John Maynard Keynes’s little-appreciated respect for the “animal spirits” that drive the free market boiled down to an ironic two-part proposition: without these guys taking crazy risks, there wouldn’t be robust economic growth—or those terribly awkward busts. The death-defying optimism of big business today seems as vital as that of the hustlers that haunt Starbucks.
Muhtar Kent, president and CEO of The Coca-Cola Corporation, revealed his wild side at Clinton’s Global Initiative Conference. Bill Clinton—America’s most loquacious second-guesser—must have egged him on. Here’s the Financial Times’ take:
“Muhtar Kent, Coke’s chief executive, said “in many respects” it was easier doing business in China, which he likened to a well-managed company. 'You have a one-stop shop in terms of the Chinese foreign investment agency and local governments are fighting for investment with each other,' he told the Financial Times.”
Kent finished up complaining that US lawmakers are stuck in gridlock. “When a country is in trouble, you can’t have a polarized political process,” he huffed. He didn’t bother to address “class warfare” in America, or China’s fondness for political “harmony.”
It’s fun to imagine the anguish of his senior VP of public relations and his US retail division. Here’s the head of America’s most accessible popular icon announcing that China is best for business. A leader of one of the greatest manifestations of America’s long-tested liberal political and legal institutions—the vast buying, selling, and investing global corporation—suggesting it's more rational to do business with a secretive, authoritarian, one-party state.
His remarks seemed genuine and public spirited—a desire to let us in on wonderful news. He wasn't bullying or bluffing. He’s not a vociferous critic of Barack Obama and added in his remark on China that he is ramping up Coke’s investment in China with a further $4billion over the next three years.
Muhtar Kent is simply one of those crazy optimists.
At home, America has giant banks that just recently believed it was safe to bet their businesses on the theoretical and practical impossibility that housing prices will keep rising—forever. Now, America has Mr. Kent: a brilliant global negotiator whose own success and charm has convinced him that it is great business to negotiate with unaccountable regimes competing, for now, for his billions.
Keynes might say, “I completely understand. Just don’t forget the other half of my proposition.”
This display of long-game optimism abroad, at least, puts in doubt an entirely different proposition about business behavior. Politicians (usually Republicans) who get business votes leap to think they know how businesses make decisions. And right now they claim that America’s capitalists are sitting on $2trillion largely because of US regulatory and tax uncertainty. Yet, is it reasonable to imagine that real American entrepreneurs are so afraid to take on their own government—so worried about political change domestically—that they feel it’s wiser to invest their charm and money in China’s provinces?
More likely they’ll be chasing the next boom-and-bust in America with the same exuberance they’re displaying in China, whoever is president and whatever is going on in Washington.
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