What issues do financial executives most want lawmakers to tackle after the election to support business activity and boost economic growth?
Financial executives view the looming fiscal cliff and the consequences should a bipartisan deal not be reached before the end of the year as a major—but not the most important—economic concern, according to a survey of 6,000 attendees at the annual conference of the Association for Financial Professionals (AFP).
Three-quarters of the corporate treasury respondents believe the economy “will worsen without action to address the tax cuts and automatic spending cuts that are due to kick in,” the survey found.
More than one-third (39 percent) of finance executives also said that sluggish economic conditions and weak demand are “uncertainties that are discouraging their companies from making strategic investments in expansion and hiring.”
Almost two-thirds (63 percent) of respondents said they do not expect the upcoming election to significantly impact business conditions, while 71 percent do not anticipate a post-election change in their investment spending.
"Companies are looking beyond the elections," said Jim Kaitz , president and CEO of AFP, in a statement. "The most important issue is resolving long-term fiscal and deficit issues."
What issues do financial executives most want lawmakers to tackle after the election to support business activity and boost economic growth?:
- Resolving long-term fiscal/deficit issues (63 percent)
- Implementing changes to avoid the fiscal cliff (49 percent)
- Reducing regulatory complexity and uncertainty (42 percent)
- Resolving political gridlock and improving the tone of political debate (37 percent)
- Corporate tax reform (33 percent)
- Policies aimed toward the safety and soundness of the banking system (20 percent)
- Addressing unfair and anti-competitive practices of foreign companies (10 percent).
The fiscal cliff is of major concern to business executives as well, according to a Millionaire Corner survey conducted in September of affluent households. Fifty percent of business owners said they were very worried about the fiscal cliff, as did 46 percent of senior corporate executives.
Analysts caution that should lawmakers not reach an agreement on the fiscal cliff, the country could slip back into a recession. The issue is now considered by global investors to be a bigger risk to their portfolios than the EU sovereign debt crisis, according to a September survey of fund managers conducted by BofA Merrill Lynch.
And the business owners and senior corporate executives are anything but optimistic. Only 13 percent of the former and 7 percent of the latter believe that lawmakers will reach an agreement before the deadline.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.