The addition of General Electric CEO Jeff Immelt to the third top Obama Administration position on economic policy tells an important tale about both this political moment, but more importantly, about the struggle within ruling economic and policy elites over the fundamental structural changes that recovery from the great financial crisis requires. GE was itself clearly a recent unindicted co-conspirator in the "too big to fail" group of companies whose risky betting adventures in the financial sector with their clients' money led to a disaster that the taxpayers have had to pick up the insurance on.

For years "the most profitable corporation in the world," GE Financial Services division, as well as Goldman Sachs and JP Morgan, were all revealed as the chief beneficiaries of the Fed and Treasury's efforts to keep the "counter-parties" (owners of bonds and other securities) of the failed AIG, Bear Stearns and Lehman Brothers institutions whole. GE, JP Morgan Chase, Goldman Sachs and others walked away with clean balance sheets. Now this upfront romance between GE and the liberal side of Wall Street (I call them the "Rubinistas") seems to have emerged as the strongest players and organizers in the president's drive to mobilize private capital to support the big structural and educational investments that must be made to both cooperate and compete in a global economy.

But the story with GE in particular is a lot thicker than that. For decades, GE was the iconic instantiation of corporate America. Rich, industrial, innovative, professional, sponsor of the top think tanks, trainer of presidents and CEOs. The list of fortune 500 CEOs is sprinkled throughout with graduates from GE's legendary executive training regimen. If you are good enough to survive being a GE VP – you can probably manage most standalone corporations.

No corporation contributed more to the career and elections of Ronald Reagan, whose political career was practically a GE creation going all the way back to the 1950's when he used to tour the plants for the company urging workers to reject joining unions, or, if they had to join one, to be sure they joined an anti-communist one. No corporation did more to put in place the post 1975 drive toward unregulated financialization as a means of accumulating the capital resources in order for capitalism itself to reproduce itself on sufficient scale in the late 20th Century. Wealth has dramatically tilted toward the super rich, but inequality is widening, not narrowing.

So the apparent change of heart from this cornerstone of 20th Century corporate ideology should be taken seriously. The Obama-Rubin-GE "industrial policy" – lets call it by its real name – is not the same as the Oil-Coal-Defense-Agribusiness – industrial policy, which is mostly just a continuation of military-industrial complex priorities. In the past year GE has given several indications the need to change its ways. They announced a "brand new" strategy of returning to "doing what they do best," that is, "making things, preferably big things." Now Obama closes a deal with China including a 250 Boeing planes (powered in many cases by GE engines) and a thousand locomotives (manufactured by GE in Erie, PA). He announces an innovation-led, high-tech manufacturing, big infrastructure investment (high speed rail, broadband, etc) agenda. While the funding is private the goods created are likely to be a large public good, for which I cannot believe the big players will not be reimbursed in licenses and rights, and first dibs at the market changes and opportunities that arise from revolutionized infrastructures.

The workforce required by the GE-Rubinista future needs a lot of training and good incomes, access to global markets, plus certainly no fears of imminent unemployment, loss of insurance, imprisonment for poverty, etc, etc. Unfortunately if financial market reforms are not carefully supervised, all thoughts of industrial policy can be sacrificed to speculation and further crisis. The workforce required by the military-industrial-agbiz-oil-coal crowd is a problem that will just have to take care of itself through force or pacification or bribery. Thats how little they seem to regard the problem. The two factions are in a critical struggle over who becomes dominant. GE has cast its lot with Obama at a high level, and he with GE as well. There should be some Republican defections if the "new industrial policy" will indeed draw some serious private money behind it.

Its arguable from a national point of view, politically, that the Obama has no practical alternative to this "triangulation" tactic in response to the Republican counter-offensive in the 2010 elections. And the deal with GE and the Rubinistas is not all one way. Implicit support, not opposition, for already enacted health care and financial reform is part of the deal, clearly. Expect there to be a big fight emerging within the military, however, as GE – a traditionally strong contractor – joins the camp most at odds many defense interests.

So what does all this mean to working people? The GE-Rubinista plan is better than the Republican alternatives, but fraught with risk, especially given the staggering high rates of long term unemployment that will not wait, politically, for long range investments to pay off. National service, employer of last resort work – especially for youth – is a national emergency.

But the main product of GE's efforts seem to be staying ahead, way ahead, of their competitor's information and intelligence. Prognos, as the Greeks once said, meaning foreknowledge of future events. They are earnest – importunate – in their claim to falcon-like insights. As UE International Rep Don Tormey used to quip, as GE management sat rubbing their chins across the bargaining table: "At Generous Electric: Prognos Is Our Most Importunate Product."

Photo by trekkyandy, cc by 2.0