With 401k's crashing and 7.6% unemployment (the highest since 1992) no one doubts the need for government intervention, especially in the form of an economic stimulus package.
President Barack Obama has been putting the whip to lawmakers on both sides of the aisle, forcefully pushing for adoption of a plan that would pump more than $800 billion – well, lots of places. The House and Senate have each passed a version of the bill and they'll be haggling all week under the watching of eye of Obama hit man Rahm Emanuel, not to mention folks from Wall Street to Main Street.
More than $60 billion has been proposed for Education, tens of billions more for Construction projects and about $50 billion for Renewable Energy. It could be a nine-figure sum that will be heading to state treasuries across the country in the form of Medicaid, unemployment benefits, Cobra programs and feeding the hungry. Some of these funds are designed to go directly to individual Americans and most of it – or so the argument goes – will get to individuals eventually.
What if you threw a stimulus party and nobody came?
The key word in the previous paragraph is eventually. (Check out any infrastructure construction project in your neighborhood and tell me if it's gone quickly. Ditto for school programs.) The one thing that seems immediate in the Obama Stimulus Package would be tax cuts. They are paid out very quickly (President Bush tried one last Spring) and as currently configured would give middle class individuals $500. I don't know about you, but if I'm lucky enough to find an extra $500 (or even $5000) in my bank account I'm not going to spend it. I'll use it to pay down a credit card or loan - or maybe I'll stuff in my mattress - but I'm sure as hell not going to buy anything with it. And I think most Americans will feel the same way. (That's what happened with the Bush stimulus attempt of 2008 – and that was before the financial meltdown last fall).
What does all this have to do with your executive career?
Everything. That's right, we all have a lot at stake career-wise. The current economic crisis is so big that it overshadows all other career issues and probably will for some time to come. If the stimulus plans aren't successful in the next 90-100 days, profits will continue to drop, 401k's will continue to drop, and layoffs will increase. More people out of work means more foreclosures and still less spending, while consumer confidence continues to plummet. We've all recognized the "vicious cycle" nature of the current economic crisis and it impacts not only your strategies, tactics and exigencies – it may well threaten your very job. If you don't believe it, check out what Nissan is planning to do – or for something equally bold, how about giving everyone every tenth day off, as has the State of California.
Remember, most analysts are now saying it will be 2010 at the earliest before things start to get better. And 2009 is only six weeks old!
- Job Hunters - It Is "WHO" You Know
Erik Sorenson is chief executive officer of Vault.com, Inc. Mr. Sorenson, 52, oversees the strategic direction of the global, New York-based media company. He is widely regarded as an expert on media strategy and industry trends, with experience spanning radio, local and network broadcast television, cable and syndicated TV, and the Internet. From 1998 through 2004, Mr. Sorenson served as president of the MSNBC cable news channel. He has won more than twenty Emmy awards as a writer, producer, and television executive.
Comments? Send them to firstname.lastname@example.org