TWO CATEGORIES OF AMERICAN CORPORATIONS via ROBERT REICH

An astute post from economist and former Secretary of Labor in the Clinton Administration Robert Reich. Take a moment to read the piece in its entirety.  Below are several excerpts that I found especially illuminating.   The thoughts and explanations that appear most obvious upon first reading are often those I find most exhilarating.  

The first group includes national telecoms like Verizon and AT&T that need a prosperous America because most of their sales are here.

The second group includes companies like Coca Cola, Exxon-Mobil, Hewlett-Packard, Intel, and McDonalds, that get substantial revenues from their overseas operations. Increasingly this means China, India, and Brazil. Ford and GM are still largely dependent on US sales but becoming less so. GM sold more cars in China last year than in the US. Not surprisingly, American companies that are less dependent on American consumers have been showing the biggest profits. 

So what does this mean for politics? Big companies hedge their bets and support both Republicans and Democrats. But in my experience, companies in the first group are more responsive to tax, spending, and monetary policies that cause unemployment to drop and wages to grow, and less obsessed by inflation and deficits, than are companies in the second group. The former are also more supportive of new investments in infrastructure and education, which improve U.S. productivity over the longer term. 

JNOMICS