Last week, The Wall Street Journal headline read “Companies Cling to Cash.” The story reveals that U.S. companies are sitting on almost $2 trillion in cash, and that cash as a share of corporate assets is at the highest level since 1959.
Why are companies sitting on all this capital that, under normal circumstances, they would be putting to work? Because the Obama administration and this Congress have spent the last two years throwing obstacles in the path of American businesses as they seek to grow.
For instance, over a year ago, the cable company Comcast decided to put a big chunk of cash to work in the economy by purchasing NBC Universal from General Electric, and look what it got them–the transaction has been stuck in regulatory approval limbo with the Department of Justice and the Federal Communications Commission (FCC) ever since. That’s a year of waiting for the federal government to say it’s okay to combine resources and energies in order to grow.
Yes, grow. This is not one of those mergers where two similar companies decide to merge to gain efficiencies–in other words, less spending and fewer jobs. No, the Comcast/NBC-U transaction is between two growing, creative companies in complementary businesses that have decided that the path to greater growth (more jobs) lies in combining the two companies.
But over a year later they still don’t know if the transaction is going to be approved, and if so, what conditions will be attached. Meanwhile, thousands of employees, hundreds of business decisions, and the downstream businesses and creators who do business with Comcast and NBC Universal are, to some degree, on hold.
On Tuesday, at the FCC’s scheduled meeting, the commission should move approval of the Comcast/NBC-U transaction, with a minimum of harmful conditions. It’s what’s best for the economy, best for shareholders, and best for all those downstream businesses and creators who depend on Comcast and NBC Universal.
But, instead, on Tuesday the FCC will throw even more obstacles in the way of economic growth by proposing the first ever federal regulatory scheme for the Internet. The regulators just don’t get it.
Today’s TechByte was written by IPI President Tom Giovanetti.