by Mitch Kokai
Senior Political Analyst, John Locke Foundation
When the Dow Jones index was born in 1896, General Electric was one of the companies included. It’s been a constituent of the Dow continuously since 1907. In a sign of how far the company has fallen, GE has just been dropped from the Dow.
This isn’t a surprise development. Market watchers have seen this coming for at least a year, as the company has seen its stock fall, its CEO hit the exit door, and the company cast about for a new direction.
There’s plenty to say about this, but it’s crucial to remember GE’s heavy bet on federal industrial policy.
GE’s previous CEO Jeffrey Immelt landed a gig as Obama’s jobs czar. At the dawn of the Obama Era, he declared that the federal government would be “an industry policy champion, a financier, and a key partner.” GE is “a particularly desirable partner for governments,” he wrote. …
… The Bush-Obama bailouts benefited GE. When former President Barack Obama opened up federal funding for embryo-destroying stem-cell research, GE launched a stem-cell business. When Obama announced an initiative to subsidize high-speed rail, GE hired Linda Daschle — wife of Obama confidant Tom Daschle — as its rail lobbyist. When Obama opened doors to Russia by backing away from an Eastern Europe missile shield, GE was the first company to pass through that door.
GE was also the poster child of Obama’s stimulus. …
… GE’s bet on big government hasn’t saved the company. GE has been trying to sell its struggling light bulb business, but failing.