from this administration, whether they are around energy, whether they are around financial reform, whether they are around certain areas of executive comp, finding areas of actual partnering and collaboration at the starting point, rather than fighting things until the 11th hour would be something that would be something I think we can do.

And third, and I understand that you all have an obligation to your shareholders, but in this world where it seems like the obligation to your shareholders and your employees — sometimes with people moving between companies so quickly — people feel that that connection has been broken as well. And on top of that, the connection you need to have to your community and to your country needs to be reinforced. So this whole reintroduced notion of corporate responsibility, not as some kind of side item that’s 15th on the agenda for window-dressing, but the notion that you are engaged and trying to get this country back on its feet, in a major, meaningful way – and again, I think the opportunities in the energy space are particularly attractive here – will go a long way towards reestablishing again that bond of trust.

Reestablishing that bond of trust, I think is long-term in your interest. I also believe it’s in the long-term interest of your collaboration with this new Congress and this new Administration.

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