'Bumbling' Economy Result of 'Meddling' From Leaders: Ross
The U.S. economy is just "bumbling along" and creating an uncertainty among business that is likely to stifle hiring and growth, investor Wilbur Ross said.
In a CNBC interview, Ross blamed Washington policies for much of the problems, from the lack of a housing recovery to the recent controversy in which the Obama administration is trying to block Boeing from building a plant in a right-to-work state.
"It's not going to be a 'W' or a 'V' or an 'L' (recovery) or another alphabet letter," said the vulture fund manager and head of W.L. Ross & Co. "It's going continue to be punctuation — dots, dashes, question marks, exclamation points, one strong month, one weak month — a very fragile economy."
That lack of direction could stand in the way of businesses that want to expand.
"This kind of thing is bad because it's unsettling to companies," he said. "Business has a terrible time adjusting to uncertainty. Good news they can adjust to, bad news they can adjust to. Uncertainty makes it very, very hard to make long-term commitments."
Businesses also are facing weak consumer spending. Unemployment remains mired at 9.1 percent, while housing prices recently have double-dippeddespite aggressive efforts in Washington to stem the crisis.
"The consumer still hasn't been rehabilitated," Ross said. "All the meddling in the real estate side of life has not fixed residential real estate. If anything I think it's made it worse, because it's extending out the foreclosure time lines and putting more uncertainty and more downward pressure."
Ross also wondered about the state of job creation considering the battle the National Labor Relations Board has waged against Boeing.
The agency contends that Boeing broke the law when it moved a plant to South Carolina, where workers are not required to belong to a union.
Boeing contends that even though it has a unionized work force, it also can build plants in right-to-work states. Some in Congress have called on cutting funding to the NLRB on the grounds that the agency has overstepped its authority.
For Ross, the issue comes down to the kind of message the administration is sending at a time when job creation is at a premium.
"Who in American business is going to have confidence to build a new factory, add employees, if you're not even sure you can build the factory where you want to?" he said. "You can't have social experimenting interfering with turning the economy around. And I think that's what's going on here. It's social experimenting instead of building the economy."