Nike

Taking the heat and defending free enterprise

by Fran Smith on October 14, 2009

in Economy, Environment, Global Warming, Sanctimony

It’s about time that business groups started defending free enterprise, and the U. S. Chamber of Commerce is off to a good start – a bit belatedly – with its “American Free Enterprise. Dream Big” campaign. Launched on October 14, the campaign features national TV and print ad campaigns, a video contest, small business awards, and other outreach.

Here’s the underlying message, as shown on their website:

At the U.S. Chamber, we believe that the values of individual initiative, hard work, freedom of choice, and the free exchange of trade, capital, and ideas can lead America back to prosperity. Only free enterprise will create the innovation, the opportunities, and the jobs our nation needs. That is why we are launching this campaign.

The Chamber has been under a lot of pressure recently to cave in to the rent-seekers on global warming policy.  Some members of the Climate Action Partnership seeking to profit from cap-and-trade legislation  –  the utilities Pacific Gas & Electric, PNM Resources and Exelon — bowed out of their Chamber membership. Then, Nike and Apple sanctimoniously dropped their membership.  But as the Wall Street Journal noted today, both of those companies would escape onerous energy taxes from global warming legislation because most of their manufacturing is done in countries that don’t yet suppress energy use.

The WSJ points out how short-sighted these companies are:

If companies are going to dump the Chamber over a single dispute, then the overall influence of business in Washington is likely to decline. The Chamber’s job isn’t to favor one company’s agenda over another but to stand broadly for free trade, low taxes and limited regulation-principles that help U.S. business as a whole.

Having abandoned their business allies on climate change, Apple and Nike might wake up one day to discover they need those friends on one of their crucial issues. It will serve them right if they find themselves alone in the Beltway square.

The Chamber deserves kudos for standing firm on principle and coming out loud and clear in its support of free enterprise.

Nike quits the Chamber. When will the sanctimony end?

by Marlo Lewis on September 30, 2009 · 1 comment

in Global Warming, Sanctimony

Today’s Greenwire (subscription required) reports that Nike, the sports shoe king, is resigning its position on the U.S. Chamber of Commerce’s Board of Directors. Nike supports cap-and-trade legislation, a national renewable portfolio standard, a moratorium on new coal power plants lacking carbon capture and storage, and EPA regulation of CO2 under the Clean Air Act. The Chamber opposes all of the foregoing.

Although the Greenwire story is not slanted, neither is it particularly informative. The reporter makes no effort to ascertain what bottom line interest might account for Nike’s decision to quit the Chamber, or for the company’s decision to join the Business for Innovative Climate & Energy Policy (BICEP) coalition, a project of Ceres, the Gorethodox investor network.

The vast majority of Nike’s production facilities are in China and other Asian developing countries such as Thailand, Indonesia, and Vietnam. (I can’t find exact numbers — Nike appears to be coy about the details.) Nike factories in developing Asia would not be subject to CO2 controls from either Waxman-Markey or EPA regulation under the Clean Air Act.

What’s more, if the G-77 Plus China hang tough at the Copenhagen climate conference, and the successor treaty to the Kyoto Protocol continues to exempt developing countries from legally binding emission limits, then the comparative advantage (lower energy costs) those countries already enjoy under Kyoto will increase, making Nike factories even more profitable to invest in.

Here’s what an honest Nike press release might say: 

Nike believes U.S. policymakers should use law, regulation, and the Copenhagen treaty to hobble domestic firms in favor of the Asian economies where our facilities are located. In contrast, the U.S. Chamber opposes policies that would offshore more U.S. jobs and investment to China and developing Asia. A truly carbon-constrained world would destroy jobs and growth in Asia, too. However, that’s years away, and Nike cares only about its short-term bottom line. Therefore, we are pulling out of the Chamber. 

Instead, Nike tut-tutted about the need for “urgent action” on climate change. When will the sanctimony end?