April 30, 2010
This image has been posted with express written permission.
This cartoon was originally published at Town Hall.
April 30, 2010
Goldman Sachs has a public relations problem; of that there is no doubt. Even to those of us who found some of the questions in Monday’s Senate hearings as baffling as Goldman’s own executives did — and felt bizarre sympathy at their struggles to answer a number of questions that seemed remarkably off point and ill-worded — it’s nevertheless difficult to miss the whiff of moral bankruptcy hanging about the place.
Lost in the sound and fury of Washington’s ritualistic hearings was the other Goldman (GS, Fortune 500) news reported by the Wall Street Journal in mid-April: the fact that investigators are looking into whether a member of Goldman’s board of directors might have given an illegal tip to disgraced hedge fund manager Raj Rajaratnam, he of The Galleon Group. It is no small tip, either, but news of Warren Buffett’s $5 billion investment in Goldman in late September 2008.
Selling your clients a package of loans you think is “shi**y” is one thing. Insider trading is another. The first is unethical. The second, illegal.
The import of the allegations does not seem to have been lost on Goldman’s leadership. In March, the firm announced that the board member under suspicion — Rajat Gupta, the former managing partner of consulting powerhouse McKinsey & Company — would not stand for reelection at the company’s annual meeting next week. (They didn’t exactly say why at the time, but the Journal would do that for them soon enough.) In what might be their only smart public relations move in recent memory, Goldman announced that H. Lee Scott, Jr., the president and CEO of Wal-Mart (WMT, Fortune 500) from 2000 to 2009, would stand as Gupta’s replacement at its May 7 meeting.
Goldman executives surely feel they are under siege from critics. Mr. Scott knows all about that. Pick your corporate poison — bad press, employee lawsuits, community anger, finding yourself a political piñata — and Wal-Mart and Mr. Scott have been there, done that.
When Lee Scott took over the helm of Wal-Mart, the firm had what could be charitably described as an “us-versus-them” mentality, in which “us” was Wal-Mart and “them” was everybody else, from critics to the competition, the government, and yes, sometimes even its own employees. The company’s public image as a rapacious behemoth reflected that.
When he stepped down from the CEO role a decade later, the image was undoubtedly that of a softer, gentler giant, if still a fierce one. “Under Lee Scott’s guidance and direction, Wal-Mart experienced a transformation of its public image into that of a responsible corporate citizen,” says analyst Jaison Blair of Rochdale Securities. “He led a sustainability-green effort, he greatly improved the benefits of its employees, and he approached the new administration as a partner rather than an adversary.”
April 30, 2010
Labour shortages caused by the onslaught of baby-boomer retirements will be “the dominant economic trend” in Canada between 2015 and 2030, due to the limits it will place on the country’s economic growth, says a Conference Board of Canada report released Wednesday.
Defining the boomer generation as those born between 1947 and 1966, the report says the oldest members of this cohort are turning 63 this year. With an average retirement age of 61, the Conference Board concludes that “the wave of baby-boomer retirements has now begun.”
Because the biggest part of this generation is at the younger end, the pace of retirements will accelerate in future years, the think-tank says.
The implications of the shrinking labour pool will be less economic growth, said Pedro Antunes, the Conference Board’s director of national and provincial outlooks and author of the report.
He said Canada can expect relatively strong economic growth of more than three per cent, on average, between now and 2015. That’s anticipated to slow to about two per cent between 2015 and 2020, and dip below two per cent beyond that until around 2030.
“Why is that important? Why growth for the sake of growth?” Antunes asked rhetorically. “What’s really important are two things.
“One is, are we growing richer? Is the average household getting more real income per capita?
“The other factor is … we need to be able to grow the economy enough so that we can afford to pay for health care, education and other programs.”