To get its confidence back, America needs less regulation and more innovation even if that means some failed ventures using taxpayer money, General Electric Chairman Jeff Immelt told CNBC Thursday.
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Jeff Immelt
Immelt defended the use of federal funding for certain ventures.
Taxpayer funding for innovative companies have come under fire ever since Solyndra, a clean energy company, declared bankruptcy.
"The reason why Solyndra failed is they didn't have the right technology and they had too high costs," the GE executive said. "Anytime you get into venture capital investing you're going to have some losses."
Solyndra, which received nearly $500 million under President Obama's $800 billion stimulus plan, has become a hot-button issue for Republicans critical of Obama's attempts to spur the economy. Immelt currently heads the president commission to help the US generate more jobs.
"People can make their own judgment as to whether or not venture capital investing is the right method and that's something that can be widely debated," he added. "At the same time, I’d say particularly with sluggish economy and things like that, I do believe that infrastructure and some of the other activities, (research and development), ought to be things that the government still plays a role in."
In a separate speech Thursday to executives of mid-sized businesses in Columbus Ohio, Immelt also said the recovery from the recent recession is going to be slow.
"Recovery is underway, but it's a long, slow recovery—slower than we'd like," the GE executive said. "There is just a lot of volatility, because the world has problems and classic institutions have not been able to solve those problems."
Immelt also said the primary ingredient missing for business growth simply may be a positive attitude.
"We need confidence. That is the operative word," Immelt said. "Business is not as bad as the mood. We've got to get our confidence back."
Doing so will require getting the government off the back of business and for Congress to stop all the infighting and move forwarded with policies that would stimulate an economy that some think is on the brink of recession, he added.
One positive step needed is tax reform—specifically generating the kind of revenue that will help the US close its gaping budget deficit hole, Immelt said.
"Business rarely speaks with one voice on anything. But we are united from the standpoint of tax reform. Let's have a lower tax rate. Close the loopholes," he said. "Nothing is getting done right now. Any bipartisanship right now would be applauded by the markets. It would be stimulative to the economy."
Immelt's company—a minority owner of CNBC-parent NBC Universal—has been criticized for using those loopholes to avoid paying any federal income tax last year. Comcast
is the majority owner of NBC.
On other issues, Immelt said he continues to believe that the US and China should have a "good, strong, positive engagement."
And he offered praise for Apple CEO Steve Jobs, who died Wednesday afternoon.
"What Apple stands for is this unique combination between innovation and execution," Immelt said. "He is iconic and the world will never forget Steve Jobs."
Editor's Note: This report contains updated information to clarify Immelt's position on Solyndra.
